THE FUTURE OF DATA BUSINESS: DECISION-SUPPORT?

SCHAUMBURG, Ill. -- The drive to leverage information technology to gain a competitive advantage is prompting huge changes, both for retailers and for the role that service firms play in the industry.Throughout all segments of the supply chain -- from retail stores to manufacturing plants -- the need for detailed, accurate and on-time information has never been greater. Nor have the challenges, Steve

SCHAUMBURG, Ill. -- The drive to leverage information technology to gain a competitive advantage is prompting huge changes, both for retailers and for the role that service firms play in the industry.

Throughout all segments of the supply chain -- from retail stores to manufacturing plants -- the need for detailed, accurate and on-time information has never been greater. Nor have the challenges, Steve Schmidt, managing director of ACNielsen's U.S. business unit here, told SN in an interview.

The new competitive landscape and emerging retailer demands for strategic IT solutions, in particular, make it incumbent upon companies such as ACNielsen to move from primarily offering data to now providing knowledge and decision-support.

"The world of technology is changing so fast today that companies such as ourselves have got to understand the needs of our customers, and then be able to deliver -- whether it be decision-support, software or applications," said Schmidt.

"It is hard to keep up with that pace of change," Schmidt added, "Systems architecture is one of our key drivers and key strategies as we move from a more defined, mainframe environment to a more relational, data warehousing type of environment."

Efficient consumer response and category management are two of the key forces driving ACNielsen's business today. But directly from those needs emerge other critical IT issues, including customers' needs to understand price elasticity and post-promotion analyses.

"Probably the greatest driver from our standpoint is that everything we are doing is consumer-based," said Schmidt. "Our purpose, as I define it today, is to provide consumer insights to our customers and help them sell more business profitably."

In Schmidt's view, the grocery industry is stepping up to the plate and making use of higher-level information tools.

"The grocery industry is doing a great job of pushing the edges of technology and challenging us, quite frankly, at some of the most progressive chains, to do some things that we hadn't thought about," he noted.

ACNielsen, in response, is broadening its customer focus beyond the manufacturers who have made up the core of its traditional customer base. "I can assure you today that we are spending as much time across all sectors. We understand the supply chain. It is retailer first, manufacturer second. And the broker is a key element of that -- they are the salesmen for many of the manufacturers we deal with today."

Schmidt added, "We are trying to think about how we develop consistent partnership programs, how we develop consistent system strategies and how we develop consistent planning processes across the entire supply chain."

Another influence behind ACNielsen's current strategic focus is the planned breakup of parent company Dun & Bradstreet Corporation into three separate companies, which is expected on Oct. 1.

ACNielsen's business will focus solely on marketing information for the consumer products and services industry in 92 countries around the world. At about $1.3 billion in total revenues, it would remain the world's largest market-research company, Schmidt said.

The other two successor companies, Cognizant Corpo-ration and a new Dun & Bradstreet Corporation, will each pursue separate objectives.

As an independent entity, ACNielsen (the periods were dropped from the logo this past spring) will have a new flexibility to meet the specific needs of its various customers, Schmidt noted.

Schmidt said that ACNielsen will have to demonstrate to its customers that its products and services can add value to their businesses. It will achieve this goal by bringing in high-end analytics, along with decision-support software and other tools, which will allow ACNielsen customers to make use of the data.

"What we truly understand being in the service business, is that the entire ACNielsen organization must be externally focused," Schmidt said. "We are now talking to our customers, figuring out exactly what they need, then going out and building the application software and services that meet those needs. That's a very different mindset."