Retail’s transformation has barely begun, leaders believe

While almost all recognise the extent of structural shifts, most believe their businesses have barely begun to adapt, a study has shown.

Eighty per cent of retail executives said their organisation understands the need for transformation, according to The DNA of the Retailers of the Tomorrow report, which was unveiled at World Retail Congress.

But when asked where they were on their transformation journeys, 62% said they have not even started or are only at the beginning of the process.

Only 44% have identified the capabilities needed for transformation, and only 24% know “what transformation looks like on a day-to-day basis”.

Ocado and Fat Face chairman Lord Stuart Rose said: “The initial findings of this study highlight a troubling lack of core capabilities and awareness within the retail industry and among its leaders.

“However, it effectively identifies the key areas retailers need to prioritise in order to succeed.”

‘Action gap’

Steve Baggi, co-founder of executive search specialist Green Park, which was one of the backers of the study, said the findings indicated a worrying “action gap”.

He said: “Chief executives and boards are battling massive headwinds caused by changing customer behaviour and disruptive challenger brands. There is no doubt that radical change is required.

“The ‘action gap’ is dangerous because the drivers creating the need to transform will only accelerate. Having a strategy is an excellent first step, but having the confidence to deliver on it is vital.

“Retailers need to be brave and invest in new models underpinned by technology that deliver the goods, services and experiences that customers want. If they fail to change, change will be imposed upon them.”

The report was commissioned by Green Park along with World Retail Congress and Planet Retail, TrueStart and EY.