Most Americans will consume any food regardless of the calories, nutritional value and health related consequences. The Brain behind the Big, Bad Burger article mentions the importance of using a Business Intelligence System (BIS) which “provides them with insights, not just mountains of data” (Levison, 2005). Business Intelligence gets its strength from being able to pull data from disparate sources store it for use in a loosely coupled way, and then pull it out in an accurate and meaningful way.
Organizations can pull data from customer surveys and sales reports; however, this information is useless without a framework. Jeff Chasney, CKE’S CIO clarified this point further by stating "There's nothing worse, in my opinion, than a business intelligence system that reports changes on a weekly basis, he says, because those systems don't provide any context as to what factors are influencing those changes.
Without that context, you don't know whether the data is good or bad; it's just useless” (Levison, 2005). BIS gathers information from various data points in the company to create multifaceted contextual statistics for better decision making. For example, BIS helped CKE determine if the Thickburger was actually contributing to increases in sales at restaurants or if it was just cannibalizing sales of other, lesser burgers. CKE Thickburger in fact did increase their sales “it was selling like gangbusters”.
The success was measured through a variety of data points including cost of production, average unit volume compared with other burgers, total sales for each of the test stores, and the contribution of that menu item to total sales (Levinson, 2005). The Monster Thickburger exceeded expectations in test market, and this is why CKE decided to roll it out nationwide.
Summary of Discussion Questions
BIS add values to CKP by focusing on the company's most important performance indicators which included sales and cost of sale, historical and forward-looking business trends.
BIS uses econometric models to provide context which explains performance. By having this information the company is more agile and responsive to improve making decisions and finding problems areas to correct and take new directions in the rapidly changing fast-food industry environments. Some tips for using BIS is for strategic decisions such as what new products to add to menus, which dishes to remove and which underperforming stores should be closed. BIS can be used for tactical matters like renegotiating contracts with food suppliers and identifying opportunities to improve inefficient processes.
BIS can also help improve the infrastructure of the supply chain. BIS is an analytical tool that helps executives make better decisions. It is important that we pay attention to data quality and integrity to make sure that we are not basing our judgment on erroneous data. I will also suggest devising key performance metrics (KPI’s) that are most relevant to the business to examine the deviations that are causing losses to the operations and locate opportunities areas to grow and take advantage of. One last tip which is very important is to take into account users’ feelings, and address their concerns up front.
The success of the BI systems is user acceptance and without user acceptance, companies will waste time and money establishing a Business Intelligence System. The Monster Thickburger was a good idea because it increased sales at restaurants and it narrowed its overall losses and even turned a profit in 2003. As long as you have an idea of what information you are looking for a system can be implemented in order to find that information and make sense of it. References Levinson, Meredith. (2005). The Brain Behind the Big, Bad Burger and Other Tales of Business Intelligence.