Ian Shearer; Managing Director, EMEA & APAC, Park Place Technologies:
No other vertical market endures shifting consumer dynamics quite like retailers do.
Today, the relentless expansion of digital possibilities and innovations, such as Artificial Intelligence (AI), Virtual Reality (VR), and Augmented Reality (AR), are shaping the way consumers purchase goods and services. Lines between online and offline shopping continue to blur, and retailers struggle to keep pace. Serving these experiences at the IT backend are retail infrastructure leads, who also have the challenge of keeping a constant pulse on how to optimise systems, streamline logistics and maintain just the right amount of stock levels to serve the experience.
Given these high and dynamic expectations, one might assume that delivering IT infrastructure in retail settings is equally innovative and flexible, attracting both top digital talent and technology solutions capable of anticipating and delivering future consumer trends. Yet, paradoxically, retail settings often lag other verticals in terms of IT infrastructure.
Physically integrating modern infrastructures with legacy systems is challenging and complex — and sometimes impossible due to incompatible data formats and legacy structures. As a result, upgrades, and any chance of downtime, are often avoided, leading to slow or low adoption of modern technology.
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Retailers are integral parts of long and complex supply chains that depend on a multitude of independent systems and processes. Any retail upgrades must be reflected and coordinated across the entire supply and logistics chain, and these can be global. Such interconnected legacy systems impact inventory management, point-of-sale operations, merchandising, e-commerce, delivery, and customer relationship and service management.
There is a shortage of cutting-edge digital development skills within retail IT, as existing infrastructure managers often focus on maintaining current operations rather than pursuing major new infrastructure projects. With fewer IT personnel compared to other sectors, retail IT departments are typically run lean, requiring strict prioritisation of tasks and limited migration skill sets.
Fortunately, there are some shifts happening to address skills gaps, but too often IT professionals are still often enticed by the more prestigious, innovative, and financially rewarding opportunities offered by the tech industry itself, such as cloud development, data analytics, and cybersecurity. IT departments face a dual challenge as professionals with extensive experience in legacy hardware mainframe systems are now nearing retirement. The departure of these highly experienced individuals could result in a skills gap at both ends.
Enter infrastructure managed services, tailored specifically for retailers. A reputable and well-resourced managed service provider can mitigate system obsolescence and facilitate the transition to digital platforms. They assist in planning and implementing changes while also developing and training in-house talent to enhance long-term capabilities and foster a culture of managed change, innovation, agility, and continuous improvement. A retail-focused infrastructure managed provider brings a forward-looking perspective on how emerging technologies like machine learning, AI, and blockchain are likely to impact both short and long-term strategies and takes the heavy-lifting out of planning, migrating and maintaining retail estates.
Data protection is of utmost importance in the retail sector, where retailers handle vast amounts of personal consumer data, including not only transactional records but also data warehousing for predicting consumer behaviours. Infrastructure managed services must ensure that new systems comply with industry regulations and data protection laws. Retailers rightfully fear penalties for non-compliance and breaches during and after data transition. Therefore, infrastructure managed services are frequently also tasked with maintaining audit trails in these tightly regulated environments.
Addressing the shortage of in-house digital skills in retail necessitates a strategic shift in how retailers perceive and invest in IT. This entails recognising its strategic importance and long-term value of technology to the brand, fostering a culture of innovation and empowerment, and delegating tasks to expert infrastructure managers when necessary or too complex for in-house teams. Using a supplementary approach, retailers gain access to a comprehensive platform of management tools that continuously monitor the health of their entire infrastructure, ranging from legacy mainframes to the latest shopping apps, 24×7.
By using an outsourced infrastructure management provider, retailers can benefit from proactive ongoing maintenance provision, ensuring system reliability and resilience and right across the estate. This outsourcing of services also attractively entails a financial shift from traditional large upfront capital-based CAPEX annual budgeting for hardware and software expenditure, to OPEX-based managed services provision that offers predictability and flexibility for usage. This provides retail CIOs and CTOs with greater confidence in budgeting for innovation projects.
Make sure that any retail infrastructure managed service provider selected to help can confidently talk you through their retail experiences, with relevant case studies or testimonial referrals.