SAP Retail Strategy

At SAP’s Analyst Base Camp gathering of industry analysts, as reported by Retail Systems Research, SAP Retail Industry Business Unit chief Lori Mitchell-Keller asserted no retailer is an island, even if many continue to operate that way. She noted that more attention to supply chain flow -- 'multi-industry value chains' -- would help retail operations gain increased market share, improved average basket size, more sales per sq. ft., and greater customer satisfaction.

Mitchell-Keller outlined key drivers to retail growth as: 'real' real-time data, the mobile revolution, globalization and consolidation, price and margin pressures, and omni-channel retailing. Her product pitch for the retail sector centered on SAP's Retail Planning platform -- an integration of technology into a holistic approach to sales, supply chain operations, customer interactions, and business forecasting.

She contended the retail problem in implementing new technology stems from the common assessment that less than 1% of revenue gets spent on IT, so enterprise resource planning (ERP) remains a challenge. SAP reconfigured its applications into prioritized 'pre-integrated chunks' so retailers can attack the most pressing problem first, knowing that the next problem-solving app integrates into the previous app without a lot of legacy system workarounds. Over time, adding 'chunks' eventually builds an ERP system.

Of course, fixing only one link in the entire chain reduces the benefits of SAP's holistic approach, but sometimes one link is all you can afford -- assuming the new link fits in with all the old links.