“TCS’ industry analysis of global retailers indicated a marked reduction in stores contribution to overall net income of the organization. STAR was conceptualized to address the problem of keeping stores relevant,” says Dheeraj Shah.
TCS’ retail industry analysis of top 10 global retailers indicated the average change in YOY performance, indicating a marked reduction in stores contribution to overall net income of the organization. The advent of multi-channel retail poses a continual question on the viability of brick and mortar stores. However, the customer is still in the store, which mandates stores to be relevant through better customer experience and leaner, efficient, more productive and profitable store operations. The traditional siloed and fragmented way of individual process optimization results in sub-optimal benefits and adversely affects non-focus areas due to inadequate dependency considerations. The need to optimize the essential building blocks of people, process and technology with benefit realization assurance coupled with a unique blend of methodologies and toolkits resulted in the birth of TCS’ STAR.
Keeping stores relevant
STAR is a solution developed by TCS’ Retail Solutions team, focusing on keeping the brick and mortar format of retail stores relevant in the multi-channel, web, mobile and social media world. It aims at driving improved customer engagement / experience and reducing the “fat” by focusing on operational efficiencies and productivity. While retailers across the globe are trying to sustain and nurture viability of stores, this unique solution helps them take an “outside in” perspective to drive sales, reduce costs and improve customer experience. TCS has used STAR to deliver business benefits of USD 8 million to a large specialty retailer and demonstrate value to a leading electronics and furnishing retail chain in the Middle East. This recommendation to realization (R2R) participative and self-sustaining solution is being considered by leading retailers to realize benefits of millions en-route their stores transformation journey.
Conceptualized to address an entrenched problem
Thus, STAR was conceptualized to address retailers’ omnipresent problem with a new innovative holistic solution spanning the store operations landscape. It addresses the key profit and loss expense areas including inventory, labor, shrink, promotions, utilities and infrastructure. STAR meets the industry need for a domain-focused, faster, better and cost-effective solution, by delivering business benefits through cost reduction, cost avoidance, revenue uplift, cash flow improvement and GM uplift.
STAR realizes business benefits by leveraging unique domain customized assets that help address the various transformation goals of individual sub process areas.
- Workforce Management (Patent applied) determines and deploys optimal workforce across store sales floor, back room and other areas without affecting customer experience or process objectives.
- Stoktimizer helps reach an optimal inventory without affecting availability and visual aspects of store merchandizing.
- 4S Identifier is designed to identify simplification, standardization, synergy and service opportunities within the store landscape areas thorough symptoms analysis.
- Store Operations Quick Insights Playbook is a ready reckoner designed to accelerate the identification ofviable opportunities that will deliver maximum business benefits.
- Factor Attribution Tree is an accelerated solution identification module aiding determination of root cause and, hence, appropriate treatment.
- Flow Optimizer (Patent applied) is a complimenting supply chain enabler used in DC to ensure store receiving on-time for the adequate availability of the merchandise in the store.
- Energy Consumption Profile Analyzer is leveraged to transform into optimal lighting and HVAC schedules and, hence, optimize the utility consumption for the organization providing an ecologically sustainable benefit.
These novel assets are ingrained into a well-defined structured robust three staged proven methodology Envision - Enable - Realize. The benefit measurement framework and sustenance approach built in the solution ensures “no roll back effect.” A well-defined ROI template enables STAR as a solution to handhold the customer until the benefits are realized in organization books of account and signed off by the CFO organization.
Thus, STAR not only results in hard benefits but also helps address environment sustainability, customer experience improvement and employee satisfaction, enhance organizational leadership skills and build a sustainable improvement culture in the organization.
A differentiated solution
STAR is a differentiated customer-centric transformation solution that is unique in a number of respects.
Recommendation to Realization - Benefit realization assurance positively affects the key performance indicators. Get benefit maximization through a unique blend of industry-proven methodologies like Lean Six Sigma, creativity and lateral thinking tools, and domain knowledge. STAR leverages TCS’ E2E capability with inbuilt cutting-edge retail technology solutions. It offers flexibility for the alignment of a number of strategic drivers. It focuses on the pan-stores operations landscape to avoid an adverse impact. It gives faster results through a participative and collaborative model. The innovation drives a process improvement culture for self-sustenance.
Delivering business benefits in store operations
STAR was conceptualized while executing a transformation program for a large specialty retailer in North America. TCS delivered USD 100+ million of business benefits in store operations, signed off by the customer’s CFO, by improving business processes. These processes spanned store receiving, cashiering/ checkout, planogram setup, advertisement signage, utility consumption, store supplies, backroom efficiencies and allocated cost optimization. In another initiative for one of the leading electronics and home furnishing retailers in the Middle East, TCS leveraged STAR to define a roadmap for the retailer to positively transform its in-store customer experience and customer engagement. This roadmap would deliver benefits across KPIs including customer checkout time, sales representative efficiency, customer conversion, cross sell / upsell percent and customer traffic / footfall.
The quantum of economic benefit realized from the innovation till the time of writing this article was USD 100+ million.
*As published on tataquality.com.