Complicated Communication

Overly complicated, internal communication networks have made large retailers clunky. For instance, several companies have design offices in one country, sourcing offices in another country, and logistics offices in a third country. These are typically the very large, mid-tier retailers-- the ones that are taking a stock beating and can't stop shuttering stores.

Communication becomes a nightmare because the decision making power is unclear and dispersed. Designers develop product, but then it's often given to a buying office that works with a vendor that can't communicate with the initial designers. The logistics team isn't aware of what the vendor's capabilities are, so shipping and delivery becomes a nightmare. And so on.

The reason for this structuring was that companies originally thought the benefits would be so great as to outweigh any inefficiencies. Sourcing teams could find the least expensive vendors, and logistics teams could find the most efficient routes. The trouble is, holistically, this strategy doesn't work for making high quality, fashionable product. It can't. It's too slow and too difficult to execute a specific vision for the brand. You end up with generic seasonal buys, Chase orders that are delivered too slow, and floundering sales because you can't keep up with what customers are asking for.

Brandon Cohn