‘Moving Closer To The Customer’.  It’s been a hot-topic for some considerable time and, whilst it shows no signs of abating, when the top-n lists of Retailers’ strategic focuses are analysed, the emphasis of the value it brings has started to shift.  Improved Business Intelligence (BI) relating to consumer purchasing patterns, propensity to buy and favoured channels of delivery has resulted in a more granular understanding of how, why, when and where products sell, in what volumes and to which demographic groups.  Personalised campaign and promotion management is now a very real prospect; the enticing possibility exists of minimising the annoyance to customers through offering discounts on products they would have purchased anyway and instead enhancing cross- and up sell opportunities by proactively presenting offers on items that the data insight generated suggests they would like to try instead.  Get it right and sales growth becomes a reality.

But harnessing the latent insight within carefully-curated data held on customer behaviour for Retail transactional (Sales) improvement is but one side of the coin.  The obverse side relates to how such data can benefit the operational Supply Chain.

As long ago as 2011 McKinsey & Company was talking about how the necessity for omni-channel Retail operations was splintering the Supply Chain, identifying issues such as “supply chain planners must deal with rising complexity.  For many companies, this need means working harder to meet their customers’ increasingly diverse requirements.”  However, in reaction to such challenges McKinsey saw many Retailers, CPG/FMCG and Manufacturing organisations “splintering monolithic supply chains into smaller, nimbler ones [to] help tame complexity, save money, and serve customers better.”  It is this sub-set of smaller, nimbler Supply Chains which can benefit from overlays of true, real-time customer purchasing by integrating the demand signals with the ‘traditional’ statistical forecasts generated algorithmically and heuristically.  Better demand management leads to more accurate forecasting which in turn has the potential to better optimise inventory volumes and positioning, reduce out-of-stocks, improve customer service levels and ultimately drive increased sales, margins and growth.

Hitachi’s Smart Customer Experience looks holistically at how omni-channel operations can be enhanced and optimised alongside the identified benefits of Moving Closer To The Customer.