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RILA report highlights importance of multichannel strategy

BY Michael Johnsen

Arlington, Va. — E-commerce sales continue to grow and have a major impact on multichannel retailers, according to new report from The Retail Industry Leaders Association. RILA, in partnership with Auburn University and with sponsorship from Accenture, on Wednesday released the third annual State of The Retail Supply Chain report.

"This study will be essential reading for a wide cross-section of retail supply chain executives seeking insights into the key supply chain trends taking place in retail, including multichannel operations," stated Parag Jategaonkar, senior executive with Accenture’s Retail practice. "Accenture’s own experience with clients indicates an increasing focus amongst retailers on developing their supply chains to more effectively deliver a compelling customer experience, regardless of the channel." The most significant takeaway from the report centered on the importance of multichannel operations including fulfillment of dot-com, mobile, and tablet orders.

The report states that electronic e-commerce sales have grown by more than 15% to $35.3 billion, versus an overall sales growth of 4.1% versus the previous year. With predictions that e-commerce sales will grow 10% annually, multichannel has become a game changer for retailers.

According to the report, more than 85% of survey participants indicated that direct consumer fulfillment is a top priority for them. "Consumer expectations are changing, and as a result, retail business models are changing," RILA EVP retail operations Casey Chroust said. "Traditionally, retailers have used separate operational models to move goods and fulfill orders. Now those models need to be merged so that companies can continue to deliver the products consumers want across any channel without losing efficiency or adding cost."

The report also highlighted the various multichannel challenges facing retailers, including: variation in shipment size, order filling processes and delivery methods, as well as the inconsistent SKU assortment of multichannel retailers. Less than 18% of the retailers surveyed offer the same SKUs across channels. "The real challenge for today’s multichannel retailer is to become channel agnostic and fulfill demand effectively regardless of order type or origin," stated Brian Gibson, professor of supply chain management at Auburn University. "As sales volume grows in nontraditional channels, achievement of technology integration, operational flexibility, and process visibility will separate the leaders from the pack."

The report data was compiled through a series of executive interviews and industry surveys with retailers across every segment of retail, with the goal of understanding the capabilities that drive exceptional retail supply chain performance. All told, 199 retail supply chain executives took part in the research.

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B.Brent says:
Nov-30-2012 03:24 pm

Business will surely adapt whatever it takes to make them compete or even be on the top of their games. They really make sure that there will be no stones left unturned. - James Stuckey

B.Brent says:
Nov-30-2012 03:24 pm

Business will surely adapt whatever it takes to make them compete or even be on the top of their games. They really make sure that there will be no stones left unturned. - James Stuckey

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eTraining: How It Can Make a Difference in Your Company

BY CSA STAFF

By Tim Wright, [email protected]

Companies spend thousands of dollars to train one new employee and hundreds annually for additional training with each existing employee. Cost savings alone are tempting consumer product retail, manufacturing, distribution and wholesale companies to turn to eTraining, but the benefits go beyond savings.

Consider the example of a company deploying a new Enterprise Resource Planning (ERP) system, where the initial training approach focused on “Train the Trainer.” This approach could turn out to be less effective due to an inconsistent message from person to person, especially over time. However, after developing a customized eTraining system centered on the ERP system and standard operating procedures, training materials would be presented through an interactive application. Following implementation of the eTraining, the employees’ knowledge of the system and their familiarity with standard operational procedures would be quickly learned with the message originally intended by the management.

eTraining works by delivering educational content through a centralized Learning Management System (LMS). The LMS allows a company to streamline video, text and images to make training visually stimulating, utilize customized quizzes, and present supporting documents thereby establishing a virtual classroom. This method of communication technology is consistent with the communication channels that exist today. Through this virtual classroom, consumer product companies can deliver a specific or robust, cost-effective and timely implemented approach to training at any level of the organization.

Training given in different locations, by different individual and possibly by different media may not be cohesive producing less than optimal results, minimizing the effectiveness of any initiatives put forward by the company for the purpose of making improvement in the first place. eTraining provides a consistent training approach by presenting all employees with the same instructional material. These virtual classroom materials demonstrate the skills and knowledgebase associates need to properly perform activities which, in turn, give them a sense of pride and ownership in their work. eTraining allows an opportunity for employees to learn at their own pace, while most will learn very quickly using this hands-on visual method. Within as little as an hour, personnel can become fully educated on areas such as customer service, loss prevention, and sales techniques – naming just a few.

With eTraining initiatives in place, employees can spend more time assisting and interacting with customers by spending less time training, and manager schedules don’t have to be interrupted. Training expenses can be greatly reduced by less man hours by both trainer and trainee. In addition, there is a significant opportunity for increasing sales by showing proven sales techniques and explaining proper customer service. Because of this the return on investment is found many-fold. With strong collaboration and focus by the client-side team and eTraining vendor, a basic but efficient eTraining tool can be developed and deployed in less than a month.

A customized eTraining LMS can be planned and developed within the first week where time is spent reviewing the requirements and assigning the client side project team; making sure all of the necessary protocols and the messaging of the training are agreed upon. Weeks two and three would focus on filming, creating the copy content, then integrating the movie and copy into the application. The vendor providing eTraining should work with management to script and direct onsite filming. Showing examples from within the company itself, with tasks being done by real employees, gives the trainee a sense of being part of the company culture and demonstrates equipment that is actually used in their work environment. During the final week, regression testing and training would be conducted to ensure the message comes across and that quiz segments are effective in showing appropriate content is learned and scoring is produced without error.

A deployed eTraining system can be accessed at a standalone terminal within the company or at the trainee’s home over the internet. This method allows new hires, promoted employees and re-hires immediate training after signing their paperwork! And the options go on:

  • Broad topic or very specific content instruction can be delivered using a modular approach.
  • Large department stores can focus training on merchandise planning and customer service techniques in store, over the internet, or even by distributing DVDs from the corporate office.
  • Corporate owned store locations or franchises can be given modules that focus on improving customer service, managing store operations, loss prevention, product knowledge and proven sales methods.
  • Specialty and off-price retailers can show specialized merchandising and product markdown management processes. Reference guides can accompany the computer training module when more detailed information is necessary.
  • Safety precautions and procedures, and best practices can be shown to warehouse workers, distribution agents and manufacturing staff.
  • Education beyond store level could include corporate initiatives such as the importance of sustainability and how employees can support those efforts.
  • Provides more content and less expensive than video only training.
  • Gives training and information tailored to your product or industry versus canned training methods, which are less informative, of less interest to the trainee, and more expensive by paying for actors’ time, directing, and production.

In short, eTraining is not only cost-effective, but reliable and timely; giving the employees the knowledge and confidence they need for improved operations in all parts of the company. After implementing an eTraining program, consumer product organizations can experience immediate improvements in employee compliance and customer satisfaction.

Tim Wright, manager, Clear Thinking Group (clearthinkinggroup.com), Hillsborough, N.J., has over eight years of professional experience with operations improvement and systems implementation, workforce management, sales force automation, strategic sourcing, inventory management, and technology. He is a member of the Project Management Institute and is a certified Project Management Professional (PMP) and can be reached at [email protected].

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Target does well, but Fortune’s Most Admired misses retail mark

BY CSA STAFF

Target ranked 25th on Fortune’s listing of the 50 Most Admired Companies, which is the lowest level in the past six years. The decline could be viewed as troubling, but only if you buy into the notion that the list is the definitive report card on corporate reputations.

It is not, at least as far as retailers are concerned. In 2011 and 2010, Target was ranked 22nd, down from 2009 when it was ranked 19th and considerably below 2008 when it nearly broke into the top 10 with a ranking of 11th after a ranking of 13th in 2007.

Being included on such a list is a welcome accolade for any company, and it beats the alternative, but such inclusion and ranking is ultimately irrelevant for Target or any of the other retailers (Costco, 20th; Nordstrom, 21st; Walmart, 24; Whole Foods, 28th). The reason why has to do with the methodology behind the rankings and ultimately the issue of admired by whom and for what?

The “for what” part is easy. Fortune looked at what it determined to be such key attributes of reputation as innovation, people management, use of corporate assets, social responsibility, quality of management, financial soundness, long-term investment, quality of products and services and global competitiveness. Kind of interesting that Target ranked second on global competitiveness among the general merchandise retail segment since it doesn’t yet operate international stores.

The “by whom” piece is less clear. Since we are talking retailers, the most relevant views on reputation would be those of actual shoppers, but Fortune’s survey is based on responses from 3,855 executives, directors, and securities analysts who had responded to industry surveys to select the 10 companies they admired most. They chose from a list made up of the companies that ranked in the top 25% in last year’s surveys, plus those that finished in the top 20% of their industry. Anyone could vote for any company in any industry, according to a description of the methodology provided by Fortune.

The publication’s survey partner started with approximately 1,400 companies and then sorted those by 58 industries and selected the 15 largest for each international industry and the 10 largest for each U.S. industry. A total of 698 companies from 32 countries were surveyed.

It all begins to sound convoluted and really irrelevant as far as retailers are concerned because the best measure of reputation in the retail industry is the number of people coming in the door and how much money they spend.

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