The Future: Industries Aligned with the Information Technology
Are you adapting?
All this activity will increasingly place the consumer firmly at the center of different industry business models. While it is impossible to predict exactly how the industry will evolve, it is clear that successful industry players will need to cultivate the following qualities:
- Agility & Active.Organizations will need flexibility in all aspects of their operations – from IT infrastructure and front‑end interfaces to management structures – to respond swiftly to threats posed by new entrants and changing consumer demands.
- Integration competencies.Industry stakeholders must be proficient at absorbing and launching new lines of business.
- New management skills.These will be necessary to effectively implement new operating models, processes and workflows.
- Communication capabilities.Organizations will need to think innovatively about how to look beyond traditional industry boundaries to form new alliances and offer services aligned with the accountable consumer.
- Health adoption in IT.Healthcare organizations must accelerate their adoption of digital solutions. Digital agility and power will be necessary to compete with new entrants and to streamline operations to generate savings.
Setting up Digital Priorities
Balancing these demands requires setting some clear digital priorities. The following steps can help clarify where to make initial investments:
- Aware of the market.Consider your place in the overall market; the strategies and investments that market segments are making; and local competitors’ apparent strategies, capabilities and investments.
- Reduce gaps.Understand today’s “industry standard” alongside the future “new normal.” While entities should eventually close the gaps between those poles, they also need to be aware of shifting consumer expectations and technology advances vs. doggedly checking off potentially obsolete boxes.
- Find the meaning of digital.Develop a digital strategy that identifies where you will differentiate yourself from competitors and understand the key capabilities that enable the differentiation.
- Review investment.Take a step back and look at the sum of your capability investment goals. Be realistic and remove the low priorities to have a better chance at achieving the more important goals.
- Do yourself Examination.Examine the range of your investments among standard, leading and pioneering capabilities. Aim to achieve a balance between initiatives aimed at closing gaps and creating differentiation, as well as a small number of pioneering investments to implement as pilot programs.
60% of shoppers report in-store their inconvenience . Here’s why they prefer the online seller and stores.
- Product availability. Out-of-stocks are a top shopper frustratation. The old adage “you cannot sell from an empty shelf” remains true, particularly in the digital era. Stores continue to face challenges with their receiving practices, markdown management and planogram execution, all of which directly correlate with missing items and holes on the shelf.
- Botched in-store pickup of online purchases. In-store pickup is growing in popularity among consumers, with 62% of respondents using this service. Yet retailers continue to stumble on execution: This year, 60% of respondents to our survey experienced service failures, up considerably from 2014’s tally of 49%. Shoppers point to problems with inconvenient pickup locations, long wait times and items not ready for pickup.
- Inconsistent cross-channel fulfillment policies and training. As boundaries blur between traditional and online stores, customers expect fluid service and personalization. The cost of delivering a seamless customer experience is a modest investment in customer loyalty and advocacy. Some retailers are experiencing small gains based on that strategy.
- Lack of personalization. It is well-known that consumers are more likely to be repeat customers if retailers provide them with targeted, personalized offers. However a majority of retailers fail to deliver on this one-to-one relationship effort. The CMO Council reported that more than 50% of U.S. and Canadian consumers have considered ending their loyalties to retailers that do not provide tailored, relevant offers, and 54% of respondents to our survey said they would respond to personalized services such as special access and token gifts.
- Ineffective store associates. Shoppers’ two most requested store improvements have nothing to do with technology, according to our survey: They want more knowledgeable associates, as well as the ability for associates to match prices. The importance of price matching soared from 21% in 2012 to 44% in 2015. The majority of store customers are prepared to make a purchase, and trained, equipped and empowered store associates who can properly engage customers will seal the deal.
- Long checkout lines. A recent study illustrates that 33% of customers have abandoned the checkout line when forced to wait for more than five minutes. Furthermore, nearly 50% will actively avoid the retailer in the future if the wait was longer than five minutes. According to our 2014 Shopper’s Survey, customers said a bad experience at the checkout will negate what was up to that point a positive customer experience. This desire for efficiency has fueled the rise in self-checkout among large retailers.