Automation – developing digital capabilities for retailers

Retailers no longer need to be convinced about the true impact of emerging digital technologies for their customer-facing services. From personalised marketing and mobile loyalty, to in-store real-time inventory, the way brands and customers interact has changed dramatically.

However, the cost of developing these digital capabilities is the biggest challenge faced by retailers. Developing new front-end tools and gadgets to keep shoppers hooked is crucial. But to achieve this, back-end systems have to be transformed.

At the recently held exclusive round table dinner, Syntel, in association with Retail Week Connect, interacted with some of the big names in the retail industry to find out what steps are necessary to modernise retail businesses from a digital standpoint and whether automation is the most cost-effective answer.

Behind the scenes

From designing and implementing a robust digital infrastructure, to attracting the right talent and building a development team, a chief technology officer’s (CTO) job is complex and ever-changing. There was consensus among retailers that achieving consistency in the customer experience and defining what digital really means to a retail business is crucial for a CTO.

One ecommerce director at the event said: “Things have changed so much. In an ecommerce system, a small change you make one evening will affect millions of people the next day.”

With so much at stake, it’s vital that retailers revisit the behind-the-scenes locale of their systems. The back-end system of any ecommerce platform has to be efficient and highly sophisticated, according to Syntel’s head of Europe, Ben Andradi. “Businesses require a sound investment from retailers, often without clear identifiable returns in the short term. To wow the customer, businesses should have a clear vision and make proactive investments that would help them stay ahead of the curve. Success stories in retail – such as Sainsbury’s – reflect this trend.”

Everyone agrees that retailers are cash-strapped and the challenge is to find an investment when the RoI is unclear. With this relative uncertainty, and with budgets under close scrutiny, Ben Andradi believes it is vital that retailers use all the technological tools at their disposal to work efficiencies into their systems. He adds: “Retailers are getting the raw deal on the margins because of pure-play online retailers and hard discounters. With the consumer-driven digital change, they do need the extra cash to invest in digital capabilities such as mobile and store experience. This cash can be generated from savings made in automation of the day-to-day IT operations.”

Driving data

There is good news. Customer data and analytics are already showing tangible rewards for investors. A retailer at the event said: “We’ve invested in the technology to know more about our customer, and we are to offer online product suggestions based on what they bought last time. We’re at an early stage and this is all coming from our own internal data.”

Data is invaluable, but can be expensive to operate and maintain. However, with the right approach, these costs can be driven down. Ben Andradi outlines Syntel’s own solution, SyntBotsTM, which has proven credentials in reducing costs, time, and efforts for retailers and banks. “The system automates repeatable tasks and removes manual intervention across development operations, processes and IT operations. These customers have seen the IT operational costs dip to a scale of 70% and the digital go-to-market time by 50% at the least,” he said.

CTOs realise the importance of these savings and their relevance to their businesses, and to the future potential of investment. It’s a complex new world, and retailers need to do a lot to stay ahead of the competition while keeping costs down. The need is to embrace this challenge and look for exciting new solutions.

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