Raghubir Singh, Head – IT, Relaxo Footwears Ltd, and CIO Power List 2017 winner, talks about the three elements set to revolutionise the retail and manufacturing industry. By Satyaki Sarkar
Technological innovations have changed the way businesses function and Raghubir Singh couldn’t be happier. The IT leader has over 25 years experience in helping companies leveraging IT to transform business and increase efficiency, including at Usha International Ltd, Iterate India Private Ltd, and JK Industries Ltd. Felicitated as the SCM Icon at the recently concluded CIO Power List 2017, Raghubir talks to us about the three factors that are transforming the retail and manufacturing industry.
1. Connections: With distributors, vendors and stakeholders
“From the beginning companies have been struggling to collect the data from their direct connections. For many organisations, their direct connections are distributors, for others it might be their retailers. However, the way retailers or distributors are obtaining this data, as well as what they are doing with it, is not very clear. On the other hand, the companies are themselves not very sure about how to connect with these sources of theirs, and use the relationships to their advantage. The retailers and distributers are a treasure trove of information that companies can use to drive their business models. On the other hand, most companies are also still struggling to reach out to consumers.
“In most FMCGs, the area I belong to, the dealer connect is present. They have the distributor and retailer connections, but they have no semblance of connection with the end customers. What they fail to realise is that the end customer is their end consumer, and it is they who affect the sales, profits, and everything else. Until and unless the originator or manufacturer has a feel of its end customers, it becomes very difficult to predict the future of the organisation. Another factor affecting this is that gathering information is a lot more difficult from a B2B point of view than a B2C. Most organisations know how to obtain information pertaining to secondary sales, but have no idea of how to get to know the demands, preferences and needs of the business end customers.”
2. Analytics and data
“In the data-centric world that we live in today, information is one of the most important and valuable resources. As such, most organisations have developed and adopted a number of data gathering techniques to ensure they are not left behind. However, the problem lies in the fact that in spite of sitting on a veritable goldmine of information, very few organisations actually know how to integrate and utilise that data to improve their businesses. Organisations speak of secondary sales data, stock data, etc, but they are still unsure of its business value. The first problem is that they are unable to utilise the data. That’s because there’s usually one person handling the analysis and MiS functions and there’s no integration with any marketing insights. This data needs to be free flowing in the organisation, so that delivery, sales, and distributor payment can be measured and analysed in relation to the data available. The organisation might have seen business revenue increase from Rs 1 crore to Rs 1.5 crore. In this scenario, it is imperative that the data is captured and analysed properly to understand the reason for the increase, and how to use that to consistently drive profits. Additionally, the payment time given to the distributor is initially less, but increases as trust grows. At that point it is important to understand whether the distributor is hoarding stock, tying up sales in other departments, whether his increased payment cycle is leading to a blockage of funds, and whether the returns obtained justifies the distributor’s operations. So data analysis is key to running a successful business.”
3. Digitisation and automation
“Many people are scared constantly evolving technology will lead to loss of jobs. However, I do not agree, as that has been said since the beginning of time. Whenever advancements happen they don’t lead to a setback, but rather make roles more specialised. So automation will do away with the need for repetitive manual labour, and introduce more precise roles for people. So it will be imperative to keep updating and upgrading ourselves with the advancements and innovations as they keep happening. Not only will that help us improve our skillsets, it will also lead to further innovations and creative developments, much like a vicious cycle that keeps driving technological progress forward. This will lead to businesses becoming more cost-effective, efficient, and profit driven, in the long run.”