Operations-Centric Revenue Management is a unified and a synergistic approach of Sales & Operations to revenue maximization. Strategy, Structure, People and Processes in Sales and operations have to be working in unison on ongoing basis for any Revenue Management application to be successful. Peaks and troughs in business need to be well managed with right involvement of right teams to right degree .
OCRM implementation entails the following phases: initial technology agnostic assessment of its applicability for your business, revenue growth potential assessment for the business case, implementation effort estimate for FOO implementation and its integration with SAP, FOO implementation & integration and Revenue Benefit measurement. Continuous feature enhancements identification may be something you optionally want to do on an ongoing basis to keep track of its relevance and effectiveness in the wake of new business models being employed, changes in market dynamics etc.
Operations-Centric Revenue Management is the science and math of revenue maximization for manufacturing, distribution and service industries. OCRM, though applicable for all manufacturing, distribution and service industries in general, the degree of applicability and the benefit potential can vary based on the type of products the organization deals in, organization’s position in the supply chain, the business models employed, logistics infrastructure and constraints, terms of sale with customers, customers’ expectations, customers constraints and host of other factors. Growth in the order of 4 to 12% is what one can expect approximately from deployment of an OCRM application.
There are two ways to growth potential assessment – (a) Historical data based assessment (b) Growth projections based / simulation based assessment. How are your KPI dials looking now? To what extent these dials can be moved with implementation of OCRM is what is assessed in this phase.
Implementation involves two things - FOO set up and FOO integration with SAP ECC. How standard are your SAP processes vs. how much of customization has been done in your system has an impact on the overall implementation effort. Taking a high level inventory of transaction processing software applications in your current systems landscape and the current set of processes in place in SAP ERP are important for making an approximate estimate of the implementation effort involved in integrating the Operations-Centric Revenue Management application “FOO – Fulfillment Operations Optimizer”.
FOO is a cloud based Software as a Service application. Though the standard set up or implementation is relatively simple. This involves configuring the application based on a few configurable parameters for modeling , decision rules set up and authorizations set up for operational adjustments to theoretical optimal rules etc. It is an application developed with extensibility as the key factor for reaping its full potential. FOO can be used in ways not imagined by the creators themselves and we do not believe in constraining its use. Clients however, have to keep in mind the fact that it is a balancing act and every functionality feature may not be worth building. A proper periodic assessment of its use and identifying the additional features to be built can be an ongoing exercise to maximize the benefits.
FOO is an application, the benefit of which depends on variety of factors and its benefit realization ranges from 0 applicability operational periods to up to 12% top-line growth in certain operational periods. Deploying continuous and quantifiable monitoring mechanism is important. Re-course decisions that FOO generates range from operational to tactical.