
Industry executives and experts share their predictions for 2019. Read them in this 11th annual VMblog.com series exclusive.
Contributed by Karmesh Vaswani, EVP and Global Head of Retail, Infosys
Retail, Supply Chain and Emerging Tech
Not to be left behind in the age
of digital transformation, the retail sector will become smarter, more
connected, and more immersive in 2019. Driven primarily by data for customer
experience and digital operations, retail enterprise will move
beyond pilots and proof-of-concepts to become mature in effective usage of data
collected from diverse sources.
Infosys
research projects 4% to 5% growth for the US retail sector in 2019. Technology
investment growth will match these growth rates in the US and other developed
countries. This growth mindset will motivate CIOs to shift their priority from
cost reduction and risk mitigation to revenue impact, to innovate for new ideas
and business models, supported by a data-centric culture.
- Technology investment growth will match
these growth rates in the US and other developed countries. This growth
mindset will motivate CIOs to shift their priority from cost reduction and
risk mitigation to revenue impact, to innovate for new ideas and business
models, supported by a data-centric culture.
- Stores of the future will become context-aware,
understanding why a consumer is looking to buy a particular product at a
specific point in time. Non-intrusive user interaction across physical and
virtual channels will help to create relevant personalized experiences. In
the next 3 years, more than 80% of consumers across segments will be in
favor of such engagement and be influenced by it in their purchasing
decision.
- The experience will be immersive in nature,
providing rich digital product content and insights beyond just pricing,
on multiple devices, nudging customers to make a choice. Augmented reality
(AR) will be a top investment area, with more than 50% of consumers using
AR on their smart phone for product evaluation and comparison in the next
2 years.
- Store operations will become self-adaptive,
making autonomous decisions. Robotic Process Automation (RPA,) backed by
Machine Learning/AI with cognitive capabilities, will enable near
real-time, rational decisions. This next-generation RPA will
consolidate insights mined from internal operations and the external
market. RPA will automate more than 50% of operations in every function in
the retail sector within the next 3 years - from HR and talent acquisition
to supply chain, finance, store operations, IT services and planning.
- Supply chains will become cognitive in decision making
and nimble in operations, with shrinking order sizes and fulfillment cycle
time. This will help them become responsive to fluctuations from
consumer demand and nature. Data-oriented supply chains with visibility
into shipment status will enable more accurate lead time and delivery
prediction, accelerating the trend away from statistical models.
- Distribution systems will adopt multi-modal logistics,
shrinking the gap with customers, targeting an elusive and ideal zero
distance, moving as close as possible to the point of consumption.
- The rising need for traceability and transparency
from farm-to-fork will see wide blockchain adoption, saving retailers and
manufacturers from excessive litigation in the food and consumer sectors.
Regulatory requirements will move the hype from cryptocurrencies to
material, financial and process traceability as the strongest, must-have
use cases for blockchain. This will be important to effectively manage or
hopefully prevent problems causing inconvenience to the consumers.
- To play catch up with smaller and new age players in
the technology and developing market race, retailers will look for
partnership and inorganic growth in niche technology areas (AR/VR,
IoT, blockchain, AI/ML), new product categories and market segments. More
than 50% of top line growth will be from new classes of products, segments
and geographies, leveraging digital technologies.
- Brick and mortar retail giants will focus upon
leveraging what has traditionally been their strength in physical stores
and supply networks. They will not just copy the digital native new
entrants. If pilots such as Wal-Mart's Alphabot - an example of humans,
robots and algorithms working in collaboration for order fulfillment - are
successful, retailers will scout for more such players to scale up.
- With accelerating technological changes, IT and
business people alike will play more important roles to conceptualize,
implement and manage the transformations for a smart workplace of the
future. Retailers will go beyond the usual classroom-based training,
investing significantly to leverage emerging technologies for large scale reskilling.
More than 50% of the budget and participants will be from business units
and functions outside the CIO's office.
- Traditional roles such as the cashier will see less
growth, eventually becoming a quaint exception while new roles such
as data analysts, systems engineers and programmers will see significant
growth, starting with large format stores. In the next 3 years, 50% of
roles will see churn, with new roles not yet named.
- Among all these changes, IT infrastructure enhancement
will accelerate to match industry expectations:
from mobile apps to IoT, cloud, enterprise systems and data centers.
- 80% of investments for new IT applications and
technology will be off-the-shelf, needing little customization, with rapid
deployment on cloud, a mobile app for last mile human connectivity and IoT for
closed-loop asset monitoring. Partners will better
understand the business, working in collaboration with retailers to apply
technology solutions where it matters most, in ways that are secure and do not
compromise consumer privacy.
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About the Author
Karmesh Vaswani, EVP and Global Head of Retail
Karmesh is the Executive VP and Global Head for
Retail, Consumer & Logistics at Infosys. With over 25 years of experience,
Karmesh is a customer-centric, values-driven, industry partner and leader. His
expertise includes strategizing, architecting, and delivering
technology-enabled business performance improvements for Fortune 500
Enterprises.
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