Kurt Wiener, Director of Business Development at Lemongrass Consulting, offers five top tips for retailers looking to build resilient IT estates.
The world of retailing can so often be a question of survival of the fittest. Established retail brands, mid-market players and innovative original start-ups can flourish or go out of business in a matter of weeks, such are the weight of the dynamic forces impacting this market on a 24×7 basis.
If the last few years have shown us anything, it’s that resiliency is the difference between survival or a swift death for many retailers. This is not resiliency in terms of having a tough padlock on the warehouse door (although it is that as well), this is resilience in operations, resilience in the supply chain and resilience in customer delivery – all of which are underpinned by resilience in the IT systems that a retailer deploys to function as its commercial backbone.
The shock of the Covid-19 pandemic forced many organizations to accelerate their digital transformation strategies, leaping forward in the space of a few short months more than they would in many years. However, in the post-Covid world, how do organizations not just survive, but thrive?
We can offer a handful of strategic tips for retailers looking to build resilient IT estates that not only enable them to manage the unexpected but build genuinely world-leading systems that provide a better service to customers, alongside more effective back-office systems and supply chains.
#1 – Understand the digital customer journey
By incorporating customer behavior from website or app interactions with CRM, regional and financial data into a decision tree that ultimately supports an organization’s different commercial branches, the likelihood of any action bearing fruit and leading to longer-term success is increased. It’s all about creating a digital customer journey, understanding customer preferences and behavior, and then being able to adapt a value proposition to changing customer needs – and that’s just not possible without data.
#2 – Data-driven decisions
Retailers can achieve a faster route to IT-based operational resilience if they formulate new go-to-market strategies based on data-driven decisions. The more any given retailer knows about its customer base, and other factors, the better. These measures might include the state of wider fluctuations in world markets, seasonal and other trends impacting demand, and even what types of strategies competitors are taking.
#3 – Bricks & mortar replication
Organizations should also be fanatically focused on improving customer experience. For retailers in the digital world today, this means replicating all the good elements of the ‘brick & mortar’ shopping experience and reducing any of the less pleasing parts.
In practice then, this means recreating all the positive elements such as special offers, customer relationship management, personally delivered shopper advice, loyalty rewards, and maybe even an occasional free gift or two. It also means eliminating all the negative aspects associated with shopping, such as the hunt for products, the search for availability, and even a means for getting after-sales support – all of which can now be addressed through virtualized Cloud services.
#4 – Cloud-native scale advantage
Firstly, let’s think about the need to embrace cloud-native IT technologies through as many channels, and at as many levels, as possible. When an organization can combine its back-end and front-end systems in a more intelligently connected manner, while also connecting them to the customer, then it can scale-in and scale-out as needed. It is also much easier to deploy new digital services.
#5 – Securing the supply chain
A resilient retailer runs on a supremely secure supply chain. This does not mean security in the sense of cyber strength, although that is indeed part of it as well. It means securing the supply chain so that an organization knows it can always source the materials, goods, resources, and services it needs in order to be able to supply its customers. Therefore, it’s essential to build a robust digital platform to ensure scalable interoperability with suppliers.
The brilliant resilient retailing road ahead
Retailers who want to achieve commercial brilliance through intelligent resilience, need to think of themselves as modern business operators. Modern thinking in this instance means letting go of previous retail practices that were heavily weighted towards procurement-based trading, i.e., creating products and services that the retailer thinks will sell, before taking them to market at whatever level. Today, the retailer must start from a customer-first position and examine what kind of value proposition they need to create. They must shift from being steadfastly focused on following tactics designed to simply increase margins to being laser focused on customer experience and satisfaction.
Without a proactive resiliency strategy, retailers face the difficult task of downsizing or switching focus while in a reactive state. This can put the business at risk of not being able to sustain a longer-term position of success.
A mantra for resilience brilliance
Though most of this discussion may sound like a lot of hard work for some, there is good news because these factors are all achievable through a progressive approach to cloud technologies.
Remember, retail enthusiasm is commonplace, but endurance is harder to find. Life never gets easier, but like us, businesses get more resilient and stronger as they fight these battles. Let’s go out on this mantra: move forwards with enough resilience to aim for higher standards than any person or group would reasonably ever expect of you – and be tough on your own resilience, to polish it for brilliance.