Since being accused of sesquipedalianism I've tried to shy away from using long words but this time there's no escape.  Interconnectedness: the state of having different parts or things connected or related to each other.

The dizzying concepts involved in the Butterfly Effect suppose that apparently small, minor events can have non-linear impacts on a complex system.  The effect is often illustrated by suggesting that a butterfly flapping its wings in, say, downtown Southampton can give rise to an undersea earthquake in Micronesia.  It is, of course, not the flapping wings which cause the earthquake but small occurances can, and do, create catalysts for larger, sometimes catastrophic events.  With this week's news about UK sandwich chain Pret A Manger confirming 3,000 job losses it set me thinking about the interconnectedness of things in the Retail and Hospitality world and the critical imperative of ensuring that data strategy is addressed in a similar, connected and rounded sense.

Pret A Manger's woes stem from the immediate impact of COVID-19 Lockdown.  As central town and city workers were ordered to stay at home and not travel into offices, shops and factories up and down the land, so the lunchtime demand disappeared.  Many such Food-On-The-Go outlets are - or were - located in commuting transport hubs; railway stations, airports, motorway service areas, etc., and of course, 'commuters' no longer existed.  And the interconnectedness of things becomes startlingly apparent.  No travelling workers, vastly reduced/cancelled public transport, no footfall, no demand, no sales - no business.

For decades, in Supply Chain Management (SCM) terms interconnectedness has been a key proponent and focus.  It's called a Supply Chain for good reason: there are multiple moving parts serviced by multiple players and stakeholders, but the length and strength of the chain is only as resilient as its weakest link; over-stress that weakest element and the chain can easily break.  To counter such inevitability, SCM has developed tools to construct 'What If?' scenario plans, whereby potential future breakages in the chain can be modeled and their effects simulated in the ether without disrupting real-world day-to-day operations.  Scenarios such as the effect on production shutdowns due to typhoons or prolonged power outages, disruption to transportation and logistics routes, falling/increasing demand for a consumer good caused by changing health conditions or - I don't know, something bizarre such as a viral pandemic...  Again, it is the interconnectedness and associated interdependence of complex trans-national distribution networks that can be inherently fragile, breakages of which can have massive impact and consequence.

Over the past couple of years I had the pleasure of working with one of the UK's largest operators of restaurants, pubs and bars as the company developed and implemented a very grown-up data strategy.  The business currently comprises 17 Brands and it is these names customers know, not the Group name which controls them all.  In total, it operates c.1,700 locations, yet there are Brands within the portfolio which effectively compete with one another - a nice problem to have, one might think, but a problem nonetheless, and I'll explain why.

Because Brands are run and managed by dedicated teams each separate entity is striving to attain best profitability by maximising sales and minimising costs.  But Brands would run Loyalty and promotional exercises such as e-coupon dining offers in isolation to other Brands under the corporate umbrella, all of which have a number of effects.  First, offers were being 'blanketed' across Loyalty and non-Loyalty diners regardless of spending history and propensity to purchase at full price.  Second, close location proximity of restaurants led to 'Brand bleed' and cannibalisation of sales and third, there was no way of tracking overall, aggregated impact of Brand activity against corporate goals and financial targets.

The solution was a comprehensive data strategy review, leading to the creation and deployment of a contemporary Application Programme Interface (API)-derived Data Platform.  API Strategy (as this Forbes article clearly articulates) is the key enabling component of pure Digital Transformation and, in the case of our case study business, has facilitated clear competitive advantage as the business now has multiple data sources and, with the advent of delivery partners, data destinations, all of which provide a 360-degree all-encompassing view of business operations across all Brands.  Critically, it provides the opportunity to undertake Brand and Category-based analysis of fundamental desired business outcomes by facilitating Sales and Marketing functions such as Customer Segmentation but across multiple Brands, regardless of demographic and/or location.  And that's real insight.

The business has created a Data strategy, Data Platform and operational working parameters based upon interconnectedness.  Individual Brands still exist, but the data which describes their business activities can be applied across the portfolio, monitored, measured and leveraged to best effect for the good of the Group and its financial business ambitions.  The data silos have gone, replaced by available insight and the business of Retail Hospitality is the winner.

Whether we like it or not, everything is connected to everything else in some which way, large or small.  Data aggregation, analysis and strategic planning based upon empirical business insight provides Retail and Hospitality with the tools to influence that interconnectedness in the best possible ways.