As consumer habits continue to evolve after the reset seen during the pandemic, retailers face the challenge of having to also evolve – often looking at how to repurpose their back-office tech or even re-platform altogether.
Against this backdrop, PMC – a consulting, professional services and engineering company focussed on retail – and Retail Gazette gathered a panel of retailers together in London to discuss, under Chatham House Rules, how to manage this evolution.
The panel was quick to dive right into the crux of the challenges they themselves face, stressing how they are all grappling with the shift from legacy systems to more agile, composable architectures, a journey, they agreed, was fraught with challenges.
One panellist from a well-known UK grocery chain shared how she recently moved from the food side of the business to the non-food division, where she is now dealing with legacy systems more than ever before. How, she wondered, can she manage the process of migration?
One panellist from a world-renowned footwear maker and retailer firstly suggested that the retail industry was perhaps caught up too much on terminology, with many feeling confused by what exactly composable commerce meant.
He stressed that, to persuade those in the company that have to foot the bill for re-platforming – and indeed for those that will have to actually use a new system, more of which later – it was perhaps better to explain to them the benefits of composable commerce, rather than just bandying its name about.
He provided a useful analogy, suggesting that for those within the company who were perhaps not so familiar with the terminology, it was helpful to liken the move from legacy system to a composable one as like “the shift from a “dumb phone” to an iPhone – moving from a monolithic, one-size-fits-all system to a platform where retailers can pick and choose the best apps and functionalities to suit their needs”.
In response, many of the retailers represented said they too were struggling with outdated, legacy systems. The CIO of a building supplies company, which helpfully is well down the path to composable commerce, shared how he has overseen his company moving from 13 different ERP systems to a single, modern solution.
It’s all about the data
The biggest challenge he said that needed to be overcome was not so much the terminology, but how to make sure that the data the company had across a range of legacy systems could be used in anything new – to not just offer continuity of service, but also to deliver new benefits and futureproofing.
The data cleansing and migration process was a significant challenge, he said, but he saw it as an enabler to unlock greater efficiencies and flexibility down the line. Similarly, another well-known grocer said it too was grappling with aging systems, highlighting the widespread nature of this issue in the retail industry. Its head of logistics also emphasised the importance of data quality and having a “single version of truth” as a foundation for their composable journey.
He highlighted the challenges his organisation has faced: “The key block when we try to roll out new systems – which we’re trying to do at the moment – is the data quality and having the data in one place,” he said. He went on to explain that the process of moving all of the company’s data into a strategic data lake platform has been one of the most difficult aspects of the project, as it requires extensive data cleansing and consolidation.
The building supplies retailer had experienced similar issues, noting how that played out when moving from those 13 ERP systems. “For example,’ he said, “you might have John Smith appear across 10 different brand accounts across three different systems. Is that the same John Smith, because it’s called John Smith? Is it also the same John Smith that appears in one system as John Smith and as J Smith in another? Which is that all the right person or so you got to do a lot of data cleansing and deduping – it’s hard.”
Empower to the people
While cleansing data is important to any migration, perhaps more so is not rushing it. Of those panellists that had travelled some way along the migration journey attested, as people need to keep up.
As the panellist from the shoe company pointed out: “We went from a monolithic platform straight into composable and the biggest problem we had was people reference back to what they could do on the old system and not on this one. For example, they would say ‘I used to be able to do JavaScript, that’s my job and if I don’t do that then do I have a job?’. We have to show them what they can now do with the new system and how much better that is. You have to bring them with you.”
The panellist from the building supply company agreed. “It’s very easy to go too fast and you start getting the murmurings of resistant staff going ‘I can’t deal with it. It’s just every release seems to bring more of a change’. Instead, we have had to cultivate a change in mindset slowly and help them adapt as it changes.”
So, how do you do that? Underlying all of these technical and strategic challenges is the critical need to effectively manage change and communicate the benefits to employees. Speakers shared various approaches, such as tailoring messages to different employee profiles – such as career-driven versus job-focused, for instance – involving stakeholders early in the process and using engaging training methods such as videos and “tips and tricks” repositories.
The importance of empowering employees and giving them autonomy was also highlighted, but with the acknowledgment that this must be balanced with the right controls and monitoring to avoid potential pitfalls. As one panellist pointed out: “the more power you give people, the more you have to culturally remind them to hold on ‘We’re on a journey’.”
Vendor selection and partnerships
Aside from the managing data and keeping staff on-side, choosing the right technology partners is another key consideration for retailers embarking on their composable journey. But a panellist from host company PMC highlighted the importance of not just evaluating the technical capabilities of vendors, but also their ability to work collaboratively and their overall “personality” fit with the organisation.
The need to be able to handle the immensity of moving from legacy systems to new, composable based systems – often over a lengthy time frame – as well as keeping staff happy requires more than just technical know-how and access to state-of-art tech. It is more subtle than that; it is about how all that expertise fits with the client company’s only view of how to move its business and its staff along.
“I think sometimes it comes down to the personality that people are picking as much as the vendor and the partnerships,” he said. “The ability of vendors to work collaboratively and seamlessly with one another is just as important as the individual technical solutions they offer.”
This sentiment was echoed by PMC’s other representative, who noted that the most successful technology partnerships are those where vendors are willing to work together, rather than trying to protect their own proprietary solutions. As he explained, “We’ve all got to accept that each vendor and each platform are each going to maybe have a small slice.”
The decision between choosing a larger, more established vendor versus a smaller, more agile provider was a dilemma faced by the grocery chain that was in the process of replacing legacy systems in its non-grocery business around its customer data platform (CDP) implementation
“We do have a bit of an issue with getting people on board,” she said. “And I think it is what you say about people not having seen the data before.” In this case, she acknowledged the need to carefully evaluate the roadmap and capabilities of potential vendors, as well as their ability to effectively communicate the benefits of the new system to stakeholders.
As PMC then pointed out: “Suddenly people across the business of finding out ‘Oh, this isn’t right’ and it is then about getting people to realise that yeah, it’s not right. But before who knows what was wrong, like there could have been a lot more wrong before we just didn’t see it.”
The panellist also stressed the importance of considering corporate compliance and accountability when selecting technology partners. “Does that play a part in the business, or do we go for a little agile vendor?” asked one. This is a critical factor, especially for larger organisations that need to demonstrate to their shareholders and board that they have invested in the right solutions.
In the end, the consensus among the speakers was that the selection of technology partners must go beyond just technical capabilities and include a deep understanding of the vendor’s culture, roadmap and ability to work collaboratively within the retailer’s ecosystem. By taking a holistic approach to vendor selection, retailers can better position themselves for success in their composable commerce journeys.
Five lessons learned and the path forward
So, what did we learn? Across the roundtable discussion, several key lessons emerged that can guide retailers on their composable commerce journey:
- Prioritise cultural change and change management: Implementing new technologies is as much about people as it is about the technology itself. Retailers must invest time and resources into effectively communicating the benefits, managing resistance to change, and empowering employees to adapt to new ways of working.
- Embrace a phased, iterative approach: Rather than aiming for a big-bang transformation, retailers should consider a more gradual, phased approach that allows for quick wins, learning, and continuous improvement. This helps build resilience and buy-in within the organisation.
- Carefully evaluate technology partners: The choice of technology vendors and partners is critical. Retailers should look beyond just technical capabilities and consider factors like the vendor’s ability to collaborate, their roadmap, and their overall “fit” with the organization’s culture and needs.
- Leverage data and analytics strategically: Retailers must ensure they have a solid foundation of clean, reliable data that can be leveraged across the organisation. This includes establishing a “single version of truth” and using data-driven insights to inform decision-making and drive continuous improvement.
- Embrace agility and adaptability: In an era of rapid change, retailers must cultivate a mindset of agility and adaptability. This means being willing to experiment, fail fast, and continuously evolve their technology and processes to stay ahead of customer demands and market shifts.
By addressing these key lessons and navigating the complex landscape of legacy systems, cultural change, and emerging technologies, retailers can position themselves for success in the era of composable commerce. The journey may be challenging, but the rewards of a more agile, customer-centric, and future-proof retail operation are well worth the effort.
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