Given the number of breaches announced by banks, technology companies, manufacturers, and retailers, it is clear that information security is a big challenge—and technology is both parts of the problem and part of the solution. In the retail segment, customers’ payment data is some of the most sensitive information that requires protection, and there are a number of current and evolving solutions. Some solutions focus on securing data on credit cards or customers’ mobile devices. Other solutions focus on tokenizing and encrypting to eliminate sensitive data. Some solutions are proprietary, and others more open. The ideal solution for retailers would secure data from end to end, respect the customer’s choice of mobile device and payment type, integrate smoothly with the shopping experience in all channels and be extensible to work with emerging standards. The solution must provide access to the data needed to best serve the customer without sacrificing security and without disintermediating the retailer from the customer.
"Technology can better serve retailers by supporting open standards, providing middleware to allow a best-of-breed approach or offering comprehensive solutions"
Having a real-time view of inventory across a complex supply chain from the manufacturer or supplier to the distribution center, to the selling floor, to the customer’s doorstep is critical. Some retailers handle this well and are trying to get better, while others are in the early stages, but all of us are working to continuously improve. Moving from understanding demand in the rearview mirror to accurately forecasting future demand is another area in which retailers would like to improve. Both of these areas involve the real-time integration of systems and powerful analytic capabilities. Technology can better serve retailers by supporting open standards, providing middleware to allow a best of- breed approach or offering comprehensive solutions. Likewise, analytic tools that can integrate data from multiple sources while offering expert knowledge of certain business domains will accelerate progress and allow retailers to focus on customers rather than the technology. Finally, vendors can do more to offer industry-specific implementation patterns and reference architectures to accelerate and improve the use of their technology.
Retail IT must do more to look ahead for emerging opportunities, move faster to pilot solutions and make quick decisions as to whether pilots should be expanded, modified or shut down. This requires more research and development than we previously thought the retail business requires, more nimble decision-making, a different approach to risk management (many little bets in line with an overarching strategy), and a blend of fact-based and intuitive decision-making. In short, retail IT needs a new strategy and culture. Additionally, technical debt is a growing problem in IT shops. Reducing technical debt involves striking the right balance to ensure that critical production systems get the attention they need while newer initiatives are designed to minimize ongoing support. Increasing reliance on industry standards will allow retail IT to distribute new capabilities while delivering high-quality service to production system.
Retail technologists have not done a good job explaining that “cloud” is more than just a technology thing. Just as cloud requires more thoughtful technology architecture, it enables new business architecture. Cloud technology can enable flexible business architecture, allowing partners to plug in new capabilities without reworking our existing business infrastructure or processes. That is the only way we can experiment and roll out new capabilities fast enough to meet customer expectations. From a planning perspective, leveraging a pay-as-you-go model means we can start heading in a new direction without a big bet up front. Doing that safely and in a way that is scalable and manageable over the long term will require a new level of focus on enterprise architecture.
Technology is revolutionizing opportunities to stay relevant and connected to customers. Staying relevant requires understanding customers’ interests and preferences. Between social media and allowing the customer to maintain a shopping profile, we should have a better understanding than ever before of each customer’s interests. Likewise, through the analytics of in-store and online shopping habits, we should have a deep understanding of the customer’s preferences—perhaps even better than they have consciously thought through. The Exchange’s motto is “we go where you go,” and that is the foundation of staying connected. Shopping can still be a great experience, but it is also true that buying is being integrated into daily activities. A smart TV allows customers to buy outfits they see on a TV show. Social media integration allows the customer to buy the book a friend recommended. A mobile app keeps a grocery list while cooking dinner which can be delivered to home at the click of a button. Being connected to the customer’s lifestyle gives us the opportunity to serve customers better and enables them to focus on the things they enjoy.