Creating and Delivering Performance

Information

Jayson Bonao
Norilyn Tumanlao
John Harris De Mesa
Geraldine Vicente
Shonalyn Pamplona
Michael Gapangada
 What is Data Mart?

 A data mart is a simple form of a data warehouse that is focused on a single subject
(or functional area) such as Sales, Finance or Marketing.

 Data Marts are often built and controlled by a single department within an
organization

 Given their single-subject focus, data marts are usually draw data from only a few
sources. The sources could be internal operational systems,
a central data warehouse or external data.
 Difference Between
Data Warehouse and Data Mart

Category Data Warehouse Data Mart

Scope Corporate Line of Business (LOB)

Subject Multiple Single Subject

Data Sources Many Few

Size 100 GB-TB+ <100 GB

Implementation Months to years Months

 Types of Data Marts
Two types of data marts are:

1) Dependent data mart

2) Independent data mart

The main difference between dependent and independent data marts is how you
populate the data mart.

Extraction-Transformation-and Loading (ETL) – process

involves moving data from operational systems,
filtering it, and loading it into the data mart.
 Dependent Data Mart
 Dependent data marts draw data from a central data warehouse that has already
been created

 The ETL process for dependent data marts is mostly a process of identifying the
right subset of relevant to the chosen data mart subject and moving a copy of it,
perhaps in summarized form.

 Dependent data marts are usually built to achieve improved performance and
 availability, better control, and lower telecommunication costs
resulting from local access of data relevant to a specific
department.
 Independent Data Mart

 Independent data marts are standalone system built by drawing data directly from
operational or external sources of data, or both.

 The number of sources is likely to be fewer and the amount of data associated with
the data mart is less than the warehouse, given your focus on a single subject.

 The creation of independent data marts is often driven by the need to have a solution
within a shorter time.
Jayson Bonao
 Data Cube
 A data cube helps us represent data in multiple dimensions. It is defined by dimensions
and facts. The dimensions are the entities with respect to which an enterprise preserves
the records.

 In computer programming contexts, a data cube (or datacube) is a multi-dimensional

("n-D") array of values. Typically, the term datacube is applied in contexts where these arrays
are massively larger than the hosting computer's main memory.
 Illustration of Data Cube

 The data cube is used to represent data along some measure of interest. Even though
it is called a 'cube', it can be 1-dimensional, 2-dimensional, 3-dimensional, or higher-
dimensional. Every dimension represents a new measure whereas the cells in the
cube represent the facts of interest.

 Suppose a company wants to keep track of sales records with the help of sales data
warehouse with respect to time, item, branch, and location. These dimensions allow
to keep track of monthly sales and at which branch the items were sold. There is a
table associated with each dimension. This table is known as
dimension table.
 OLAP - Online Analytical Processing
 is an approach to answering multi-dimensional analytical (MDA) queries swiftly in
computing.

 OLAP is part of the broader category of business intelligence, which also encompasses
relational databases, report writing and data mining.

 Typical applications of OLAP include business reporting for sales, marketing,

management reporting, business process management (BPM), budgeting and
forecasting, financial reporting and similar areas, with new applications
coming up, such as agriculture.

- OLAP tools enable users to analyze multidimensional

data interactively from multiple perspectives.
OLAP consists of three basic analytical operations:

1) Consolidation - involves the aggregation of data that can be accumulated and

computed in one or more dimensions.

2) Drill-down - is a technique that allows users to navigate through the details.

3) Slicing and dicing - is a feature whereby users can take out (slicing) a specific set of
data of the OLAP cube and view (dicing) the slices from different viewpoints.
Norilyn Tumanlao
 Financials
 Financial ratios express relationships between financial statement items. Although
they provide historical data, management can use ratios to identify internal
strengths and weaknesses, and estimate future financial performance. Investors
can use ratios to compare companies in the same industry.

 Ratios are not generally meaningful as standalone numbers, but they are
meaningful when compared to historical data and industry averages.
 Financial performance of the business

 Liquidity Ratio

The most common liquidity ratio is the current ratio, which is the ratio of current assets to
current liabilities. This ratio indicates a company's ability to pay its short-term bills.

A ratio of greater than one is usually a minimum because anything less than one means the
company has more liabilities than assets. A high ratio indicates more of a safety cushion,
which increases flexibility because some of the inventory items and receivable balances may
not be easily convertible to cash. Companies can improve the
current ratio by paying down debt, converting short-term
debt into long-term debt, collecting its receivables
faster and buying inventory only when
necessary.
 Solvency Ratio

Solvency ratios indicate financial stability because they measure a company's debt
relative to its assets and equity. A company with too much debt may not have the
flexibility to manage its cash flow if interest rates rise or if business conditions
deteriorate.

The common solvency ratios are debt-to-asset and debt-to-equity.

 The debt-to-asset ratio is the ratio of total debt to total assets.

.

 The debt-to-equity ratio is the ratio of total

debt to shareholders' equity, which is the
difference between total assets and total
liabilities
 Profitability Ratio

Profitability ratios indicate management's ability to convert sales dollars into profits
and cash flow. The common ratios are gross margin, operating margin and net income
margin.

 The gross margin is the ratio of gross profits to sales. The gross profit is equal to
sales minus cost of goods sold.

 The operating margin is the ratio of operating profits to sales and net income
margin is the ratio of net income to sales. The operating profit is equal
to the gross profit minus operating expenses.

 The net income is equal to the operating profit

minus interest and taxes.
 Efficiency Ratio

Two common efficiency ratios are inventory turnover and receivables turnover.

Inventory turnover - is the ratio of cost of goods sold to inventory. A high inventory
turnover ratio means that the company is successful in converting its inventory into sales.

The receivables turnover ratio - is the ratio of credit sales to accounts receivable, which
tracks outstanding credit sales. A high accounts receivable turnover means that the
company is successful in collecting its outstanding credit
balances.
 Evaluating Financial Performance
Ability to Meet Maturing Obligations

Balance sheet perspective

Current ratio = current assets ÷ current debt
Quick ratio = (cash + accts receiv) ÷ current debt

Asset flow perspective

Accts receivable turnover = sales ÷ accts receivables
Inventory turnover = cost of goods sold ÷ inventories
 Evaluating a Firm’s Operating
Profitability
Formula:

Operating Operating Income

return on assets
= Total Assets
Why is the OROA high or low relative to competition?

To answer this second question, we look at the two pieces of OROA:

Operating Total asset

OROA = X
Profit margin turnover

or more completely,

OROA = Operating profits Sales

X
Sales Total Assets
The first piece is the operating profit margin:

Operating Profits Sales

OROA = X
Sales Total Assets
For example, IRM, Inc. compared to a peer
company:
IRM, Inc. Peer Co.
Sales $400 100% 100%
Cost of goods sold 240 60% 50%
Gross profits $160 40% 50%
Operating expenses:
Selling & marketing $48 12% 12%
General & admin 24 6% 11%
Depreciation expense 32 8% 7%
Total operating expenses $104 26% 30%
Operating income $56 14% 18%
 The second piece is the total asset turnover:

Operating profits Sales

OROA = X Total assets
Sales

To know how efficiently we are using the firm’s assets (the balance sheet), we need two pieces of information:

1. A common-sized balance sheet to know the relative size of each asset in the
balance sheet
2. The turnover ratios that tell us specifically how we are
managing:
Accounts receivables: accounts receivable turnover
Inventories: inventory turnover
Fixed assets: fixed asset turnover
(sales ÷ net fixed assets)
How does the firm finance its assets?

Balance sheet perspective:

Debt ratio = total debt ÷ total assets

Income statement perspective:

Times interest operating interest

= ÷
earned income expense
 Owner’s Rate of Return
(return on equity)

Return on net total equity

= income ÷
equity investment

Total common equity = all of the equity,

including retained earnings
What causes ROE to be high or low?
• High operating return on assets (OROA) produces a
high return on equity (ROI),
• High debt causes ROE to be high IF OROA is higher
than the firm’s interest rate on debt
• But high debt causes ROE to be low if OROA is lower
than the firm’s interest rate on debt
Geraldine Vicente
 Sales
 Sales are activities related to selling or the number of goods or services sold in a given
time period.

 The seller or the provider of the goods or services complete a sale in response to an
acquisition, appropriation, requisition or a direct interaction with the buyer at the
point of sale.

 The seller, not the purchaser generally executes the sale and it may be completed prior
to the obligation of payment.
 Contrary to popular belief, the methodological approach of selling refers to a
systematic process of repetitive and measurable milestones, by which a salesman
relates his or her offering of a product or service in return enabling the buyer to
achieve their goal in an economic way.

 Selling has become more difficult in recent years due to changes in technology and
general access to prospects.

 Selling is the profession-wide term, much like marketing defines a profession.

Two common terms used to describe a salesperson are "Farmer" and "Hunter“

1) A hunter - is often associated with aggressive personalities who use aggressive sales
technique. In terms of sales methodology, a hunter refers to a person whose focus is
on bringing in and closing deals. This process is called "sales capturing".

2) A sales farmer is someone who creates sales demand through activities that directly
influence and alter the buying process.
Shonalyn Pamplona
 Supply Chain Management
 Effective supply chain management enables enterprises to track the movement of the
raw materials needed to create products, optimize inventory levels to reduce costs, and
synchronize supply with customer demand.

 Supply chain management enables enterprises to maintain visibility over their logistics
to ensure availability of materials and delivery of products to customers.

 Supply chain management also helps enterprises avoid production stoppages by

identifying areas in which they are reliant on a single supplier.

 Supply chain management provides enterprises,

especially manufacturers, with tremendous
competitive and business advantages.
 Three Key Issues in Supply Chain Management
1. Globalization - presents several critical supply chain management challenges to
enterprises and organizations:

First, to reduce costs across the supply chain, enterprises are moving manufacturing
operations to countries which offer lower labor costs, lower taxes, and/or lower costs of
transport for raw materials. For some companies, outsourcing production involves not only
a single country, but several countries for different parts of their products.

However, outsourcing not only extends the production process

globally, but also the company’s procurement network.
Having suppliers in different geographic locations
complicates the supply chain. Companies will have to
deal with, coordinate, and collaborate with parties
across borders regarding manufacturing, storage, and
logistics.
 Second, as companies expand sales into global markets, localization of
existing products requires a significant change in the supply chain as companies
adapt their products to different cultures and preferences.

There is an inherent risk of losing control, visibility, and proper management

over inventory , especially if enterprise applications are not integrated. This
requires managing diverse structures of data across geographies effectively.
2. Fast-changing Markets - consumer behaviour is affected by cultural, social, personal,
and psychological factors that are quickly being changed by technology and
globalization.

Social media is creating new pressures for consumers to conform while putting pressure
on enterprises to utilize these sources of information to respond to changing preferences
in order to stay interesting and relevant.

The fast-changing consumer market also brings with it supply chain management
challenges:
First, products have shorter life cycles due to rapidly
changing market demands. Enterprises are under
pressure to keep up with the latest trends and
innovate by introducing new products, while keeping
their total manufacturing costs low.
Second, aside from new products, companies also need to constantly update product
features. Enhancing product features requires enterprises to redesign their supply chain to
accommodate product changes.

Finally, innovation presents a challenge in forecasting demand for new products. The
constant innovation necessitated by fast-changing markets also means enterprises will
constantly have to anticipate demand for new products. Enterprises need to create and
maintain an agile supply chain that can respond well to spikes and dips in demand and
production needs.

Companies should be asking if they have all the data

needed to make planning decisions to address challenges
created by fast-changing markets.
3. Quality and Compliance - Aside from influencing consumer behaviour, social media
highlights the importance of having high-quality products.

Social media has not only raised consumers’ expectations of product quality, but
has also amplified the damages caused by product recalls.

Enterprises are under increasing pressure to create high-quality products and to

create them consistently.

Product quality often goes hand-in-hand with

compliance. Enterprises need to ensure that
they meet local and international regulatory
standards in manufacturing, packaging,
handling, and shipping of their products.
Overcoming Supply Chain Challenges with Data Management and Integration
 At the core of all these supply chain challenges, from globalization to compliance,
is the need for better data management and integration.

 Data management and integration is key to solving these challenges by

connecting the manufacturer’s supply chain management systems with those of
their suppliers and partners. Data management and integration give
manufacturers much-needed visibility and control over all of their supply chain
processes such as procurement, manufacturing, storage, and logistics.

Data management and integration address supply

chain management challenges at the most basic
level of the value chain and in every activity.
John Harris De Mesa
 CRM - Customer Relationship Management
 is one of the most important software in the context of the management information
system.

 is a performance demand, which then needs to be accomplished in the process of

transformation of the operational processes that are managed with the help of other
models that make up the system of supply chain management - SCM.

 From the perspective of IT, software, customer relationship management (CRM,

 Customer Relationship Management) is one of the most important software in
 the context of the management information system (MIS).
CRM deals with the historical and current data on
ERP-sales services for each customer or group of
customers, financial indicators, data on the extent
and the frequency of delivery.
 Customer Relationship Management Process Framework
 CRM process framework has three primary components:

1. Operational or process Management technologies - CRM solutions involve integration of

business processes involving customer touch points. These technologies reside in those parts
of a company where moments of truth occur i.e. a customer makes direct contact with the
employees of the company.

2. Analytical or performance management technologies - CRM analysis the data created on the
operational side of the CRM effort for the purpose of business performance management and
improvement.

3. Collaborative - CRM involves the facilitation of collaborative

services (such as email) to facilitate interactions between
customers and employees. All this effort produces rich data that
feeds the Analytical CRM technologies.
 Technical Architecture of CRM Systems

A CRM system consists of three major components:

 CRM Software - This is the backend of CRM systems which usually includes a
relational database for storing persistent information, a software applications for
handling business logics.

 Client Hardware - It could be a PC or handheld devices for accessing enterprise

information.
 Mobile Middleware - A middleware facilitates the
interactions between CRM software and access
devices or PCs. The Mobile middleware provides
great benefits for mobile workers to access and share
enterprise information across organizational lines
and locations.
Michael Gapangada
 Vertical Solutions Marketing
is an appealing option for growth, especially in an era in which organization have
already been pared to the bone.

 But managing the evolving tension between the company’s old and new
business structures and sharing and transferring resources among the solutions
units must be done carefully.

 is the process of selecting target customer segments, intimately understanding

the target segments’ needs, and delivering a total solution to each
target segment through a vertical marketing system.
 A Vertical Marketing System

 is a distribution channel structure in which producers, intermediaries and retailers

agree to act as one to serve their agreed-upon target segment(s).

Two varieties of Vertical Marketing Systems:

1. Corporate VMS - organizes all the businesses or divisions of a multi-business
company under a unified system.

2. Contractual VMS - which reaches beyond the

scope of the company to include other non-
owned entities.
 Solutions Selling

 is about moving from the engagement level between seller and buyer to a
marriage commitment level, the seller develops such a deep understanding of
the customer that the customer sees the seller’s solution as the only viable
option for their needs, and is willing to pay a premium.
 Why Vertical Solutions Marketing?
 From the customer’s perspective, especially in the telecom networks environment,
there is clear value in having a single source of expertise that can provide an end-to-
end, fully reliable, fully integrated solution, that is also forward, backward and
horizontally compatible with its current and emerging technology standards.

 From the seller’s perspective, as target customers are better satisfied and are willing
to pay a premium, a VSM approach has the potential to increase market share within
the target segments, and total revenues, profit margins and
customer loyalty, compared to the more traditional
approach.