If you polled a few hundred retail C-suite leaders and asked them about their highest priorities for the next year, it’s likely their answers would swirl around this theme: a more connected business. Connection is essential to thrive in a space as fast-paced and dynamic as retail (even before the future-altering several years and beyond that we’re living through). And what’s the cornerstone of this desired nirvana-like level of connection? A solid link between the front and back office. 

The definition usually goes like this: The front office refers to customer-facing aspects of the business, and the back office refers to the administrative side, such as finance, human resources (HR), and IT. So while not every part of desire for connection fits neatly into a front office-back office link (there are no perfect metaphors), it all leads to better decision-making. And no retail leader will say no to that. 

The CFO’s Priorities

Let’s start with finance. Retail CFOs stay up at night thinking about a lot of the same things as other CFOs, but the industry has turned upside down over the last several years—and the pace of disruption doesn’t appear to be slowing anytime soon. The use of alternative shopping models (curbside, ship to store, buy online and pick up in store) skyrocketed during the pandemic, and many of those models have stuck. A single source of truth can make a retail CFO’s job (and weekend) much better. Hiring needs are ever-shifting, and the costs of training those employees for new procedures evolved as the pandemic evolved. As all this happens, CFOs have to adjust their plans at a rapid pace. And to adjust their plans without negative effects on the rest of the business, they need insight at every level of their operation.

As the complexity of the retail space increases, having a nimble system that can provide rich, multidimensional data is absolutely critical to making informed and timely business decisions.

Each time a change comes around the corner or a new model comes into play, finance forecasts shift and models change. And here’s where the front-back office connection comes into play—new models mean that front-line employees must be trained to adapt. Employees are no longer only running cash registers or restocking shelves, they’re running a mini-warehouse and distribution center for all the different ways that customers can buy goods. It’s a whole new world for the back-office empowered front office worker. Lower costs, more efficiency, and more value—the goals of every retail CFO—come within reach with a strong front office-back office connection. CFOs also want to close the books faster, and again, this connection makes it that much easier. 

A Better Way to Plan

Planning is now continuous for retail finance leaders, and without a strong front office-back office connection, those plans live and die in a vacuum. And that continuous planning approach is likely to flounder without a solid analytics hub, such as Workday Prism Analytics. Retailers have a dizzying amount of data to sort through, and if it’s not at their fingertips, it could impact their business before they can say, “How did we sell out so quickly?” For example, a celebrity decides to don a brand’s jacket at a red-carpet event, a photo of it goes viral, and demand begins to spike. Workday Prism Analytics can bring in social media data in case something starts trending online and then enable leaders to make changes to procurement or supply if necessary—avoiding the customer-facing nightmare of “sorry, it’s out of stock!” An analytics hub that pulls in all relevant data is a necessity for a solid front office-back office partnership.  

What better way to build the front office-back office connection than simplifying into a single source of truth? RaceTrac, a major U.S.-based convenience store chain, used to keep its financial data in three disparate systems. This led to wasted time, errors, and inflexible reporting. But with Workday, the chain went from three financial systems to one and automated 80% of its business processes. RaceTrac’s vice president of accounting said it best: “As the complexity of the retail space increases, having a nimble system that can provide rich, multidimensional data is absolutely critical to making informed and timely business decisions.”

What the CHRO Needs

And of course we can’t forget human resources. HR is a very strong example of the importance of the front office-back office connection. Especially in an industry with such high turnover, employee experience must be prioritized. When scheduling is as easy as an employee opening their phone to find an extra shift or quickly swap shifts when plans change, that’s a great employee experience. Front-line workers may be balancing multiple jobs, so when training and development can be done anywhere they have their phones, that’s another great employee experience. And all those experiences add up to better retention and satisfaction, which help alleviate the steep offboarding and onboarding costs of high turnover. It’s a win-win that the retail C-suite can smile about. 

As retail leaders continue to find new ways to thrive, they should focus on connecting the front and back office, and see the benefits they’ll unlock moving into the future.

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