Paul Mullis, industry leader, consumer products, retail & distribution Cap Gemini Ernst & Young
As e-commerce gathers momentum and retail services such as home delivery continue to proliferate, effective management of resources and skills is set to become a defining competitive success factor in the evolution of the business.
It is estimated that the above trends might reduce store size by as much as 50%. As increasing volumes of product flow through other channels, store environments might shrink dramatically to stock less product, but to include additional features and facilities such as interactive kiosks and internet cafes. What will the impact of these changes be on the staff profile on the sales floor as well as the back of store?
The traditional head office "command and control" model might also change. The internet, TV-enabled communications, e-mail and other conferencing technologies will support more "work from home". Staff communities will be created connected by job function, without the same need to occupy expensive real estate.
Increasingly of course, Customer Relationship Management (CRM) will be the bedrock of continued success. Customer and business knowledge will be highly prized, and managing this store-by-store, channel-by-channel will be a big undertaking. Enormous volumes of data will be generated, analysed and embedded into the business to provide deeper insights. Retailers of the future might primarily be managers of knowledge.
Successful retail strategies will crucially count on accessing new skills to drive intangible value as well as efficient deployment of staff in new store formats. These advances in technology are not the death knell of in-store shopping. They do, however, provoke some fundamental challenges in shifting resources and skills to new areas. The most successful retailers will be presented with new, multi-channel opportunities to build knowledge and intangible assets in the business, gaining and retaining customers more effectively and so creating the new sources of shareholder value.
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