Many retailers are freeing up their resources so that they can focus their energies on innovation.
Many retailers have found themselves in positions that allow for few growth opportunities and hinder their abilities to compete in today’s market, but new research from Accenture suggests that retailers have the ability to reverse this trend.
According to a report from NACS, Accenture’s research, “Increasing Agility to Fuel Growth and Competitiveness,” which surveyed 700 executives across 13 industries, has revealed the challenges and opportunities that retailers face when it comes to creating cost-competitive operating models and reinvesting in growth. The research included a poll of industry analysts on the industry environment and the performance of retailers, along with the analysts’ views of the aforementioned challenges and opportunities.
NACS reported that Accenture’s research revealed that 88% of retailers are now focusing on freeing up the necessary funds to reinvest in growth, with many viewing investing in digital and entering into new markets as key opportunities for growth, which is consistent with the growth opportunities that were identified by industry. Additionally, the research revealed that more than half or retailers feel that investing in innovation is their business’s way of gaining a competitive advantage.
A core challenge for retailers is inflexible operating models, according to the research from Accenture. Only 17% of the retailers surveyed reported having an agile operating model capable of adapting and driving value for the company. NACS reported that retail executives identified technology, the cost of effort and experience to lead transformation as barriers to advancing operating models. Additionally, the research revealed that retailers are even further challenged by executing cost reduction programs and prioritizing growth investments, with only 38% of retail executives reporting that their companies are prioritizing reinvestment of cost savings in alignment with the business strategy.
NACS also reported that Accenture has offered three action steps that will help retailers to achieve the adaptability necessary to spur and sustain growth. They are as follows:
- Rethink the Operating Model: Operations should be digitized and digital-centric to help enable adaptive retailing, reduce time from product planning to sales and fuel growth.
- Make “Digital Inside” a Key Business Strategy Element: Retailers must integrate digital into their business strategies in order to reduce operating costs and increase agility.
- Get Everyone On Board: Retailers must use data to support business decisions and fully communicate strategies, value drivers and anticipated outcomes.