3 Responses to “With retail businesses cutting back on capital expenditure for change programmes and more focus on turnaround of distressed businesses, what are your predictions for interim management in retail next year?”
I believe for the experienced interim manager with the right skill set there will be opportunities. Retail businesses at this time need individuals who can hit the ground running and make a positive impact immediately. This is not always possible with a permanent hire as individuals need a period of induction and confidence building to propose let alone enact change. Interims offer Retailers a cost effective remedy to burning issues that need attention now.
I agree Mark. I am equally sure the ‘honeymoon’ period for new permanent hires will be much shorter than in the past. I think that the advantage for those retailers hiring Interims will be that they will be instrumental in achieving in the moment rather then the usual politicking and budgetary approach of a permanent. Indeed in one of my assignments I was ‘coached’ by a senior leaver to take my approach to budget setting based on whether I intended to stay there for the long haul or was in it just for the short term! Good for managing steady improvement (and bonus pay out) but not necessarily in the interests of the company
You cannot disagree with the comments above but I feel more specifically there are a few opportunities to consider which were quite successful in the US in the 90s and which are beginning to start over here:
1) Putting forward candidates who are adept at renegotiating innovative rental agreements with landlords (strong candidates would be ex-insurance/landlord people) for retailers with large estates as well as smaller retailers who want to grow
2) Specialists in improving back-office operations (ie Lean process experience people &/or Six Sigma Black Belts) – excellent opportunities here as most of them are surprisingly inefficient (I speak with authority here as I have worked in the retailer supply chain for a number of years)
3) Pricing Specialists: Retailers can`t afford to keep on doing BOGOFs forever so there is a need to be more innovative – v good opportunity here!
4) Supply Chain specialists: as retailers have generally (excuse my coarseness)`crapped` on suppliers these past 5 years or so there has been a significant drop in Goodwill – candidates who can restore goodwill and turn the chain into an `asset` delivering bottom line returns whist changing the perception that the retailers are supplier ‘hire-and-fire” merchants will be very well received. A collaborative approach is needed as many suppliers are struggling with cash, costs, NPD etc
5) Using ex-supplier people (suggest possibly me!) to negotiate with suppliers on retailers behalf cuts alot of street-cred with suppliers.
6) Supply Chain Finance: this is a trend about to rocket over here – large retailers can use their `buying-power` with their bankers to get their supplies better terms/access to finance from the retailer bankers. The banks settle the supplier invoices directly whilst simultaneously gaining more business. This makes good commercial sense for the bankers and could achieve a lowering of cost to the retailers both in bank charges and back-office AP operations and in supplier charges.
7) Good potential for supplier consortiums and smaller retailer `loose` consortiums to develop to better leverage purchasing.
Another potential opportunity could be to approach investors (VCs/PE Houses) with candidates who could help loeverage supply chain synergies across the whole profolio of companies a particuloar investment house has interest in. At the moment most do this with Audits, Insurance and possibly banking but not much else. This could be particularly relevant in general but specifically for retailers as many have the same owners but trade purchase as if they are individual entities rather than as Groups.
Thats all for now!
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Dialogue is the regular posting place for the news and opinions of interim management specialists, Interim partners.
January 12th, 2009 at 6:05 pm
I believe for the experienced interim manager with the right skill set there will be opportunities. Retail businesses at this time need individuals who can hit the ground running and make a positive impact immediately. This is not always possible with a permanent hire as individuals need a period of induction and confidence building to propose let alone enact change. Interims offer Retailers a cost effective remedy to burning issues that need attention now.
January 27th, 2009 at 3:38 pm
I agree Mark. I am equally sure the ‘honeymoon’ period for new permanent hires will be much shorter than in the past. I think that the advantage for those retailers hiring Interims will be that they will be instrumental in achieving in the moment rather then the usual politicking and budgetary approach of a permanent. Indeed in one of my assignments I was ‘coached’ by a senior leaver to take my approach to budget setting based on whether I intended to stay there for the long haul or was in it just for the short term! Good for managing steady improvement (and bonus pay out) but not necessarily in the interests of the company
January 29th, 2009 at 4:12 pm
You cannot disagree with the comments above but I feel more specifically there are a few opportunities to consider which were quite successful in the US in the 90s and which are beginning to start over here:
1) Putting forward candidates who are adept at renegotiating innovative rental agreements with landlords (strong candidates would be ex-insurance/landlord people) for retailers with large estates as well as smaller retailers who want to grow
2) Specialists in improving back-office operations (ie Lean process experience people &/or Six Sigma Black Belts) – excellent opportunities here as most of them are surprisingly inefficient (I speak with authority here as I have worked in the retailer supply chain for a number of years)
3) Pricing Specialists: Retailers can`t afford to keep on doing BOGOFs forever so there is a need to be more innovative – v good opportunity here!
4) Supply Chain specialists: as retailers have generally (excuse my coarseness)`crapped` on suppliers these past 5 years or so there has been a significant drop in Goodwill – candidates who can restore goodwill and turn the chain into an `asset` delivering bottom line returns whist changing the perception that the retailers are supplier ‘hire-and-fire” merchants will be very well received. A collaborative approach is needed as many suppliers are struggling with cash, costs, NPD etc
5) Using ex-supplier people (suggest possibly me!) to negotiate with suppliers on retailers behalf cuts alot of street-cred with suppliers.
6) Supply Chain Finance: this is a trend about to rocket over here – large retailers can use their `buying-power` with their bankers to get their supplies better terms/access to finance from the retailer bankers. The banks settle the supplier invoices directly whilst simultaneously gaining more business. This makes good commercial sense for the bankers and could achieve a lowering of cost to the retailers both in bank charges and back-office AP operations and in supplier charges.
7) Good potential for supplier consortiums and smaller retailer `loose` consortiums to develop to better leverage purchasing.
Thats all for now!