Specialty retailer invests in supply chain planning technology

The initial approach included detailed, bottom-up business discovery and requirements development, vendor shortlist identification, request for proposal "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 — which is rarely included in a typical technology selection effort when led by indirect sourcing, IT or generalist services firms.

NTT DATA’s full-service supply chain-led technology selection and procurement model ensures a company receives the best fit for their needs, is positioned to negotiate effectively and is prepared for a successful implementation project. The approach goes beyond meeting high-level capability requirements at the lowest possible cost. It’s 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 total cost of ownership (TCO).

Ensuring long-term value delivery

The specialty retailer’s selection project began with collaborative development and refinement of a detailed list of business requirements. The retailer’s preliminary list of desired capabilities was compared to NTT DATA’s list of key functionality and best practices for the retail market. The team added requirements that were unique to its 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 that reflected current and future needs for the retailer.

This step is often overlooked or minimized, but it’s extremely important to long-term value delivery. The resulting requirements aren’t only used to determine the best fit software solution but ultimately determine solution design, user adoption and business process enablement. Organizations that 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 and are forced to build workarounds or add customizations that can exceed the cost of the technology.

Shortlisting vendors

After requirements development was complete, a short list of leading vendors was created based on a joint set of evaluation criteria. This initial short list was made possible through NTT DATA’s experience in the supply chain planning space and our work with a variety of players in forecasting, inventory optimization, replenishment planning, allocation and sales and operations planning (S&OP) technology solutions. The shortlisted vendors were invited to participate, submit initial pricing and functionality and schedule live demonstrations using the retailer’s customized data and use cases.

The demonstrations were facilitated by the NTT DATA team but assessed by the retailer’s key business stakeholder team using a rigorous scoring methodology that was customized from NTT DATA’s scoring platform. While demonstrations from multiple vendors can be time intensive, leveraging customized use-case tests and data sets to draw out the differentiation in capabilities and approach within the shortlisted vendors allows the retailer’s team to assess each option comprehensively. This ultimately provides a 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 vendors have unbiased and equal opportunities to highlight their differentiators and strengths. Investing the time and energy to customize the demonstrations rather than rely on generic data greatly improves the quality of the discussions for the supply chain planning stakeholders and the vendor teams. It also helps highlight the differentiators that matter to each company and drives increased alignment around future-state planning process expectations.

After shortlisted vendor demonstrations were complete to the retailer’s team and scoring was compiled, NTT DATA provided advice and guidance during the follow-up activities and final negotiations. Creating an environment of fairness for everyone involved, including the software vendors, was also vital. Although NTT DATA maintains partnerships and deep expertise with a variety of supply chain solution vendors, it avoids a reseller relationship, kickbacks or any exclusive limitations to any one technology platform. This eliminates potential conflicts of interest during the procurement cycle.

Because the NTT DATA and retailer team had created and refined an initial business case and preliminary timeline and budget for the implementation, financial expectations were understood across key stakeholders before the implementation project began. This forward-thinking retailer started the implementation project ahead of the game and is now looking forward to the benefits of the new solution.