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RS 22 RS June - July 2012 feature cloud computing A perfect storm? The huge appeal of cloud computing is undeniable, but what is it that’s drawing retailers towards this kind of technology? Is it the agility cloud promises or is it the cost and time savings it delivers? Karen Moss finds out In a recent Microsoft-commissioned survey of about 3,000 business decision-makers across the United States, nearly half of the respondents (48 per cent) from the retail industry said their companies have used cloud computing. One-third (32 per cent) said that their companies were ready to move all applications to cloud computing. So, what’s pulling retailers toward the cloud? Many believe it is the agility that cloud offers in a fast paced and unpredictable industry like retail. This could be anything from ramping up web capacity during busy times on an e-commerce site to updating large, complex legacy systems without having to replace the expensive hardware. Srini Pallia, SVP, retail, CPG, transportation and government,
SBU, Wipro Technologies, says: “When it comes to pulling retailers toward the cloud, it is important to consider the different drivers for large enterprises versus smaller businesses. What we’re seeing is that for larger businesses, the cloud presents a real opportunity to optimise their existing infrastructure, particularly if they are expanding into a new geography or launching a new brand. For smaller businesses, current pressures mean they’re ready to do really interesting things with their infrastructure and reinvest in their core platform. “While agility is a much talked about term, it is often misplaced. The key question is agility for whom? <strong>Retail</strong>ers need agility at customer touch points, which is why CRM in the cloud is really taking off. “There is a huge opportunity for retailers to use the cloud to enhance the customer experience in-store. This opportunity isn’t just about providing customers with free Wi-Fi, but what this then enables that will convert the customer into a loyal shopper. For example, using Wi-Fi to deliver apps for special offers or other geo-location services.” Fit to change It’s not just retailers across the pond who see cloudy skies ahead, a recent survey by Fujitsu – Fit to Change – found that cloud technology is really taking off among retailers in the UK as well. Sixty per cent of those surveyed cited cloud computing as an enabler to their business. Andy Taylor, director, private sector division, Fujitsu, says: “The figures are impressive, particularly when compared to telco/utilities companies which came in at half of this result. And with the sheer amount of change that the retail industry is faced with – such as external factors and volatile market conditions, it is no surprise that retailers are seeing cloud as the panacea. It offers a great amount of flexibility, where retailers can scale up and down – but also get their services out quickly – we are talking weeks rather than months. “One of the main drivers in cloud adoption is cost. IT budgets continue to be squeezed across the board – and retailers are feeling it as much as any industry. They have to start thinking radically and addressing the problem – and cloud can help solve this – when tackled in the right way. Rather than lose control over their data, they should be working with suppliers who take on the risk, but give the retailer control and create a dynamic infrastructure which will drive out cost. “Some retailers are already exploiting public clouds as their web hosting platforms. However in order to overcome security and privacy issues and for retailers to really maximise the use of cloud in the back office , the next step is an ‘enterprise ready’ public cloud that can cope with the specialised IT needs of large retailers. The potential for collaboration within the retail sector with such a platform is significant.” Taylor believes retailers need to look for cloud solutions that provide them with the best of both worlds – a combination of in-house delivered IT coupled with applications and infrastruc- cloud computing feature ture provided across as mix of public and private cloud(s). An approach which provides the flexibility and agility required to remain cutting edge and competitive while ensuring business critical data and processes are as secure as they need to be – a hybrid cloud model. Pub chain group, Mitchells & Butlers, implemented a superfast, commercial-grade broadband service and private cloud after partnering with Fujitsu. “The cloud creates tremendous business innovation,” comments Tony Bentham, CIO, Mitchells & Butlers. “Thanks to the flexibility offered by cloud technology, we can design new applications in weeks rather than months, ensuring that new ideas can be deployed faster. This enables us to offer new services such as electronic order capture, table booking and employee training, at minimal cost and without the need for further substantial investment in technology.” Another retailer realising the benefits of cloud technology is Ocado. through Google Apps for Business they were able to give their employees the power to access emails at home and on the go via the cloud. Paul Clark, director of technology at Ocado, says: “Eighteen months ago we were one of the first retailers to adopt Google’s cloud-based collaboration suite, Google Apps for Business. 1,600 of our staff needed access to emails, documents and other data from multiple sites, on the move and even from home, so we were looking for a way to liberate them from their desktops and made the decision to take that step into the cloud. As a web-based service, Google Apps for Business offered not only a solution to this requirement but also the promise of improved productivity and internal communication. “Cloud computing has helped us improve collaboration through being able to quickly access and work on shared documents, even from mobile devices. This has led to more efficient and smarter working practices, helping to drive further innovation within the business and ensure that we continue to provide our customers with the fastest and most reliable delivery service possible. We love the fact that Google Apps continues to innovate and develop new features and are excited about the further benefits we expect to see across the business. “Using Google’s BigQuery technology, we are also starting to use the cloud to securely store and analyse some of the huge volumes of data that we generate on a daily basis” Managing peaks One word that is frequently associated with cloud technology is agility – something that is all important for retailers. Having a cloud hosted solution gives the IT team more time to focus on coming up with cool new consumer facing features, like apps and store locators. So in that way cloud can be a god-send, as Simon Dunleavy, director of managed services at Maginus, attests. “More and more retailers are leaning towards using a hosted cloud service, as it relinquishes the burden of IT maintenance enabling them to concentrate on their core business competen- RS June - July 2012 RS 23
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