Kalypso, a leading innovation consulting firm, recently published a Viewpoints on Innovation article describing the challenge that retailers now face when it comes to their planning approach. Many retailers are still planning in a linear, disjointed fashion which very much puts them at risk in today’s competitive retail environment. Due to the proliferation of channels including mobile and online and a more demanding consumer who expects what they want, when and where they want it, retailers must do something to integrate their planning.
The retail planning process involves multiple functional areas including Finance, Merchandise Planning, Merchandising, Digital Channels, Sales and Demand Planning that are all responsible for a piece of the overall plan. Unfortunately, these functions all too often operate independently and at different times throughout the pre, in and post season and go-to-market calendar. This means they have their own processes, different KPIs and different systems and data sources resulting in no single version of the truth and an organization that is disparate and silo’ed.
Creating an end-to-end integrated planning strategy can be daunting and impacts people, processes and often technology. So, how do you begin the journey to modern planning processes? Below are five spot-on strategies Kalypso outlines to help your organization turn to an integrated planning process and successful execution.
Five Factors for Integrated Planning Success
- Share the strategic vision. Ensure that there is a well-documented long-term strategic plan with very clear financial objectives and that it is communicated and socialized across the organization. It’s not enough to say “we should grow 5% next year”. The strategy must clearly define how we plan to get there, which product categories to focus on, which customer segments are most important, what new markets are being targeted, etc. Providing the Planning team with the high-level direction and financial targets earlier will enable them to incorporate the strategy into their merchandise and assortment plans.
- Get the right people at the table. Good planning decisions are made by incorporating the best available information, so getting cross functional input is key. Line Planning, Digital Channel Planning and Global Merchandise Planning teams need to work closely together throughout the entire go-to-market process to ensure enough products, and the right products, are being developed to meet financial goals. Regional merchants and planners should provide input on what they need and identify gaps early on so that the global design and merchandising teams can develop product in time. Incorporating Sales and/or Retail Merchants into line discussions earlier helps to identify key account needs and incorporate customer and consumer feedback.
- Timing is everything. Bringing products to market quickly and efficiently requires some planning decisions to be made sooner rather than later. Procuring materials, reserving factory capacity and managing transportation need to be done well in advance to ensure on time delivery – but all of these rely on accurate planning and forecasting. Progressive lock down on product decisions combined with early involvement of both Demand and Sales Planning will help streamline execution and maintain margins throughout the entire process and prevent costly re-work.
- Make sure everyone is speaking the same language. Establish common KPIs that are used across teams. Ensure that there is alignment and understanding of the definitions of those KPIs. Good governance enables alignment around shared goals, improves trust in the information, and facilitates communication. Having one version of the truth is essential in ensuring smooth execution in today’s planning environment.
- Support the process with robust tools. Planning today requires a set of reliable and integrated planning tools that can support the key steps of the process and ensure that accurate and trustworthy information is always available. One system which can be leveraged by multiple functions simplifies communication and encourages collaboration.
At JustEnough we feel these strategies are crucial to a retailer’s success in meeting their financial objectives and this is what our company is passionate about – building solutions that are intuitively integrated, taking a lot of the work out of retailers’ hands.
Our omni-channel retail planning software enables leading retailers to merchandise assortments and maximize product inventory across physical and digital channels so products are available when and where shoppers want them – all on a single integrated platform. Contact us to learn more about how we can help you improve your planning processes for success and meet the demands of your customers.
Read the complete Viewpoints on Innovation article here.