Managing the complexities of integrated multichannel eCommerce, internationalisation into new markets, and tailoring brands to different buyers are retailers’ top three areas of focus for 2011, according to Hitachi Consulting UK’s Retail Vision Report: 20 Technology Challenges from 20 Leading Retailers. However, despite many retailers having several leading BI tools in place, the report highlights a growing gap between business intelligence capabilities and business requirements, resulting from lack of alignment to the business process, gaps in the data, and inadequate reporting from the retailers’ existing Business Intelligence systems - many of which have not been properly aligned or deployed.
Hitachi Consulting conducted qualitative interviews with 20 of the UK’s leading retailers, including Debenhams, Waitrose, River Island, Halfords, Shop Direct Group, ThorntonsPlc, TK Maxx, BHS, Argos, Signet Trading and ATS Euromaster among others. The report identified 20 areas of IT focus (and frustration) for UK retailers in 2011:
1. Double-edged sword of managing multichannel eCommerce and increasing customer complexity;
2. Managing business expansion into new markets, including through joint ventures and franchises;
3. Tailoring brands, ranges and promotions to multiple or new channels and markets;
4. Significant uplift in operational complexity arising from strategic business initiatives;
5. Reporting capabilities not keeping pace with business demands;
6. Lack of business clarity from existing systems;
7. Customer data locked in source systems and not available in corporate information systems;
8. Difficulty in extracting and manipulating meaningful data from corporate information systems;
9. Reliance on IT information across almost every job function and business area;
10. Almost every job function is less than very satisfied with their BI provision, including the executives who sign off the cheques!
11. Those in online are significantly more satisfied with their BI services than those in multichannel;
12. BI is not closely enough integrated to the business process;
13. There’s a strong appetite to get closer to real time information;
14. Information requires significant rework before it can be presented;
15. ‘Spreadsheet Spaghetti’ is still prevalent;
16. Desire to improve data reporting capabilities, including dashboards and complex analysis;
17. Mobile is still not central to BI plans;
18. Patchy success rates even with multiple business intelligence systems deployed;
19. Concerns over customer, product, supplier and finance data;
20. Inability to mine data around specific issues to validate and support business plans.
“Every one of the retail organisations we spoke to has already deployed market leading BI systems, and some are running four or five different BI Systems simultaneously in an attempt to keep pace,” said Chris Gates, Director of Retail Solutions at Hitachi Consulting UK. “The problem isn’t the tools, but rather the way they’re being deployed. Given that success or failure depends on how quickly retailers respond to rapidly changing conditions, retailers need to re-examine their BI strategy, and tailor their systems to their unique requirements. Being able to effectively address BI challenges - such as increasing levels of customer complexity in multichannel eCommerce and the need for fast, accurate, in-depth analysis and reporting - are core to achieving the agility that retailers need to succeed.”
As part of its Retail Business Intelligence Best Practice, Hitachi Consulting UK has outlined the Golden Rules of Profitable Business Intelligence to help retailers maximize their technology investments and provide the insight required to help facilitate growth and profitability.
About Hitachi Ltd
Hitachi, Ltd, (NYSE: HIT / TSE: 6501), headquartered in Tokyo, Japan, is a leading global electronics company with approximately 360,000 employees worldwide. Fiscal 2010 (ended March 31, 2011) consolidated revenues totaled 9,315 billion yen ($112.2 billion). Hitachi will focus more than ever on the Social Innovation Business, which includes information and telecommunication systems, power systems, environmental, industrial and transportation systems, and social and urban systems, as well as the sophisticated materials and key devices that support them.
About Hitachi Europe Ltd
Hitachi Europe Ltd is a wholly owned subsidiary of Hitachi, Ltd., Japan. Headquartered in Maidenhead, UK, it has operations in 11 countries across Europe, the Middle East and Africa and employs approximately 460 people. Hitachi Europe comprises of nine business areas: air conditioning and refrigeration systems; digital media and consumer products; display products; industrial components and equipment; manufacturing systems; information systems; power and industrial systems; power devices and procurement and sourcing. Hitachi Europe also has three Research and Development laboratories and a Design Centre.