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In conjunction with a comprehensive report Salesforce Commerce Cloud developed with Accenture on organizational transformation, I had the opportunity to do a Q&A session with Jill Standish, Senior Managing Director of Retail at Accenture, where she focuses on business strategy, and development and execution of retail industry strategy for its clients. Jill has spent her entire career in retail, both in the technology side and as a consultant to major brands.

The report on which we partnered, called “Retail Organizations: the Next Phase of Transformation,” focuses on the evolving concept of customer centricity, and how retail leaders are taking a new approach to their operational and organizational models; one that is adaptive, collaborative, and intelligent.

Rob Garf: What prompted this research?

Jill Standish: If you consider other industries, I hate to say it but retail is kind of laggards. If you consider that this is the 10-year anniversary of the iPhone and how much that’s evolved, and then you go into a retail store – stores haven’t changed much. In addition, we have upstarts that are totally disrupting traditional retail. So what is it that’s causing this lagging of innovation in retail compared to other industries and business models? There has to be a reason. That’s what prompted us to do this. Is there something going on here within the four walls of these companies that’s inhibiting this from happening?

RG: Right, and as we dove into the research, we discovered a widening gap between leaders and laggards in retail.

JS: Yes, we wanted to see if there were certain characteristics within an organization that we could test with our survey to see if those are some of the things that came out as really important.

RG: We identified six, and I love how you called these the “six characteristics of survival.” When you look at leaders, they’re harnessing these characteristics to differentiate themselves. The organization today is looking a lot different than yesteryear. When you’re product-centric you’re thinking about product, velocity, forecasting, throughput and quality. In this world, when everything is so dependent on an ecosystem of partners, vision is so importan

JS: If you think about your digital and physical operations and getting everyone aligned, is everyone an ambassador of your brand? There are great examples of brands where you walk into the store and immediately know the story behind the brand. These great companies are becoming very viral and tribal with their products. But there are others where, if you asked a sales associate ‘what is the vision of this firm?” they’d have a hard time with that. So the question is, is the CEO’s message reaching all the way down to the sales associate?

RG: Leaders are also solving a customer problem versus just pushing product through the supply chain. Let’s move on and talk about culture. Our research showed that’s the biggest hurdle to overcome.

JS: Culture is a big one. There’s culture in retail where we are perfectionists. We want the website to be beautiful, the stores to be beautiful, our projects to have an instant return on investment. This is a perfectionist culture, but in the startup mode, or for those that are doing fast innovation, it’s ok to say ‘beta.’ Can you imagine going to a retailer’s site and it says ‘beta’ or going into a store and see yellow tape around a department that says ‘this is a test?” So there’s a part of the culture that says everything has to be perfect, which stops fast experimentation and innovation. The other thing about culture is that everyone is insular. The notion of collaboration — inside and outside the four walls — is a really good one, but it doesn’t happen enough at many retailers.

RG: Market insight came across as very important in the research as well. What do you see there?

JS: There are thousands of great ideas but as a C-level executive of retail today, it’s so hard to know everything. They want to be smart and representative of what’s happening in the marketplace but things are happening so fast, how can you know everything? So market insight was way up there with innovation as two things that retailer said was important but very hard.

RG: The research showed that store associates are on the front line to understand what’s happening in the market. Retailers can’t do it from the mothership back at headquarters. Your associates are your line into the market.

JS: But look at the lack of innovation in that space of getting market insight from store associate. If there was a way to curate all that first hand knowledge, wouldn’t that be great? Retailers must harness store associates, the most important brand ambassadors, to sense and respond to customer demands.

RG: So what about innovation?

JS: It goes back to the point of a perfectionist culture. There’s another piece of this which is financial. Look at how retailers are evaluated by the Street. It’s all about top line and profit. How can you take cost out of your business to invest in these experiments when there’s a culture of making sure you have ROI? That’s part of the reason why innovation is tough.

RG: Regarding performance, based on our survey of 200 retail executives, we uncovered that leaders were more mature in each of the six characteristics compared to laggards. The most significant maturity gap was data intelligence (along with market insight). It’s not just collecting data, it’s making sense of it and turning it over to associates.

JS: It’s the old adage in retail which is, we have the data but no insight. Every customer we work with is having the same problem. There’s some tools which will help; Dashboard-based tools, predictive tools suggesting what is the next action to take. Looking ahead, I’m hoping that things like AI and machine learning will help, because data has got to inform all that in an intuitive way. But today we still have the problem.

RG: You look at upstarts and they’re hiring tons of data scientists. Who would have thought that machine learning and PhDs would be one of the hottest career paths in retail? And there’s a total talent gap there. Last characteristic is agility. Moving into new spaces. Being able to move in an interconnected way. You can curate it in a way that’s personalized.

JS: if you look how fast pure plays get a product on the site, change a price, or change a product assortment, it’s amazing. Then consider the laborious processes required to do a price change for other retailers. A lot of that involves the complexity of the omni-channel  environment.

RG: Right. Often, price changes have to be done in a dozen different systems.

JS: Retailers are now consolidating all that to have a single view, and that’s a function of the cloud. It’s about having information delivered as a service, and it’s going to change everything.

RG: It sure is. So retailers, be on lookout for those six characteristics to make sure you survive.