Today's retailers spend most of their money on store operations-
unloading trucks, stocking shelves, marking inventory.
But what about the customer?
Smarter operations help retailers take cost out –
freeing up resources to invest in activities that
actually help grow the business and differentiate from the competition.
Like opening new stores in new markets, introducing new
products and services, even business model innovation.
By doing more with less, smarter operations in
their own right can prove an engine for growth.
Watch the videoTo achieve maximum efficiency, retailers have
traditionally focused on their enterprise business model:
reconfiguring what is done, how, in what location, by whom.
And this is where retailers have historically
made the most significant use of technology,
whether in the stores,throughout the supply network,
or by outsourcing functions.
An emerging approach to business model innovation is
through cloud computing, which is particularly
well suited to retail's numerous physical locations,
fast-changing needs and seasonal swings.
Cloud offers a way for retailers to do more with
less by aligning operations with actual traffic
and cutting costs while adding flexibility.
Here are just a few examples:
Say you're a major department store.
You could use cloud to consolidate in-store technology,
allowing you to reduce the complexity and cuts costs.
Cloud allows you to dynamically scale up
computing power when you need it to perform intensive
operations like merchandise planning and demand
forcasting and scale down when you don't.
You could deploy new customer services to
the cloud, like on-demand checkout.
This could help you quickly enable point-of-sale capabilities,
whether physical, mobile or on line.
Watch the videoSmarter operations are also focused on new revenue models:
changing how revenue is generated through
new value propositions and pricing.
Retailers are always looking for new ways
to differentiate by delivering increased service levels.
As consumers become accustomed to
receiving home delivery of goods the same or
next day, some retailers are rethinking the role
of the store – adapting them from simply being
a place where you buy stuff to an experience
focused on the solutions customers demand.
And retailers are serving customers better by
tapping into employees' expertise and
offering relevant services around their products.
For example: Say you're a retailer
who realized your value to customers resided not just
in the products you sell but also the expertise
and services you deliver.
Transforming your workforce by adding a
service team that helps customers design,
install, and operate computer and home solutions
helps you continue to grow revenue
and increase market share.
Watch the videoBy combining new enterprise models with
new revenue models you open up the potential
to transform an entire retail segment,
reshape the dominant industry model for that segment,
or even create an entirely new business model.
Retailers have an opportunity to provide an
environment where customers can access the solutions
they need and want to live their daily lives.
For example: Say you're a fashion brand
who traditionally reached customers through larger
established partners. By designing a new
integrated operating model based around merchandise
management, distribution, financing and
technology, you could launch your own successful
e-Commerce channels across multiple countries.
You now can own and orchestrate the buying
process and deliver products and
services that support your unique brand.
By making operations smarter, retails can
build products, stores and shopping experiences
around the most important thing, the customer
Watch the video