1. Walking the BPM Talk at Littlewoods… …with TM1 Mark Bodger BA ACMA Business Information Controller BPM: Make it live in 2005 Tuesday 19 th April 2005, IOD

2. Contents 1.Company Background 2.BPM Requirement 3.Why Olap? Why TM1? 4.Case Study 5.BPM Reports 6.Conclusion

3. Company Background - Largest Mail Order business in the UK - Recent merger with GUS Home Shopping - Combined Turnover £2bn - 4.5m Customers

4. Definition of BPM BPM is a set of integrated, closed-loop management and analytic processes, supported by technology, that address financial as well as operational activities BPM is an enabler for businesses in defining strategic goals, and then measuring and managing performance against those goals Core BPM processes include financial and operational planning, consolidation and reporting, modelling, analysis and monitoring of key performance indicators (KPIs) linked to organizational strategy. BPM Standards Group March 2004

5. BPM Requirement To satisfy every manager’s dream of being able to access budget, forecast and actual performance data from one source To remove the pain of “information retrieval“ and simplify weekly performance reporting To deliver information to decision makers that is relevant, timely and summarised To integrate business planning information across functional areas (Marketing, B&M, Operations and Finance) = one plan!

6. Why Olap? Why TM1? Planning process dependent upon hundreds of (undocumented) Excel spreadsheets Lack of version control – poor communication of changes Inconsistent use of activity drivers and assumptions across the business Large complex business required robust solution to data management TM1’s key strengths –“Real-time” data refresh –Multi-cube architecture –Flexible reporting and consolidation –Integration with Excel –Fast implementation

7. TM1 Case Study A “multi-cube” solution to support the Financial and Operational Planning process Activity Planning Model –Marketing Sales Plan linked to B&M Sales Plan –Converts Marketing Sales to volumes that drive activities –Weekly sales, margin and volume reporting Carriage Model –Calculates the carriage cost plan by carrier –Weekly cost of carriage by brand Stock Intake Model –Calculates the stock intake plan by warehouse –Weekly activity performance monitoring Contact Centres Model –Calculates contact centre activities –Call handling capacity planning A modular approach…tailored to business requirements

8. TM1 Multi-Cubes All cubes are driven by the same sales data and volume drivers

9. TAPS Model This cube has 7 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures|Time|Version| Brand|Product Group|Handling Type|Sales Outlet Purpose –To plan and monitor Sales, Margin and volumes by Brand, Product Group, Sales Outlet and Week Actual data –Data is loaded weekly and is used for performance reporting (compared to budget, forecast and last year) –Model used by Finance, Marketing, Trading, Supply Chain –Reports issued to Board, Executives and Senior Management TM1 Activity Planning Model

10. Carriage Model Carriage costs are analysed using a 6 dimension cube; Measures | Time | Version Brand | Carriers | Handling Type Purpose –To plan and monitor the cost of parcel delivery to the customer by Carrier by Brand –Planning data is driven by volumes created in the TAPS cube (which is fed automatically) Actual data –Data is loaded weekly directly into the application from TM1 input templates using Excel

11. Stock Intake Model This cube has 6 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures | Time | Version Product Group | DC Location | Handling Type Purpose To plan and monitor stock intake and stock movements by DC and Product Group in £s and units To calculate the cash flow required to support merchandise stock intake To produce activities (units) by DC location to drive Warehouse Manpower planning Actual data Data is loaded weekly and is used for performance reporting (compared to budget, forecast and last year) Model used by Finance, B&M and Warehouse operations

12. Stock intake profile reflects seasonality of catalogue launches (Summer and Winter)

13. Weekly chart comparing actual picking activity to budget

14. Contact Centre Model This cube has 7 dimensions and allows weekly performance monitoring of key activity drivers, actual against budget and latest forecast ; Measures | Time | Version Brand | CC Location | Customer Type | Activity Purpose To produce activities by Contact Centre to drive Manpower planning and budgeting To determine manpower resource requirements and to identify peaks Actual Data Weekly actual data loaded for reporting against budget and forecast

15. High volatility in the pre Christmas period as customer demand increases = hire temporary staff for peak

16. BPM Checklist BPM ObjectiveObjective Achieved? Analytic processes, supported by technology, that address financial as well as operational activities Measuring and managing performance against business goals Processes include financial and operational planning, consolidation and reporting, modelling, analysis and monitoring of key performance indicators (KPIs)

17. Performance Reporting (Actual vs Budget vs Forecast) Users of TM1 Weekly Flash Sales and Margin - by brand, by outlet type, this year last year Group Exec Weekly Trading and Marketing performance reports - by brand, outlet, product category, this year last year Brand Exec Weekly Operational Reports - stock and intake by site by product type, this year last year Warehousing Exec Monthly Carriage Account - by carrier, by brandWarehousing Exec Bus Express Exec Monthly Carriage charge – by carrier, by brand, by product lineBrand Exec Ad hoc reportingBusiness function analysts Finance and Operations

18. TM1 Users by function

19. Conclusion Integrated business planning process Financial planning Operational planning Analytical capability Weekly performance reporting KPI monitoring Using TM1 technology = A working BPM solution!

20. Contact details Mark Bodger Business Information Controller SJMB, 13 th Floor 100 Old Hall Street Liverpool L70 1AB 0151 235 4890 Mark.Bodger@Littlewoods.Co.Uk