Sharing Best Practices
Ahold’s U.S. loyalty expertise includes the ability to take advantage of the latest technologies to deliver offers in real time. That know-how is now finding its way to Europe, Schlicker said.
“A lot of the program that we developed in the U.S. is now going to Europe to be implemented first in Albert Heijn.”
That extends to the systems level. Ahold selected London-based EYC (Engage Your Customers) as its U.S. partner to support database and customer insights, and that partner will be used in Europe as well.
But it’s not just a U.S.-to-Europe one-way street. Ahold in Europe has pursued its own loyalty efforts, “so we’re taking some of the things they’ve tested and using them here,” Schlicker explained. “So going forward, we’ll have similar systems and sharing of information, and this is our first real global project. It shows how far we’ve come as a company.”
These efforts to streamline practices extend to Ahold’s strategic statement, called the “Six Pillars,” which include growth-creating steps such as increasing customer loyalty, broadening the offering and expanding geographic reach, and growth-enabling steps, such as simplifying the business, fostering corporate responsibility and developing the organization’s people.
“In our vision and values we’ve made a big step forward in alignment,” Boer said.
One of the biggest challenges facing any company with expansive holdings is balancing the need for central structure with the imperative of local decision-making. That’s not a new topic for Ahold, but the company has lately found a successful model for dealing with this, executives said.
They point to the balance struck at Ahold USA back in November 2009, when four geographic divisions were created, a move that encouraged locally driven management, including separate presidents and teams. The four divisions are Stop & Shop New England, Stop & Shop New York Metro, Giant-Carlisle and Giant-Landover.
Prior to this, some 550 stores in Stop & Shop and Giant of Landover were managed out of headquarters in Quincy, Mass.
“Now they have local people who make decisions on assortments, local buying and other things,” Schlicker said.
While benefiting from local management, the divisions can count on central support for certain behind-the-scenes aspects, including operational and commercial development from Carlisle, Pa., and IT, finance and real estate from Quincy, Mass.
“The divisions are empowered, and they’re driving the sales,” Schlicker said. “They’re making decisions on ads, on competitive situations, on relationships with labor contracts, and other things. So they’re really an accelerator of our growth, and the support organization is there to support.”
Neil Stern, senior partner, McMillan Doolittle, Chicago, said the U.S. divisions appear to be on a “positive arch. They had long challenges in getting the balance right between local autonomy and centralization, and now it seems they have that balance.”