Comment: Technology will drive success during economic upturn

The volume of financial updates from retailers in the last few weeks was a prime opportunity to take the temperature of the sector as it begins to prepare for the Christmas countdown.

Much interest has inevitably focused on the search for evidence of an economic recovery. That evidence remains frustratingly inconclusive, and at times contradictory, given the lack of real-terms growth in household earnings.

But there were other, no less significant, take outs to be had from comparing the commentaries of the store chiefs that accompanied the raft of results.

Most striking of all perhaps was the focus placed on technology.

It’s become close to a cliché to describe retail as a technology-enabled industry, but that makes it no less true.

Technology now connects every facet of retailing, from its traditional role driving efficiencies to its ever-growing position as a lynchpin for future growth.

In a report on IT in retailing, to be published at the Retail Week Technology Summit next week, one IT leader sums it up neatly saying: “Technology is at the heart of what we are trying to achieve; it drives the business strategy.”

It’s a significant shift, but hurdles remain. The growth of ecommerce and the digitalisation of departments such as marketing have confused traditional lines of responsibility; while the recruitment of the right IT leaders - those who can combine technical know-how with genuine commercial savvy - is a growing challenge.

Such issues are reflected in the sector’s continuing battle to attract the best young IT talent. In fact, a survey of more than 300 IT graduates for the report found that only 4% of the respondents listed retail as their preferred career option.

The best retailers have continued to invest in technology despite the downturn, recognising the response needed in order to meet the structural changes that have run in tandem with the economic downturn.

It should be no surprise to see these businesses at the vanguard of those taking advantage of the economic upturn when it does finally take root.