In hopes of drawing customers back into stores, many retailers aspire to operate ‘the store of the future,’ identified by customer-centric, advanced smart-store technologies like digital signage, smart inventory management, and self-checkout systems. But not every retailer understands just how difficult that vision is based on its current state of IT operations.
“Many organizations see their IT infrastructure as a dependency for the end product — the retail store — but in reality, it’s an enabler of that product,” says Samir Sandesara, Product Manager for Retail Edge Solutions at Dell. “From capability to efficiency to security, building a foundation of a futuristic store has to start with rethinking IT.”
A seamless, efficient, and personalized shopping experience is where the retail industry is headed, no argument. However, delivering this futuristic experience with speed, at scale, while keeping existing workflows and business running, is near impossible without updating the underlying, foundational systems that support it. To fully leverage today’s emerging technologies and deliver the experiences customers are expecting, retailers must modernize their stores' IT infrastructure for three critical reasons:
1. Outdated systems lead to time-consuming and expensive processes
IT management in retail today revolves around the management of resources dispersed over a wide geography. So many tasks, repairs, and upgrades require retailers to send a person to a site to perform the action. Installing and configuring software and hardware for each site, one at a time, is a time-consuming and expensive process — and the time it takes is proportional to the labor dollars retailers must throw at it.
For example, one home improvement retailer operates with a hardware update cycle that can run as long as 18 months for one phase. According to Sandesara’s experience, it is not uncommon for many retailers to have to start the next update cycle as soon as the first one is over, due to the large number of devices and stores when considering the available IT resources.
We can also see issues with outdated systems when it comes to rolling back system updates or addressing critical failures. When the retail infrastructure is bare-metal, it can be physically difficult to update and manage. That can slow down the pace of change for the business. When critical failures can’t be rapidly addressed, it affects operations. Suddenly, it's a real business risk. Retailers may have to resort to shipping IT teams across the globe to get their systems back online; whereas a virtualized workload that is running on a consolidated, managed platform could be rolled back in a few minutes.
The physical limitations of legacy infrastructure can prevent retailers from embracing new use cases today because it would simply be too expensive and time-consuming to deploy the changes onsite. Only when retailers understand the value of modernizing these systems does it become a business priority to do so.
“When you see how quickly retailers can roll out changes utilizing a modernized IT infrastructure, the difference is jarring,” says Sandesara. “It’s the difference between deploying techs to sites for months versus hitting a button behind-the-scenes. Then, when you move beyond updates to trying to build a modernized smart-store environment, one that is constantly evolving, you can see how broken the old paradigm is because the costs simply scale out of control.”
The ability to deploy new technologies quickly and easily contributes to overall operational efficiency of a retailer, and makes it possible to introduce new technologies, processes, or upgrades more quickly and in a cost-effective manner.
2. Outdated systems can’t support the technology retailers need
The store of the future offers consumers a range of innovative technologies designed to enhance their experience: digital signage that offers targeted ads, smart inventory that ensures optimal stock levels, and intelligent checkout systems that provide a faster, more convenient shopping experience. Instead of deploying these tools virtually on top of a consolidated IT stack, many of these technologies are deployed on single-purpose hardware. The hardware is mismatched, difficult to manage, and can’t be used to its full potential.
“When retailers try to implement new capabilities into their current systems, they end up piecing together multiple pieces of hardware, all with their own refresh cycles and management processes,” says Sandesara. “Each piece of hardware delivers a different use case on a different schedule, resulting in a very complicated physical environment. It becomes a complex operation just to keep systems afloat, let alone use them to their optimal capabilities.”
The best approach to building a retail store that makes the most of cutting-edge technology is to lay the groundwork for it with a mature and capable IT platform. Otherwise, every new initiative or new technology use case will require a new deployment of hardware that also has to be separately updated and maintained.
3. Outdated systems leave openings for more security vulnerabilities
More complex, costly timelines and a limit on capabilities are not the only risks associated with stacking new technology on old without modernizing the entire system. In a technological era where 75% of retailers were hit by some kind of ransomware attack, security vulnerabilities stand out as a significant risk that can plague retailers and that expose them to cyber threats.
Ultimately, each piece of software added to a retailer’s technology stack introduces different vulnerabilities into the system, all networked together. And as older software with dependencies on older hardware continue to require older drivers, the attack surfaces continue to expand.
“When you don’t look at IT infrastructure through a holistic lens, every addition inadvertently expands the attack surface malware has to gain entry into the system,” says Sandesara. “That adds exponential costs and issues when it comes to unreliability and the risk of cyberattacks across your entire technological footprint.”
When a retailer’s smart technology footprint is built off of a secure and integrated IT foundation, they see benefits in both performance and security measures. The technology works together as part of one system, and the retailer can remotely manage many processes instead of performing onsite, human-driven procedures.
Especially in the case of security vulnerabilities, a modernized IT infrastructure allows retailers to streamline and optimize a response that could otherwise result in significant downtime. For example, if a retail team is able to monitor a security threat in real-time, a modernized infrastructure will lend them improved detection speed and response, as well as speed of recovery. Better still, systems can self-monitor and autonomously roll back to last known good configurations. This signals the end of going on-site just because a system fix has to be deployed in Safe-Mode or to undo an update.
Outdated Systems Keep Your Store Stuck in the Present
Despite the growing list of opportunities retailers can act on by using advanced technology, many struggle to implement these technologies due to the limitations of their outdated IT systems. When these legacy systems are unable to support the advanced functionalities required for smart-store technologies, it hinders a retailer’s ability to innovate and meet evolving customer expectations. The time-consuming nature of existing processes also prevent retailers from quickly adapting to new opportunities and challenges, ultimately affecting their competitiveness and profitability.
To overcome these challenges, retailers need an updated, modern IT infrastructure that can support the deployment and secure management of advanced technologies. Intel and Dell Technologies are working with retailers to develop products and solutions that accelerate the deployment and management of intelligent store technology. By adopting advanced technologies like Dell's NativeEdge running on the latest generation of Intel® Xeon® Scalable processors built for edge environments like stores, retailers can overcome the limitations of outdated systems, enhance customer experiences, and achieve significant operational efficiencies and cost savings, building a clear and study runway for ‘the store of the future.’
To learn more about how Dell and Intel are helping customers modernize their IT footprint to meet the demands of a technology-driven retail environment, visit Dell.com/NativeEdge or reach out to learn more.
