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Digital transformation in retail: if you can’t beat them…

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07 . Dezember  2017

Alison Wiltshire

Posts nach Autoren: Alison Wiltshire, Global Practice Lead, Retail and Consumer Goods, BT.

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Digital transformation needn’t be complicated. With the right solutions, bricks and mortar retailers can easily catch up with their online competitors.

Retailers around the globe are wrestling with digital transformation. Racing to catch up with consumers’ rising expectations for more convenient and individual service, they know what they have to do. Give customers an altogether more engaging and personal experience in store, with mobile sales associates and digital touchpoints. Understand the whole of the customer journey, not just individual steps. Use data and business analytics to drive a genuinely different customer experience. Build a platform that brings it all together.

But knowing what to do is not the same as knowing how to do it. Most bricks and mortar retailers are still puzzling out how to get from where they are now to where they need to be. And they don’t have much time. Digital newcomers continue to wreak havoc. Who would have bet on online fashion house ASOS (age 17) overtaking British high street stalwart M&S (age 133) in terms of market value?

The barriers to digital transformation are well documented. Weighed down by their legacy IT systems, retailers have an infrastructure which is not flexible enough for today’s pace of business. IT departments are considered cost centres, not the potential powerhouse of the business. But these obstacles can be overcome. The way ahead lies in embracing and applying the same agile infrastructure and open innovation model as digital entrepreneurs.

Cloud services are the first step. In general, the shift to cloud is well underway. CIOs are increasingly adopting a multi-speed model, using the cloud for digital innovation to sidestep the difficulties of working with legacy IT, to make their organisation more agile and accelerate delivery.

By using the cloud for digital programmes, retailers can move at pace, adding and subtracting resources and services as they need them. Pay as you go makes it commercially easier to pilot new services. Cloud services have security built in. Using a single cloud vendor for access to third-party data centres and pre-connection to popular cloud services like Microsoft Azure and Amazon Web Services reduces risk and time to market. After all, that’s what digital-only retailers do.

Retailers also need a network to match the flexibility of the cloud. Built in an earlier era, the fixed network model is complex, hard to change and ill equipped to cope with the impending tidal wave of data from customers, inventory and Internet of Things (IoT) devices throughout the supply chain. However, the arrival of software defined networking (SDN) and network function virtualisation (NFV) give us a whole new way to build and manage networks for the digital age.

By using software instead of hardware to create and control the network, SDN/NFV makes wide area networking more flexible, affordable and easier to manage. These dynamic networking services will bring real benefits to retailers as they seek to transform their physical stores. For example, they’ll be able to:

  • Open up new stores more quickly
  • Introduce new services more easily
  • Scale network capacity to meet seasonal demand
  • Expand into new geographies more simply and cheaply

In the digital world, the IT team will think and act more like a software development house - agile and swift in outlook and behaviour. A business such as Amazon will have 100 software releases every week, constantly making subtle adjustments to its platform. It’s all about speed of execution – rent servers, write software, exploit ‘as a service’ resources and make changes in days not months. An alternative to the historic ‘waterfall’ approach to project delivery, this agile methodology and mindset is all about using cloud tools and services to develop, refine and innovate at speed.

If you can’t beat them, join them. Tap into the same ecosystem of cloud products and network services that digital entrepreneurs use to delight customers and liberate employees. You don’t have to be a start up to be a successful digital retail business.

To find out more about how you can overcome today’s digital retail challenges, have a chat to our experts at the NRF 2018, Retail’s Big Show, from 14 to 16 January 2018. They’ll be in booth 3165 on level three.