Progressive Grocer

MAR 2016

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120 | Progressive Grocer | Ahead of What's Next | March 2016 Supply Chain Digital Solutions "Tis improvement has helped the retailer get the right products onto the shelves at the right times to satisfy consumer demand," explains Tim JW Simmons, Teradata's general sales manager, North America, demand chain solutions and services. 'Fail Fast' In addition to being faster, digitally enhanced retail supply chains will require a diferent employee skill set, including people who aren't afraid to come up with new ideas, according to Gartner's Griswold. However, since a culture of experimentation hasn't exactly been the norm at supermarket companies, this may be a major challenge for the industry, he notes. Gartner will further explore this idea, which is part of what it calls a "bimodal supply chain," at its upcom- ing Supply Chain Conference, May 17-19 in Phoenix. "Folks will need two sets of skills, or two types of thinking, in their supply chains," explains Griswold. "Tey need what we call 'mode one' — which is basically the operations side of the busi- ness. But they also need 'mode two,' which is really where the innovation happens." Mode-two thinking will require what Gartner refers to as "fail fast." "People need to come up with innovative ideas, but not every idea is going to work," notes Griswold. "Companies will have to try a lot of new things, but they won't want to penalize people for ideas that don't work, as long as the ideas were well thought out and had a good premise. Tat mindset around failing being OK is very counterin- tuitive for a lot of food retailers." Walmart has already demonstrated mode- two thinking by not only merging its technology functions, but also experimenting with drones to see how the futuristic fying devices can facilitate product delivery. Walmart follows in the footsteps of Amazon, the Seattle-based online retailer that continues to encroach on the grocery business by ofering online ordering and home delivery. As Griswold sees it, drone technology shows the most promise in rural areas, where the nearest Walmart might be at least 10 miles away. But he says supermarkets shouldn't be quick to shrug of the potential of this technology. "Instead of thinking in extremes about how drones might not work, think about where the tech- nology could work … and most importantly, how it can bring value to the consumer," he advises. Another recent example of mode-two thinking comes from Keasbey, N.J.-based supermarket coop- erative Wakefern Food Corp. Its ShopRite banner is involved in a new initiative that will allow custom- ers to shop from their home kitchens using a "smart fridge" called Family Hub. It's this type of openness that will help super- markets build a supply chain that sustains not only the physical world — which is still very much the mainstay of the business — but also the digital world, which only will continue to grow. PG The Importance of Being Accurate On the business-to-business side of the supermarket supply chain, retailers are relying on data more than ever before to fuel everything from orders, to promotions to stocking their shelves. Meanwhile, on the business-to-consumer side, people are looking for accuracy in how products are described on both their packages and on retailers' websites. Where these two worlds merge, Gladson, a provider of syndicated consumer packaged goods product content, is working to make sure that product information is consistent and accurate to help ensure sales and operating efficiencies. Sue Sentell, CEO and president of Lisle, Ill.-based Gladson, says one of the biggest conversations her com- pany is having with its customers is the importance of the execution of the merchandising plan within a supply chain. "They're looking at how to get the products from the manufacturers to the DCs and into the stores, and how to determine where they're going to go on the shelf," she ob- serves. "Then that information needs to be synchronized and linked with the external, business-to-consumer side, because shoppers are online researching products, building shopping lists, and look- ing at nutrients or ingredient information to choose prod- ucts they want to purchase. When they go to buy that product, whether it's online or in the store, they want to make sure that that prod- uct is the same one they've seen online." Gladson's database of consumer packaged goods product content includes images for online usage, as well as key attributes of each product, such as dimension, weight and package measurements. "We also create a very robust database of anything that's on the package that can be used in the promotion of that product or in the supply chain," explains Sentell. The importance of accurate data can't be underestimated in the supermarket supply chain, she contends. "If you think about this through the supply chain, you want to ensure that your product package measurements, whether that be at the case or at the individual consumer unit, be accurate, because that impacts transportation, space in the warehouse … or even online ordering and pickup or home delivery." That mindset around failing being OK is very counterintuitive for a lot of food retailers." —Mike Griswold, Gartner Sentell

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