Why retailers must break down team silos to drive digital innovation and growth

This article is brought to you by Retail Technology Review: Why retailers must break down team silos to drive digital innovation and growth.

By Abdi Essa, Regional VP UK & IE, Dynatrace.

The pandemic hit global retail hard, but not in an even way. The fortunes of supermarket chains soared, whilst fashion retailers were forced to shutter their high street stores and struggled for many months.

Yet there’s one trend that unites the sector: the pandemic has added a new urgency for digital innovation. As far back as 2017, experts were claiming that as many as 96% of consumers would walk away from brands if they had an unsatisfactory experience. Today, the digital imperative is even stronger.

In fact, according to global retail CIOs we polled recently, 89% say digital transformation has already accelerated, and a further 61% believe it will continue to do so going forward. Yet this also puts the pressure on IT teams already struggling to “keep the lights on” while supporting radical workplace technology shifts. To get the insight and control they need to deliver value to the business, the answer lies with automatic and intelligent observability delivered from a single unified platform.

The pressure’s on for IT

Even ‘essential’ stores that were allowed to stay open during government-mandated lockdowns experienced a huge surge in online traffic during much of the pandemic. In the UK, online sales grew 36% in 2020, the highest such figure for 13 years. Those capable of supporting multi-channel and omnichannel retail experiences and mobile commerce fared best—illustrating changing consumer habits. Retailers must meet these evolving expectations to safeguard operations and drive revenue growth in a highly competitive sector.

Yet for IT teams, the demand for faster innovation and new user experiences is a struggle, when placed in the context of traditional silos, and ineffective IT monitoring and management tools. It also adds to an already significant workload. Nearly half (45%) of retail CIOs believe their IT teams are stretched more thinly than ever today. They’re being tasked with supporting rapidly changing business requirements and sudden fluctuations in digital service demand from customers and their workforce.

This pivot to online will also outlast the pandemic. According to separate data, 40% of global consumers increased their e-commerce spending during lockdown and 45% said they’ll continue to shop online even after the crisis recedes. An increase in users and scrutiny can lead to unwanted side-effects: we found 46% of CIOs have recently experienced an increased number of IT performance-related issues. These can have a major negative impact on the consumer or user experience—affecting staff productivity and customer engagement.

The barriers must come down

The problem for many retail IT departments is that there are multiple disparate teams designing, building, and deploying the software that drives IT operations and the customer experience. Many use different tools to monitor and manage applications and infrastructure – compounding silos and making it difficult to collaborate and solve problems. We found 45% of retailers have IT and business teams working in silos and 41% have data stored in separate monitoring tools. The result is complexity where there should be clarity – into the end user experience, and whether changes to digital services deliver business value.

Modern cloud-based IT environments are a patchwork of interlocking containers, microservices, serverless architectures, orchestration platforms, and more. They are both complex and dynamic – characterised by billions of dependencies that might change in milliseconds. If IT isn’t getting accurate visibility into this environment and becomes too disconnected from the business, then serious challenges start to appear.

It becomes harder to identify, prioritise, and minimise the impact of performance issues, to properly understand and meet changing business and customer expectations, and see where IT is delivering value. Without effective insight, IT teams waste their time finger-pointing in endless war rooms whilst revenue slips away due to preventable mistakes. We calculated that retailers waste 485 hours per year on average due to IT and business teams trying to combine data from siloed systems to identify solutions to problems. This lost productivity could be costing them as much as $1.5 million each on average.

A single source of truth

This is time that could be better spent, with the right tools and approach. Retail CIOs understand this: 76% are tired of being forced to tie together data from multiple tools to assess the impact of IT investments on the business, and 95% know these investment decisions must be more data-driven. Yet just 11% of retailers currently have a unified platform for IT observability.

This must be the first step towards success for the BizDevOps and NoOps projects that retailers are increasingly adopting. A single platform delivering precise answers about the performance and security of apps and infrastructure will go a long way to busting silos and removing blind spots. With this single source of truth, developers, IT operations, and business teams will finally be working in the light, and towards the same goals. That’s the way to drive digital innovation and growth as retailers look to a successful post-pandemic future.