Strategy is many different things to many different people and retailers run the gamut of strategies now in their struggle to maintain success. In my opinion a strategy combines culture, current capabilities, strength and a vision of the the future that is desired to define a direction and steps to make the vision reality. These ingredients to the strategy provide important building blocks to achieving the vision of the future and the basic objective of strategy is achieving the vision of the future. Every retailer has a strategy and a vision of the future and they struggle every day with maintaining this strategy in the face of changing consumer and market demands. As a result of changing demands I believe that retailers must fundamentally change their strategic definition to incorporate the consumer changing demands.
Retailers must focus their strategic support tools on a flexible foundation and the tools to support analyzing and understanding consumer and market demands. In addition, and most importantly, retailers must change their culture and especially leadership to support a long term vision and drive for these strategic support tools. The market is changing to quickly for retailers to expect to maintain the rate of change under their current framework foundation, processes and procedures, tools and culture. In order to meet these quickly changing demands retail leadership must focus on a strategy that can support the rate of change and a culture that can recognize and embrace the changes. In other words, retailers must develop a long term strategy for change that support incremental changes to support changing market demands.
This change requires collaboration as a foundation in order to listen and learn quickly and efficiently. I see this as a major challenge for most retailers and especially the large legacy retailers. These retailers have embraced and internalized a strategy of low cost and operational efficiency to support the low cost. This encouraged a cumbersome command and control structure that was difficult to change and is now a hindrance to success due to the impact of the Internet on the consumer market. This strategy worked in the past where consumers had limited choices in retail outlets and allowed the retailer to focus on efficiencies delivered through size. The Internet changed all of that and as the offerings and improvements in usability grew the consumers moved to this market.
A social commerce strategy requires as a foundation collaboration across all partners and treating the consumer as an equal partner at the table. This is a dramatic change to the retail culture that requires the support and guidance of the retail leadership. Retailers must embrace a social commerce strategy that dramatically shortens the change cycle and also provides for a means to collaborate and seek guidance from consumers and other partners in the types of changes that will meet the consumer and market demands. This all requires a foundation framework of flexibility that supports change easily and quickly.
And now for the audience participation portion of the show…
ECommerce will have wide ranging impacts on both the retail and manufacturing sectors. How can you focus these abilities to improve the consumer's experience? Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes. In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas. How can you support these continuously changing requirements?