Store Operations Council: Core Themes

I’ve just come back from “walking in Memphis” with some fantastic operators as part of the Store Operations council.

This annual event, organized by Cathy Hotka, is completely unique. 

Nowhere else do you have a two day event where operators from such a range of different companies large and small can come together and discuss challenges and potential solutions in an open forum (FYI, you can email Cathy here for details about attending next year). 

To condense so many topics from those two days is a tall order but here is my attempt to condense the four core themes I heard:

Theme 1 – Reducing overwhelm

One retailer talked about having over 20k BI reports. Another, 2,223 SOPs in their database and a third had 900 daily emails to contend with.

It was clear that the need to simplify was on everyone’s agenda. A necessity for the future of driving productivity. 

As part of this, a lot of conversation surrounded the emergence of AI Co-Pilots. 

• Field Co-Pilots, like Quorso – that help Field leaders reduce data overwhelm and prioritize the right action areas in store.
• Generative AI Co-Pilots, like Tractor Supply Company’s HeyGura – that helps retailers quickly surface SOPs and product recommendations from their internal database. 
• Visual Co-Pilots, like Google Gemini – that use computer vision to understand process issues and provide recommendations.

It was clear, with 50x the amount of data being captured, and the increased complexity of more to manage, solutions that help simplify store operations will be essential.

Theme 2 – Driving consistency

Best summarized in an excellent talk by Jordan Poff, Corporate VP of Retail Operations at Kroger. Retailers have a growing realization of how much value there is to unlock by more effective store management (by Quorso’s calculation >20% of store profits). 

Jordan indicated how an approach combining the following was rapidly unlocking store profitability at Kroger.

1. A composite approach to focus – Operators can be like lumberjacks in a forest. When focused on a metric, they are incredibly effective at “chopping it down.” often, however, that can lead to fires elsewhere. In order to broaden the approach it’s required to make sure you are focusing on a composite of metrics rather than just a singular one. 
2. De-averaging – Averages can hide a lot of hidden issues by masking underperformance. So it’s important to focus on the whole. Identifying variation in performance rather than just looking at the average.
3. Consistency – The final issue was one of volatility, consistency is more important than perfection. Incentivizing everyone on consistency drives more consistent outcomes and ultimately better results.

Through just simple reframing, the results in just weeks for Kroger have been astonishing, with more to come by using technology further to double down on these efforts and efficiencies.

Theme 3 – Customer service

There was a general understanding that retail is being pulled between different challenges that ultimately impact customer experience.

1. Hiring/experience challenges – this has continued since the pandemic. Retailers are having challenges not just with associate hiring but also managing stores with less experienced personnel with manager experience reducing from on average more than 15-year to around 5-years.
2. Loss prevention challenges – a big focal point in stores over the last 2-years, locking everything up and automating supply chain has become a more standard approach. 

All of these are having an impact on customer experience. Yet customers are wanting more interaction not less. General reflections are that customers are not enjoying ‘just walk out’ and self check out experiences and want human interaction. 

As such technologies and processes should focus on giving associates and managers more time with customers. 

Theme 4 – Technology experimentation 

It’s a golden age of technology for Store Operations right now. Computer Vision, ESLs, RFID, AI Co-Pilots are all coming of age. But what are the drivers behind what to try and adopt? General consensus is that:

1. It needs to have multiple use cases – point solutions add more complexity than worth .
2. It needs to have a business case that drives revenue or EBITDA .
3. It needs to be able to move from test to scale rapidly.

Are you doing anything around these key themes?