“Digitization in retail”
An Interview with Prof. Dr. Christian Kille, Professor of Retail Logistics and Operations Management at the University of Applied Sciences Würzburg-Schweinfurt
1. Digitization reached retail long ago. To what extent have businesses risen to the challenge, and what are their strategies?
Some companies are aggressively dealing with the issue of digitization. However, I think many are struggling, since no one really knows for certain what the term entails. The fact that e-commerce companies are doing better here makes sense (even if they do not always choose the right strategies themselves). Traditional retail has many more hurdles to overcome — especially internal ones. Strategies vary from a sledgehammer approach to something more like a “deer caught in the headlights.”
2. Brand-name companies are currently driving forward their multichannel or omnichannel concepts in order to increase online growth. Is that enough to satisfy the demands of the digital environment, and what should the focus be here?
Many digital tools work behind the scenes. They optimize processes, facilitate operational activities and offer customers added value alongside the pure distribution channel. Many companies, especially from the side of the logistics service providers, are positioning themselves as partners to support the digitization strategy.
3. How and at what levels is digitization changing the role of logistics and fulfillment service providers as supply-chain partners for retailers?
Collaboration will change a lot. The logistics companies will no longer be just a "means to an end," but will play a key role in making things happen.
4. The end customer is increasingly becoming the focus of digital supply chains. That means evaluating and interpreting big data is also becoming more and more important. How does that affect retail logistics specialists?
They are finally being perceived as being able to increase the competitiveness of the entire business enterprise with their diverse data. Retail logistics — whether internal or external — is becoming an important pillar of a company's success.
5. In contrast to retail, manufacturers/OEMs have had very little access to the data about their end customers so far. What problems arise from this and what opportunities do manufacturers have to become more independent?
This is where the logistics service provider comes in! With their data, which is collected by different customers or even across the entire supply chain and analyzed, manufacturers now have the opportunity to gain insights into processes, preferences and challenges beyond their direct customers. Of course, data protection and the anonymity of the individual must be respected throughout — as in the case of other companies that collect data, such as Facebook or Google. The logistics service provider can become a “Google” of the supply chain because it can access lots of data that is processed in different IT systems.
6. How do you expect retail and logistics to develop in the future?
Logistics is becoming a success factor for trade. My expectation is that the power relation might not quite reverse, but at least balance out. Logistics companies obviously have to understand this and act on it. To do so, it helps to understand digitization and the opportunities that come with it.
About Prof. Dr. Christian Kille
About the person
Dr. Kille currently teaches as professor of commercial logistics and operations management at the Würzburg-Schweinfurt University of Applied Sciences.
He studied electrical engineering at the Friedrich-Alexander-University Erlangen-Nürnberg. After completing his diploma thesis in 1999, he started as a research assistant at the Fraunhofer Working Group for Supply Chain Services (SCS).
- 2010: PhD on logistics markets and their quantification.
- From 2011 to 2016: Scientific Advisory Council of the Fraunhofer SCS.
- Since 2011: He works at the University of Applied Sciences Würzburg-Schweinfurt as a professor for commercial logistics and operations management and is head of the degree program in business administration.
- Since 2011: Market expert of the Bundesvereinigung Logistik BVL.
- Since 2013: Member of the jury of the "Logistics Hall of Fame" and the "Logix Deutscher Logistikimmobilien Award" (since 2015 chairman).
- Since 2015: Chairman of the nomination committee „Beste Marke der Logistik“ ("Best brand of logistics")