How to Increase Operational Efficiencies With Process Management
Today’s retail landscape is filled with messages and strategies that often address an omnichannel approach. Hundreds, maybe even thousands of media articles have been written over the last few years addressing retailers that are embracing an omnichannel approach, as if that's the only strategy needed to be a successful retailer.
Implementing the right omnichannel strategy is important, especially to compete within high-volume, low-margin businesses. Home improvement retailer Lowe's, for example, attributed a significant portion of growth and success in a recent quarterly earnings report to its omnichannel approach, integrating online, in-store and order fulfillment in any combination of the two. The company said online purchases delivered from a store saw sales growth of 33 percent during the quarter.
Even though brick-and-mortar store locations remain an important aspect of omnichannel, the increased proliferation of online shopping has had a profound effect on the shift of in-store processes and procedures. According to market research firm Euromonitor International, total U.S. stores decreased by 0.1 percent in 2017 from a year earlier, the first downturn since 2009.
Retail stores are not only enhancing the customer experience, but they're now embedding in-store technologies that mimic the benefits a customer has when shopping in an online environment. Facial recognition technology alerts the arrival of loyalty program members, how-to videos teach customers about product, and screen technology can show customers what they would look like if wearing a particular style/color of makeup. All these changes also mean a change to employee/back-end processes.
It should be noted that omnichannel strategy would never work without an effective business process management (BPM) solution at work behind the scenes, bringing together corporate processes and procedures that affect both the back-end functionality as well as the consumer-facing user experience.
BPM is running today’s retail business model, tying everything together on the technological end.
Retail today is significantly more complex than it was several decades ago. Customer relationship management, sales and enterprise planning, accounting, and order fulfillment all run on different systems that are integrated into one another. Further complicating matters, these systems weren’t all built at the same time, meaning older “legacy” systems must be able to seamlessly (and quickly) talk to all the other systems in the business to make it all run harmoniously.
BPM is what keeps each of these systems running interdependently, efficiently and continuously. Customers will never actually see BPM, but they will experience its benefits any time they shop. Whether it be during research, transaction, receiving an order, or connecting with a customer service representative, the customer experiences every aspect of the BPM process. When that process runs smoothly, the customer walks away with a satisfied experience.
Behind the scenes, BPM also helps retailers with transformation as their businesses evolve. This technology helps retailers see their entire operations in an effort to identify competitive opportunities, establish actionable processes for employees, and deliver a seamless experience behind the scenes and in front of the customer, producing an environment for lower costs, greater transparency, reduced risk, increased agility, and innovation expedited.
For example, CITTI Group, a large German-based grocery supplier, recently leveraged BPM to reign in operational tasks, processes and complex procedures that were difficult to document and manage during the company’s rapid growth. The technology has resulted in better documentation for decision making, as well as more integration between IT and other departments.
BPM works in two major steps for retailer organizations of nearly every size today: First, the technology helps create a model that shows the right process for each of the retailer’s day-to-day operations; and second, it enables the creation of workflows that pull employees, processes, decisions and technology into one seamless, transformed system.
More retailers would be wise to incorporate several key areas into their organization to help them identify where and how to implement a successful BPM solution. Structuring the system in a way that they can identify key metrics and return on investments is of importance. These include steps such as research and benchmarking to identify key areas within the organization where BPM can offer the greatest impact, as well as the ability to simplify and standardize all workflows.
Mark Holenstein is the COO and responsible for the sales, customer service and marketing departments at Signavio, a provider of business process management solutions for retailers.
