Breaking the Large Retailer Mold

The large retailers have traditionally followed the lead of smaller retailers in responding to consumer demands and market demands because of the level of effort required for these large retailers to change direction and also because of the level of change generally required.  This has resulted in these large retailers almost struggling and fighting the changes. Now, over the recent four to five years retailers have been shortening this timeframe through a combination of acquisition of capabilities and their own internal development of services in their omni channel in order to remain competitive. These recent developments have been focused on operational capabilities and lend themselves to purchasing the capabilities. There is, however, a much deeper and cultural change in the market that requires these large retailers to break the mold and push the market changes earlier and more quickly in order to compete with agile retailers such as Amazon.

These recent developments now require a focus on collaborative development and delivery of services that cross partners and requires a continuous process of change that allows the retailer to sense and respond to the demands and challenges.  Retail services and demands will continue to change and grow and now the challenge for retailers is to be able to maintain the pace of the change in a continuous process. There is no time now for the large retailers to let someone else develop and perfect the services, these service delivery models are changing and becoming collaborative services offered by niche players in the collaborative network model.  If retailers were to wait now for someone to perfect the services to allow the retailer to acquire the service it will be too late for the large retailer to respond because the market will have moved to the next demand. The delivery cycle is no longer measured in months or quarters it is measured in weeks or months.

This increase velocity of change and demands from the market will impact the culture of these large legacy retailers to incorporate the tools and the processes to sense and respond to the market demands.  The legacy practices of these retailers to wait while the market decides on the direction and the solution is implemented will no longer work because by the time a solution is identified the market demands will have moved on to the next change.  The impact of technology is such that these larger retailers must change their methods to incorporate a continuous change model that provides the means to sense and respond the demands more effectively, and quickly. The retail marketplace and especially consumers are all about the speed of delivery now and if the retailer waits for the solution to be vetted they will only fall further and further behind.  We have seen this recently where Wal Mart invested large sums of money to acquire companies that could provide the types of services demanded by the market.

Large legacy retailers must embrace the collaborative network model to provide the means to both sense changes and new capabilities and services and also to provide the support to efficiently react to the demands.  This network provides the foundation to support the partners across the supply chain and to the end consumer in a robust framework that supports the changing demands. This network allows the retailers and their partners to support each other in a manner that would not be achievable alone.