POSitive reinforcement
Michael Griffiths, global product manager for Microsoft Dynamics Retail Solutions, says retailers can get business-critical data in real time thanks to end-to-end, sale-to-supply-chain automation.
In Summary:
| • | Retailers can gain the upper hand by automating data straight from the checkout line. |
| • | Inventory and purchasing management begins at the point of sale. |
| • | A common view of data throughout the organization increases efficiency and productivity. |
Many retail business decisions stem from information gathered at the point of sale. Is a popular seasonal product selling out so fast you need to contact your supplier and speed your next delivery? Should an overstocked item that is selling slowly be marked down? Yet too often the data to support these decisions is trapped at the store level until managers have time to send it to headquarters, resulting in lost revenue opportunities.
With automated tools such as Microsoft Dynamics Retail Management System (RMS), retailers can gain a competitive edge by receiving up-to-the-minute information about inventory and demand straight from their point-of-sale systems. Michael Griffiths, global product manager for the Microsoft Dynamics Retail Solutions team, recently discussed the importance of end-to-end automation with Momentum contributor Sandra Gittlen.
What challenges do retailers face in getting information from their stores into the hands of decision makers?
The top challenge is that many of the IT systems leveraged by retailers to gather this information are very different. They have one system for their in-store point of sale, another for central headquarters consolidation, and still another for their supply chain or warehouse enterprise resource planning. There is no consistency in the data, no common view, so they lose accuracy and integrity as information is ported from one system to the other. It also means they're working off different assumptions and different sets of data, and that can pose serious problems.
Take, for instance, the Dallas Cowboys organization, which includes the team, real estate, and oil companies. They had 29 separate IT systems across their enterprise and no way to easily translate and share data. They recently implemented Microsoft Dynamics RMS at their point of sale, headquarters, and back-end ERP to consolidate these disparate networks. Out of the box, Microsoft Dynamics RMS provides data translation and mapping, so they immediately were able to have a common platform and a common look and feel for their whole IT organization.
Why are point-of-sale systems so critical to decision making?
In many cases, if you want to make the best possible decisions, then you need to know what is being sold at the time it's sold. This is a key resource in determining pricing and promotion. It helps to know what to purchase and in what amount. Remember, businesses incur costs around the inventory they carry. You can't have too much or too little. It has to be just right. And you need to know if you are optimized to handle what you sell well. Are you ready for seasonal sales or various promotions? If you're not getting data back in real time, you're not always ready for this. Each day or week it takes you to get information on how well an item is selling costs significant dollars.
How does automation resolve this issue?
Automation allows you as a decision maker to set parameters and model your business on how you'd like to see price and performance, as well as how your customers are managed. With Microsoft Dynamics RMS, you can start to handle inventory and purchasing management at the point of sale. You get results in a timely manner and all the processes needed for that are seamlessly connected and work together.
Automation is also important for retailers engaging in multichannel efforts such as in-store and
online sales. You have to ensure the inventory you're working with can be updated quickly and is in synch. You can't serve customers if you don't have a system that provides real-time automation, feedback, and response times.
Lastly, when you do batch processing, there is a lot of manual data entry. Store associates have to spend time at the end of the day getting data into the right format. By automating data collection, you free up your staff to focus on customers. And by having data available in real time through the POS, associates can better serve those customers. For instance, if a customer tells your cashier an item is out of stock, he can quickly check to see if it is available at another store or in your store in an alternate color or size. This suggestive selling keeps the purchase at your store.
How does Microsoft Dynamics RMS ease the retail management burden for IT?
Microsoft Dynamics RMS allows for IT system integration so that data is mapped to and flows from each point in the retail chain. Because everyone has a common view of data, there is tremendous efficiency and everyone is more productive.
Also, RMS ties in to Microsoft Office and Microsoft SharePoint so you can take advantage of your other system investments. Since [the environment] is familiar to them, users can create their own alerts without needing assistance from IT. For instance, they can set parameters that trigger a purchase order to a supplier if inventory drops below a certain level. They can also customize reports according to the specific metrics needed to effectively run the business. And our partners have tools to allow real-time data to be integrated from both Web and physical locations into RMS.
What are the first steps to rolling out an automated system?
Determine the success metrics that are critical to run and understand your business. Microsoft Dynamics RMS has a lot of great settings and preconfigured templates that can be used, but you need to know how to tailor it. That requires a sound understanding of the information that is most important for you to make good decisions.
Next, you need to think where you want to be in five to 10 years. What growth and scale are you expecting? Do you want to become a multichannel organization? This has to be part of your deployment plan.
Finally, you need to know how your employees are spending their time in your store each day. Are they busy manually entering data and working with complicated systems? With automation, you'll see an increase in productivity and a positive shift in your business. Employees can move from mundane operational tasks to business-growth activities such as performing real-time inventory counts or creating innovative promotional displays.
What role do Microsoft partners play in deploying Microsoft Dynamics RMS?
The real strength of Microsoft Dynamics is our partner community. They are the local presence that can work closely with you and give you attention. If you just buy off the Internet, you'll have trouble getting up and running the way you want to. Instead, pick a partner with deep expertise in retail, not just software installation. Research what types of implementations they've done in the past and what experience they bring to the table. You don't want them to just construct the system. You want them to consult on the business aspect as well.
 | Sandra Gittlen is a regular contributor to Momentum, the midsize business center newsletter. |
