Who's Mining the Store?
In the first of a series of "View from the Top" interviews, 7-Eleven President and CEO James Keyes says the role of IT is to help the company sell more stuff by creatively using point-of-sale data.
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What do you like to see in an IT business case?
I do something unfair. [Laughs] I tell IT that they have to generate cost savings from the project that will cover the costs of implementing the technology. Then, I tell the sales- people that they have to have X percent revenue increases after the project is completed. It gives them a target.
Is there an IT project you wish you'd never funded?
OK, I'll give you one. In 1997, approximately, we had become very successful in the ATM business. We were also selling almost $5 billion worth of money orders per year, and prepaid phone cards were a big piece of our business. We recognized that all of these services could be delivered electronically, in a self-service environment.
So when I became CEO, we were partnered with NCR to develop a new generation of ATM. We were trying to do things that were very sophisticated at the time—like print a money order, cash a check. No one [at NCR] believed enough in the business model that people would do self-service for other things [besides cash]. So what we ended up doing was taking preexisting hardware and software and jamming it all into one 9-foot monstrosity of a box. We were well ahead of the technology curve, but customers didn't want to use it.
The good part about it was we learned that we could sell a heck of a lot of check-cashing services, money orders and other things if we could do the kiosk right. It gave us enough confidence to [continue development]. We made it Web-enabled, and we shrunk the box down to 3 feet. We now have a device we call "Vcom" that's in 1,050 7-Eleven stores—and that goes beyond the ATM functions to offer [online shopping]. I'm hoping to introduce products that are only available through 7-Eleven—or that we have a temporary exclusive on. I can see us offering a new record for download through Vcom for 30 days before it hits the stores, for example. We're still early in terms of consumer acceptance of a wide range of financial services at an [ATM kiosk]. But it's very promising.
You said a lack of commitment to the project was the main problem. Explain what you mean by that.
It goes to the question of who really understands the customer. NCR said, "We've been making ATMs since ATMs were around. We know what the customer wants in an ATM." So rather than looking at this as an R&D effort, they were focusing their R&D energy in other areas.
