How can Retailers cope with rapid changes in technology?

By David Watson

There was a great session at the Amazon Web Services (AWS) re:Invent 2019 conference this week.  The presentation showed how a major EU utility moved their legacy meter data system to the cloud on AWS.  The utility needed to ingest 12.5 billion raw data points from smart meters generating 288M messages daily. There was a complex set of business drivers and potential value drivers to understand and a variety of technical solutions to evaluate to meet the varying demands of the different business units.

With the need for technology to meet new demand, how can Retailers better understand their own requirements and correctly apply potential solutions to solve those problems?  The Cynefin Framework provides decision-making contexts to better understand situations in your business. And, if extended to technology, it helps you start thinking about how to apply technology within specific types of situations.

Simple

The Cynefin Framework starts out (in the lower right quadrant, moving around counterclockwise) with the Simple context which includes situations that are obvious and clear to most users. Consider use cases that most everyone experiences in their professional or personal lives.  What’s the best way for employees to communicate across disparate locations?  If the corporate office is based in Texas but salespeople or brokers are located in the Northeast, how can people communicate with each other?  A Retailer wouldn’t need to hire a technology consultant to figure out what combination of phone, email or collaboration tools like Slack all serve some or all of these basic requirements.  One could easily sense what’s needed, categorize the priorities (phone calls versus emails versus text messages) and respond with a simple set of solutions.

Complicated

Next the Complicated context moves into situations that are well known, but many options might exist to solve the problem. What would a Retailer do to manage a detailed customer database with history of past and current contracts, discussions with individual customers, concerns about customer retention, opportunities to track prospects, etc.?  There are dozens or more established Customer Relationship Management (CRM) systems on the market that have been used for many years.  Some Retailers have chosen to build their own CRM system internally, while others might leverage popular CRM systems like Salesforce.com, Oracle Netsuite or Microsoft Dynamics. The Retailer would still need to sense what’s needed. However, the next step would be to analyze all potential solutions from a functional, technical and financial perspective to determine what’s the most effective CRM – and then respond by implementing the best solution.

Complex

The Complex context moves into the space of requirements that may not have been met previously.  Some examples might include the EU retailer speaking at the AWS conference about ingesting 288M messages on a daily basis where existing solutions didn’t exist.  Another example might be a compensation management solution that falls into the Complicated context on its own, but ends up in the Complex context when you consider it must be integrated to 2-3 other ERP, CRM or other billing systems.

A previous EMC article from January 2019 proposed three steps to simply compensation management found here.  This is a great example of how to apply a framework or methodology to move from Complex to Complicated, and even Simple, over time.

Chaotic

The Chaotic context is what it sounds like – uber chaos! Given the timing around the holiday seaons, how might Amazon.com respond if their entire web site went down?  The team would act immediately to get the site back online quickly.  Eventually, the Amazon.com team needs to sense what technical and business solutions might be applied in the future to address the situation.

As technology continues to mature, the solutions shift requirements from the Complex to the Complicated and the Complicated to the Simple. Before cell phones and email, communication might have been Complex 20+ years ago.  But now that’s Simple. As you take on new technologies and face the classic question of “buy versus build, “Consider how your business might leverage this framework to deal with the challenges of an ever-expanding technology landscape.

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David Watson is a Vice President of Pariveda Solutions and lead executive for the CRAFT business unit.