We help retailers develop robust structures and build capabilities to meet their most pressing organizational challenges.

Driven by competition and consolidation, large, complex retail enterprises operate across countries, channels, categories, and formats. While size and scope afford economies of scale, they also present considerable structural challenges.

We work with retailers to manage organizational complexity and design robust organizations that fit their specific needs. Our experts offer deep retail knowledge and the latest thinking on organizational health and performance. We have completed hundreds of projects on retail organization over the past 5 years.

We help our clients’ organizations become more efficient, faster, leaner, and more effective so they can achieve stronger growth, higher margins, and deliver consistently higher quality to their customers.

What we do

Our teams help retailers and retail holding companies on a wide variety of organizational topics, such as the following:

  • Organization design.Redesign is inevitable and can have transformational impact, yet only 23 percent of redesigns are successful. McKinsey’s approach to organizational design integrates structure, process, and people to enable the best strategy for making core retail-organization decisions, such as those related to headquarters, corporate functions, regions, stores, and digital organization.
  • Merger management. The traditional, process-focused integration-management office often struggles to meet the complex, often disruptive change needed to achieve breakthrough value in mergers. We help with preliminary planning, integration, and capability building for retailers considering a merger or acquisition.
  • Talent. We work with clients to unleash the true potential of their people. We offer guidance on talent strategy development, excellence in talent management, and the establishment of a talent culture. We also engage with clients on workforce strategy and planning. For people-development and performance-management efforts, we use a wide range of diagnostic tools, benchmarking data, and intervention methods to help retailers achieve new levels of performance. Our teams design strategic incentives and create processes that enhance group energy and alignment across organizational health, HR management, talent sourcing, and leadership development.
  • Transformational change and capability building.We help clients achieve systematic, sustainable improvements in business performance, organizational health, functional capabilities, and other key areas. We help executives design the overall transformation approach, conduct diagnostics, establish concrete change initiatives, and lend implementation support. We also offer top-level client-learning programs, such as those on centered leadership and lean leadership, to strengthen our clients’ leadership skills. Our functional-capability-building programs, such as the Merchandising Academy, comprise turnkey approaches and complete training modules that help build functional capabilities and optimize organizational performance.
  • Selling, general, and administrative (SG&A) productivity. We help retailers improve their selling, general, and administrative efficiency and effectiveness by evaluating distinctive levers, capabilities, and mind-sets.
  • Agility. We help quickly identify and unlock the greatest sources of value through agile ways of working. We do this by applying advanced analytics, digital tools, tech expertise, and multidisciplinary agile coaching.

As new commercial opportunities and challenges develop, organizational requirements often evolve. We closely work with clients to ensure that they anticipate changes, benefit from the competitive advantages of a strong organizational foundation, and become agile organizations.

Featured capabilities

Many projects make use of the honeycomb framework, which covers all the elements of a comprehensive organization strategy, such as structure, processes, people, and performance management. It guides our thinking on complexity management and agility and helps retailers work across organizational silos to apply a more customer-centric perspective on formats and channels.

We use a variety of solutions when working with our retail clients, including the following:

  • Retail Organization Library. A library of retail organization structures, head counts, and efficiency metrics that contains benchmarks on more than 50 retailers across sectors covering more than ten functions, such as marketing, e-commerce, and store operations.
  • Corporate and Business Functions Database. A record of detailed benchmarks on support functions for more than 1,900 companies across sectors and geographies as well as comprehensive effectiveness benchmarks.
  • Idea Bank. A collection of more than 750 codified, proven impact ideas organized around seven levers and grouped by function and subfunction for increased speed to impact.
  • Operating Model Database. A library of retail and consumer companies that includes global, regional, and local choices made.
  • Retail Roles and Responsibilities Library. A collection of cross-functional process maps, decision rights, roles, and responsibilities across retail-specific functions.
  • Time-allocation surveys. Ready-to-customize surveys and interview guides on time allocation for support functions and core retail functions, such as merchandising.
  • Capabilities assessment. A modular capability-diagnostic survey for key retail functions, such as merchandising, marketing, and operations.
  • OrgLab. A solution that blends data management, visualization technology, and design expertise to enable successful organization transformations.
  • Organizational Health Index. A survey that measures and benchmarks organizational performance against peers.
  • People Analytics. Use advanced analytics to make better talent decisions

Featured insight


Crafting a fit-for-future retail operating model

– Retailers must move beyond cost cutting to embrace a comprehensive transformation.

Related practice

People & Organizational Performance

We work shoulder-to-shoulder with our clients to ensure their organizations are capable of achieving the transformation they want and sustaining it for years to come.

Connect with our Retail Practice