Category Archives: Process improvement

Innovative Improvements Continue to Emerge in Supermarkets

PREPARING FOR THE “NEW NORMAL”

Today’s Wall Street Journal reported that Koninklijke Ahold Delhaize NV is accelerating development of a robotic cleaning arm to help workers clean stores and process orders more effectively due to the COVID-19 pandemic.

“All the researchers said this Covid situation is so urgent, we see a direct application for our work right now because there’s scarcity of people who can work in stores,” said Bart Voorn, Director of Data, AI, and Robotics.

Of course the grocery giant is only one of many organizations taking innovative steps to initiate improvements in how the operate.

The article quoted Paul Daugherty, Accenture PLC’s group chief executive for technology, as saying, “Hyper automation is coming. We have now only automated 15 to 20 percent of what we can do.”

As noted in previous posts, necessity is, indeed, the “mother of invention” in supermarket chains across the globe; and combining technology with tried-and-true process improvement methodology is the likely path toward preparing for the “new normal” in food shopping.

Necessity & Innovation

Nearly everyone we ask says that they want to be innovative — the best returns come to those who are first to market with a new product; those who innovate new and better processes can provide much better quality at much lower costs; those who can create a management system or culture that constantly is clicking on all cylinders can have a powerful advantage.

But how often do they happen, and why?

In our experience and research, we find that innovation is truly enigmatic:

  • Large organizations have more wherewithal to invest in systematic innovation, but smaller organizations seem more capable of capitalizing on innovative ideas.
  • Most innovations come not from visionaries at the top but from people closest to the work. Yet paradoxically, strong leadership and vision at the top of the organization are required to create an environment that fosters innovation and risk taking. Without strong leadership, organizations become bureaucratic and risk-averse.
  • Outsiders often have the most innovative ideas, but insiders’ know-how and buy-in are required to get them implemented.
  • And possibly most relevant during the current pandemic, adversity or “necessity” often brings about innovative solutions.

A recent SupermarketNews article notes that current world challenges have been exceptionally tough for supermarkets, and that the associated difficulties have brought about significant and innovative improvements in how stores are being run… now and possibly in the future!

“The first hint of the virus reaching our communities ignited the shock of an overwhelmed supply chain,” said Randy Evins, Senior Principal and Industry Advisor.

“A couple of weeks later, the consumer experience was further diversified with online pickup services, home delivery and special hours reserved for vulnerable shoppers. Some local grocers have also installed plexiglass protectors around their checkout stations and added floor markers to help ensure shoppers are standing six feet apart while waiting in line.

“There’s unquestionably a lot of ingenuity happening in supermarkets right now. But there is one area of the business that still requires attention — especially if grocers want to continue surviving this constantly evolving time as well as the eventual rebound to come.”

The article goes on to stress the importance of leveraging digital technology to ensure that all variables are considered in “real time” when making inventory management and ordering decisions.

“Digital strategies must go even deeper to cover the entire value chain — addressing the need for connected processes, real-time transactional data and immediate visibility into store-level inventory,” Evins said.

“Supermarkets can no longer afford to order new products and additional inventory blindly. They need to know what is available on their store shelves, store backrooms and distribution centers — by SKU and quantity and in light of forecasted demand.”

In support of this perspective, the article cites predictive data indicating that 25% to 30% of a grocer’s sales volume will consist of digital orders by 2025, compared to 6% to 10% today.

Evins went on to say that the use of technology, as described, will enable store employees to “have the visibility and insight they need to work more efficiently, safely and productively while keeping consumers happy and coming back over and over again.”

Certainly, given today’s circumstances, necessity has truly been the “mother of invention.”

Read related newsletter…

Supermarkets Offering Innovative Improvements & Solutions

Necessity is the mother of invention, the adage says. Certainly, we’ve seen many examples of innovative thought and practical improvements put in practice in supermarkets throughout the U.S. during this pandemic.

For example, to promote social distancing, H-E-B was among the first to offer its customers a deal that to keep them out of lines and away from large crowds. Their stores across Texas provided free, next-day curbside ordering and pharmacy deliveries to help slow the spread of COVID-19.

“We are working diligently to provide solutions for seniors and Texans in need to access food and supplies with limited public interaction,” the company wrote.

They and many others also shortened store hours to better serve customers and to give team members more time to restock more quickly-depleted shelves, thus increasing product availability.

Stop & Shop was among the first to offer designated shopping hours for seniors, a step taken to help create a safer and more comfortable shopping environment for those most susceptible to the virus. Many have followed…

Albertsons was the first major company to announce they will install plexiglass “sneeze-guard” barriers at checkouts in its 2,200 stores… Walmart and Kroger have made similar commitments… Whole Foods also confirmed it’s in the process of rolling out sneeze guards at all locations to protect customers and Team Members at the registers.

Additional examples of best practices and suggestions were recently shared by the The Brookings Institution, a nonprofit public policy organization based in Washington, DC that conducts research into new ideas for solving societal problems. Among their recommendations are the following, which many supermarkets have put into practice of their own accord:

“Employers need to implement immediate steps to reduce grocery workers’ exposure to COVID-19 by expanding access to personal protective equipment (PPE) such as masks and gloves and end any restrictions on workers wearing them. While supplies of protective masks and gloves are extremely limited across the country, employers and policymakers should prioritize PPE for grocery workers as they become available.”

“Employers should provide adequate cleaning supplies and hand sanitizer, regular opportunities for workers to wash their hands, and frequent equipment cleaning.”

“Stores should shorten hours and limit the number of customers at any given time.”

“Grocery stores should implement additional measures to protect workers and enforce safe spacing of customers.”

SpartanNash Reducing Food Waste & Enhancing Customer Service with Flashfood

An earlier post featured SpartanNash for leveraging technology to enhance their online and order pick-up processes. Today we once again focus on the company as they have launched an innovative program to reduce food waste while enhancing customer service.

According to a recent Progressive Grocer article, SpartanNash is piloting a Flashfood mobile app at five of its West Michigan Family Fare stores, allowing customers to purchase meat, produce, seafood, deli items and bakery products that are nearing their “best-by” date at up to 50% off.

As you may know, Flashfood is a Toronto-based mobile app that operates in more than 440 grocery locations throughout Canada and the US.

After downloading the Flashfood app, customers can select a participating Family Fare store, choose items, pay for them directly on the app, and then pick up their items at the store’s customer service counter, where the purchased items are stored in refrigerators.

“Customer convenience is key with the app,” said Matt Bennett, Director Retail Consumer Innovation at SpartanNash. “This app is a win-win for customers and the environment.”

Read the full article…

Tech Driving Customer Experience at SpartanNash

SpartanNash is leveraging GPS location technology to improve curbside service in its Fast Lane online grocery pickup program. According to a recent SupermarketNews article, a number of the chain’s locations are now using Radius Networks’ location-based FlyBuy Pickup service with ShopperKit’s in-store grocery fulfillment software to bring out Fast Lane orders to customers as soon as they arrive at the store.

Referenced as a “click-and-collect platform,” the process begins when a customer places a Fast Lane curbside order. The order is fulfilled and the customer is notified when their groceries are ready for pickup. The customer can then share their location via mobile apps or a web browser to let their Fast Lane personal shopper know they’re heading to the store. That allows customers’ orders to be prepared and delivered to their vehicles the moment they pull into the pickup area.

“This new technology will completely change our customers’ experience with Fast Lane,” said Brian Holt, vice president of marketing for SpartanNash.

“Fast Lane already provides exceptional customer service, with overall satisfaction scores 30 points higher than the national average, as well as some of the nation’s leading fulfillment rates. And our new GPS location technology will only improve the ease and speed of the Fast Lane experience.”

This is another good example of how today’s supermarkets are leveraging technology and continuous process improvement to drive customer service and the shopping experience.

Wakefern Focusing on Process Improvement & Customer Experience

Wakefern Food Corporation, a Keasbey, N.J.-based grocery retail cooperative, is planning a 50-store test of a computer vision system that automatically identifies when product stock runs outs on shelves.

As reported in a SupermarketNews article, once out-of-stocks are flagged, the system helps store associates prioritize them as they occur and recoup the most lost sales as possible per labor hour to make the most customers happy. The system keeps track of both lost sales per hour (LSH) and frustrated shoppers per hour (FSH). The company said this information enables them to track an “out-of-stock hours” metric that makes it easier for them to rack on-shelf availability of products from store to store.

“Focal Systems’ out-of-stock detection through computer vision and artificial intelligence has enabled us to automatically identify shelf gaps,” Wakefern Chief Information Officer Cheryl Williams said. “This early success has encouraged our members to opt into a 50-store pilot expansion this autumn.”

Focal noted that its platform allows store associates to spend more time serving customers because it eliminates the need to manually scan for out-of-stock items.

“Customer expectations are high, and retailers want to deliver on those expectations,” stated Focal CEO Francois Chaubard. “Focal Systems provides the real-time data retailers need to run their stores efficiently…”

Innovation at Hy-Vee Reduces Food Waste

Iowa-based Hy-Vee Inc. is piloting an innovative mobile shopping app that will reduce food waste, according to a recent SupermarketNews article.

The app is called Flashfood and is designed to let shoppers browse and buy food items nearing their “best before” date at significantly reduced prices. It was developed by a Toronto company of the same name.

“At Hy-Vee, we know it’s important that we do our part as grocers to reduce food waste,” said Jessica Ringena, Vice President of Innovation and Business Development.

Read the full article…

Forbes Was Right: 4 Ways Your Grocery Store Might Change this Year

This past December Forbes published an article suggesting we should expect to see more changes at the grocery store this year as the industry adapts to various competitive pressures and emerging shopping habits.

“The last year has been a trying one for supermarkets that face not only changing technology and consumer demands but heightened competition on price,” the article said.

The article predicted four key trends for 2018, which were:

  1. More online shopping options
  2. Mobile payment acceptance
  3. Meal kits
  4. In-store drinking and dining

At the half-way-or-so point, it seems these predictions are on track. And clearly all four predictions focus on improving processes as well as customer service and the shopping experience!

Guess we can all stay-tuned to see if these trends continue…

 

Sam Walton & the 5th “P”

In a recent article published by the International Speaker’s Bureau, author Michael Berghdahl referenced Sam Walton’s retail success, noting that Walton intuitively knew that retail marketing is all about the “4-P’s,” which are having the right products, price, placement, and promotion.

However, the article goes on to say that Sam Walton knew the “4 P’s” were not enough; that he was not satisfied to simply apply traditional methods, but rather always out to do more… to try new ideas.

“You might say he [Sam Walton] embraced change like a welcomed friend,” Berghahl wrote. “Never complacent, he sought ways to improve every aspect of the Walmart success formula each and every day.”

As part of this approach to continuous improvement, Walton figured out the key to creating a sustainable competitive advantage in the retail marketplace was by adding a “5th P” to his success formula: PEOPLE. Success required fully-engaged people working together as a high performing team, and serving his customers.

This perspective is consistent with the latest research on the critical importance and value of an engaged workforce.

But beware! Traditional efforts to engage employees have not been fruitful!!  These unsuccessful attempts have been haphazard at best, and have largely focused on trying to make employees happy.  Unfortunately, research and experience has proved that happy workers are not necessarily more productive workers.

Clearly a more strategic approach to engagement is needed, yet few retailers or organizations of any type have a formalized engagement strategy.

If you would like to create such a strategy, here are ten behaviors  you might initiate, which are based on research and experience that shows productive employees tend to be engaged employees, not the other-way-around.

Read more… 

Food Waste!

In a recent video report, Phil Lempert, “Supermarket Guru,” referenced a United Nations’ Food & Agriculture Organization statement indicating one-third of food gets spoiled or wasted.

That translates to approximately $1 trillion per year, or double the dollar volume of the grocery industry as a whole!

As you are most likely aware, to reduce food waste we have to control environmental conditions including temperature, moisture levels, and UV exposure all across the supply chain including on shoppers homes.

The Spoon reports that a group of researchers led by Giovanni Salvatore at ETH Zurich have developed a biocompatible microsensor that can be directly applied to food and is safe to eat. The sensor is made from a combination of edible materials such as magnesium and a compostable polymer made with corn and food starch.

But there is a problem – making them is currently very expensive, compared to pennies or even fractions of pennies for traditional RFID tags.

However, Salvatore predicts that these biodegradable sensors will be part of our everyday lives within 5 to 10 years.