MDM Podcast: The Power of Analytics for Distributors - Modern Distribution Management

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MDM Podcast: The Power of Analytics for Distributors

In this week's MDM podcast, ProfitOptics CEO Tony Pericle shares his passion for how distributors can use analytics and technology to make better decisions. He discusses prescriptive analytics, AI, workflow automation, profit optimization and more.
The Power of Analytics for Distributors

Analytics is one of the core areas of best-practice distribution management that MDM has championed for decades (and have supported industrial products marketers through our MDM Analytics offerings). If you’re looking to create a more data-informed organization — and who isn’t today? — then I’m excited to share my conversation with Tony Pericle, CEO and founder of ProfitOptics, in our latest MDM Podcast about his insights on the current state of analytics in distribution. I’ve known him for more than 10 years, and he is one of the most passionate and knowledgeable people I know on this subject. (His career story is interesting, and we kick off with some details.)

We touch on a range of subjects, from clearly defining specific applications of analytics to — perhaps more importantly — the talent and attributes of a strong business and data analyst. We get into these more qualitative aspects of building a stronger analytics team and culture deeper into the pod, along with his thoughts on how smaller distributors can outflank larger competitors with the right application of analytics.

We also touch on practical definitions of analytics, artificial intelligence and machine learning with a distribution focus. There are several takeaways here, but one of my favorites is his description of predictive analytics, and a “do-nothing report,” which a former client was using 20 years ago.

“He said, ‘Look, we know that the best predictor of the future is the most recent past. And if we make an assumption that customers are going to continue to purchase the same things at the same rate, then we can forecast that in the future.

“But we also know that occasionally there’s a change to some attribute that affects that future, for example, a cost increase. And we’re all experiencing that cost increase today through what we call inflation, right? So, if you merge those two together, and you say I know what the customer is going to purchase, I know there’s going to be a constraint, and I can make the decision on whether to absorb that cost. Then I can calculate what that’s going to mean for me.” Or scenarios for mitigating and even optimizing those potential impacts.

One of the challenges many distribution leaders face is hiring the right talent in analytics. Tony talks about the difficulty of hiring someone with all the technical skillsets required. But he offers some great tips for finding an analytics quarterback with the right skill sets to connect the business logic with the power of analytics. “So, you can’t just hire one person,” he says. “There are very few people that can do all of that; I think I’ve met maybe five people in my life that have all those capabilities. But if you have the right person, they could assemble those resources in a way that allows you to build and then to maintain and then to also improve those systems moving forward.”

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