Today’s rapidly evolving trading environment is the ultimate test for retailers.
Supply chains have been upended by disruptions while the way shoppers’ shop is dramatically evolving. Retailers have no choice but to accelerate their digital transformation strategies to be resilient and adaptable to the pace of change. Here are the answers to the Big Questions senior executives across Australia and New Zealand are asking TCS …
Q: How unique is the impact for the retail industry? What are the themes emerging across Industries which retailers can leverage?
PALANI: Retail is a consumer “demand” and “experience” centred business. There is an unprecedented challenge in fulfilling the escalated demand because of supply constraints in our current environment and delivering the connected experience as a result of social distancing.
There is also a shift in the buying priorities of consumers. Consumers have paused buying discretionary products and services as the focus is on everyday essentials and wellbeing.
For any business working-capital is the oxygen. Retailers have to pivot their business models faster by repurposing their capabilities to survive and thrive in today’s new normal.
RAMESH: There are some themes emerging across all industries, regardless of the varying scale of impact. The first is that resiliency is being embedded into operating models. This will mean a fundamental shift in the way cost efficiency is weighed against robustness or resilience, for example alternative supply chain models and near shore sources. The second is fast tracking digital business models entailing digital platforms and strengthening channels. The third is the emergence of the new customer as some behavior shifts will persist beyond the crisis, and many companies will counter new realities and changes to their ecosystem.
Q: Are we seeing a shift in consumer behaviour? Is eCommerce the way retailers will operate in the future?
PALANI: What we do know is that consumers are a driving force for change, and this is accelerating the need for innovation and agility. Competitiveness in unified commerce is only going to grow and retailers must have a strong digital strategy to deliver to the market and stay ahead. Today’s circumstances have driven a massive increase in online shopping and retailers need to prepare for more shifts in consumer behaviour. Digital technology including artificial intelligence and automation are key in responding to unpredictable customer trends and scaling up and down when demand fluctuates. Artificial intelligence can help you make the effective decisions regarding inventory and replenishment in real-time. When it comes to demand transferability, AI and automation give you the power to dynamically price in today’s environment and assess your space allocations with ease.
RAMESH: Companies will face the challenge of distinguishing between transient changes in customer behaviour due to the crisis as opposed to a more permanent shift. Companies need to build “sense and respond” systems to detect emerging trends using predictive data analysis and testing the feasibility while keeping an eye on cross industry disruptors. Today’s challenging environment has given businesses and their customers an opportunity to try out and get accustomed to digital channels of engagement, working and conducting business. This and the greater return on investment that digital channels generate is accelerating the implementation of digital business models.
Q: How can we respond to disruption in our supply chains? How will my ecosystem enable this response?
PALANI: ‘Efficiency vs Sufficiency’. Retailers will be focusing on ensuring supply sufficiency, as the opportunity lost will be expensive than the inventory cost. There will be a shift from ‘efficiency’ to ‘sufficiency’, earlier businesses were doing bulk overseas sourcing for essentials to keep the costs low but now that will be relooked to source locally to ensure sufficiency. Disruptions in supply chains have complicated retailers’ abilities to satisfy consumer demands for faster and more convenient delivery in today’s environment. Retailers must be prepared to make shifts in their supply chains to those that present the best time to market cost-efficiencies. Retailers need to unleash information across the value chain using technologies that can help by giving greater visibility and transparency over transactions.
RAMESH: A big part of this is having transparency over your local and national reach and keeping abreast of your options. The Internet of Things, AI and blockchain give you the ability to link up with multiple partners and coordinate and track your suppliers and orders across your networks/value chain. It’s important that retailers seek out partners and distribution methods that are agile, resilient and adaptable. This helps to maximise your upstream capabilities and ensure you’ve got the right quality and allocations while reducing your costs.
Q: How can we maximise the health, safety and wellbeing of our staff and customers?
PALANI: Retailers need to assure safety for both associates and consumers, by stringent operating procedures supported by digital interventions. There is a plethora of options for retailers to reimagine the entire shoppers’ journey and day-in-a-life of associates. TCS is helping retailers via rapid deployment, smoothening the shopper footfall using appointment scheduler, computer vision-based compliance system to monitor social distancing, scan and go, tap to pay and kerbside pickup.
RAMESH: In the current environment attending to the physical and emotional well-being of the workforce is the highest priority. Employees still working onsite in industries such as health care, retail, food services and critical manufacturing operations will have different needs than those working from home. It's important to think creatively about supporting employees wherever they are. Redrafting work from home policies, employee assistance programs, wellness toolkits and resources, informal videos from leader’s that are empathetic and talk personally are some of the interventions being adopted by firms.
Q: How is TCS’s helping retail customers?
PALANI: When it comes to addressing today’s unique challenges for retailers to ensure safe shopping experiences, enhance your supply chain efficiencies and improve demand fulfilment, TCS does an Algo Retail™ way, with algorithmic propositions.