Agile Retail must start in the workplace
This is a guest blog post by Katrin Schleife, Principal Analyst, at industry analyst group CXP
The world of retail moves faster than any other industry.
In the last six months alone, Amazon has opened the doors at its checkout-free store, Tesco has successfully piloted 1-hour automated delivery in London and Wal-Mart has started testing robots for in-store inventory checking.
Also consider the number of high-profile players that have struggled to keep pace with the technology-centric revolution. Toys R Us, True Religion and RadioShack are among the brands that entered into bankruptcy protection in 2017, as they lost ground to digital native competitors.
As a result, successful retailers needs to ensure that they are agile enough to adapt to meet changing buyer demands, build new technology innovation into their business models, and respond rapidly to new competitive threats.
A critical aspect is ensuring that this agile approach begins in the workplace, and that employees have the right environment, policies and tools to enable them to maximize their productivity and fulfill their potential.
Today’s workplace is falling short
PAC recently partnered with Fujitsu to interview 277 senior decision-makers at retail organizations in Europe, ANZ and the US to understand the current challenges they face in delivering a truly compelling and productive workplace strategy.
And the truth is that today’s workplace is falling some way short of delivering the agility that retailers need to win today and to thrive in the future.
Retailers are generally ahead of the curve in their use of freelance or temporary staff, particularly to support peak seasons. However, 85% of participants in the sector admit that their current working hours and practices are still not flexible enough to get the most out of their workforce.
Retail groups are also struggling to attract and retain the right talent. 79% say that high staff attrition is a barrier to productivity in their business today and this is likely to become more of a challenge going forwards as they adapt to the needs of millennial and Gen Z entrants.
Technology is critical to retail, from the warehouse to the website and of course, in the store, where many organizations have been looking to digitally enhance worker productivity. Millions have been invested in providing instant access to product and customer data to improve conversion rates, reduce queuing time and enhance the customer experience.
But has it been money well spent? The study found that for many businesses, technology is actually acting as a barrier to productivity, rather than an enabler.
An overwhelming 86% state that the complexity of their existing workplace technology tools is a barrier to productivity, while more than a third (37%) believe that their current approach to cyber security – with too many layers of authentication – is slowing employees down.
Where is workplace investment going?
So how are retailers looking to tackle these challenges?
Out of all the industries that participated in the study, retail leads the way in changing current policies to create an improved work/life balance for employees (74%). Ikea’s UK business recently announced that it would make its employees eligible for one weekend off in every four.
Retailers also lead the way in looking to improve their workers’ ability to drive innovation through engaging with external partners.
Almost half (49%) are planning to provide access to tools and platforms to create and share innovation with wider ecosystem, with 44% planning to invest in open innovation/crowdsourcing and hack-a-thons in the next 12 months. Cosmetics retail group Sephora is one company that has successfully harnessed innovation from outside the walls of its own business through a dedicated lab.
Retail companies will have to support an increasingly diverse workforce, and 46% are looking to improve knowledge sharing between experienced workers and new millennial and Gen Z entrants. This is encouraging given that there is a core group of 10% that have to put a formal knowledge management and sharing strategy in place.
And the retail sector also leads the way in planning investment in robotic process automation (RPA) as part of their workplace modernization strategies during the next two years (45%). On the topic of automation, 93% of participants from the sector see the rise of artificial intelligence as one of the major factors that will reshape their workplace in 2025.
Some final thoughts
Many established retailers have successfully negotiated the first era of digital transformation, by building and integrating effective e-commerce engines into their traditional channels.
But the next stage of the battle will see them make a potentially more transformation of their traditional operations – overhauling back and middle office in order to ensure that the business can move and adapt at the speed of its customers and competitors.
Building a workplace environment based on a flexible technology platform that boosts rather than holds back productivity, will be essential to achieving this goal. The findings of the study suggest that while today’s approach is falling short in many areas, the majority are laying the right foundations for an agile and successful future.
Join us for our live Retail webinar on 11 April at 10.00 GMT/11.00 CET to find out how you can future-proof your workplace