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Retailers willing to invest in a single information model

Friday December 11 2009

A recently published survey report from IDC Retail Insights said IT delivery against customer-centric and business performance targets is a critical success factor for retailers now.  

A recently published survey report from IDC Retail Insights said IT delivery against customer-centric and business performance targets is a critical success factor for retailers now.

 

Although cost containments and solid financial justifications for new IT investments rank high in the current IT agenda, reducing IT costs is a major issue, especially for small organisations across Western Europe including UK retailers, the new research indicates.

 

In turn, the main focus for approximately one out of every four Western European retailers will be integrating IT systems and applications to achieve a single information model for the entire enterprise. In addition, more than 20% of retailers have planned investments during the course of 2009 in new strategic applications to improve their competitiveness.

 

"Reducing IT costs ranks high in the current retail IT agenda, but the IDC Retail Insights 2009 survey of 253 Western European retailers shows that not every retailer will just focus on costs," said Ivano Ortis, IDC Retail Insights research director.

 

"As many as 20 to 25% of retailers will in fact drive legacy migration, IT integration projects, and new investments in strategic customer-centric applications. Our recent survey results also show that IT investment directions will vary significantly by country and enterprise size class, with large retailers clearly driving short-term investments. Going forward, hosted enterprise IT systems and software as a service delivery options emerge as the preferred implementation choices for European merchants."

 

Custom-built enterprise IT systems are a reality for approximately one out of four Western European retailers especially for enterprise resource planning (ERP) and retail-specific applications. IDC Retail Insights believes that in the current business environment, retailers will place increased emphasis on legacy migration as reported by one out of five retailers IT rationalisation and consolidation programmes.

 

The modernisation roadmap will encompass the IT infrastructure, back-office systems, and front-end applications, including store systems and multichannel selling platforms. European retail IT directors are turning more to IT outsourcing options going forward hosted enterprise IT systems and software-as-a-service (SaaS) delivery options emerge as the preferred implementation choices.

 

"In the short term, we find evidence of the fact that the hottest areas of investment focus will be CRM [customer relationship management), ERP, content management systems and collaborative technologies," added Ortis. "At least in Europe, retailers are not moving fast to be green, with a mere 1% of Western European retailers focusing on green IT and environmental-sustainability projects."

 

Concerns around customer data privacy and payment security are hot in the current agenda, signalling that retailers clearly identify brand reputation risks as major issues hampering customer-centric objectives. IDC Retail Insights believes this could potentially accelerate developments in related areas such as Payment Card Industry (PCI) compliance.

 

www.globalretail-insights.com

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