An FMCG company deals with producing fast-moving consumer goods (FMCG). The goods produced by this type of company tend to have a relatively short shelf life and a quick turnover rate.
There are no strict criteria to help us identify FMCG companies, but their items are often sold at lower prices and consumed soon after purchase. Most food items and other supermarket items tend to qualify as FMCG products. Specific examples of FMCG products include soft drinks, toiletries, and batteries. As a rule of thumb, an FMCG company sells these kinds of products. Coca-Cola, McDonald’s, and Nestlé are some of the most significant examples of FMCG companies.
FMCG companies face particular challenges that other businesses do not. Hence, there is an extra focus on the importance of knowledge management in these companies.
Why is knowledge management important to FMCG companies?
The success of an FMCG company is defined, to a greater extent than other companies, by its marketing strategy and ability to adapt quickly to a specific market. FMCG products might have a shorter shelf life than in different industries and a smaller profit margin, meaning that teams need to be on top of their game to ensure regular, quick sales.
Therefore, employees in FMCG companies that can effectively spread important knowledge to the rest of the team are highly valued. The more employees know about a marketing campaign or product update, the better they will be able to execute their activities and get the product into the hands of consumers as effectively as possible.
Poor knowledge management practices are said to negatively impact Fortune 500 companies, which can lose out to $31.5 billion yearly. This does not insulate leading FMCG companies, so there is a lot of value to be placed on improving your company’s knowledge management.
Knowledge management can be split into four main components:
FMCG companies know that the successful sharing of knowledge is crucial to their success. For knowledge management in FMCG companies to be effective, the focus must be placed on every stage of their normal business process: from the rapid creation of resources when new information is received to making these resources easy to access and transfer to others.
All members of an FMCG company should have access to the information that is required for them to improve marketing campaigns and get a better understanding of their customers.
There has been plenty of empirical evidence to support the claim that effective knowledge management boosts the productivity of FMCG companies.
In a study into knowledge management in FMCG companies, employees from 10 such companies were surveyed about their experience with leadership figures within their company.
It was reported that process innovation and manufacturing efficiency were significantly boosted by transformative leadership traits, with a particular focus on knowledge management practices. Successful knowledge management in FMCG companies appears to be tied to acquiring, transferring, and applying new information, as defined previously.
Separately, a 2013 study indicated a strong link between implementing knowledge management in FMCG companies and the success of new product development activities. It highlighted the ‘cut-throat’ nature of the industry and how FMCG companies need to develop top-quality products to remain in customers’ minds. Employees of 10 different FMCG companies confirmed that solid knowledge management practices made their product development process more competitive.
How can FMCG companies promote better knowledge management?
Your FMCG company might not know how important it is to share knowledge across a team.
One of the most effective ways to create and share new knowledge is to give everybody access to an all-in-one knowledge management system. As sales teams can benefit from using one, this can work on a larger scale with your FMCG company.
A central knowledge management solution means no more dealing with lost information. Upload information, documents, and critical marketing information to help your next campaign put your product into the hands of more consumers.
On top of the benefits, we’ve already mentioned, using a knowledge management system can boost the well-being of your team since they’ll feel more connected to one another. Employees will stop feeling like they need to push to get information or keep important information to themselves.