by Sharon Goldman

5 ways retail CIOs can future-proof their business

May 23, 2017
Business IT AlignmentCIOIT Leadership

You don't need to predict the future to prepare for it. The strategies outlined here will help you keep your organization’s eye on the prize.

Credit: Thinkstock

The retail CIO is facing a number of challenges in 2017. Budgets are tightening, the technology environment is rapidly shifting, the business has become more empowered to bypass IT, and brick-and-mortar stores are struggling to meet digitally-demanding consumer expectations.

At the same time, CIOs have a great deal of opportunity to help both the IT organization and the overall business not only keep pace with industry changes, but future-proof against thorny obstacles that may hold companies back. Here are five powerful ways the retail CIO can help keep the organization’s eye on the prize:

1. Find a balance between “Stop” and “Go”

When it comes to emerging technologies, many retailers get burned by ‘shiny object syndrome,’” says Peter Sheldon, VP of strategy at Magento Commerce and former Forrester Research analyst. “They jump on the bandwagon to invest in pilots without fleshing out the new technology on the maturity curve,” he explains. For example, it’s important to determine whether a new solution works within the reality of a physical brick and mortar environment, including bluetooth and WiFi adoption. At the same time, CIOs need to strike the right balance between being perceived as negative and unsupportive, while still being the voice of reason to the C-Suite. “They may need to encourage more restraint and say, ‘Let’s sit by sidelines on this one,” he says. “Retailers may believe digital transformation is key to saving the in-store sale, but what is the value proposition? Does it really improve the customer experience?”

2. Work with the business

The rise of other C-level positions, such as the Chief Digital Officer (CDO), who may be given responsibility for discovering the above-mentioned “shiny objects,” as well as increasingly powerful CMOs with large technology budgets, means the CIO may struggle to rein in spending that happens with or without the CIOs help. “The trend we see is that spend is getting bigger, if no one is reining in this fast growth path,” says Ricardo Belmar of InfoVista. However, a proactive CIO will reach out to work with the business to solve technology challenges while not holding the business back. “The successful CIOs will not be the person who says, ‘No, we can’t do that,’ it will one who is proactive and says ‘That’s a great idea; here’s how I think we should work together to implement it,” he explains. “The CIO can say, here’s three challenges we might have, but we know how to solve using technology — so let’s get it right the first time.”

3. Support continuous delivery

CIOs must have the right people, processes and products to support continuous delivery, says Rob Thomas, SVP, Global Research & Development at Manhattan Associates. In

many cases, he explains, this may mean looking for partners that have products with all the necessary elements. This includes things like decoupled business components to support plug and play enhancements across the system; an extension model that allows for unique solutions and strategies while ensuring the core system components can be upgraded without downtime; and the ability to deploy in and leverage cloud environments that support rapid provisioning and horizontal scale. “With the right business agility, architectural agility, and people/partners, the company’s ability to create competitive advantage or react to a competitive threat with continuous delivery will put them in the position to create the future rather than react to it,” he says.

4. Ensure consistent and reliable application performance

Picture this: You walk into Williams Sonoma with your gift checklist. The clerk enters your name on his/her tablet, and instantly knows your entire purchase history at the store and offers suggestions based on purchases by other customers. Consistent and reliable application performance power personalized experiences such as the scenario above, says Belmar. “With all the network traffic that these in-store wireless technologies are generating, it’s important they don’t interfere with the bandwidth required by other priority applications, such as those on the POS which require constant up-time,” he explains. “CIOs need to explore what they need to build out that’s missing from the store to support a new application — I see that step being skipped; there are a lot of assumptions where a test is done and they assume it will work at all stores.”

5. Support an open ecosystem

Many traditional retailers struggle to integrate digital and physical elements because of silos in the IT infrastructure, says Shelley Kohan, VP of retail consulting at RetailNext: “Today’s retailers need to understand the importance of an open ecosystem in the retail landscape,” she explains. CIOs can work diligently to create an infrastructure in the back of the house that supports this integrated solution across all touchpoints of the business. “Those retailers that really create this partner ecosystem and shared intelligence will leapfrog ahead of retailers that may not be employing some of those strategies,” she says.

Agility, adaptability and innovation

Overall, the CIO can help the company future-proof by being highly adaptable and agile and by delivering projects quickly for the business, says Sheldon. “It’s a fast-paced, dynamic environment, so obsessing about the needs of the business while also being responsible for opening the eyes of the business, especially as it relates to being too early regarding new technologies, is essential.”

The CIO must also ensure that the IT organization can continuously deliver innovation to the business, adds Thomas. “Speed of innovation isn’t just a catchphrase, it is the key to competing successfully — particularly in an environment where change is occurring so rapidly,” he says. “The business is looking for you to deliver fast and then support the need to learn, adjust and refine the solution in near real time. That’s a tall order for many CIOs that are dealing with legacy systems and spend 80 percent or more of their budget on just keeping the lights on.”

On the plus side, the CIO position has been significantly elevated over the past few years, so he or she has a voice at the table, says RetailNext’s Cohan. “A lot of that is because the importance of enabling technologies has become significantly more important in the retail landscape, whether it is mobile payments, social media, analytics or automation.”

The CIOs who will survive and thrive and take their companies to the next level, are those who garner the absolute support of the business, says Sheldon: “The CIO needs to be willing to embrace new ideas, including working with cloud vendors and SaaS-based solutions, but also can prove that their organization can be agile and deliver projects very quickly, on time and on budget and work collaboratively with the business.”