Do What We’ve Always Done… Get the Same Results

March 25, 2007  by in UnCategorized   

By Home Furnishings Business in Retail Technology on March 2007 Information technology. Sounds simple, right? There exists a plethora of information technology available€”it€™s everywhere we go and in everything we use. Here we are, almost 61 years to the day since the basic concepts were introduced to the world, and there is more information, communication and processing in the tiny cell phone you use than there was in the 30-ton, 1,800-square-foot ENIAC €”the very first programmable computer system unveiled on Valentine€™s Day, 1946. Like the Internet, and so many other new technologies of the past half century, its purpose was to solve problems related to national defense. Today, the world is a very different and much better place for it.

But just because we can collect, accumulate, process and distribute more information than ever before doesn€™t mean that we€™re using it very wisely. I often shop in big-ticket stores just to examine the customer experience and the usage of information technology in a retail organization. Quite routinely, what I see is a result of good intentions but very inadequate implementations. At best, the store may use the system to ring a sale, and that€™s it. In many cases, the sales process isn€™t even done on a computer, it€™s done on paper and entered into a computer later.

In the book Good to Great, Jim Collins tells us what we already know€”that technology is an accelerator, not a solution. A great business starts (and ends) with great people. But well-intended, great people are not enough. A competitive company must have great people, be aligned with core business and processes, and effectively leverage technology to accelerate growth. As an industry, we have let too much technological innovation pass us by. It€™s no secret that our industry lags behind in its usage of technology. All one has to do is look at the pervasive usage of technological gains in other retail sectors. All the while, home furnishings has been idly accepting of technology that was developed almost 20 years ago. While the key decision makers in the industry have been facing different strategic issues, the technological infrastructure has weakened and thus created opportunities for aggressive competition to attack a growing and profitable market space in the U.S.



Shakeup Ahead

The supply chain will continue its shakeup; the retail sector will continue to €œright€ itself. When all is said and done, the companies that can see true trends sooner and react to them faster will be the ones that survive and thrive. And the answer to that insight and reaction lies within the information that flows through the veins of our business every day. This information is there€”stored in one form or another. In people€™s heads for example, or on paper, or even on a computer disk. But knowledge and information has no value when it is stored. It only has value when it is accurately shared with the right person at the right time. How that happens is where information technology can create a great advantage.

I firmly believe that there are two very different sets of features for any technology purchase made by a company. First and foremost is the set of features and promises made to senior management, the effective results that could happen if all systems were aligned and performing in a specific manner. That€™s the set of features that a company €œbuys.€ But, there€™s also another one€”the set of features and functions that actually get implemented.

It is the specific purpose of technology to perform things faster and cheaper than was possible without it. And it is naive to think that such change will be accepted and adopted quickly and without fear by the good people of an organization. Yet so many systems providers and retailers fail to address this key issue above all else. If retail was €œso easy a caveman could do it,€ the retailers wouldn€™t need the systems providers. That need, reliance and willingness to pay puts an obligation on the systems provider to assist where possible, and help the retailer through the change process. For far too long, retailers and manufacturers have accepted what they have as €œthe best of what€™s available,€ effectively lowering the standards to simply be the lesser of all evils. And while other countries and other industries whiz past home furnishings, too many systems companies fail to invest in truly new technologies. And too many home furnishings manufacturers and retailers fail to invest in the curve to get there.



Look at ROI

What this really nets out to is simple alignment€”the alignment of people, process and technology€”they are three legs of the same stool. It€™s not difficult to accomplish, but it does take a willingness to take an introspective look at your organization. Does technology cost money? Sure it does. But so does the lack of technology. What€™s even worse could be the improper usage or application of technologies because when that happens, an organization accumulates the cost of the technology and the costs of the efficiency losses.

If you€™re thinking about technological improvements, think in terms of return on investment rather than cost. Make sure whatever options or project you are considering have a clearly defined and expected return on the dollars spent. Just remember that the technology is not an investment in and of itself€”the payback can only be measured in the efficiencies it creates. It is a supporting tool, just like your delivery trucks. An investment in technology can accelerate your growth, but only if your organization, your processes, and your people are ready to embrace it as an easier way to do what gets done. HFB