So, what should retail leaders do to spur growth? I suggest that while they work IN their business, they also should work ON their business. Consider the words of Rahm Emanuel, the mayor of Chicago and former White House Chief of Staff: “You never let a serious crisis go to waste. And what I mean by that is that it’s an opportunity to do things you think you could not do before.”
Since 2008, companies have hunkered down to remain viable. That’s a normal response to stormy economic conditions. But now, when what was thought to be a passing storm has instead become the new long-term business climate, I suggest it’s time to take advantage of emerging technology capabilities to initiate beneficial change. As John F. Kennedy once said, “Change is the law of life. And those who look only to the past or present are certain to miss the future.”
This deep into the downturn many firms have strengthened their balance sheets with cash reserves. But what are they going to do with the cash on hand? There may be no better investment a retailer can make today than in improving how the organization works to achieve immediate gains and long-term competitive advantage.
The process for making this happen involves the HOW, the DEGREE, and the WAYS to invest.
There are three ways HOW retail firms can change their game to improve results:
1. Improve the capabilities of store operations and the people who directly serve customers
2. Improve back-office tools to more effectively serve operations
3. Improve supply-chain efficiencies to better serve customer satisfaction
Operations improvements that can make a difference include POS, loyalty programs, kiosks, pricing, labor scheduling, task management, digital training and ordering systems. Back-office improvements should involve marketing, financial systems, maintenance, energy, human resources, merchandising and IT infrastructure. Supply chain improvements should involve procurement, warehouse management and logistics systems.
The next consideration is how far to go with the projects? The DEGREE of change must carefully fit the need. There are three degrees to consider:
1. Small, incremental change to existing tools
2. New point solutions for specific open needs
3. Large ERP systems involving transformational change
The final consideration involves three WAYS to invest. They are buy, build, or rent.
1. Buying involves hardware and software, often modified to fit proprietary requirements
2. Building involves developing in-house tools tailored to fit unique needs
3. Renting today means subscription services and becoming more comfortable with advances in cloud technology
So, leaders must choose HOW, the DEGREE, and the WAYS to best invest the cash building up on the books to stimulate growth in a sluggish economy. Whatever choices are made and methods pursued, now is the right time to press ahead with strategic initiatives to change the game around your organization and seize competitive advantage.
Lynn Olsen, Ph.D. is the CEO & Principal Consultant for The Innovation Group, Inc., a Minnesota-based leadership and organization improvement consultancy. He can be reached at: [email protected].