Data-Driven Performance Improvements: What can retail learn from competitive cycling?

When it comes to British cycling’s ascent from zero to hero after years in the dumps, the books have been written, the interviews given and the movies made, but it all came down to one thing. One percent to be precise. British Cycling’s savior, Dave Brailsford, used the theory of marginal gains to make small improvements in every possible area – training, diet, equipment, sleep, hygiene – to maximize performance and create a literal medal factory in the Olympics.

As Brailsford himself explained in a 2015 interview, “We searched for small improvements everywhere and found countless opportunities. Taken together, we felt they gave us a competitive advantage.” These countless opportunities kept on surfacing, such as the discovery that dust in the back of the team’s transport vehicles might be affecting the performance of the bikes, a finding that led the team to paint the interiors white so they could now see these offending particles. This is just one of the many minute details that Brailsford and his team looked to optimize, as well as developing a system that could manage their development at scale.

Is it fair to say that all retailers adopt a strategy of continuous improvement? While the link between cycling fast and selling food might seem tenuous at best, in fact, there is an element common to both and one that is central to higher performance, and that is data.

British Cycling turned data to its advantage by developing a data-driven system called the Readiness Index, an indicator that could track whether or not an athlete was on their way to Olympic Glory. Such directional insight is also possible within retail thanks to the wealth of operations performance data that can be brought together and analyzed through sophisticated cognitive technology. This includes taking historical sales data for a product, i.e., how many bananas have you sold?, and fusing it to advanced analytical engines to calculate the probability of this product being on the shelf for a customer to buy. Such outputs will only be enhanced as further inputs to the algorithms are collected, including other IoT devices and data points.

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For retailers to design their own Readiness Index, they will need to lean on the most meaningful data points they have at their disposal. One thing for certain is that retailers are not short of data, the acceleration of their technology agenda over the last two decades has been intense, to the point where their issue is now about the gulf between the volume of data and their ability to effectively leverage it. For example, every retailer still struggles with phantom inventory which is essentially a problem of poor and inaccurate data quality, but investments continue into new technologies that add even more data for retailers to consider. There is a mismatch here.

Fortunately, cycling has more clues to success up its lycra sleeve, and that is every part of the organization working together and focusing on the same goals. We understand how challenging this is not just in retail but all sectors, how to get people who work in different departments and disciplines to pull together around shared product and customer objectives.

For large organizations operating across multiple formats, channels, and territories, this is a hard journey but one that has already begun, when one considers retail’s rate of digital transformation, its adoption of advanced data techniques such as artificial intelligence, which is starting to surface previously unseen insights, and more tightly integrated supply chains. All of this combines to enable small improvements to be made that can have dramatic outcomes in terms of sales, rate of throughput, and availability, which in turn can reduce the need for markdowns and ultimately drive down surplus food waste.

Longer-term, small improvements have a profound impact on the business, as British Cycling knows well. Andy Harrison, British Cycling’s Programmes Director said, “This is not marginal gains. This is new. This is how we get a dynasty.”New call-to-action

Written by Tom Coe

Tom is the Project Manager to the CEO at Retail Insight. A former NCAA distance runner, he now uses his competitive passion in everything he does at Retail Insight, with a particular focus on strategy and partnerships. He is an MBA graduate from Tulane University and is a Business Management graduate from the University of Birmingham.