How Can CIOs Speed Up IT Innovation In Retail?

by CXOtoday News Desk    Jan 28, 2014

retailinnovation

CIOs in the retail sector have the potential to spearhead the digital innovation agenda globally, but there’s a hitch as many believe lack of business resources within the organization are discouraging them from using the latest and disruptive technologies such as mobility, social media, cloud and big data and in turn speed up innovation. These are the findings of a latest research by Forrester Consulting, commissioned by TCS.

In the report, “The Global Agenda of Retail CIOs,” that examined the attitude of global retail CIOs towards key trends and disruptive technologies, almost two thirds of global retailers consider cost reduction as a major focus over the next few years, versus innovation which has been cited by less than two fifth of the respondents. Forrester report however states that emerging technology is poised to transform retail ib the most innovative way. However, if retail CIOs are to play a key leadership role in this dynamic new world, they must get out of the back office and lead the innovation agenda. In order to leverage emerging technologies in the most innovative ways, the report recommends the following to retail CIOs:

Become a C-level strategist, not a service provider: CIOs must shift their focus from cost savings to differentiation and innovation. Savvy CIOs will do both, turning to cloud and SaaS solutions to drive both cost savings and continued access to the latest technology innovations while they leverage partners to provide not only commodity outsourcing services, but also value-added capabilities like mobile development, architecture, and business requirements definition. To do this, CIOs must develop world-class vendor management capabilities and concentrate their internal resources on strategy, business alignment, and partner governance while partners concentrate on technology excellence.

Combine channels to turn data into actionable insight: Business plans demand growth, and retail executives overwhelmingly see growth coming from existing markets. They see the deeper digital engagement of consumers through mobile, eCommerce, and multichannel services as core to that growth. CIOs must play a key role in delivering this agenda. Multichannel integration requires sweeping changes to the supply chain, store systems, eCommerce, and other technology silos and must be underpinned by a cross-channel view of the customer. For many retailers, this requires major changes to complex legacy systems. Visionary CIOs are turning to the cloud to rebuild their core retail capabilities around commodity building blocks and are leveraging advanced analytics and optimization to provide business leaders with the real-time, cross-functional data they need to make better decisions.

Digitize the retail value chain: CIOs mustthink cross-functionally. Mobile, cloud, big dataand social media aretransformative technologiesif leveraged appropriately. If technology and sourcing decisions are made in functional isolation, firms will fail to leverage the true value of these technologies. CIOs must ensure that these key technologies are not seen as IT implementation projects, but as business transformation opportunities. By combining aspects of each of these key technologies, CIOs can transform the retail value chain by driving deep multichannel integration and developing a customer-centric operating model that delivers next-generation, digitally enhanced customer experiences

Currently however, retail CXOs’ core priorities remain revenue growth – with 87% citing it as a top priority - underpinned by multichannel integration and digital customer engagement. Even though they believe that the emerging technologies will continue to radically transform the retail industry status quo, they are not structured adequately to take full advantage of these technologies in the present scenario.