Ahead of the release next week of a “speed to market” survey by McKinsey & Co. Inc. in partnership with WWD, Jennifer Schmidt, senior partner at McKinsey, shared some of the conclusions drawn from the research as well as some actionable steps retailers and fashion brands can take to improve supply chains and reduce long lead times.
The report, which will be released during the WWD Apparel & Retail CEO Summit, was based on a survey of industry executives and was conducted as the market adapts to changes in consumer behavior. Researchers at McKinsey assert that retailers and brands need improved lead times as well as to leverage consumer data and insights — and many do, but perhaps not enough.
“Throughout the product development process, executives report that insights are being used, but most often from traditional sources (e.g., sell-through, web analytics), with fewer (less than 20 percent) playing in more advanced techniques (e.g., predictive analytics, big data analytics) that can help to anticipate what consumers will actually want,” Schmidt noted.
Schmidt also said two-thirds of respondents report that “improving speed to market and supply chain efficiencies is a top priority, but the majority are still playing by the old rules with seasonal development processes longer than a year — this means they are not even able to use insights from the mirror season when they start the development process.”
And when it comes to making needed investments in technology, Schmidt said it “appears lower on the priority list, with 35 percent of executives reporting that they have not digitized any of the product development process and only 7 percent marking technology as a top priority.”
She went on to note that McKinsey sees technology “as one of the key enablers to speed to market and supply chain efficiencies [and] will be important for businesses to marry these two priorities going forward.”
Regarding actionable steps to improve speed to market, Schmidt said companies need to “start with a proof of concept, prove that it works and has impact with a clear set of KPIs (while also identifying areas to course correct) and use the start to build momentum and excitement in the organization.”
Schmidt also stressed the need to invest in talent and capabilities that are “needed to navigate this change in both supply chain and consumer insights. She also said not to “underestimate change management needed — not only are skills needed, but new mind-sets.”
“Make this a fail-fast-and-learn model,” she added.
For More Business News From WWD, See: