Defining Retail’s Next Phase: Obstacles and Opportunity for the Cloud
The pandemic and subsequent acceleration of digital transformation made the cloud a rallying point for the entire C-suite. When COVID-19 hit, retailers needed to pivot to strategies like online delivery and adjust their supply chains based on constantly changing conditions. Cloud-enabled retailers had the visibility and data to make these changes quicker than analog counterparts. And it paid off.
PwC's US Cloud Business Report surveyed executives from across sectors on how the cloud has impacted their business. We found 45 percent of all respondents ranked improving resilience, agility, and security as the top business outcome. In one of the most disruptive times we’ve experienced, the cloud helped retailers quickly adapt and manage the new work environment.
However, the reality is we’re only scratching the surface of what’s possible. PwC found 11 percent of Consumer Markets executives report realizing substantial value in using cloud solutions to increase profits, while 6 percent say the same for boosting innovation.
Two significant workforce-related obstacles are in the way. One is the C-suite’s approach to cloud strategy and the other is enabling the larger workforce. With workforce shortages across the sector, retailers are struggling to find talent able to tap into the cloud’s potential as we enter the next phase of retail. And during what’s shaping up to be a busy summer shopping season online and offline, retailers should arm existing employees with the right skills.
But First ... Clear Up Cloud Confusion
There's alarming confusion around C-suite ownership of the cloud. PwC found 68 percent of Consumer Markets executives (compared to 48 percent overall) ranked the lack of alignment/clarity on roles and responsibilities related to cloud ownership as the top sector barrier. With 34 percent ranking increased revenue as the top value from the cloud, it begs the question: Are retailers making the most out of this opportunity?
Procuring new cloud capabilities can be simple, but that ease can also mean redundant solutions, leading to increased costs and integration complexity, ultimately slowing down operations or failing to deliver value. Retailers should think about their larger operating model related to technology. The decision may be to outsource, but it’s important to consider how those partners can deliver in a more agile way that has the potential to benefit multiple areas of the business. This way there's better alignment on process and outcomes, which should be taken into consideration for contract negotiations.
The challenge isn’t simply adoption, it’s defining the vision and operations for reaching the cloud’s full potential. If the cloud is truly a shared C-suite priority, these leaders need roles to reinforce impact. The CFO and CEO should script and share the company’s cloud value story, working with other business leaders to zero in on where cloud can best drive strategy, and jointly develop an investment thesis.
Then ... Accelerate What’s Possible By Upskilling the Workforce
The second hurdle is upskilling the workforce. Businesses are already facing severe talent challenges as a result of digital transformation. PwC found 68 percent of consumer executives cited lack of tech talent — such as skills in cloud architecture, cybersecurity, or DevOps — as a barrier to realizing the cloud’s value.
Retail is one of the key industries that need to cultivate skills, especially as an omnichannel presence becomes critical for survival. Nearly half (47 percent) of business leaders worry about their ability to upskill people in line with the new ways of working that the cloud demands.
There are a few ways retail leaders can think about upskilling programs. One tactic is cloud training that’s designed to work with a cloud vendor’s certification program. There are also other ways to developing a learning culture, such as mentorship opportunities where junior talent with strong foundational cloud skills are paired with more experienced IT employees that lack them.
Shopping will likely never look the same, and neither should your strategies. As the industry invests in solutions that provide consumers the convenient experiences they crave, the cloud is central to success. By aligning on cloud strategy and upskilling the workforce, retailers can realize new opportunities to improve the customer experience, boost revenue, and improve operational efficiencies.
Tyson Cornell is U.S. private consulting leader at PwC, a global network of firms delivering assurance, tax, and consulting services for your business.
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Tyson Cornell is U.S. Private Consulting Leader at PwC, a global network of firms delivering assurance, tax, and consulting services for your business.