What will work in retail look like in 2035? To investigate this question, the EHI Retail Institute GmbH, together with the method partner ScMI (Scenario Management International AG) and HR experts from the industry, have developed a scenario project that shows several possible developments for retail.
Brick-and-mortar retail will continue to change over the next ten years. This has long been clear to all those involved in brick-and-mortar retail, so the questions that the project investigated were: What are the adjustments that can be made and how desirable are these changes?
What working in stationary retail will look like in 2035 will be determined by more or less:
- innovation
- digitalization
- Substitution of human labor
- Attractiveness of retail as an employer
- Importance of personal interaction
- Technical support
- Availability of labor
- Employee orientation
- Credibly lived corporate culture
This gives retailers the opportunity to increase the attractiveness of retail as an employer through a high level of innovation, new retail formats, new professional fields and a new understanding of themselves and employees if they act correctly now. This means you can now influence which scenario you end up with in 2035.
“Despite uncertain and challenging conditions, the scenario analysis makes it clear that retailers have their own scope for making their own working world attractive and future-proof.”
Eight scenarios, four core questions
This resulted in eight consistent, plausible future scenarios – some more desirable, others less desirable – which differ in four key questions: How open, “smart” and innovative is retail? What will the relationship between automation and personal customer contact look like? Are employees viewed primarily as individual people or as a resource within the retail value chain? How do HR and companies understand themselves?
Staff is key
“Even if there is currently a shortage of skilled workers, the question remains to what extent we will still need a large number of people for stationary retail in the future.”
Automation will play a larger role, particularly in sectors that require less advice, such as everyday food retailing – where there is no focus on experience gastronomy and delicatessens. However, fashion retail will not be completely automated in the future either. On the contrary. Service, advice and human interaction are becoming increasingly important in this industry. This also makes them more interesting for staff, because here employees can shine with interpersonal strength and competence.
Overall, jobs in retail are becoming more interesting and creative. Changing requirements expand the target group that is interested in these positions. A high level of innovation in retail formats leads to more attractive jobs. Employees on the floor (blue collar) tend to take on more interactive roles, and colleagues in administration (white collar) take on more creative tasks.
Employee retention is becoming increasingly important:
- Employees’ personal concerns must be given (even) greater consideration
- Employees have high expectations of their own work, which should be personally meaningful
- Role of employees on the floor: greater interactivity, meaningfulness and customer proximity.
- Increasing importance of HR in the company and the self-image as a “care company”.
- HR is seen as a core function because employees are the essential resource and THE success factor in retail.
- Retail and HR compete with other industries. If they address personnel issues more credibly, the attractiveness of retail as a place to work will be comparatively low.
Automation, gamification, AI and digitalization
In the positive expected future scenarios, human and automated processes will complement each other in a meaningful way. Digitalization leads to the automation of repetitive work. Relieving technology is greeted with goodwill and acceptance both on site and in internal processes. Both customers and employees enjoy using the systems and without it causing them any stress.
“The central drivers will be digitalization and AI – both for automation and to support customers and employees.”
In the less desirable scenarios of “automated high-performance trading” and “employees as a faceless resource”, strong digitalization leads to a significant substitution of human labor on the trading floor. The focus there is on increasing efficiency and maximizing profits for companies. Although this can also serve customers who focus on shopping as quickly and smoothly as possible, it was rated as less than desirable by the participants.
Rather, scenario number 4 has prevailed, “Innovation, Cooperation & Vision”, in which the positive mood in retail is also transferred to the cityscape and income development. City centers are succeeding in increasing their attractiveness through positive shopping experiences.
Core results
In summary, in the positively expected future, it is expected that the attractiveness of retail as a workplace will be increased through a high level of innovation in retail, a humane, honest corporate culture and a strong employee orientation. Omnichannel solutions, innovation, cooperation and vision significantly shape these futures.
In the negative scenarios this fails, trading is too slow and unwilling to take the necessary steps that lead to a sustainable company. As a result, large chain stores and small retailers are disappearing from the cities, leading to a real “extinction” of the cities.
In the desired future, the economy will develop largely positively, the years of crisis are over and the increased income will not necessarily be saved, but rather implemented in trade.
Last but not least, politics is also important: it must ensure good framework conditions, especially when it comes to migration. The integration of employees with a migrant background is just as important as a modern educational landscape so that the expected and desirable scenarios can come true.