Best Buy Uses the Supply Chain to Drive Innovation
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Fernando Silva, Best Buy
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Fernando Silva, Best Buy’s director of Private Label Product Lines, will be delivering a keynote address at the Consumer Electronics Supply Chain Academy that will leave no doubt that we live in a consumer-centric world, in which collaboration from all areas of the supply chain should drive innovation.
At Best Buy, customer-centricity means “treating each customer as a unique individual, meeting their needs with end-to-end solutions, and engaging and energizing our employees to serve them,” he said. “It is our primary strategy for providing a differentiated experience for customers.”
By listening to customers and employees more closely, Best Buy is benefiting from new ideas that in the past would never have reached corporate headquarters. Through employees that regularly engage with customers, the retailer has discovered several growth opportunities. Those with the highest potential include small-business customers, new services offerings and international growth, which account for a total of at least $230 billion in revenue, according to the 2007 Best Buy Annual Report.
For decades, CE manufacturers focused on creating products while retailers have focused on selling them. Silva demonstrated that retailers are sharing some of the roles that manufacturers used to dominate, such as developing a deeper understanding of the consumer. By doing so, Best Buy is emerging as a new ally of manufacturers and technology product developers alike.
For example, Best Buy has assembled a team of engineers, technologists and product experts from Apple, Xerox, Kodak and other leading R&D companies. Silva said, “they receive, reiterate, vote and synthesize end-to-end solutions to improve the lives of our customers by listening to them. It is the intersection of the three constituents - Best Buy, partner suppliers and product developers that determines what customer needs have to be met. Silva’s team - which invites input from approximately 120,000 sales associates in over 1,150 stores in the US, Canada and China - taps into the “one million hours spent daily by the sales associates wearing blue shirts who are now agents of our customers and not of product manufacturers, as they used be in the past.”
In the supply chain, as the evolution takes place from technology to ideation to shelf, the sales associates are empowered to identify who the products are actually designed for by obtaining customer feedback, understanding the customers’ needs and wants, Silva said. As a result, the Best Buy customer base has been segmented into basic lifestyle groups. The purchasing officer is identified for each segment and an associated purchasing index is developed. The data obtained from inputs is collected and analyzed. The intelligence is then extracted for product development, product redesign, new business model development and new service offerings. The results are there for everyone to see, especially as they are applied to Best Buy’s own product brands, including Geek Squad, Insignia, Dynex, Init and RocketFish.
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A two-day conference, designed to provide senior entertainment executives with the latest insights into perfecting the delivery of physical media while developing and advancing the infrastructure for the delivery of digital content. The event is co-located with the annual DEG membership meeting, which provides networking opportunities with the Presidents of all major home video studios. Last year’s Academy attracted over 325 executives.
For the second year, leading senior executives from international content holders, as well as their European production and distribution partners, are joining together to learn more about ways to perfect the delivery and distribution of physical media while they define the industry's transition toward digital.
Information technology is transforming the way that the Hollywood studios are doing business -- from theatrical, to broadcast, to home video and new digital delivery channels. This inaugural event will bring together the thought leaders, CIOs and staff executives from all the major film, video, game and music companies to address the issues of the day including: data warehousing, supply chain systems, forecasting, business intelligence, CRM, asset management, online e-commerce and others.
While most attendees at the annual International Consumer Electronics Show (CES®) are exploring the latest innovations in consumer technology on the show floor - a smallbut elite cadre of business executives go there to study the inner workings of the global machine that gets goods, on time, clear across the planet to retail and into the hands and hearts of the consumer. The challenges of the consumer electronics supply chain will be the topic of the Consumer Electronics Supply Chain Academy. Todd Thibodeaux, senior vice president, industry relations, Consumer Electronics Association, explains. "Supply chain efficiency has never been more crucial to the success of consumer electronics companies. This program is a wonderful addition to the conference lineup at the International CES and offers a valuable experience to CES attendees."
A one-day conference, designed to provide senior home video studio executives (marketing, creative services, operations) with a common knowledgebase about environmental issues that need to be commonly addressed by the home video industry, their vendors and retail customers. Topics will include but not be limited to corrugate, packaging, returns and transportation costs. The morning program will provide expert presentations about developments in "green" business practices; the afternoon will include a series of up to four solutions-oriented breakout sessions for attendees.
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