Retail and consumer goods companies have experienced digital disruption like few others, and they are champions at transforming their front office business processes, as the PwC study “The Leadership Edge” shows. However, many companies could still make further progress, which begs the question: how can this sector capitalise on its head start?
In our study “The Leadership Edge”, we surveyed more than 700 senior leaders and front office transformation experts, across a range of industries and countries, on their direct experience with transforming the front office. We wanted to find out what exactly determines the success or failure of Front Office Transformation (FOT). The results, in a nutshell: the secrets of successful FOT are involvement of senior leadership, creation of a transformation culture, empowerment of employees, and, last but not least, serious budgeting. We also concluded that retail and consumer goods is one of the best-performing sectors when it comes to FOT.
Standing still is going backwards
Retail and consumer goods customers have never had such high expectations. Customers are well connected, their networks are extensive, there are no boundaries and they are always one step ahead. Thanks to digital technologies, they interact with brands whenever and wherever they want – and they demand a lot from each interaction. Companies must therefore constantly evolve and improve. Today’s customers rate an individual company’s service not just by its own standards, but by how it compares to the most satisfactory performance they have experienced from any other company.
This forces retail and consumer goods businesses to make significant investments in Front Office Transformation and, so far, they have managed well. While an average 52 percent of all companies surveyed describe their FOT initiative as successful, in the retail and consumer goods sector, this figure stands at 60 percent. This sector’s progress is impressive, but companies should not be complacent as new competitors are continuously challenging incumbents’ business models. How can they capitalise on their lead and prepare for an even more competitive future?
Make employee engagement fun
As the title of our study suggests, leadership is key. The broader research shows that strong leadership involvement is a critical success factor in FOT. More than two-thirds of retailers and consumer goods companies say that their senior leadership teams checked on their FOT project at regular intervals, and almost a third say that their leaders were hands-on and fairly actively involved. These figures exceed those of other sectors and are one reason for the sector’s transformative success.
However, to fuel future progress, retail and consumer goods companies should look to improve their transformation culture. 97 percent of companies in the sector state that transformation proved to be a major cultural challenge, and just 6 percent say that employees were very keen to take part in Front Office Transformation. There is cultural resistance to FOT, and retail and consumer goods firms will have to ensure that everyone in the company sees the process as something that will improve their working lives and not just as a side project (this oversimplified view is currently held by 98 percent of the sector’s companies). Employees must be empowered and brought on board; the creation of a transformative culture across the business should be prioritised.
One way to achieve this is by innovative and interactive training modules, which staff can complete at their own pace – in contrast to the online sessions and webinars commonly used at present. For example, escape rooms offer experience-based learning, and employee enablement champions support their colleagues during the transformation process. In addition, gamification tools encourage employees to engage through fun activities or incentives.
By focusing on more deep-seated cultural change, particularly through senior leadership engagement and innovation in employee empowerment, the retail and consumer goods sector will continue to lead the way in Front Office Transformation.
Invest in your employees – they’re worth it
Did you know that investing in employee enablement pays significant dividends?
Overall, our research shows that companies that invest heavily in employee enablement tend to be more successful in their front office transformation: 62 percent of companies that invested more than 30 percent of their Front Office Transformation budgets in enablement say that their FOT was ‘successful’, compared with 52 percent of all companies surveyed.
- Retail and consumer goods is one of the best-performing sectors when it comes to FOT.
- 60 percent of all surveyed companies in this sector consider their FOT successful, in contrast to 52 percent of companies across all sectors.
- To be ready for fierce competition and to capitalise on their leading position, retail and consumer goods firms should foster cultural change and bring more employees on board their transformation projects.
