Omnichannel retail and supply chain management lessons from the Sochi Olympics

     

describe the imageWith the last gold medals awarded and the Sochi Olympics concluded, it's always interesting to use the Games as a lens to draw some insights about theglobal state of business. Besides being a venue for some of the world's best athletes to strut their stuff on an international stage, the Olympics is a massive enterprise venture for companies with direct contributions to the Games. It's also a significant period for many organizations with indirect ties to the Games, as a creative or meaningful connection to the people, events and phenomena associated with the Olympics can help a businesses take advantage of unique opportunity.

This year's Olympics offers several lessons for omnichannel retail and supply chain management. Most of all, it is an undeniably digital event - Forbes boldly proclaimed it "the first truly connected Olympics." Whether it was a massive Wi-Fi network with 2,500 access points built 10-gigabit pipes running 1,000 miles from Moscow to Sochi, athletes admitting the popularity of online dating app Tinder in the Olympic Village or millions of people around the world analyzing the action on Twitter, the Sochi Games was all about embracing the digital lifestyle.

Most of this technology was used to improve connectivity in some way. Building and managing networks is one of the greatest physical and virtual challenges affecting enterprises today. So much depends on the quality of connections, whether they're used to bolster business-to-business relationships or increase the quality of business-to-consumer interactions.

As with the Olympics, there are a lot of factors in play that have an effect on the final outcome. Some of them may be out of an organization's or user's control, but others can be managed more effectively with digital tools, IT support and supply chain management. In another parallel with the Games, a company may be working with a small window of opportunity to succeed.


Lesson 1: The key to omnichannel retail often isn't the product
Today, omnichannel retail success is often just as much about the sales presentation and customer engagement as it is about the product. Ralph Lauren, the designer of this year's official U.S. uniforms, saw its retail profits jump with a deft understanding of omnichannel retail strategies. Despite relatively high prices (the men's jacket retails for $795), a lack of U.S. consumers physically at the Games and designs that Bloomberg Businessweek contributor Kyle Stock suggested look "like a knitting grandmother got aggressive with the American flag," merchandise has flown off the virtual shelves. 

The clothing retailer was able to take advantage of its unique opportunity by ensuring that customers were able to access its online retail site and order Olympic-themed garb during the period of its highest popularity. It also made a huge change in its production that undoubtedly impacted existing supply chain management processes. After receiving criticism for making the 2012 Summer Olympics uniforms in China, Lauren vowed that those for Sochi would be made in the U.S., according to the Upstart Business Journal. He kept his promise, and a California company called Ball of Cotton was tasked with making the sweaters. Being able to adapt his supply chain helped Lauren to build a positive response.

Lesson 2: If you're starting from scratch, make sure your IT services are up to the task
That 2,500 Wi-Fi network mentioned earlier? It didn't exist at all when the International Olympic Committee awarded Sochi the 2014 Olympics in 2007. Most of the infrastructure supporting the games was built from scratch, with many massive projects all progressing simultaneously. This presented a few unique complications for Avaya, the California-based telecommunications provider responsible for providing Sochi with adequate Internet infrastructure, according to TechWeekEurope.

"Sochi was a telecom greenfield for us. We had a free hand and didn't have to worry about working with legacy systems, but we also had to wait for buildings to be built and it was an infrastructure greenfield too," Dean Frohwek, Avaya Olympic architecture solution leader, told TechWeekEurope. "We were wanting to do telecoms tasks, but we were waiting for roads to be built or sewers to be placed, so it was three big challenges all at once, adding extra complexity, but it's been pulled off."

Avaya erected a 54 terabyte per second backbone. but the company wouldn't know if everything would work correctly until the Olympic Village was already flooded with athletes, media and fans. It had to be sure that every member of its IT services team carried out his or her individual tasks successfully so that the infrastructure would be up to the task when the world was watching.

Lesson 3: Someone always knows something before you
Sochi's time difference meant that events being broadcast in American primetime had ended long before. This gave rise to a contingent of digital users pleading for others not to reveal results prematurely. It also inspired the general response of "tough luck" from the more plugged-in. Forbes contributor Dave Maney wrote that the age of "carefully crafted and timed narratives" no longer applies in the wired world. 

Omnichannel retailers and supply chain management professionals have to realize that traditional modes of communication are simply too slow to keep with today's fast-paced digital enterprise. Companies planning to address the issues of today can't and shouldn't expect the business equivalent of a "spoiler alert" for problems that arise tomorrow. Convergence and centralization are key to staying connected with all supply chain stakeholders and delivering a consistent, reliable e-commerce framework to buyers and clients. When something unexpected pops up, it's tough for anyone in the wired world to feign ignorance - instead, align the organization to respond swiftly to surprises.

Lesson 4: Digital trumps everything else
If Avaya's network had failed or NBC's telecasts cut out, would athletes have skipped town? Probably not, but it's difficult to imagine what the Olympic experience would have been like without constant, expansive digital coverage. The Olympics served as a reminder that the working reality is a digital one. Technological developments such as big data, bring your own device and machine-to-machine communications play a larger role in the basic operation of most of today's businesses. Accepting, integrating and reinforcing these technologies can help businesses - what else? - achieve gold. 

If you liked this article, check out:

IBM study: Consumers willing to give personal data in exchange for value, experience

Why IT needs to be part of your omnichannel retail strategy

Keeping up with the 'Omnis': Overcoming challenges in omnichannel retailing

Overcoming omnichannel commerce challenges for mid-sized retailers


The Sochi Olympics, the first "truly connected" Games, prove that digital is here to stay: