I love it when commentary about the future of retail and technology made by myself and my colleagues is validated by a respected industry expert.
So when I saw an article in Forbes by Nikki Baird, managing partner at Retail Systems Research, I was really pleased.
The article, Retailers Need to Invest In Technology Architecture to Survive 2018, highlights a “laundry list” of technology that retailers absolutely must pay attention to if they are going to survive in today’s brutal industry climate.
The key points that jumped out for me were Nikki’s recommendations for investment in the following areas:
- SOA: “Service-Oriented Architecture is important for retailers, because this architecture strategy really does promise all of the benefits of automation without giving up any flexibility.”
For us at Software AG, that means microservices which allow you to scale to your hearts content, use multiple programming languages, make changes dynamically and connect your IoT “Things” using these light-weight modular services.
- Process orchestration from a neutral vendor: “I see a lot of value in investing in “Switzerland” – a neutral solution provider focused on process orchestration out of the box.”
This is something I talk about a lot in terms of Software AG. Our independence as a vendor avoids vendor lock-in and helps to provide that “Switzerland” that Nikki mentioned.
- API management: “When you’ve got 5,000 API’s or more per application, you’re going to want something that helps you manage and monitor those.”
Again, this fits into our value proposition beautifully, as webMethods allows you to seize control of your APIs from end to end with an API management solution.
- The ability to extend strategic platforms: Over the last 10 years or so, retailers have placed a high priority in the implementation of commercial-off-the-software packages.
Driven by the dramatic changes in the retail world and the move to omni-channel, there are certain things these platforms cannot yet accommodate. If you want to create a subscription business line to compete with “Rent the Runway” or differentiate online offer akin to Jet.com then this will require the extension and orchestration across these commercial-off-the-shelf applications. This is exactly what webMethods AgileApps is built for.
- Data management & analytics: Nikki said that retailers must invest to normalize data across the enterprise, and use common tools across the enterprise for analyzing data so that the entire company can operate from a single version of the truth.
This also speaks to our webMethods platform which gives you the ability to ingest, refine and deliver Big Data in order to parse, sort and analyze it with speed and scalability.
Nikki’s Bottom Line
Nikki concluded that retailers need to stop defining technology investments in terms of an ROI based on selling more stuff or operating more cheaply. “[If] they have a short-term time horizon on that – like 3 years or less – then they will never make the investments they need to make to build a technology platform for the future,” she said.
I agree. As I said in my 2018 predictions, retailers have to eat or be eaten. Failure to transform will lead to retailers filing for bankruptcy or being acquired.
Nikki said that this is the year retailers finally recognize that their IT capability is as much a contributor to the future of their business as their supply chain or product design or store base. “I think this is the year that will start to separate those who get that from those who don’t, in terms of their ability to compete,” she added.