Merchant Innovation

JDA Software Leads The Way To Digital And Omnichannel Retail

Inventory Problems Exist Across Omnichannel

Retail is more than a product on a shelf. It’s a product on a journey, from manufacturing to distribution to warehouse storage to stocking to, finally, purchase. To make the journey more efficient, retailers need an end-to-end approach, not just piecemeal solutions. Enter JDA Software.

“At JDA, we’re focused on being able to enable the entire enterprise to operate in today’s environment,” said Jim Prewitt, JDA’s vice president of retail industry strategy. “So everything from retail planning …  through to supply chain and on into the store. And we work across those suites to help retailers enable omnichannel and make their move into digital.”

What does that look like in practice? For apparel retailer Soft Surroundings, it looks like “good riddance” to paper spreadsheets and ballpark estimates of how much stock its stores would need. The St. Louis-based retailer announced May 22 that it had automated its merchandising through JDA.

The mission of Soft Surroundings is to offer customers a unique style selection without sacrificing comfort. But it was hard to put the customer first without any sort of real-time insight into store performance, especially as the retailer was starting to see significant growth.

“We were operating more on gut feel, and needed much more visibility into how our customers shop and what they purchase,” said Laura Barrett, Soft Surroundings’ senior vice president of operations.

By aggregating data from store, catalog and web sales, JDA has empowered Soft Surroundings stores to order the right products in the right sizes by showing the company what its customers are buying (and what they aren’t). With this knowledge, the retailer can distribute merchandise where it’s needed to reduce out-of-stocks and excess inventory.

“A lot of companies are looking to modernize their systems and become more customer-aware,” Prewitt said. “The trend now is a steady move from being product-centric to customer-centric.”

He added that many retailers who took a “wait-and-see” approach to omnichannel methods within the last decade are now playing catch-up, even as companies that embraced the omnichannel market are moving ever more toward digital.

For those playing catch-up, the first step is to leverage data that’s already available to companies through loyalty programs, sales patterns or general demographics. Then, external data from, say, social media can start to round out the picture with its narrative of consumer likes and dislikes.

JDA automates that process. Its forecasting algorithms predict what will be needed where and translate that into an inventory plan. Its predictive analytics pull information from myriad big data sources outside the retailer itself, even offering insights such as when shipments are running behind and how that will affect availability.

It’s not quite artificial intelligence or machine learning, but those things are coming – from JDA and from others. JDA has invested a good deal in innovations in cloud technology, machine learning, and of course, predictive analytics.

For now, though, Prewitt said that AI isn’t necessary to introduce new efficiencies to the supply chain.

“Right now, the systems work very well with the technology we have,” he said.

Meanwhile, retailers who are further along in their omnichannel transformation need a different sort of solution. They may be ready to introduce customer-facing augmented or virtual reality elements or new ways to leverage mobile for both the customer and the employee within the store. JDA has something in its magic bag for them, too.

“The way JDA operates in that environment is, we provide much of the backbone – much of the XTP systems within a store to direct employees on how to interact, when to engage, what tasks need to be completed and the acknowledgment that they’ve been done,” Prewitt said.

In addition to stocking the right items at the right location, JDA Software deployed through the XTP system can help retailers schedule the right employees at the right times and at the right location. These same abilities can be leveraged at any point on the supply chain to predict and plan for the correct amount of inventory.

JDA doesn’t just work with apparel retailers. The company has 4,000 clients worldwide, including softlines and hardlines, from providers of home electronics and white goods, like refrigerators and washing machines, to grocery, convenience and drug stores.

Those 4,000 clients didn’t appear overnight. JDA has been around for more than 30 years, and like the industry it serves, it’s constantly evolving and changing, largely through acquisitions and collaborations. JDA most recently merged with RedPrairie (in 2012), which positioned the combined company as the leader in global supply chain management.

Since Jim Armstrong founded the company, it’s been a rapid path of acquisitions and growth, leading it from Canada and eventually to its current headquarters in Scottsdale, Ariz. The company serves clients in locales as diverse as the Americas, India and the Asian Pacific.

According to Prewitt, what makes JDA a powerhouse is integrating the strengths of all the entities it’s acquired into one cohesive suite of solutions.

“Software companies have to think differently about the needs of the retailer now,” Prewitt said. “It’s not about a single solution to fix one specific problem. The retail challenges now are much broader; they require suites of solutions. How do I enable omnichannel? It’s not one product you can buy.”

“This is probably the most dramatic period of retail change that we’ve seen – certainly in my 25 years of retail,” Prewitt said. “We’re coming out of a period of retailers trying to adjust to an omnichannel environment and retailers now starting to move into a digital environment. There is a considerable amount of ambiguity out there and a lot of challenges that retailers face.”

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