Knowledge Management in Retail- Images Retail - June 2013

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Knowledge Management in Retail - Strategy & Execution …

Knowledge Management in Retail - Strategy & Execution
Improving customer satisfaction and employee productivity through knowledge management in a retail organization.

An article by Shijo Sunny Thomas, Industry Lead - Retail & CPG, Fujitsu Consulting

More in: Technology
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  • 1. technology2 . images retail . june 2013By Shijo Sunny ThomasKnowledgeManagementinRetail:PowertotheFrontlineAre your customers andemployees getting the right,consistent and satisfactoryanswers to their questions?Customer satisfaction andemployee productivity canbe highly improved with theuse of efficient knowledgemanagement practicesand systems in a retailorganisation“What is the difference betweenthis TV model and that one? It looksthe same and has the same features,but there is a significant differencein the prices of the two.” How manytimes have you heard a customerasking this question at a consumerelectronics retail store? The answersfrom the store associate could be:“I need to check with the person in-charge”; “There is no difference exceptthat one is a lower model and the otheris higher”; “I am not assigned to thisdepartment”; “Here, you can read boththe brochures”; or “The higher pricedis the latest model.”In today’s business environment,it is essential for retail stakeholders,be it customers, employees and evenvendors, to get consistent and accurateinformation at the appropriate timeand from the right place. A retailorganisation is a constantly livingand learning environment. Theknowledge touch points in retail areimmense and have the possibilityof extending exponentially witheach customer interaction, producttransaction or supply chain networkactivity. It is imperative for retailers toweave together a fabric of processesand systems to effectively captureinformation, convert it to knowledgeand disseminate it to relevantstakeholders in the retail ecosystem.Knowledge management is highlyimperative for international retailerswho are opening shops in India.These companies will be settingup new operations, addressing adiverse customer base, recruiting newemployees and will need to rapidlyscale the learning curve to gainmarket share and profitability. Theseperformance parameters are drivenby a retailer’s ability to adapt to localsettings. It is necessary that priorexperiences, insights and practices inother markets are leveraged throughoutthe organisation to support theoperations in a new market.The challenges for retailers remain inthe fact that there is a lack of provenmodels which can help retailersstrategise, execute and measurethe effectiveness of knowledgemanagement initiatives.Creating Retail Intellectual CapitalMany retailers have not yet put inplace the initiatives to transformenterprise information from sourcesinto a structure that eventuallycreates retail intellectual capital.Knowledge management in manyretail organisations is still limited toinitiatives such as product informationmanagement, information and bestpractice availability on employeeportals and compliance informationon vendor portals. The end result isthe creation of a huge repository ofcontent which can be accessed by theinternal stakeholders. It will not be offthe mark to call the prevalent situationas “knowledge challenges related tomanaging knowledge.”Retailers should take a phasedapproach towards knowledge strategy,knowledge execution and knowledgemeasurement into the overall corporateobjectives. This ensures a continuum,momentum and traceability ofmultiple initiatives that arise fromthe strategy. Knowledge managementinitiatives in a retail organisationshould be strategised primarilyfrom three perspectives – customerknowledge capital, human knowledgecapital and operational knowledgecapital. These perspectives shouldbe bound to organisational metricsrelated to customer satisfaction;employee productivity and supplychain lead times, respectively. Variousprogrammes arising out of theseinitiatives can be tracked back to theorganisational objectives.
  • 2. technologyjune 2013 . images retail . 3ABOUT THE AUTHORShijo Sunny Thomas is theindustry lead for Retail & CPGat Fujitsu Consulting India. Hehas worked closely with retailersin India to conceptualise anddeliver technology solutionsrelevant to local needs.While deciding on organisationalprogrammes related to knowledgemanagement, it is necessary to identifyand prioritise the business areas forwhich a knowledge managementprogramme has to be implemented.The next step is to finalise a fewbusiness processes in these businessareas where knowledge managementcan be applied. In each of theseidentified processes, it is beneficial tohave estimated the current knowledgeneeds, availability and accessibility ofthe information to facilitate knowledge.Some of the most potential andimmediate benefits of knowledgemanagement can be realised inbusiness processes within the store.The processes chosen will alsodepend on the segment of retail. Fora consumer electronics retailer, it isvery essential that store associates arewell equipped with knowledge of theproduct. This will comprise of productspecifications, features, pricing options,usage, demonstration videos and alsotips to converse with the customer andclose the sale. This could also extendto connecting the customer with aproduct expert who can converse withthe customer through video.For fashion retailers, the storeassociates should have handyinformation on various fashion trends,material used in the products, videosfrom shows for luxury fashion, fabriccare information, etc. Analyticalcomponents can be used to suggestupsells or cross sells using pastpurchase information of the customers.Generating Targeted Messages forEmployeesThe purpose of knowledgemanagement is not solely limited toenabling customer interactions duringa sale. Employee skills, competenciesand assessments can be made availableto managers to enable capabilityplanning. Targeted messages can begenerated for employees or employeegroups to roll out organisational ordepartmental initiatives. Participativeknowledge management can alsobe introduced for various businessprocesses in the supply chain with theuse of collaborative workflows.After identifying and prioritising thevarious processes, a retailerneeds to identify the sourcesfrom where informationneeds to be made availableor generated. The sources ofinformation can be humans(internal or external) orobjects, which could rangefrom enterprise systems tobarcode scanners. Thesesources will need to betapped in a planned andinclusive manner to ensurethat the knowledge poolwithin the organisation doesnot dry up.While selecting thesoftware applicationsto enable knowledgemanagement, adequateconsiderations should begiven to the scalability of theapplication. The knowledgeelements within a dynamic industrysuch as retail increases rapidly andthe application should be designedto scale fast as per the needs of thebusiness. The application should beable to facilitate a convenient storage,retrieval and dissemination of bothstructured and unstructured data.Unstructured data such as store videofeeds, training podcasts, and customercomments on social media should bestored optimally. There should be amechanism to quickly search in bothstructured and unstructured data.The knowledge managementapplication should not function ina silo and serve only as a contentrepository. The application shouldconveniently integrate with otherenterprise applications such asthose used for decision support, HR,enterprise performance managementand other systems. The accessibility ofthe system is also a key parameter.Fresh ContentAn aspect that many retailers overlookis the approach to how content iskept fresh, relevant and enthusiastic.Retail headquarters have many seniorpersonnel with ground-up experiencein retail. These subject matter expertsshould be encouraged to shareexperiences, best practices and FAQs.The experts can also conduct livevideo forums or respond to ad hocqueries from various quarters of theorganisation. Incentives or rewardsprogrammes can be created to boostcontent generation and moderatingactivities voluntarily.The knowledge managementinitiative owners will need topublish regular updates for the entireorganisation such as most popular,newly added and testimonies of howorganisational knowledge helpedsolve a business issue. A regularreport should also be published fordepartment or unit heads related to theusage of knowledge management toolswithin their respective functions.Knowledge management initiativeswithin a retail organisation help createa uniformity and consistency at alllocations of the organisation. Theseinitiatives give a sense of confidenceto the store associates in a way thatexpertise, knowledge and guidanceare available at an arm’s length andon demand. The results that can berealised pertain to reduction in lostsales, improved employee productivityand increased customer satisfaction.Retailers should transform enterprise information from sourcesinto a structure that will help create retail intellectual capital