Thoughtworks Retail recently hosted a dinner in New York City for top retail executives in the local market. Our guests included a mix of IT, Digital, eComm and Customer Experience executives from major retail companies. We enjoyed a great evening of cocktails, dinner and engaging discussion around innovation and how retailers are innovating in an era of continual business disruption.
The overall takeaway from the discussion was evident – innovation is critical in order to compete in the ever-changing retail landscape. But what is the best approach to innovation and how is it being driven within each organization?
We discussed the various obstacles that retailers face everyday in their pursuit of innovation including: existing organizational structure with P&L ownership prohibiting cross-collaboration; identifying new metrics to measure success; technological debt in legacy management versus integration costs; and being able to respond quickly to continuous change and new threats.
Smart retailers are finding ways to create innovation, including cross-functional teams. They’re examining business processes of all kinds and seeking to remove organizational hurdles, like figuring out who gets credit for a purchase made online, then picked up in store. They’re looking to realign retail KPIs to online KPIs. Some are looking to third party vendors to help manage integration and enable next generation architecture. All agree that the impetus has to come from the top. “Transformation is part of the job description.”
Another challenge discussed is the evolving role of IT within an organization. As IT becomes more of a utility player in some companies, management has to prioritize and reward IT departments that enable a responsive enterprise nimble enough to continuously move the company forward. For many retailers, this means working with experts from technology companies that can offer new viewpoints and better efficiencies.
Physical stores are still essential in providing a more engaging customer experience and provide retailers a platform to bring their brand to life. Many companies are focused on the store experience, and an increasing number have appointed SVPs with titles like “customer experience,” “innovation” and “strategy.” Marketing is requesting additional technology funding to better engage with customers.
Participants acknowledged that their customers now, at a minimum, expect a seamless shopping experience across all channels – making customer experience a top priority. Creating a meaningful customer experience is the key differentiator that will either enhance or diminish brand loyalty in a world where retail is anytime, anywhere.
Thoughtworks acknowledges the Traditional Owners of the land where we work and live, and their continued connection to Country. We pay our respects to Elders past and present. Aboriginal and Torres Strait Islander peoples were the world's first scientists, technologists, engineers and mathematicians. We celebrate the stories, culture and traditions of Aboriginal and Torres Strait Islander Elders of all communities who also work and live on this land.