Why do so many retailers share this digital blind spot?

Internet Retailing

2nd May 2018

Australian retailers are in the fight of their lives, with traditional bricks-and-mortar stores under enormous pressure from digital disruptors and evolving consumer behaviour. Success requires embracing change, plus attracting and retaining customers by delivering a jaw-dropping experience.

Yet too often, we forget that a great customer experience isn’t just about innovative websites and online shopping. To win in the new retail landscape, digital transformation needs to occur at all levels. Many retailers have the customer-facing elements right, but the processes that underpin the wider business – including IT, HR, logistics and finance – are being overlooked.

It’s no good having a one-click checkout if your distribution centre system is prehistoric. If your employees spend their time struggling with unreliable and fragmented IT, finance, or HR systems, then they’re not focused on the customer. And if the customer service team can’t find previous notes on a shopper, or if they direct the customer to the wrong person for resolution, good service breaks down and the customer walks.

Here’s what’s ironic: while retailers are stepping up to the digital opportunity, internal IT, and other staff support systems frequently take a back seat. In an industry where customer service is king, the employee experience should be just as important, as it’s your staff that ultimately provide the point of difference to customers.

Instead of building an agile, efficient operating model, some retailers continue to make do with disconnected, obsolete tools and manual processes barely changed since the 1990s. And when staff are unengaged, or have to spend too much time on manual processes, guess what? The customer experience suffers.

Adidas is one company that has significantly improved visibility and service delivery by overhauling its underlying service management systems. With 60,000 staff around the world, the company’s digital transformation projects brought together information from across the business and across teams into one platform, helping staff to reduce the mean time of the resolution of incidents from 36 to 6 hours.

Seventy per cent of Adidas employees now ‘self-serve’ to fix issues rather than having to contact central departments. The time saved has allowed its staff to focus on higher-value activities, like delivering the best customer service possible.

So, how can retailers transform their operating models? How can retailers increase automation, improve HR and customer service solutions, and free up their staff to surprise, delight, and provide an experience that will keep people coming back for more? There are three key steps towards wholesale digital transformation:

Laying the foundation

Modernising current IT processes, tools and culture is the first step towards streamlined service delivery. Define what your current processes are today and decide what they need to look like in the future.

Once you understand your workflows you can remove menial tasks, re-engineer processes by which work is delivered, and automate tasks where practical. The key to modernisation is to build a systemised version of service integration and management across people, processes and partners.

Transforming the experience

The second part of the processes is to keep the entire customer experience at the forefront of process considerations. This will involve sharing knowledge with partners in the supply chain so all teams can contribute to the customer experience, making better use of data that is already at hand, as well as using data from customer interactions.

Driving service delivery innovation

Once the first two steps have been completed, your business will be working faster and smarter, so your employees now have the time and resources to focus on new ideas and innovation.

You’ll be able to open new collaboration channels, uncover insights into customer satisfaction, create new services and revenue streams, predict fluctuations in demands on the workforce or supplies, and seek further opportunities to automate and drive efficiencies in other areas of the business.

Service excellence for retailers is not only about serving the end customer better. It’s also about serving employees better so they have time to collaborate, innovate, deliver outstanding service, and focus on business objectives.

Walmart is a good example: its employee app WM1 can be used to manage schedules, check and take time off, and even change pay schedules, all in one simple easy-to-use interface, leaving staff free to concentrate on the customer experience.

While an online presence is essential for success today, retailers that are able to transform the entire experience across their organisation will reap the rewards for years to come.

By David Oakley, vice president and managing director, ANZ at ServiceNow.