The new retail omnichannel commerce - mini-series - part 1

Focus on the situation and flexibility - why the architectural landscape is not up to the new omnichannel requirements

Although we position ourselves in the B2B business with diselva, our experience and current projects give us a good insight into the B2C retail world. In addition, our B2B customers also have B2C retail challenges in some areas of their business and we are confronted with the same processes and systems through these projects.

What we can observe across the country is that many retailers are finding it extremely difficult to meet the increased consumer demands for cross-channel ordering and delivery. For example, today's consumers want to buy product X in a physical store and take it home with them straight away ... and also pay for a matching product Y, which is still available in another store, and have it delivered to their home.
The classic "buy online and pick up in your favourite store" is also a popular option - regardless of whether the shop or online shop has the product in stock.

These are just two examples of the many omnichannel processes that customers are increasingly taking for granted, but which represent a huge challenge for retailers in the background.

The simple reason: the existing backend systems (labelled "ERP & CRM" in simplified form in the graphic) are not designed for the interaction of a large number of new channels with a wide variety of requirements. As classic "systems of record" according to Gartner's Pace Layered Architecture, they are designed for solid core processes and data management. This makes them sluggish almost by definition and not flexible enough to master the requirements of the overarching processes of online and POS. Somehow, in the past, one process after another was implemented relatively statically in the combination of online shop and ERP and all employees were trained to handle it ... but the whole thing is still a long way from flexible and efficient handling.

The necessary renewal of the system landscape towards the cloud does not solve this problem either. Even the costly migration to SAP S4/Hana, for example, plus the evaluation of a new eCommerce solution, which offers a modern MACH architecture at its core, has not brought us a significant step closer to the required omnichannel coverage.

A "new type" of order management system (OMS), which essentially fulfils the following requirements, provides a remedy:

• Customer Order Management
  • Order lifecycle management - management of individual orders from order placement to after-sales services
  • Returns and refunds - handling returns logistics
• Inventory Availability
  • Inventory visibility - Aggregated view of inventory across all sources
  • Inventory controls - adding control points in inventory management
  • Preorders and backorders - Handling of preorders and backorders from customers
• Multichannel Fulfillment
  • Fulfilment optimisation - management of business and fulfilment logic via configuration
  • Store fulfilment - optimising order routings and enabling flexible fulfilment options
• Point of Sale Support
  • POS Consulting App - overview of relevant information on products and customers including intuitive usability in a consulting context - with little training for store employees

• Customer Service Support
  • Cart & Order Support - overview and intervention in shopping carts and existing orders (up to the definition of the order status)

These order management systems are positioned exactly between an ERP system and an eCommerce solution. But beware, OMS is not just OMS - this name stands for both very old-fashioned ERP parts as well as state-of-the-art software whose possibilities bring tears to your eyes with joy.

Realising flexible use cases such as the following will be very difficult with the current ERP:

• The consumer needs two more items in the shop that are not available locally, which he would like to have sent to his home.
• These two items are also not available in the online shop, but are available in exactly the same combination in three other shops.
• The order is made available in the OMS for dispatch to other shops and the three possible shops for dispatch are informed.
• The shops can "claim" the order, pack it and dispatch it.
• If there is an "unclaim" (cancellation of the "claim" made), this has an impact on the future quality ranking of the shop, which can be taken into account in the flexible distribution of the order.

The next parts of the series will shed light on the following:

• Part 2: Focus on order management systems (OMS) - what approaches are there and what are their effects?
• Part 3: Focus on the Digital Operations Platform (DOP) - why even the old ERP should be questioned