It seems there is only one certainty at present and that is change. The retail world is in a constant state of flux fuelled by new technology and the ever-demanding consumer.
So, it was fascinating to hear major retailers’ take on this new world order at the recent Millennial 20/20 event which itself has rebranded as Futr.
Andrew Murphy, the recently appointed CIO of John Lewis, said the retail industry is experiencing a continued squeeze on its resources as consumers are less willing to pay for quality and service. Retailers are at the worst part of the supply chain eking out what margin they can.
He went a step further stating we are experiencing another ‘Engels pause’ in the fourth industrial revolution – the idea being that there is a lag between the introduction of new technology, its adoption and impact on wider society. Many may be left behind and never recover.
Murphy explained that many retailers have invested in front-end technology and only after a time realise the impact on legacy technology he warned that introducing new systems “can’t always be an iterative process”.
Julian Burnett, CIO and Executive Director – Supply Chain at House of Fraser, explained that technology ‘wears out’ over time but cloud technology has created a level playing for many retailers and removed costly barriers to entry to improve legacy systems.
George Goley, CTO at Argos, outlined four current approaches to technology in the market:
- Tech avoiders
- Tech aware
- Tech driven
- Tech companies
One can assume that tech avoiders and those that are merely tech aware will fall by the wayside, while pure tech companies – those that have been established for decades – will also find the future tricky to navigate.
It will be tech-driven companies – the likes of Facebook, Google, et al – that will thrive. It is not good enough to use tech as a supporting facet of your business, but rather position it at the very heart and use data and insight to inform each decision – that was the message at the event.
Keep it simple
Murphy, by his own admission, is not a tech expert, and asks his teams to explain in the simplest terms the benefits of new initiatives to the business, which he can then present to the board. He is a firm believer that tech for tech’s sake is pointless.
“Don’t be seduced by what is possible but rather the wider plan.”