Retail Technology Collaboration

Retail Technology: Can “Collaboration” Become Catchy Again?

Mary Field, Implementation Specialist | Kyle Ferlic, Retail Analyst 

Talking about business collaboration can be nearly as commonplace as discussing organizational synergy. The terms have been overused to the point of ambiguity, and when professionals hear them in meetings or interviews, they glaze over, wondering when the substantive discourse will begin. That said, in considering this blog post, we gave pause to pondering collaboration as it relates to the subject of information technology (IT) implementation. Why? Because the two do not always go hand in hand.

The unintended but harmful silo mentality

In our retail experience, IT solutions are often selected by team or division leaders using technology to create efficiencies within their teams. The leaders recognize the time that might be saved by investing in the software, so they plan for it years ahead, purchase it at the beginning of the fiscal year and scurry to get it implemented as quickly as possible. Too little thought is given to how that particular piece of software impacts other teams. Additionally, discussion is rarely initiated until after the solution’s rollout about how complementary software can benefit other business areas.

This situation rarely occurs due to a lack of desire by team leaders to incorporate other business departments in decision making. In fact, it is mostly the consequence of traditional business hierarchy (i.e., decisions made from the top downward without explanation) and fast-paced, low-margin industries that cause a survival mentality within an organization. In other words, we understand why a retailer might get caught in the silo mentality when it comes to choosing a software vendor, purchasing solution sets and implementing them across a retail chain.

Important inquiries for retailers

So what factors can help retailers create the relational space to collaborate prior to, during and after an IT solution is rolled out, particularly so that everyone in the business benefits? How will an organization ensure that the solution meets the IT architecture, security and reliability standards of the organization? How does a retailer incorporate ideas from the best minds in the company before the solution is ever selected? How might that organization see companywide buy-in around the solution? How can that retailer experience maximum benefit from the host of functions associated with one purchased solution? These are difficult questions to answer.

Collaboration and open innovation

To give it our best attempt, we looked to an article published earlier this year by economics professors Rangus and Cerne1 about open innovation. Open innovation was made popular years ago by Dr. Henry Chesbrough of UCLA. He described how our traditional concept of business innovation (i.e., in-house scientists experimenting in labs) was severely limiting. Instead, he encouraged internal (employee-to-employee) and external (employee-to-consultant or business-to-business) relationships to generate ideas leading to market-breaking R&D.

What could that have to do with retail collaboration and IT implementation? In their article, Rangus and Cerne described several important elements that made innovation blossom within the studied organization:

  1. Employees’ openness toward each other influenced their ability to generate new and useful ideas;
  2. Beyond only creating healthy environments, leaders can invigorate associates and teams to be innovative;
  3. When leaders did that, they escalated their teams’ ability to negotiate, accept and implement solutions.

The retail frame of reference

Let us put that in the context of retail. When retail leaders create a culture where employees strategically intermingle with other departments and external thought-partners, tackling IT-related problems before, during and after solutions are adopted, innovation might occur. For instance, we imagine when associates from merchandising and category management strategically discuss operational technology issues, future IT solutions might benefit all parties. When finance professionals collaborate with food safety peers to propose new financial IT solutions, functions for those solutions might be expanded.

This need not stop internally. In our experience, a large part of finding the right technology solution, especially in the workforce management world, is partnering with the right vendor. Some vendors offer great technology but with little support. Best-in-class vendors will offer the technology and their expertise as a means to solving larger business problems, ultimately routing retailers toward optimization and success. This point is reinforced in Dr. Chesborough’s work on open innovation, especially regarding how exposure to the right external input can catapult businesses toward new horizons.

Pause for a moment

Now, there is a caveat to collaboration via open innovation. We recognize that collaboration must be balanced with effective budgeting and proper execution. When too many voices are involved in the design or financing of an IT solution, especially if those voices want to maintain the operational status quo, it can severely stall implementation. What this blog post proposes is a healthy balance between the three to drive organizational change.

To bring this full circle…

Returning to our questions at the beginning of this blog post, consider the following when collaborating around your next IT solution. Collaboration stems from culture, and the healthiest organizational cultures allow diverse voices to share their opinions during planning and implementation without fear of rebuke. The more departmental executives who sign off on the benefits of an IT solution, financial and otherwise, the more those leaders and their teams will be accountable for driving the necessary adoption of the solution in the future.

In conclusion, collaboration is an old phrase with new meaning if retailers use it strategically. When considering collaboration in the context of open innovation, collaboration has the potential to lead to more effective IT problem solving and implementation. It will take effort on the part of the retailer, as cultural shifts are delicate to balance, but it could be worth it.

References

  1. Rangus, K. & Cerne, M. (2019). The impact of leadership influence tactics and employee openness toward others on innovation performance. R&D Management, 49(2), 168-179.