Let’s Talk About Your Capabilities Roadmap

A capabilities roadmap outlines the initiatives, dependencies, sequencing, investment, resources, etc. required to deliver meaningful value in solving a company’s biggest challenges and achieving business objectives.

A company’s overall strategy and high-level objectives may define revenue growth, margin optimization, inventory effectiveness, or just the desire to be at the forefront of innovation. However, a capabilities roadmap clarifies what, when, and how key improvements will support the strategy. The roadmap also confirms that the strategy is realistic and right-sized.

It is important to realize that not all strategic goals require a technology component. Some can be accomplished through a more simplified and clarified process that changes the way the organization thinks and works together. The overall point of the roadmap is to have a cohesive plan that has company leadership alignment.

Despite the media attention and executive focus on all things unified commerce, seamless customer experiences, inventory transparency, globalization, integrated business planning, and of course artificial intelligence, we still see many retailers continuing to operate in silos. Failing to operate and align across functions significantly impedes the majority of those endeavors.

Further, even with innovative technologies that enable much better standardization, collaboration, analytical capabilities, and the panacea of ‘one version of the truth’ (for data), too many brands are still winging it, being reactive—or simply hopeful. These reactions typically are the result of not having a clear vision of how the many corporate initiatives must be coordinated, prioritized, and executed to achieve a company’s desired capabilities.

Defining a capabilities roadmap that considers all elements of a company’s business, inclusive of processes, technology, and organizational impacts ensures that priorities and dependencies across all impacted areas are fully considered.

The scope of a capabilities roadmap may be narrow or broad. An example of a narrow scope is a focus on improving a company’s merchandising capabilities to drive better business results. This roadmap would look at business processes such as merchandise financial planning, assortment planning, item planning, and so on. Such a roadmap would also outline initiatives associated with impacts on roles and technology changes relative to improving a company’s merchandising capabilities.

An example of a broader, transformational capabilities roadmap would be a company looking to change its operating model. We recently worked with a client who is considering moving to buying vendor-complete finished goods vs. sourcing the raw materials. This potential move represents a transformational change and will significantly alter the processes and resources required to support the new model. Such a change will also have tangential impacts across the company’s business, internally and externally. In this case, the driver is the operational strategy, and the first step to successful transformation requires defining and aligning on a capabilities roadmap.

A key tenet of a roadmap and the expected benefits is that business value does not appear magically as soon as a new capability is deployed. While we often define a set of ‘quick wins’—or short-term activities in the capabilities roadmap that will deliver results within the first 3 to 4 months—value realization takes time. It also takes focused attention on training, learning, and data cleansing, as well as making tweaks (and sometimes major adjustments) to existing systems or processes.

Further, engaging the impacted organizations from the very beginning of your roadmap journey with thorough and honest communications and executing a tailored organizational change management plan is key to not only reaching the target but also ensuring adoption and achieving sustainable results. This involves defining and then sharing a common vision throughout the company and enabling the team to not just come along for the ride but even help navigate the course at times.

Business conditions, competitive pressures, objectives, strategies, and priorities change. Therefore, even if a company successfully defined a capabilities roadmap a couple of years ago, it is paramount to periodically review and update it. We recommend revisiting and realigning the capabilities roadmap as part of a company’s annual strategic planning process. This cadence helps support alignment among company leaders on priorities and objectives for the year.

Although numerous companies focus on technology in their current roadmaps, the most impactful strategy for crafting a capabilities roadmap involves examining the comprehensive environment within which a retailer or consumer goods company functions. Regardless of whether the scope is narrow or more transformational, the roadmap must include:

• Business process design work
• Organization and role definition
• System configuration changes or development
• Selection of new technology

There is a cliché that says, “If you don’t know where you’re going, any road will take you there.” While many retailers may have a solid grasp on their future business objectives (where they want to go), it is paramount to also have a well-defined, aligned, and realistic approach to achieving these goals (or how to get there).

We would love the opportunity to work with you in defining a capabilities roadmap that solves your biggest challenges and drives your organization toward operational excellence.