Accelerating Digital Transformation in Retail Industry

4 minutes read
on 03 January, 2020

Accelerating Digital Transformation in Retail Industry


In the present time, it is fair to tell that Digital Transformation in the Retail industry is constantly accelerating the technological growth in the retail segment. In its peak, using digital technologies to create game-changing business innovations that disrupt existing industries or create whole new ones, it transformed the economics of the impacted industry in radical ways.


Digital Transformation in Real

Ironically, this is actually the game of big and medium players of Retail segment. For example, Amazon Go who has a unique concept – a store set up with cameras and sensors that track a shopper’s every move. It is clear that Amazon Go is not about the ROI of a cashier-less store. Proper training is given to the AI involved to identify specific shopper or consumer behaviours.

In this process of accelerating digital transformation in retail a large amount of data gathered. Each move of the shopper. Every product or item they picked up and then dropped in a bag. Every label read and product replaced on the shelf. But it is also an enormous amount of data about the blackest box in retail today: the store. One thing I’ve learned in my own travels is that innovative retailers do not define ROI in terms of optimizing processes. Instead, they look for projects that create opportunities to gather data – all kinds of data, including the expected and the unexpected.

So in order to identify the correct ways of accelerating digital transformation in retail, it is required to understand why Retailers fail at making this transition.



  • One, they try to save their existing organisational structure from radical change. These are the people who veneer their awful processes, inflexible technology, and competing/contradictory incentives that have different parts of the business working at cross-purposes. They’re able to make some progress once, and one time only, because they didn’t put in the flexible business processes that let them continue to evolve over time.

  • Two, they don’t develop an insight-driven culture. No unified data strategy. No emphasis on turning data into insights. They continue to rely on corporate myths about what customers really want, about what works (which is based on insights developed twenty years ago), and no single version of the truth to go to in order to fight back against those corporate myths. Fiefdoms prevent assembling one version of the truth across the company. And are enabled by an ROI process that undervalues the contribution of learning something new about customers or creating a new way to engage with customers because no one can speak to how it will explicitly move the needle for the business, either on the revenue side or the cost side. Contrast that with Amazon, which is more willing to invest in new processes or technologies to see what they can learn – to collect the data, and then look for ROI, rather than the other way around. It’s the difference between investing in order to learn where the value is, vs. never investing because the value cannot be predicted in the first place. How will you ever learn what you don’t already know?

  • Three, they don’t care about the advancement of technology as an enabler. Different departments run off and buy their own solutions, because the IT department is so bogged down they face a two-year backlog and very little investment into innovation. This perpetuates the retailer’s challenge in building an insight-driven organisation, because these new processes are so detached from the business they can’t connect back into one view of the data. Disconnected processes lead to a fractured view of data, no insights, and no flexible business processes to adapt to take advantage of the next round of insights gained.


Digital transformation in the retail industry is for real. In this current as well as in future scenario Retail as a business can no longer be just about products. It has to be about consumer or customer’s success. Hence, it means that now retailers no longer are going to draw profit by optimising their product-driven processes.

If retailers are going to change their focus from product to customer, they must achieve the milestone of shifting the entire process from efficiency to flexibility, from implementing optimisation to inspiration. The profit to be made will come from the volume of customer insights a company can produce and how quickly they can arrange those insights into act, not from how soon they can shift product. It is evident that accelerating digital transformation in retail can’t be achieved by following existing organisations, processes, or even technology investments.