Business Intelligence: Will It Improve Inventory?

Weekend warriors and fitness fanatics alike canfind all their gear at Dick’s Sporting Goods. But until the retailer revamped how it analyzes its product lines, building and tracking reports for sales and inventory took a marathoner’s effort.

Until 2003, the company relied on merchandise management software that tracked inventory for its stores and distribution points. The software could compile sales figures for athletic gear and clothing into a report, but it couldn’t aggregate and drill down, for instance, on how products were being sold and stored in different regions, according to Miles Mewherter, vice president of application development and enterprise reporting.

Beyond that, Dick’s had no single repository where reports and figures were kept, says Mark Schroer, the chain’s director of enterprise business intelligence and reporting. Instead, employees kept their own sales and inventory analyses, derived from the merchandising system, within their own business units and often on their own computers. There was no standard formatting of sales and inventory reports. And the company hadn’t put in place any format for naming reports, so some were lost by the people who had created the reports because they couldn’t remember the file names, Schroer says.

Still, employees insisted on using the system, shunning attempts by information-technology managers to push tools from Cognos, a maker of business intelligence software, which helps companies mine, analyze and report corporate data. “They were used to it,” Mewherter says of the merchandising system. And since Dick’s didn’t set up a formal training program, users found it easy to ignore the new tools, he adds.

To move toward standardizing reports, the team at Dick’s decided to build a data warehouse a single repository to store all of the company’s sales and inventory statistics with an Oracle database. The chain then deployed business intelligence software from MicroStrategy to mine the warehouse and create standard reports displaying, among other things, how apparel and equipment were selling from store to store and in different regions across the country. At the same time, the company initiated a training program to promote user adoption. And to make sure users embraced the new system, Dick’s got rid of the merchandising system and its reporting tools.

The company built the business intelligence and data warehouse system, Schroer says, with a key purpose in mind: “Our goal was to have it be the place to go, for anyone in the business, when they wanted information.” How it got there, though, is a lesson for all companies and particularly mid-market firms looking to grow in change management, systems planning and, above all, finding the sweet spot in data analysis.

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