It’s no surprise that the world of retail is changing quickly, and it seems no retailer is immune. This includes one of Chainalytics’ clients, a leading musical equipment retailer.
Unlike many retailers today, this organization is uniquely positioned to thrive in the current environment, owning both brick-and-mortar stores along with a well-established and significant online channel. While omni-channel sales and fulfillment are nothing new to this retailer, over the past two years the organization came to recognize an urgent need to move beyond its legacy forecasting and planning systems which had been in place for a decade, and to invest in the next generation of predictive planning solutions now on the market in order to minimize operating cost and capital investment, improve flexibility and responsiveness, and maximize product availability for customers.
In addition to other initiatives designed to adapt to the changing retail environment, the company determined that a sophisticated supply chain planning solution was a key enablement component of its long-term strategy. Knowing that an internally-driven technology selection and procurement process could risk lacking sufficient knowledge of leading vendors, hands-on planning technology implementation experience, and supply chain planning best practices, Chainalytics was engaged as an external partner in order to ensure that the retailer’s business needs would be met with the highest confidence.
Chainalytics’ supply chain technology selection and procurement methodology is founded on the core objective of helping the client realize the greatest long-term value at the lowest long-term investment while minimizing disruption to the business and ensuring customer service throughout the implementation and operational transformation.
The elements of our methodology include detailed, bottom-up business discovery and requirements development, vendor shortlist identification, RFP development support, customized use case design, vendor demonstration management and scoring methodology, and a readiness and technical assessment to prepare for the actual implementation itself — which is rarely included in a typical technology selection effort when led by indirect sourcing, IT or generalist services firms.
This full service supply chain-led technology selection and procurement model helps ensure Chainalytics’ clients receive the best functional and technical fit for their needs, are positioned to negotiate effectively regarding pricing and terms, and are fully prepared for a successful implementation project. The approach is distinct since it goes beyond meeting high level capability requirements at the lowest possible cost; it is additionally focused on enabling the supply chain to maximize value delivery to the enterprise, and looks holistically at the trade-offs between capability, speed to value, risk, change management, and TCO.
The specialty retailer’s selection project began with collaborative development and refinement of a detailed list of business requirements. This was done by starting with the retailer’s preliminary list of desired capabilities, and then adding Chainalytics’ list of key functionality and best practices for the retail market. The team then added requirements which were unique to the retailer’s business model through an extensive supply chain operations and planning discovery effort that included detailed demand data analytics and segmentation. This purpose-fit bottom-up approach led to a comprehensive list which reflected both current and future needs for this specialty retailer.
This step is an often-overlooked or minimized activity, yet is extremely important to long-term value delivery, as the resulting requirements are not only used to determine the best fit software solution, but ultimately determine solution design, user adoption, and business process enablement. Organizations which select forecasting and planning technology without an experienced supply chain-based perspective on the long-term business process enablement provided by the technology often end up lacking specific capabilities needed, and are forced to build workarounds or add expensive customizations which can even exceed the base cost of the technology itself.
After requirements development was complete, a short list of leading vendors was created based on a jointly agreed-upon set of evaluation criteria between Chainalytics and the retailer. This initial shortlisting was made possible through Chainalytics’ experience in the supply chain planning space, having worked directly with a wide variety of established and emerging players in forecasting, inventory optimization, replenishment planning, allocation and S&OP technology solutions. The shortlisted vendors were then invited to participate, given the opportunity to submit initial pricing and functionality, and then scheduled for live demonstrations using the retailer’s customized data and use cases which Chainalytics prepared.
The demonstrations were facilitated by the Chainalytics team, but assessed by the retailer’s key business stakeholder team using a rigorous scoring methodology which was customized from Chainalytics’ scoring platform. While demonstrations from multiple vendors can be time-intensive for everyone involved, leveraging customized use-case tests and data sets to draw out the differentiation in capabilities and approach within the shortlisted vendors allowed the retailer’s team to assess each option more comprehensively, ultimately providing a much more realistic representation of the future-state operating model and planning process.
This method requires close coordination between all parties to ensure the right data set is used, the demonstrations flow smoothly, and each vendor has an unbiased and equal opportunity to highlight their key differentiators and strengths. Investing the extra time and energy to customize the demonstrations rather than rely on generic data greatly improves the quality of the discussions for both the supply chain planning stakeholders and the vendor teams, helps highlight the differentiators which matter to each company, and drives increased alignment around future-state planning process expectations.
After the shortlisted vendors demonstrated to the retailer’s team and scoring was compiled, Chainalytics provided advice and guidance during the follow-up activities and final negotiations. While Chainalytics’ primary objective is to achieve the best outcome for the client, creating an environment of fairness for everyone involved, including the software vendors, is also vital. Although Chainalytics maintains partnerships and deep expertise with a wide variety of supply chain solution vendors, Chainalytics avoids a reseller relationship, kickbacks, or any exclusive limitations to any one technology platform, eliminating potential conflicts of interest during the procurement cycle. The Chainalytics team works hard to help facilitate the process, bring to bear best practices, highlight key distinctions, and add the voice of implementation and operational experience specific to supply chain planning for each client’s needs.
With Chainalytics’ help, this leading specialty retailer selected their next generation forecasting and planning technology and moved quickly into implementation planning. Because the Chainalytics and retailer team had already created and refined an initial business case and preliminary timeline and budget for the implementation, financial expectations were well understood across all key stakeholders before the implementation project even began. This forward-thinking retailer was then able to start the implementation project ahead of the game, and is now looking eagerly forward to the benefits that their new solution will provide as a result of having made the up-front investment of engaging Chainalytics’ Integrated Demand & Supply Planning team to maximize value and confidence in this critical business decision.
To learn more about how Chainalytics can help with all your planning challenges, contact us at firstname.lastname@example.org.