CIOs in the cash-strapped retail sector are starting to collaborate and work together to enable them to keep innovating in difficult economic times.
IT teams in different companies are increasingly talking to each other and providing support for new projects, which helps to reduce risk and save resources.
Aurora Fashions, which owns high street brands including Oasis, Warehouse, Karen Millen and Coast, is working with shirt maker Thomas Pink on a cross-channel system that will allow customers to reserve a product online and collect it from a store, or buy in store and have purchases delivered. The system also aims to provide a single view of the customer using customer relationship management (CRM) technology.
Aurora Fashions is also in early talks with other retailers on collaborating on a mobile till project.
Innovation on a budget
Aurora's group IT director John Bovill is working with Peter Milla, Thomas Pink's IT distribution and e-commerce director, and says it is a good way of experimenting and innovating under tight budgets.
"There is a need to invest in customer-facing technology. What is important is the ability of the IT team to experiment and continue to be flexible and agile. The answer is to collaborate, not just with our technology providers, but also with other retailers. This is a logical and sustainable approach operating within a tight spend world. It also makes sure we benchmark the IT service and continue to be challenged," says Bovill.
Brian Hume, managing director of Martec International, which produced a report on the top UK retailers' use of IT, says it is usually suppliers who bring different companies together.
"The most obvious place you would expect to see [collaboration] is in subsidiaries of the same group, where CIOs can easily take a group view. Companies like Oracle Retail, SAP, JDA and Aldata have user conferences each year where the customers all get together and debate what R&D they would like the vendor to do in the next year or two. This is a very important source of input for these suppliers since this is what encourages their retail customers to renew maintenance," he says.
Before you start…
A few boxes need to be ticked before collaboration is helpful. Companies need to have similar supply chains and preferably work on the same or similar platforms - Thomas Pink and Aurora Fashions both use a BT platform and work with BT Expedite.
A formal governance process is helpful, facilitated by the shared supplier, to avoid the risk of sharing sensitive corporate information and provide some ground rules.
Most importantly, CIOs need to find like-minded individuals before embarking on a project, and find companies that are not direct competitors. Once the hurldes are overcome, collaboration can be helpful for IT teams in a competitive industry, as working together helps them exploit new technologies without wildly increasing costs.
If teams can talk to each other as they implement systems, they gain from increased support and access to expertise and knowledge. In doing so, it also cuts the risk of new projects in what is often a high-risk sector.
"The need for technology experimentation to enhance the customer experience has increased within an information age and collaboration is a logical way of meeting this need within the constraints of our sector," says Bovill.
He believes this kind of collaboration could work in sectors other than retail, but says it would only be useful in markets where IT is not part of the intellectual capital or "core competence" of a business. In retail, product development is a company's core competence, making collaboration in that area a no-go.
As long as all the obvious pitfalls are avoided, Bovill says IT collaboration can help with everything from risk mitigation to improving the speed of projects to market. "Ultimately, it helps with delivering a better customer experience," he says.