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Consumer packaged goods: Cloud computing changes the game

Savvy use of cloud computing has the potential to help consumer packaged goods (CPG) companies achieve greater agility, scale, and efficiency.

Overview

To achieve and sustain competitive advantage and high performance in the future, consumer packaged goods (CPG) companies around the globe will need to confront a daunting set of new imperatives. These imperatives include serving the new digital consumer, winning “the war in the store” and driving growth in emerging markets.

As CPG companies strive to achieve success, we believe cloud computing will play a major role. The cloud’s potent combination of agility, scalability and efficiency supports the qualities that industry players will need to compete and win in the future.

Learn the four trends defining CPG companies’ use of cloud computing, as well as the four steps to consider when developing a cloud strategy.

Background

To achieve and sustain competitive advantage and high performance in the future, CPG companies around the globe will need to master agility, scale and efficiency across a wide array of their businesses.

Specifically, companies must:

  • Serve the new digital consumers who are interacting with CPG companies in radically new ways. Serving this consumer calls for excellence in customer-facing processes.

  • Win "the war in the store" by helping retailers to grow their store sales and margins through consistent delivery of the right products, prices and promotions, in return for more valuable shelf space and ideal product placement. This requires strong performance from data-analytics processes.

  • Drive growth in emerging markets to stay competitive in the face of stagnation in developed markets. This globalization demands exceptional functioning of infrastructure-related processes.

  • Extract high performance from business processes, to scale up or down to meet the changing market needs that have come with globalization. This feat requires agile operating and supply chain models to serve consumers in developed and emerging markets alike. Meeting these requirements escalates the need for superior management of core and non-core business processes.

Cloud computing—using IT platforms, infrastructure, software applications or business process management over the Internet—can help companies achieve the agility, scale and efficiency needed to manage the processes most critical for succeeding in an industry that has grown more turbulent than ever.

Analysis

As CPG companies strive to achieve success with the new imperatives facing them, we believe cloud computing will play a major role. The cloud’s potent combination of agility, scalability and efficiency supports the qualities that industry players will need to compete and win in the future.

In our view, there are four trends defining CPG companies’ use of cloud computing. Cloud computing is:

  • Helping CPG companies serve the new digital consumer by excelling at customer-facing processes.

  • Enabling CPG companies to work with retailers to win “the war in the store” by mastering data-analytics processes.

  • Positioning CPG companies to aggressively drive growth in emerging markets by strengthening their infrastructure-related processes.

  • Empowering CPG companies to meet globalization challenges by increasing performance from their core and non-core business processes.

Recommendations

To meet current and emerging imperatives, CPG companies must act now. Those that do not miss out on the chance to strengthen capabilities their rivals are rapidly acquiring. We recommend that companies consider the following steps:

  • Explore ideas for taking advantage of different cloud services. Companies can benefit by envisioning creative ways to make the most of the different types of cloud services.

  • Tackle security and regulatory challenges. Cloud will help CPG companies manage a new generation of security threats as well as regulatory oversight that will impose greater control over online transactions.

  • Manage Big Data complexity. CPG companies will have to learn how to manage a flood of unstructured data and combine it with existing transactional data before plugging it into analytics engines to glean meaningful insights.

  • Experiment with leading-edge processes. Cloud will let companies experiment with leading-edge processes, with reduced risk and no upfront capital investment.

Authors

Kelly Dempski is a managing director with Accenture Technology Labs in Silicon Valley, where he leads the R&D program for Digital Experiences. This program is focused on developing new ways for Accenture’s clients to interact with their customers and workforces using emerging technologies in the areas of social media, mobile devices, gamification and new modes of interaction on the Web and in the physical world. Dempski holds an engineering degree from the University of Illinois, and joined Accenture in 1994. He has written three books and numerous papers, and is a frequent speaker on the subject of technology trends and innovation.

Andrew Long is a senior manager in Accenture’s IT Strategy and Transformation group, specializing in IT strategy and enterprise architecture. He has worked in a variety of industries and multinational organizations across 

Europe, the United States and Asia Pacific to align their business and IT strategy, defining road maps for change and designing technology solutions to support this change. Long is the Cloud Strategy lead for Europe, Africa and Latin America working with clients on understand the specific value cloud can bring to their organizations.

Laurie Henneborn, based in New York, leads the global Technology research team within Accenture Research, an in-house network of professionals who have strong knowledge of various industries, geographies, technologies and functional domains, as well as research methods and techniques. Henneborn specializes in cloud and applications-related topics.

V.M. Sundaram is also a member of Accenture Research with the global Consumer Goods and Services research team.

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