Trading companies must be strategic

Study: Trading Company tend to short-term process and cost optimization measures?

Study of IIHD Institute and the consulting firm BearingPoint shows: Trading Company have weaknesses in the strategy implementation / management work to surgically

German trade is more than ever in transition. Efficiency improvement projects, surplus space in almost all areas and formats, as well as increasing competition from former pure online retailers, international retail giant and increasingly vertikalisierende manufacturers are trading companies and their executives are coming under pressure. A change in their business models should have the highest priority - this in practice, however, there is a lack of strategic skills. This underlines a recent study of management and technology consultancy BearingPoint and IIHD Institute, were interviewed for the executives of 30 German trading company.

The fourth edition of the Red Paper publication series subtitled "Management as a scarce resource - is the Chief Strategy Officer, the solution for the trade?" and asks why a strategic realignment in the German trade is slow. It is clear that companies have problems especially in the strategy implementation. Especially in this phase, one in three companies frequently disorders Source:

Quantitative and qualitative resource bottlenecks are identified as the main cause of the problem. The study shows that managers are sometimes very heavily involved in the trade in operational activities. "This creates a tension between strategic realignment and the operating business, where trading companies typically about short-designed process and cost optimization measures tend" said Kay Manke, Partner at BearingPoint. Through the ever-increasing focus on operational adjustments wane experience and expertise in the development of corporate strategies as well as the communication and implementation of transformation programs. As the survey shows that there are some significant shortcomings in the implementation capability of strategic initiatives. In particular, the ability to prioritize and team building and staffing are weak.

The CSO as a key figure

"The solution to this problem of trade keeps falling back into old patterns of behavior established: He fights threats shortly quite successful, but loses long-term and significant existential threats from view," says Prof. Jörg Funder, IIHD Institute.

Therefore, the Red Paper proposes the Chief Strategy Officer before additional Personnel of the Executive Board of the trading company. The CSO, which simultaneously takes over the management of the Office of Strategy, is a key figure for corporate strategy and the extended arm of the CEO in strategic matters within the company. Depending on the configuration of the CSO role and the existing skills in top management this change be

Task and requirement profile.

To be able to break away from outdated patterns of action, requires a stronger strategic orientation of trade, which is, however, only be achieved by additional support in quantitative and qualitative terms. Remain unaffected these screws, the risk of failing transformation increases.

The complete study is here available for download:

About the Red Paper publication series

After a successful first year, the Red Paper | Retail & Consumer, the IIHD | Institute together with its cooperation partner BearingPoint is now in its second round. In a year full of exciting topics, challenges and innovative solutions, the Red Papers address and discuss current and strategically relevant issues from retail and consumer goods companies. They give food for thought and show practical, feasible alternatives. The Red Papers are both critical and provocative and take a clear position. To strengthen the cooperation, BearingPoint initiated a Competence Center 'SIM - Strategy & International Management' at the IIHD | Institute that sees itself as a think tank and reflects and critically questions the relevant issues of the time.

About BearingPoint

BearingPoint consultants have always in view that the economic conditions are continuously changing, and the resulting complex systems flexible, focused and require individual solutions. Our customers, whether from trade and industry, the financial and insurance industry or from the public administration, gain measurable results when they work with us. We combine industry-specific management and technical skills with new technical possibilities and own product developments to adapt our solutions to the individual problems of our customers. This partnership, results-oriented approach is at the heart of our corporate culture and has led to sustainable relationships with many of the world's leading companies and organizations. Our 3.350 employees support together with our global consulting network customers in over 70 countries and working together with them for a measurable and long-term business success.

For more information, please visit www.bearingpoint.com and in the BearingPoint Toolbox: toolbox.bearingpoint.de

About the IIHD | institute

The IIHD | Institute is an affiliate of the University of Worms. The IIHD | sees itself as independent and self-financed Institute as a subject educator and partner in the retail, consumer goods and consumer-related services sectors. The IIHD | Institute pursues a context-driven, problem-focused & interdisciplinary research and consulting approach. It thus turns away from protracted, isolated research efforts with unclear practical relevance. Rather, research is carried out in cooperative projects with a direct impact in the company. Practice and application-related research, advice and further training are divided into topic-related competence centers.

For more information: www.iihd.de

Source: Frankfurt / Worms [IIHD]