The sheer question of what constitutes an ‘item’ is a regular part of debate between business departments. For the procurement team an item is the ‘buying’ unit delivered by the vendor – usually a pallet or half pallet with ‘X’ cases and dimensions. For the store manager, an item is the ‘sales’ unit – one scannable UPC. For a depot the item is the ‘store shipping’ unit – a single case containing individual selling units. Using the example of a toothbrush – the buying, selling and shipping dimensions are all different.
Information technology is a key enabler for and provides companies with the foundation for process improvement/consistency and is almost always a component in business efficiency. While there is still on on-going opportunity for cost improvements due to automation of business processes, there is also a game-changing factor in applying mobile applications and Internet to retail. All in all, the retailers are being challenged to perfect the existing technology base while adapting to new technology opportunities.
Fortunately, there is a large community of technology providers who can speed the introduction of new technology so that retailers can leverage IT while focusing on their core skills of sourcing and merchandising. The RFID technology is proven but its high cost of implementation is acting as a hurdle for retailers. Business intelligence is also a clearly recognised value, again with a high cost of entry. But it promises big returns as retailers get more sophisticated in its use. Mobile commerce, in contrast, has a relatively low cost of entry and can provide immediate value in both customer communication and logistics support.
Retailers always require good people and business process to provide high value information critical to company growth, but the same processes introduced to standardise operations have facilitated access to information for all parties in the retail transaction, an impact on consumer buying patterns that has yet to be fully appreciated.
For more articles, Click on IIPM Article.Information technology is a key enabler for and provides companies with the foundation for process improvement/consistency and is almost always a component in business efficiency. While there is still on on-going opportunity for cost improvements due to automation of business processes, there is also a game-changing factor in applying mobile applications and Internet to retail. All in all, the retailers are being challenged to perfect the existing technology base while adapting to new technology opportunities.
Fortunately, there is a large community of technology providers who can speed the introduction of new technology so that retailers can leverage IT while focusing on their core skills of sourcing and merchandising. The RFID technology is proven but its high cost of implementation is acting as a hurdle for retailers. Business intelligence is also a clearly recognised value, again with a high cost of entry. But it promises big returns as retailers get more sophisticated in its use. Mobile commerce, in contrast, has a relatively low cost of entry and can provide immediate value in both customer communication and logistics support.
Retailers always require good people and business process to provide high value information critical to company growth, but the same processes introduced to standardise operations have facilitated access to information for all parties in the retail transaction, an impact on consumer buying patterns that has yet to be fully appreciated.
Coordinated by Neha Saraiya
Source : IIPM Editorial, 2010.
An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).
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