IBM Guide to Consumer Products Industry Technology Trends Transformation through Analytics, Cloud, Mobile and Security

Introduction

The accelerating pace of technological change is transforming the consumer products industry. New technologies are revolutionizing how people communicate, research and choose goods and services. The result? Traditional sources of competitive advantage have evaporated and the market is redefining what it takes for manufacturers to win. Consumer products companies must uncover new ways to serve tech-savvy consumers, face disruptive competitors, and embrace new operating and partnering models that may be required to remain relevant.

IBM believes that there are four key imperatives that form a framework for success in the consumer products industry:

1. Deliver a differentiated brand experience using deep shopper and consumer insights. 2. Collaborate more effectively with channel partners to differentiate at the point of purchase. 3. Optimize supply and distribution networks by integrating demand and supply signals. 4. Reinvent processes and accelerate organizational agility to enable new growth.

Because of the speed of technological change, how you satisfy this framework is changing dramatically. Therefore, in spite of the unprecedented disruption and transformation, to meet the four key imperatives you must:

• Deliver better experiences to consumers. • Offer unique value to various channel partners. • Drive efficiency and reliability in the supply chain. • Maintain consistent and cost-efficient operations across back-office functions.

This revolution relies on successfully navigating four spheres of the IT environment. The first sphere is analytics, or the ability to generate new and better insights from the explosion of available data to consumer products companies. As the volume, variety and velocity of data exponentially expand, data is becoming a new natural resource. And while volume and variety of data have historically been focus areas, velocity and a new “V”, veracity of data, are driving value today. Companies that master the four “V’s” to extract value from available data uncover new and unique insights into consumer trends and enterprise performance. These insights can then generate new selling, marketing, manufacturing and supply chain strategies that increase market share and margins.

Traditionally, companies have used analytics to identify what already happened—such as historical brand sales performance or how many pallets of inventory were shipped to a retailer. This backward-looking, descriptive analytics is being superseded by predictive analytics that define likely future events based on analyzing the historical patterns and relationships, and prescriptive analytics that suggest a specific next-best action given the likely future scenarios. Our research shows companies that successfully embrace predictive analytics are faster to market, gain more market share and achieve deeper brand loyalty and better consumer retention than their peers. The reason is that predictive and pre­scriptive analytics help you understand consumers and anticipate their future behavior and needs, so you can deliver the high level of personalization and brand experience they expect.

The second sphere is cloud computing, which encompasses the delivery of information technology and business processes as digital services. Because cloud operates on an anything-as-a service model, it is transforming every industry, through the unprecedented speed and agility it enables. Cloud makes it possible to inexpensively upgrade both internal and external facing technology infrastructures, allowing you to satisfy today’s customer and consumer demands while facilitating future expandability. Because of the potential that cloud computing offers, finding the right balance of on- and off-premises computing for business software and services is rapidly becoming one of the most important elements of consumer products companies’ IT strategy.

The third sphere is mobile computing and the explosion it has brought to social engagement online. How we interact online and how we connect with others is fundamentally different and continues to evolve rapidly. Mobile technologies such as smartphones, tablets and location-sensing devices have made connectivity a constant and ubiquitous aspect of our lives. And as network access now extends to a growing Internet of Things, the physical world is uniting more fully with the digital and virtual worlds. Simultaneously, social networking technologies have ushered in near instantaneous communication between people and businesses as well as other organizations and institutions.

For manufacturers, the potential impact of mobile and social technologies is huge. Connecting with your consumers as individuals, and providing information in-context and in real-time, can foster richer and more rewarding relationships with them. Social media provides a 24x7, global window into consumers’ behaviors and attitudes toward brands—a capability that was science fiction just a decade ago. And just as importantly, mobile computing can facilitate interactions between employees, suppliers and partners to drive significant efficiency and productivity increases.

The fourth sphere is digital security. When a single breach can destroy years of goodwill, digital security has become one of the most serious concerns for consumer products industry CEOs. Unfortunately, the digital security practices many businesses have established to protect corporate, customer and consumer data are often grossly inadequate when compared with the sophistication of today’s international cyber attackers.

The consumer products industry is one of the most exposed of all industries, due to the volumes of information it pro­cesses, the quantities of sensitive internal and external data which manufacturers hold, and the proliferation of entry points to their networks and systems. A manufacturer’s data must be recognized for what it is: a crown jewel that must be protected from all angles, with security established as a corporate priority that is governed by value at risk, and not just by budget. Effective safeguards are indeed available to protect against intrusion, to quickly detect suspicious activity, and to mobilize resources to ensure containment and defeat.

Consumer products made with IBM This guide provides a quick overview of what we believe manufacturers need to address within each of these technological transformation areas and how IBM solutions can support that transformation.

IBM offers manufacturers the integrated solutions and services required to keep pace with today’s transformational business requirements. Based on the experiences and feedback from working with many leading consumer products clients around the globe, we have designed a portfolio of offerings that addresses the specific needs of consumer products companies from strategy and roadmap development to integrated software solution delivery all focused on using technology enablers to create new value across your enterprise. We help manufacturers deepen their relationships with their consumers, offer differentiated value to channel partners to generate competitive advantage, establish supply network improvements to increase efficiencies and achieve operational excellence—all for the express purpose of supporting continued profitable growth.

Please contact your IBM representative to arrange for a briefing on any of the offerings in this guide.

Sincerely, Your IBM Global Consumer Products Industry Team

Smarter consumer experience

WHAT YOU NEED

BUSINESS cONTEXT EXAMPLE

Analytics

Potential benefits

Higher sales and margins

Greater consumer satisfaction and brand enthusiasm

Larger market share

Lower operating costs

4

Why it’s important According to EMC’s “The Digital Universe of Opportunities,” data volumes are growing at a rate of 40 percent per year.1 While this naturally includes all forms of traditional enterprise data, it also extends far beyond traditional data to include customer and supplier data, consumer and shopper data as well as data generated by connected devices that comprise the “Internet of Things (IoT).” The challenge with data today is that it:

• Belongs to no single institution or enterprise • Follows no single structure or format • Constantly evolves, grows and changes shape

Clearly, data is rapidly becoming a global natural resource that can be mined. Analytics refers to your ability to discover new insights and extract value from the growing reservoir of information available to you. Examples of how analytics can help improve your business include identifying emerg­ing consumer purchase and consumption trends, managing operational resources, maintaining your physical plant and equipment, forecasting short- and long-term demand more accurately, and understanding individ­ual consumers more intimately than ever before.

The key is proactively using data to reveal the needs of a specific shopper or consumer segment — or even individual consumers — and then using those insights to present relevant products, services, and offers to deliver a compelling brand experience. Imagine the possibilities created by a consumer’s use of technology throughout the purchase path: researching products, checking reviews, talking digitally to others and comparing prices and offers. With IBM analytics, you can provide those consumers with the right information or engagement at the right time, depending on what stage they are at in a particular shopping journey.

Of course, consumer analytics is just one area in which leading manufacturers will mine insight and gain competitive advantage. With the advent of sophisti­cated and less expensive processing power, more sophisticated modeling and the availability of new data sources, leading consumer products companies will deploy analytics to improve product development speed as well as manage the entire supply chain. The combined result is a rapid marketplace evolution that promises to continue at an accelerating pace.

To support those companies IBM is investing USD 3 billion over the next four years to establish a new IoT unit. IBM estimates that as much as 90 percent of all data generated by devices such as smart-phones, tablets, connected vehicles, and appliances is never analyzed or acted on.2 As a result, more than 2,000 IBM consultants, developers and researchers will focus on helping enterprise clients reveal new insights from IoT data. Combining traditional busi­ness data analytics with rich IoT data analytics can significantly improve your enterprise decision mak­ing. For example, sensor-enabled manufacturing and plant equipment provides the ability to predict plant and equipment failures before they occur so you can proactively take action to prevent costly shutdowns.

IBM teams up with The Weather Company One example of a nontraditional use of powerful analytics for the consumer products market is repre­sented by the strategic alliance announced between IBM and The Weather Company. This alliance will help enterprises by integrating real-time, analytics-based weather insights to improve their operations and decision-making. Through this partnership, The Weather Company will also shift its massive weather data services platform to the IBM Cloud and integrate its data with IBM analytics and cloud services. The result—easily accessible weather data that can help consumer products companies with new capabilities such as forecasting demand more accurately and optimizing replenishment operations to more effi­ciently and effectively meet local demand.

Core capabilities

Make and act upon better, more timely insights

• Improve operational reporting and planning with descriptive analytics

• Uncover patterns and trends with predictive analytics

• Optimize decisions using predictive analytics • Identify previously unforeseen correlations among

disparate data • Interact more naturally with consumers with

cognitive computing

Establish an information foundation

• Access, store, archive and analyze many types and sources of data

• Process and analyze data in near real-time • Ensure the quality, availability and integrity of data

Enhance IT infrastructure

• Manage new workloads needed for advanced analytics

• Leverage cloud computing for flexibility, scalability and reliability

• Develop a comprehensive approach to digital security

5

How we deliver it

To capitalize on the opportunity to leverage new data sources, develop new insights, and engage with con­sumers more effectively, IBM offers a range of analytic capabilities, from operational reporting to self-learn­ing systems. These include:

• IBM® Cognos® Business Intelli­gence provides analytics and planning that help your managers understand how stores, channels, brands, promotions and marketing organizations are performing.

• Predictive consumer intelligence (PCI) identifies your consumers’ shopping patterns, preferences and behavioral drivers, then predicts the best way to deliver timely and relevant interactions with them at each stage of the buying journey.

Selected IBM offerings

• IBM Decision Optimization on Cloud incorporates prescriptive analytics to help improve your efficiency and effectiveness by automating complex decisions that must balance limited resources as well as optimize supply chain design, supply networks and inventory levels to fulfill the promise of omni-channel consumer interaction.

To succeed in this increasingly analytics-driven environment, the right IT infrastructure is essential. Consumer products CIOs must intel­ligently manage, store and archive data cost-effectively. Advanced technology platforms, such as the IBM PureSystems® family, efficiently consolidate and optimize systems used to deliver analytics, helping reduce or eliminate your barriers to accessing the analytics power.

In addition, a range of improved deployment options can allow you to plan how analytics initiatives will be run inside and outside your organiza­tion. Deployment options can include on premises, public or private cloud, Software-as-a-Service (SaaS) or a hybrid mix of on premises and cloud. IBM SoftLayer® gives you one of the highest performing cloud infrastruc­tures available, providing automated and efficient ways of optimizing and procuring computing capacity—and doing so flexibly across many pro­cesses. This can dramatically reduce development cycle times. More infor­mation is available in the cloud com­puting section of this guide.

Process and implementation services

• IT strategy and performance assessment

• Enterprise architecture assessment • Application portfolio assessment • IBM Business Analytics and

Optimization (BAO) Jumpstart • Advanced analytics and

recommended next best actions • IBM IT security consulting services • IBM security operations optimization

services • IBM business process management

visioning and roadmap • Rapid analytics results

Managed services

• Marketing and consumer analytics • IBM Global Technology Services®

(GTS) team: – Strategic IT outsourcing – IBM Softlayer – IBM Fiberlink® mobile device

management on cloud – Backup and archive on the

IBM Cloud – Managed security services

• IBM Global Business Services®

(GBS) team: – Application management – Application testing – Business Process

Outsourcing (BPO) record-to-report services

Software solutions

• IBM SPSS®

• IBM Cognos Business Intelligence • IBM Predictive Consumer

Intelligence • IBM Social Media Analytics • IBM Decision Optimization • IBM DB2®, IBM Informix®, and

IBM IMS™

• IBM InfoSphere® Analytics • IBM InfoSphere Streams

More information on each of these offerings is available on the ibm.com website. Contact your IBM representative to arrange a briefing.

6

Case studies

Amadori Group

This leading food company in Italy used sentiment analysis to better understand brand health and to create targeted digital marketing campaigns. As a result, they:

• Boosted the company’s ability to use predictive analytics to track and visualize what is said about the brand

• Improved the company’s social media presence by 100 percent using near-real-time marketing insights

• Established direct communications with the target market segment through web integration with social media

Blizzard Sport GmbH

The Austrian ski and winter sporting equipment manufacturer built a near real-time production management system that uses sensors to capture in-process product data and embedded analytics to pinpoint manufacturing flaws as they occur. Because floor staff can now address problems proactively and minimize downtime, Blizzard Sport:

• Slashed manufacturing pass-through time from 38 to 18 days

• Reduced average inventory by 49 percent

• Cut materials inventory space requirements by 40 percent

ConAgra Mills

Using powerful models and algorithmic engines, ConAgra Mills enabled translation of a vast array of market and production information into smarter recommendations. This led to higher margins and:

• Achieved 100 percent payback in less than three months

• Increased capacity utilization by five percent

• Maximized revenues through improved margin decisions

• Enhanced focus on the most profitable products through more accurate reflection of underlying costs

• Boosted ability to realize emerging business opportunities without risking “oversold” production capacity

7

Smarter consumer experience

WHAT YOU NEED

BUSINESS cONTEXT EXAMPLE

Cloud Computing

Potential benefits

Faster IT responsiveness to changing business needs

Higher consumer satisfaction

Lower operating costs

8

Why it’s important Technology is transforming how consumers shop. How you adopt and imple­ment that technology can determine whether it becomes a vital enabler of success—or a crippling impediment. To empower a profitable consumer prod­ucts business, information technology must be dependable, secure, flexible and affordable. At IBM, we believe there are areas within the manufacturing IT infrastructure where cloud computing offers clear advantages over other deployment options.

IBM studies reveal that technology infrastructure underutilization wastes signif­icant resources. The most fundamental advantage of cloud computing is addressing this waste. By running applications on a shared set of computers, very large amounts of computing power can be supplied to each process when needed. This allows computing capacity to be continuously adjusted and appropriately allocated to the intense processing bursts that occur at different times throughout concurrent processes.

Our experience suggests cloud computing is more relevant and holds more potential than ever before. One large reason is the IT infrastructure flexibility and cost-effectiveness required to meet emerging computing demands associated with analytics as discussed earlier in this guide.

Further, cloud computing is rapidly becoming recognized as a proven way you can quickly and inexpensively deploy new capabilities to support your pursuit of innovation in a more accessible and cost-effective manner. Because secu­rity concerns continue to grow, it bears noting that with appropriate design and operational policies, cloud computing can be just as secure as other IT archi­tectures—even those maintained entirely within an enterprise’s firewall.

SAP on the IBM Cloud In 2014, IBM announced several new and enhanced capabilities for running SAP on the IBM Cloud. These capabilities range from Cloud Managed Ser­vices (CMS) for SAP HANA and SAP HANA on SoftLayer, to OpenPower on Softlayer as well as SAP on OpenPower. These Cloud options allow consumer products companies to lower deployment costs and achieve greater efficien­cies when targeting new markets. By delivering SAP applications on the IBM cloud, consumer products companies can access a global IT infrastructure to quickly and consistently expand their businesses into new geographies while simultaneously improving security and boosting compliance with local laws. And with typical SAP deployments on SoftLayer, customers can lower support costs, accelerate development and testing, and improve deployment.

Core capabilities

Software as a Service (SaaS) • Commerce as a service

Highly configurable, multi-tenant software

Business Process as a Service (BPaaS) • Human resources • GNFR/indirect procurement • F&A reporting • Manufacturer-dedicated or private

Managed processes, typically non-core consumer products functions

Solutions as a Service • Customer experience • Customer intelligence on cloud • Digital commerce • Digital marketing and lead management • Digital analytics • Mobile web push

Engagement derived from targeted insights

Platform as a Service (PaaS)

• Mobile and loT development/mashups • IBM analytics • Cloud applications development

“Born on the web/cloud” applications

Infrastructure as a Service (IaaS) • Digital channel/e-commerce platform • Cross-channel operations/distributed order

management • Consumer analytics • Enterprise marketing • Consumer care • DevOps, continuous delivery

Applications, benefiting from flexible capabilities

Hosted private cloud • Product development • Supply chain optimization • Supply chain visibility • Supply chain logistics

Typically packaged, interchangeable applications, where PaaS is typically built on top of IaaS

On-premises private infrastructure • Finance • Master data management • Data repositories & business intelligence • Enterprise integration • IT Ops management

Typically custom, legacy applications

Hybrid cloud infrastructure • Enterprise resource planning (ERP) • Master data management • Data repositories & business intelligence • Enterprise integration • IT Ops management

Typically custom, legacy applications

9

IBM SoftLayer Cloud computing is the delivery of on-demand computing resources— everything from applications to data centers—over the Internet, on a pay-for-use basis.

Cloud computing is powered by physical hardware inside brick-and­mortar facilities, connected by hun­dreds of miles of networking cable. Therefore, cloud is not a commodity because no two clouds are built the same way.

How we deliver it

Your cloud computing journey to can take a variety of paths. Some consumer products manufacturers want to test cloud concepts by tak­ing advantage of IaaS for specific computing needs. This often yields valuable lessons they can then apply towards broader cloud use.

Other consumer products manufac­turers already know which develop­ment, testing and deployment workloads create the biggest challenges such as:

• E-commerce and digital readiness initiatives

• Consumer analytics • Merchandising and supply chain

To address these consistent chal­lenges, IBM pre-developed solu­tions including Cloud Managed Services for ERP or IBM Smarter Commerce® as well as DevOps.

IBM SoftLayer offers the highest performing cloud infrastructure available for both off premises and hybrid architectures. It provides a single platform that uses data cen­ters around the world and offers the widest possible range of cloud computing options, then integrates and automates activities such as cross-channel experiences, analyti­cal insights and decision making so they become core functionalities.

Occasionally, consumer products manufacturers have a general sense they could benefit from cloud com­puting, but are looking for a more measured analysis on the best approach. For these companies, we recommend IBM cloud consulting services to help identify application workloads that can immediately benefit from cloud deployment and rapidly migrate deployments to IBM SoftLayer IaaS. Depending on the application, these migrations can often be completed in days or even hours.

At the same time, we perform a detailed workload analysis of your IT portfolio. By looking at applications, data sources, integrated compo­nents, application-affinity, user-group interactions, service level agreements (SLAs), connectivity and security needs, we identify logical

Many cloud and hosting providers adhere to traditional billing practices, charging consumers for each and every communication their servers send or receive. IBM SoftLayer is different. Our servers come with terabytes of outbound bandwidth included 5 TB for virtual servers and 20 TB for bare metal servers. We do not charge for inbound traffic or for bandwidth usage across our global private network. This allows clients to effectively build on our global private network free of charge.

groups of applications that are the most suitable candidates to be moved to a cloud environment. Then, we develop a roadmap to migrate those application workloads into cloud environments.

It’s important to remember the effectiveness of the cloud depends on technical capabilities such as capacity flexing, IT task automation, dynamic provisioning and auto-scal­ing, among others. This dynamic environment requires iterative analy­sis coupled with the ongoing tuning of your portfolio. Therefore, the move to cloud computing is better visual­ized as an ongoing journey rather than discrete event. And with IBM’s philosophy to empower your IT orga­nization, you can easily manage this journey while we supply fully-man­aged cloud services as appropriate.

10

Case Studies

IBM Bluemix IBM Bluemix™ is a strategic cloud-based application development envi­ronment. Based on the open source Cloud Foundry project, Bluemix provides an open-standards-based platform for building, managing and running a variety of applications including web, mobile, analytics and smart devices.

Selected IBM offerings

Bluemix allows developers to easily compose new business applications without setting up an underlying architecture. Web and mobile appli­cations can be rapidly and incremen­tally composed using services provided by IBM, the open source community and an ecosystem of partners. This means you can quickly and cost-effectively develop, deploy

and enhance digital applications for consumers, employees, suppliers and other business partners.

Delivered as a PaaS model, the Bluemix platform, combined with Bluemix capabilities and services, can help deliver faster, less inexpen­sive and higher-quality applications than ever before.

Software solutions

• IBM Digital Marketing Optimization • IBM Digital Analytics • IBM Digital Commerce on Cloud • IBM Omnichannel Marketing

on Cloud • IBM Sterling Commerce®

Transportation Management • IBM Sterling B2B Collaboration

Network • IBM Emptoris® Contract

Management • IBM DevOps Services

Consulting, process and implementation services

• Cloud strategy and design • Cloud security services • Cloud implementation—IBM

private modular cloud • Cloud implementation—testing

services on cloud

Managed services

• IBM Cloud Managed Services for SAP and Oracle

• Managed security services • IBM Recruitment on Cloud • IBM Emptoris Spend Analysis

on Cloud • IBM Counter Fraud on Cloud

Infrastructure • IBM Mobile Web Push • IBM SoftLayer • IBM Bluemix

More information on each of these offerings is available on the ibm.com website. Contact your IBM representative to arrange a briefing.

Case studies

Bacardi-Martini B.V.

One of the largest privately owned spirits companies in the world employed an IBM Cloud Managed Services solution, migrating its operating environment to a flexible architecture on the IBM Cloud. As a result, they:

• Cut their overall IT operating costs • Eliminated waste and aligned

expenses with actual business needs

• Realized cost savings from the first day of the new deployment

American Greetings Corporation

Faced with a growing IT infrastructure and business pressures to reduce costs, the world’s largest greeting card manufacturer sought ways to more effectively administer their IT. They looked to IBM to help them on their cloud journey, and together they:

• Improved administrative efficiency • Reduced labor expenses • Slashed hardware costs by

300 percent

Pasqui S.r.l.

Specializing in digital printing and self-adhesive coating, Pasqui S.r.l. implemented a reliable hosting infrastructure for its critical SAP operations including accounting, logistics, sales and purchasing. Their infrastructure improvements:

• Lowered maintenance and management costs by 30 percent

• Enhanced availability, boosted performance and improved stability of their SAP environment

11

Smarter consumer experience

WHAT YOU NEED

BUSINESS cONTEXT EXAMPLE

Mobile and Social Engagement

Potential benefits

B2B: Raise service levels

Promote employee engagement and retention

B2C: Improve return on marketing spend

Grow consumer loyalty

Increase sales and margins

12

Why it’s important The era of constant connectivity is here. With smartphones, tablets and other mobile devices proliferating, we can connect nearly always and everywhere. And as a growing majority of consumers worldwide use mobile devices, it becomes possible to paint a detailed picture of each individual’s activities—and infer a great deal about their inter­ests and momentary intentions.

For manufacturers, this is transformational; it enables real-time awareness, real-time understanding, and real-time personalized engagement and interaction. As consumers become continuously connected, manufacturers who are competing for those cus­tomers must become connected and engaged with them in real-time. Using social engagement, manufacturers can now uncover a new source of consumer, competitor and shopper insights that can dramatically improve marketing channels, new product ideas and the supply chain. Understanding what consumers are saying about your brand, understanding cross-brand affinity, and understanding influencers and product trends can dramatically impact marketing and product development. And early indica­tors of product demand from social insights can guide supply chain decisions.

Consumers now expect an online experience optimized for their mobile devices. They demand an experience that is smooth, uncomplicated and personalized regardless of where they are or what device they may be using. They also count on speed and responsiveness from a manufacturer’s online outlets when they do research, buy an item or look for post-sales support. And since they are used to sharing product advice with their friends and social network, many of these users now want to be consulted by their favorite manufacturers on the co-creation and introduction of new products and services.

Consumer products manufacturers are just beginning to discover how mobile and social capabilities might be used to increase sales, grow market share and strengthen consumer loyalty. Regardless of channel, you can now invest in solutions that deliver near real-time information about where shoppers are physically located and what they are doing, then use those details to enrich their experience with relevant digital content and personalized, one-on-one engagement. You can then use these ongoing one-on­one interactions as insight to further shape and personalize future social engagement.

In addition, mobile and social technologies can help you become more operationally efficient. Tools that enable real-time social communication and collaboration can foster new forms of organizational integration and education, and can enhance work­ing relationships between managers and employees, employees and their co-work­ers as well as between employees and suppliers or other business partners.

Mobile is increasingly being used in supply chain and plant operations to enhance labor efficiencies, reduce costs and improve preventive equipment maintenance. In field sales and merchandising, advanced technologies such as automated image recognition analysis are reforming audit capability, shelf compliance and out-of­stock management. Advanced analytics such as dynamic route optimization, along with mobile technologies, are driving new value, wringing out additional efficiencies, and increasing channel sales.

This transformation is pressuring consumer products manufacturers to equip their associates with mobile technologies, including support for bring your own device (BYOD) initiatives. Ensuring your team members possess the most pertinent informa­tion on consumers, merchandise, inventory and orders—across all channels and sources—will position them to make better decisions, deliver a better consumer experience, increase sales while reducing costs and improve channel collaboration.

Core capabilities

• Mobile management • Device, application and asset management • Security • Technical support, services and repair • Mobile development platform • Development and lifecycle management • Scalable back-end services • Integration services

Apple + IBM In 2014 Apple and IBM announced an exclusive partner­ship to give business professionals everywhere the unique capabilities of iPhones and iPads, powered by the knowledge, data, analytics and workflows specific to the individual enterprise.

This partnership aims to redefine the ways work is accomplished, by addressing key industry mobility challenges and by driving true mobile-led business change, grounded in four core capabilities:

• A new class of more than 100 industry-specific enterprise solutions, all with native apps, developed exclusively for iPhone and iPad from the ground up

• Unique IBM cloud services optimized for iOS, including device management, security, analytics and mobile integration

• New AppleCare service and support offerings tailored to the needs of the enterprise through IBM’s exclusive partnership for delivering AppleCare

• New packaged offerings from IBM for device activation, supply and management

The new IBM MobileFirst™ for iOS solutions will be built in an exclusive collaboration that draws on the distinct strengths of each company: IBM analytics capabilities, with the power of more than 100,000 IBM industry and domain consultants and software developers behind it, fused with Apple’s legendary consumer experience, hardware and software integration and developer platform.

The combination will create apps that can transform specific aspects of how consumer products manufacturers and employees work using iPhones and iPads, allowing companies to achieve new levels of efficiency, effectiveness and consumer satisfaction—faster and easier than ever before.

As part of the exclusive IBM MobileFirst for iOS agreement, IBM will also sell iPhones and iPads with the industry-specific solutions to business clients worldwide.

IBM-Twitter partnership Through a new relationship with Twitter, IBM analytics can take advantage of social media data to help consumer products manufacturers:

• Understand consumer sentiment of corporate brands. • Identify influencers of consumer opinion and, more

importantly, key influencers of the influencers. • Discover and evaluate emotional triggers behind consumer

sentiment. • Reveal event drivers behind changes in consumer demand

and sales performance.

IBM teams with Facebook IBM’s marketing cloud clients can now combine Facebook’s powerful ad capabilities like Custom Audiences with IBM analytics to create meaningful experiences for their custom­ers across applications, devices and time. Using the new IBM Journey Designer, brands can create personalized consumer experiences across all engagement touch points— then use IBM Journey Analytics to understand how con­sumers responded at an aggregate level. By combining IBM analytics and the IBM marketing cloud with Facebook’s anonymized and aggregated audience insights, consumer products manufacturers can gain a clearer picture of their target audiences.

13

How we deliver it

At IBM, we start with the concept of systems of engagement, which are designed to extend traditional back-of­fice systems of record such as finance, HR, merchandising and commerce into the hands of your employees. This empowers them with new information and insights so they can collaborate and make informed decisions, in context, and in real time. When used effectively, systems of engagement can revolution­ize interaction by establishing a relevant and continuous dialog with customers, and enable collaboration between your employees, suppliers and partners.

One key to a winning mobile and social strategy is effectively managing the app lifecycle. IBM MobileFirst is an advanced platform that allows you to quickly develop, test and deploy quality mobile apps across multiple platforms, and easily integrate apps with your enterprise data, systems and services. Bluemix gives you key mobile cloud services such as standard APIs, app usage analytics for insights, workflow for process automation, cloud storage for mobile data management and app scanning for security. And to optimize mobile performance, IBM Cloudant®

seamlessly manages data between networks, platforms and mobile devices so your users experience the quick and reliable performance they require.

It’s also critical that your mobile apps engage and add value for your users. IBM Interactive, the world’s largest digital agency, teams with IBM Research to supply you with innovative digital strategy and application design capabilities. The result? Appealing and cutting-edge apps for use by your customers, employees and business partners.

IBM and IBM Business Partners also provide a wide variety of ready-made mobile solutions that can accelerate your mobile transformation. IBM Mobile Push Notification gives you a flexible, simplified environment for creating notification campaigns that engage your mobile app users at the optimal time and place. To optimize your users’ experience as well as detect unintended consumer or employee challenges with an app, IBM Tealeaf® automatically detects issues and provides recommended improvements. And IBM Presence Insights analyzes and acts on data generated by in-store sensors to create a seamless consumer experi­ence both in and out of the store.

Security is always a central concern with mobile apps. As mobile devices access your servers, databases and IT infrastructure, IBM MaaS360 Enterprise Mobility Management protects them by providing enterprise-class management and security for your devices, apps and content. To keep iOS devices operational, IBM provides AppleCare for Enterprise which includes 24x7 technical support and hardware repair and replacement services.

The IBM Social Media Analytics solution, which supports analysis in nine countries and counting, efficiently synthesizes and analyzes vast amounts of social media data to discover new consumer, shopper and competitive insights. Using IBM analytics solutions, the social media data can be integrated with your other structured and unstruc­tured data to augment existing sales and marketing insights. For example, IBM Watson™ uses cognitive computing and natural language processing to discover new patterns and insights in seconds.

Today, interconnectivity goes beyond connecting computers and smart devices—it’s about connecting people. Leading consumer products organiza­tions recognize social collaboration tools, whether installed on premises or on the cloud, can help employees, business partners and clients engage and innovate with one another. And because a social business connects employees, suppliers and other partners to enable superior information sharing, IBM Connections Suite provides you with world-class social software, real-time social commu­nications and content management to improve productivity and profitability. Benefits available to you include relevant shopping and services for customers, just-in-time education and insight for staff as well as, and improved performance from suppliers and partners.

14

Selected IBM offerings

Software solutions Consulting, process and Managed services Mobile: implementation services • IBM SoftLayer • IBM Worklight® Platform • IBM MobileFirst Applications and – Managed marketing services • IBM Fiberlink MaaS360 Platform Services • IBM Rapid Analytics Results • IBM Security Access Manager • IBM Interactive Experience

for Mobile Workshop • IBM Trusteer®

• IBM MobileFirst Studios Infrastructure • IBM Tealeaf CX Mobile • IBM Mobile Push Notification

•

•

IBM Ready Apps IBM Business Process

•

•

IBM Bluemix Mobile Cloud Services IBM Cloudant

Management Social: • Consumer and product lifecycle • IBM Social Media Analytics management • IBM Connections • Consumer segmentation • Watson Engagement Advisor • Next best action optimizer • Watson Explorer • Interactive User Experience/ • Watson Discovery Advisor Web Design • Watson Analytics • IBM Presence Insights

More information on each of these offerings is available on the ibm.com website. Contact your IBM representative to arrange a briefing.

Case studies

Dahl Sverige AB Kraft Australia Visa

A wholesaler and distributor of more than 60,000 plumbing, heating, industrial and construction materials products implemented an integrated an e-commerce solution that supported a new, cross-platform mobile app and provided analytics capabilities for creating targeted marketing campaigns. Implementing this mobile and social solution:

• Increased online sales and brand awareness by recommending sale items and high margin items at point of purchase

• Helped both B2C and B2B customers by optimizing search and recommending complementary products

• Boosted marketing campaign ROI with near-real-time offers tailored to customer preferences and needs

• Improved customer satisfaction and loyalty by personalizing and streamlining online searches and order processes

Looking to reinvigorate sales of Vegemite, Kraft Australia used social analytics to lay the foundation for the most successful campaign in the brand’s history. Social analytics allowed them to:

• Conduct global market research nearly 70 percent faster

• Identify 32 previously unknown unique uses of Vegemite

• Discover consumption insights that would otherwise have not been found

• Generate record sales and shipments of Vegemite

The world’s largest credit card company used mobile technologies to create context-specific promotions for customers at the time of swipe. As a result, they were able to:

• Realize a 109 percent sales lift on select initiatives

• Increase consumer loyalty through instant messaging to targeted consumers

• Transform existing consumer data into a new revenue stream with real-time smart offers

15

Smarter consumer experience

WHAT YOU NEED

BUSINESS cONTEXT EXAMPLE

16

Potential benefits

Reduce risk

Lower operating costs

Raise consumer confidence

Increase sales

Elevate brand and corporate reputation

Security Why it’s important As the technology landscape continues through accelerating changes, each new technology and access point introduces another new IT security concern: new data sources, new device types and applications, expanded social network use, new col­laboration tools and new cloud computing models. With so many new and expanded opportunities, those who will attempt to prey upon businesses and consumers have a virtually unlimited selection of threat vectors. The sophistication and scale of their malicious attacks, as well as the sheer destructiveness, is growing exponentially.

While the news of the latest attacks has come to seem almost routine, the costs are staggering. In 2014, the average total cost of a data breach was USD 3.5 million world­wide, up 15 percent over the previous year.3 In the United States, the average cost is higher, an estimated USD 5.85 million for each data breach.4 The issue is particularly acute for manufacturers because brand assets and data are at stake. That means without sufficient safeguards, your brand, your corporate reputation and even your business future may be at stake.

Consumer products is one of the most exposed and vulnerable of all industries due to the volume of proprietary product research, design and formulation data, consumer information and processed transactions as well as the proliferating number of network and system entry points. Consumer products manufacturers who have experienced a security breach can testify that it is an extraordinarily dis­ruptive and damaging event—disruptive to the business, disruptive to relationships with consumers, customers and suppliers, and enormously destructive in terms of public image and reputation as well as in direct costs.

In the face of these mounting dangers, security is obviously critical to all organizations within the enterprise. But because the enterprise will not likely embrace the required measures if security is delegated only to a CIO or chief information security officer (CISO), many consumer products manufacturers are deciding security is a serious organizational priority that now merits the involvement of the full C-suite. The reason— only with the senior leadership participation can the right tone be set and an effective governance model established to ensure the right practices are adopted and followed across the entire enterprise.

With the right safety measures established, you can position your organization to reap the benefits of the latest interactive technologies. This will allow you to engage with consumers and partners in a dependably secure way, raise employee produc­tivity and simultaneously shield the organization from intrusion and from possible reputational damage.

Core capabilities

Detect threats • Continuously search for patterns • Advise of threats • Contain intrusions before they do serious harm

Prevent attacks • Defend every network access point • Impede breaches and isolate threats • Protect sensitive data

Respond continuously • Develop effective process controls • Establish rapid response mechanisms • Initiate quick action when breach occurs

Internet of things The Internet of Things (IoT) refers to the rapidly expanding array of things—devices, appliances, vehicles and gadgets of all kinds—that are becoming Internet-connected. According to BusinessWire’s article “The Internet of Things Is Poised to Change Everything, Says IDC,” by the end of 2020 there will be over 30 billion devices connected to the Internet.5

As the number of Internet-connected devices explodes, your organization’s opportunities to send, receive, gather, analyze and respond to data from connected devices will also expand. For instance, as consumers embrace inter­connected devices, eventually they will possess a system of linked devices with embedded intelligence which will work together to simplify and enhance their lifestyle. This move towards families of interconnected devices will likely become a significant factor for many consumer products companies as the data produced by these devices yields insights into product research, merchandising and market­ing as well as customer relationships.

Therefore, the IoT can be expected to substantially add to the data consumer products companies can process and analyze for insights. Because much of this activity occurs in near real-time, beyond increasing processing and analytics workloads, additional security challenges will be introduced as data and insights are coming into and out of the IT network. Those consumer products companies that quickly embrace this shift, and discover how to securely create competitive advantages from the insights provided by this flood of new data, will likely outcompete the market.

17

How we deliver it

To be successful, we know that con­sumer products companies must address the digital security challenge in a long-term, strategic way, using a multi-layered approach built on a foundation of hardware, software, services and deep security expertise. Together, this approach and foundation provide a comprehensive and robust set of tools and best practices that can frustrate intruders, mitigate attacks and help pro­tect your organization. When employed consistently, they effectively address security issues through early detection, removal and remedy.

The road to success starts with leader­ship and awareness. An IBM Cyberse­curity Executive Awareness Briefing can help educate your top executives on the latest attack methods, the role of social media and the leading techno­logical and operational defenses. This briefing can also help you define quick actions that can be taken to immedi­ately strengthen your existing defenses.

The IBM Security Maturity Bench­mark Assessment is designed to evaluate the effectiveness of your overall security posture, using verified data to compare your posture with peer organizations. This assessment can highlight where you are strongly defended and where you may be vulnerable, and can provide the basis for a strategic action plan to address identified risk areas.

Prevention remains a vital front-line element of an overall security strategy. This require real-time protection that can frustrate attacks and disrupt attack chains. The IBM Threat Protection System breaks critical points in the

attack chain with pre-emptive defenses on both the endpoint and the network. Through its unique behavioral-based approach, the Threat Protection System detects and prevents even unknown attacks, including those using advanced malware.

IBM Trusteer Apex™ blocks the installa­tion processes related to malware to stop malware at the point of infection. IBM Security Network Protection disrupts the malware lifecycle by detecting exist­ing malware on the network, and by blocking command-and-control traffic to malware websites which can send further instructions to continue an attack.

IBM QRadar® Security Intelligence Platform products provide a unified architecture for integrating security information and event management (SIEM), log management, anomaly detection, incident forensics, and con­figuration and vulnerability manage­ment. Using either an on-premises or cloud deployment, QRadar detects threats by performing advanced analyt­ics and anomaly detection techniques such as spotting traffic spikes on off-hours or repeated login attempts —all across a wide range of data and net­work traffic.

IBM Security X-Force® Threat Intelli­gence uses the most current information on potentially malicious IP addresses, including malware hosts, spam sources and other threats, to allow you to respond proactively to known security risks.

IBM Fiberlink MaaS360 helps you bal­ance engagement, productivity and data security by managing your users, devices and data from a single console that pro­vides instant visibility into who is connect­ing to your data and from which devices. With it, you can manage and secure a variety of devices including desktops, lap­tops, smartphones, tablets or whatever device comes next—including support for an organizational BYOD policy.

IBM Endpoint Manager streamlines remediation tasks by automatically managing patches to hundreds of thousands of endpoints, including the latest mobile devices, and by providing you with integrated reporting for real-time monitoring of patch progress.

If an attack is successful, understanding the magnitude and nature of that secu­rity breach can be challenging, espe­cially with limited resources or minimal in-house forensics expertise. IBM Emergency Response Services can supplement your in-house resources by providing guidance and support in the event of a serious security incident.

Today, it is no longer a matter of whether an organization will be probed or breached, but a question of when— and how much damage will occur before an intrusion is caught and miti­gated. You need the ability to protect and respond extremely quickly once an incident is detected. With a full range of hardware, software, services and deep security expertise, IBM can help you create and implement a strategic security designed to prevent intrusion, mitigate attacks and protect your consumer products organization.

18

Selected IBM offerings

Software solutions Consulting, process and Managed services

• IBM InfoSphere Guardium® implementation services • Cloud offerings (SaaS, BPaaS, • IBM QRadar Security Intelligence • Database vulnerability assessment PaaS, IaaS)—IBM SoftLayer

Platform • IBM Cybersecurity Executive • Outsourced or managed security • IBM Trusteer Apex Awareness Briefing services • IBM Security SiteProtector™ System • IBM Security Maturity Benchmark • IBM Security X-Force • IBM Network IPS Assessment • Surveillance application (GTS) • IBM zSecure™ Suite • IT Security Services for cloud, • IT managed services: security, • IBM InfoSphere Guardium application, data, emergency mobile, network

Database Activity Monitoring response, identity and access • IBM Threat Protection System • IBM InfoSphere Guardium management • IBM Emergency Response Services

Encryption Expert • IT risk, security consulting, • IBM Tivoli® governance and compliance Infrastructure • IBM Endpoint Manager • IBM Security AppScan®

• PCI security • IBM SoftLayer • IBM POWER8®, IBM z Systems™

• IBM PureData® for Analytics • For storage: IBM DS88xx, IBM XIV®,

IBM Storwize®

More information on each of these offerings is available on the ibm.com website. Contact your IBM representative to arrange a briefing.

Case studies

Unilever Töpfer GmbH Whirlpool Corporation

A personal care, home care, food and beverage manufacturer implemented a single solution to reduce operational costs, reach higher levels of file transfer reliability and ensure data security. The solution helped:

• Provide reliable and security-rich file transfers

• Ensure service level agreements were met

• Lower operational costs

A medium-sized food services company located Germany worked with IBM Business Partner Wittmann EDV-Systeme to implement security monitoring capabilities with IBM System Networking RackSwitch G8052 networking, IBM System x3690 X5 server and IBM System Storage® DS5324 storage technology. As a result, they:

• Increased product quality • Enhanced security monitoring • Improved storage performance

by approximately 50 percent • Boosted end-user productivity

with reduced response times

One of the leading global home appliance manufacturers created a fast, simple way to request or change access rights as well as manage user passwords and roles for SAP and enterprise applications—without having to involve IT personnel. They replaced disjointed identity management processes with a customized, intelligent, adaptive and intuitive platform based on IBM Security Identity Manager. This allowed them to:

• Dramatically reduce provisioning times

• Immediately achieve 100 percent accuracy of role assignments

• Significantly streamline auditing processes

19

IBM’s commitment to the consumer products industry

For more than a century, IBM has been providing consumer products companies the software, solutions and expertise they need to wincompete in the marketplace. When supplemented with more than 4,000 IBM professionals, and one of the largest global networks with almost 2,000 IBM Business Partners, all focused on serving the consumer products industry, you can be confident we will help you succeed as well.

IBM’s pre-eminence in developing leading industry solutions is the direct result of our strong commitment to research and development. We invest more than USD 6 billion annually in R&D, and for 22 consecutive years have been the world’s leading patent-earning organization—receiving a record 7,524 patents in 2014 alone.6

These research commitments and technology results allow our software teams, researchers and consultants to create and deploy innovative solutions that help clients become more customer-centric, deliver compelling brand experiences, collaborate more effectively with channel partners and most profitably align demand and supply. Find out more today about how we can help you achieve the same success.

For more information For more information on any of the solutions described in this solution guide, or for more information about how IBM can help your consumer products company, please contact your IBM representative or visit ibm.com/industries/consumerproducts

NOTES:

© Copyright IBM Corporation 2015

IBM Corporation Sales and Distribution Group Route 100 Somers, NY 10589

Produced in the United States of America October 2015

IBM, the IBM logo, ibm.com, Made with IBM, Cognos, Watson, PureData, InfoSphere, PureSystems, SPSS, DB2, Informix, IMS, Global Technology Services, Global Business Services, Smarter Commerce, System Storage, Emptoris, Bluemix, Cloudant, Tealeaf, Worklight, QRadar, X-Force, Guardium, SiteProtector, zSecure, Tivoli, AppScan, POWER8, XIV, MobileFirst, z Systems, and Storwize are trademarks of International Business Machines Corp., registered in many jurisdictions worldwide.

Other product and service names might be trademarks of IBM or other companies. A current list of IBM trademarks is available on the web at “Copyright and trademark information” at ibm.com/legal/copytrade.shtml

Sterling Commerce is a trademark or registered trademark of IBM International Group B.V., an IBM Company.

Softlayer is a trademark or registered trademark of Softlayer, Inc., an IBM Company.

Fiberlink and MaaS360 are trademarks or registered trademarks of Fiberlink Communications Corporation, an IBM Company.

Trusteer Apex is a trademark or registered trademark of Trusteer, an IBM Company.

This document is current as of the initial date of publication and may be changed by IBM at any time. Not all offerings are available in every country in which IBM operates.

The client examples cited are presented for illustrative purposes only. Actual performance results may vary depending on specific configurations and operating conditions.

THE INFORMATION IN THIS DOCUMENT IS PROVIDED “AS IS” WITHOUT ANY WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT ANY WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND ANY WARRANTY OR CONDITION OF NON­INFRINGEMENT. IBM products are warranted according to the terms and conditions of the agreements under which they are provided.

Statement of Good Security Practices: IT system security involves protecting systems and information through prevention, detection and response to improper access from within and outside your enterprise. Improper access can result in information being altered, destroyed, misappropriated or misused or can result in damage to or misuse of your systems, including for use in attacks on others. No IT system or product should be considered completely secure and no single product, service or security measure can be completely effective in preventing improper use or access. IBM systems, products and services are designed to be part of a lawful, comprehensive security approach, which will necessarily involve additional operational procedures, and may require other systems, products or services to be most effective. IBM DOES NOT WARRANT THAT ANY SYSTEMS, PRODUCTS OR SERVICES ARE IMMUNE FROM, OR WILL MAKE YOUR ENTERPRISE IMMUNE FROM, THE MALICIOUS OR ILLEGAL CONDUCT OF ANY PARTY.

The client is responsible for ensuring compliance with laws and regulations applicable to it. IBM does not provide legal advice or represent or warrant that its services or products will ensure that the client is in compliance with any law or regulation.

1 EMC. “EMC Digital Universe study.” April 2014. Accessed September, 21, 2015. http://www.emc.com/leadership/digital-universe/index.htm

2 IBM. “IBM Connects “Internet of Things” to the Enterprise.” March 2015. Accessed September 21, 2015. http://www-03.ibm.com/press/ us/en/pressrelease/46453.wss

3 Poneman Institute. “2014 Cost of Data Breach Study: Global Analysis.” May 2014

4 Poneman Institute. “2014 Cost of Data Breach Study: Global Analysis.” May 2014

5 BusinessWire. “The Internet of Things Is Poised to Change Everything, Says IDC.” October 2013. Accessed September 21, 2015. http://www.businesswire.com/news/home/20131003005687/en/Internet-Poised-Change-IDC#.Vedpykb4MYM

6 IBM. “IBM Breaks U.S. Patent Record in 2014.” Accessed August 18, 2015. http://www-03.ibm.com/press/us/en/ pressrelease/45793.wss

Please Recycle

CPB12347-USEN-00