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3 Ways CIOs Can Lead A Transformation In Grocery Manufacturing

November 8, 2017

This piece originally ran on CMO.com

By: Matthew Campbell & Evan Kelly Managing Director; Director, Consumer Goods & Services-Accenture

Remember how straightforward the groceries business used to be? Manufacturers navigated a well-trodden path of monitoring supply-side size and scale, distributing inventory as widely and inexpensively as possible, and watching the profits flow in. It was a simpler time of mass-produced products distributed through a limited number of channels.

But the digital revolution has made this simpler time a distant memory. Modern digital technologies and the consumer expectations that come with them have changed everything, allowing nimble disruptors to eat up grocery manufacturers’ profits. Unencumbered by legacy technology or entrenched norms, they’re offering compelling customer experiences informed by vast amounts of data. They’re creating consumer-centric organizations that are agile, intelligent, and connected, and they’re continuing to do so at pace with evolving consumer expectations. Just look at Amazon’s recent purchase of Whole Foods for a sense of how quickly things are changing.

These are models that few, if any, incumbents have so far been able to replicate. Four in every five of the industry executives we spoke to in our latest research (conducted with the Grocery Manufacturers Association) said they’re still figuring out what the digital revolution means for their businesses. A third still thought it is only really relevant in marketing and e-commerce, rather than a force driving across all company operations. And even when they see value in building wider digital capabilities, executives often struggle to know where to start.

So the industry is still very much playing catch up. But it’s time to act with greater urgency. “Digital” does not refer to some long-term future-state ambition. This is all happening now. As part of our joint report with the Grocery Manufacturers Association, we created a research-based roadmap to help grocery manufacturers acquire as-yet-unseen levels of agility that will bolster their ability to keep pace with their customers and consumers. They need to be ready, with the right products and services, to fulfill each individual’s needs–whatever the channel, the preference, or the technology.

This provides an unparalleled opportunity for CIOs to step up and lead the charge. How? By leveraging digital technologies to help transform their businesses into a modern enterprise that designs for delight, reorients to deliver, and operates on flexible platforms.

Design For Delight
Continually renewing a brand’s relevance with consumers is essential for growth. To do that, companies need to design experiences that delight. And to do that, they must understand stakeholders in intimate detail.

Accenture research shows how shoppers’ behavior is determined by where their mindset sits on two motivational spectrums: emotional to functional and personal to social. So understanding whether they’re driven by, say, desires and dreams or by roles and values is essential. And while all may still prefer shopping in physical stores, their individual paths to purchase have fragmented across a hybrid offline/online ecosystem of sources of inspiration, methods of planning, means of purchasing, and modes of fulfillment.

So designing for delight means meeting consumers on their terms–as individuals. And that means running different sales, marketing, and supply chain models in harmony. That harmony can’t be achieved without an integrated and agile operating model with a digitally enabled backbone to operate at multiple speeds–both to drive the core business and to support the new.

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