Organizational Behavior, 12th Edition

Nordstrom: 115 Stores, 1 Inventory

Misplacing a pair of pants or favorite shirt happens to all of us from time to time. But when you're a highly successful chain of 100+ department stores, it's a bigger problem.

Seattle-based Nordstrom faced this issue recently. For nearly 100 years, the company flourished by pairing high-quality clothes with excellent customer service. But success came at a price—while the stores' fashions changed with the times, its inventory management strategy did not.

A customer who fell in love with a pair of candy red Prada pumps one day might return to her Nordstrom store 24 hours later to find they are completely out of her size. While inventory naturally fluctuates, Nordstrom associates couldn't easily locate a pair in another store or verify when they'd return to stock. And in an era of booming online sales, Nordstrom realized they were likely to lose such a customer faster than you could say, “I'll just Google that”.

“Traditional retailers have traditional ways of doing things, and sometimes those barriers are hard to break down.” –Adrianne Shapira, Goldman Sachs retail analyst.^b

To catch up with competitors, Nordstrom collaborated with Accenture Consulting to unify access to inventory. After an immense overhaul of the chain's inventory management processes, customers at their laptops and associates behind sales counters see the same thing—the entire inventory of Nordstrom's 115 stores presented as one selection.

So now Nordstrom doesn't have to ...