Over the past 30 years, I have watched with interest as massive technology advancements have changed the face of retail. I’ve seen first-hand from one of my first roles with IBM just how the PC revolutionized retail practices and forced a tectonic change in the way that consumers purchased products.
Technology has brought many rewards, but with systems often implemented over a long period of time and added to with bespoke solutions, many retailers do not now have consistent end-to-end visibility, usability, manageability and most importantly, integrated business processes. By adding more applications and capabilities over time, the initial simple but powerful solutions like the AS/400 and 4680 POS from IBM no longer provided the required enterprise framework. Add to this the complexity of the internet commerce channel and you have a mess. So today, retailers have trouble enabling true omni-channel capabilities and cannot yet make best use of the information they have to optimize their operations.
This has now reached a critical point. The speed of innovation means that where once we could take several years to deploy a new ERP system, retailers now need to be constantly on top of, or even ahead of, the technology game. Retailers need to look hard at where they see themselves five or even ten years from now, which is difficult considering the constant pressure to keep afloat and respond to the current needs of the business. What retailers need is a new view of their infrastructure and application framework with the clear objective of developing a single version of their data across the entire enterprise. Winging it with loosely integrated legacy operating systems and ERP solutions will not get you to the finish line!
There are several ways to strategically build the required infrastructure and application framework, although today I believe Microsoft offers a great solution to the core questions we all ask ourselves: ‘what does having this infrastructure really mean?’; ‘how do I know what is required and how will I build a roadmap to get where I want to go?’; ‘what will this undertaking cost and am I guaranteed the outcome will be as predicted?’; and ‘how do I get my business to operate as a dynamic business with integrated and interoperable business processes?’
Although complex, everything starts with the architecture. This architecture provides the structure that enables a company to achieve the fully automated and dynamic operations required in today’s business environment. Microsoft has already done most of the heavy lifting by providing products that are designed, developed and deployed to work seamlessly with each other, based on this architecture. Think of Microsoft Office; this is an example of an everyday software platform that seamlessly integrates and interoperates vast amounts of information.
In retail, having the ability to leverage a foundation which provides the agility to connect all business processes and entities is critical to being able to compete going forward. More importantly, the use of this persistent information for all employees and customers is the real key. Even having information locked up in a huge data warehouse typically only reserves the right of information access to a few, much less to all, which is what is required. It is the merging of real-time information with business process that provides retailers with the structure to create a differentiating business model not using someone else’s ‘best practices’, which could also be used by any competitor.
In addition to the interoperable operating system and platform products, being able to operationally use in real-time all of this data is a must. Web services, specifically a retail web service gateway designed for omni-directional movement of data is a required function. Data will always be disparate, structured and unstructured and will only get more this way. Having this next generation foundation allows software developers, system integrators and customers to take control and to focus on the innovation required in today’s highly competitive and quickly changing retail landscape.
The good news is you do not have to do all of this in one big gulp which is what is still being promoted by large ERP vendors. Most importantly mid-sized retailers are now more in a position not seen for many years to take advantage of today’s new technologies. Why? Because mid-market retailers still sitting on these old AS/400’s and Unix based systems who have not been able to afford the massive investments required from the large ERP vendors can now have it all for a fraction of the price and time. With the right vision, strategy and plan you can achieve this admirable position in a controlled and cadenced environment while actually saving expenditures and improving bottom line.