Magazine Article | August 22, 2007

Unify Your Three Retail Worlds

Source: Innovative Retail Technologies

Avoid negative consumer experiences, lost sales, and operational inefficiencies with an integrated source-to-sale solution.

Integrated Solutions For Retailers, September 2007
If you're a retailer, you operate in three — often disjunct — worlds:
  • Customer-Facing — all of the interactions with your customers (e.g. via the Web, in-store, catalog, media, call center, etc.)
  • Internal Operations — all of the interactions within your company (e.g. DCs, stores, merchandising, accounting, etc.)
  • Supplier-Facing — all the interactions you have with those who help you provide products and services to your customers

The reality is that each of these three worlds is critical for any retailer. The danger is that they are highly interdependent. And, when components are heavily dependent on one another, they must work together seamlessly — as a single holistic entity — or they generate bad surprises. And, in the hypercompetitive world that is retail, those negative surprises come in two very unacceptable forms: (a) negative consumer experiences (therefore, undermined customer loyalty and potential lost sales) and (b) inefficiencies (therefore, higher operating costs).

Therefore, the need is for retailers to position themselves to execute across their three worlds as if they were a single continuous process from source supplier to end sale. This integrated source-to-sale execution has become the new 'secret sauce' in retailers' recipes for developing a competitive edge. With it, the retailer is able to deliver a unified customer experience to the end consumer. Without it, top and bottom line performance are directly or indirectly undermined and competitive advantage is eroded.

SOA Is The Answer
Of course, retailers have been trying to improve each of these three worlds for years with point solutions such as bar codes, supply chain execution solutions, warehouse management systems, and store operations technology. But, it's the gaps between these point solutions that undermine the ability of a retailer to operate seamlessly from source to sale.

Let's face it; none of this is going to change anytime soon. The complexities will only compound as retailers find new and more creative ways to compete. The myriad of solutions and legacy systems already in place aren't going to be miraculously replaced by some silver bullet that fixes everything, provides all functionality needed, and still leaves room for innovation to drive competitive advantage.

So, do we just give up?  Not on your life. The advent of service-oriented architecture (SOA) technology has made it possible to implement a source-to-sale 'agility layer' that reaches across existing IT assets. Such a solution spans departments, functions, divisions, companies, and channels and provides holistic connectivity, integration, visibility, business analysis, process management, and exception recovery capabilities across all three of the retailer's worlds. The challenge is that this solution must be able to (1) step up to the typical capabilities of traditional enterprise application integration (EAI) solutions, (2) handle the complexity and scalability challenges of business to business integration (B2Bi), (3) provide unique business processing capabilities that are only possible when spanning multiple systems/enterprises, and (4) still facilitate the innovative use of information to generate competitively differentiating worth to the end consumer.

The solution is to step back and survey the landscape of your three worlds: customer-facing, internal operations, and supplier-facing. Identify where the gaps appear when you view those three worlds as a single, holistic continuum. Then, highlight how and where a source-to-sale agility layer will fill those gaps and give you the ability to drive greater efficiency and deliver unique worth to your customers.

John Stelzer is director of industry development for Sterling Commerce.
He can be reached through the company's Web site at