SPI - Retail Insights Blog - Collaboration through Business Process Optimization, Round 1

Wednesday, February 23, 2011

Collaboration through Business Process Optimization, Round 1

In my last entry, I summed up WHY retailers and vendors should better collaborate. In this entry, I'll cover HOW in a step by step process.

Now this is important because any journey to implement methods that bridge retailer-vendor gaps should begin with #1. all parties getting on the same page. When exploring how to better collaborate, retailers and vendors should have a common understanding of priorities. Are the priorities of the retailer the same as those of the vendor? Are their definitions of 'functional workflow' the same? What about capabilities - are both sides equally weighted when it comes to levels of automation? Willingness to automate? Assembling the full team will give retailers the 360° view of the entire trading process and all areas of improvement that need to be considered.

With everyone on the same page, retailers and vendors should #2. examine existing workflow and the technologies they're using to map out strengths and limitations. In some instances, retailers and vendors alike will find that a cobbled-together process works just fine on both sides, so there's really no use in changing it. Other times, maybe not, but the open dialogue will give retailers a comprehensive view of everything to be considered so they can identify which processes need to be streamlined and automated

What you should find during this exercise is that IT enablement should improve upon current business process. As retailers examine and pinpoint the capabilities that they do and don't possess, they should apply this knowledge to understand how change will impact their vendors. One area of focus for SPI has been improving on the manual interactions between retailers and vendors. Our approach has been 'With technology' and 'Through workflow!' From our experience, retailers who have incorporated electronic workflow effectively with their vendors experience positive transformations within their organizations because they're able to make their lives and the lives of their trading partners easier.

Before launching (and AFTER retailers have received vendor input), #3. retailers should pilot proposed workflow and software on a group of vendor-users. Before anything goes live, it is extremely critical that retailers receive buy-in that workflow, processes and tools are functional and practical. Retailers need to ensure that people involved in the trading process will comply, so the testing phase is crucial. (And, just like in scientific sampling, suppliers should be selected from various segments, such that the pilot group is a representation of your entire vendor base.)

During the testing, #4. retailers should again map the processes, then re-open the dialogue for how they can improve further. Changes that seemed like a great idea might be received differently once put into place and #5. vendors should submit their feedback, framing it around how these processes will be received and function within their organizations.

Going through these steps will serve as the roadmap for developing a technology solution. And with the roadmap and new programs in place #6. retailers will be able to evaluate the efficiency of the applications, enhancements, portals, or in our case tradeflow optimization, in order to continuously improve.

Now, my entry is an overview, and we're over-simplifying a little, but you can see the outline of how this works. When I blog next, I'll name the actual processes where retailers and vendors should focus. Again, the name of the game is collaboration and when retailers provide vendors with the tools they need, everyone's lives become easier.