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In between the Numbers: Fast Followers

July 1, 2011 at 1:04 pm PST

I wish I had a dollar for every time I heard a retail ICT leader describe himself as “a fast follower.”

Must admit – at least at first blush – there is a lot to admire about fast followers.

They’re risk averse. Not given to over-hyped fads (especially RFID). Careful with the budget. They’re don’t make a scene in management meetings, and accept with a nod the usual flat-to-five-percent down allocation.

And, of course, they’re certainly smart enough to catch up quickly to any big innovation the competition might bring to the industry.

Which leads us to the issue for fast followers in today’s retail climate: Who, specifically, do you follow?

Is it your traditional competition? Circuit City for Best Buy? May Co. for Macy’s? (Oops – guess not.)

Is it the new competition? Amazon for Best Buy? Amazon for Macy’s?

Is it the new tech-shaped shopper? Facebook? Twitter? Smart phones? Does a Best Buy follow Google? Macy’s follow Apple? 

In a retail world that is being completely re-shaped by digital commerce and personal technology, by product commoditization and globalization, the old rules simply don’t apply.

Fast follower?  In this day and age, that means simply being a follower. And nothing more.

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What Cisco is doing to help retailers and merchants secure customer credit card data

Recently there has been a series of news items as enterprises announce they have been breached and their sensitive customer and financial records compromised.  According to Verizon 2011 Breach report 92% of the attacks were external and 76% of all data breached came from servers.  The PCI Security Standards Council is an open global forum formed in 2006 that is responsible for the PCI Data Security Standard (PCI DSS), a standard that is designed to protect cardholder data.

I sat down with Lindsay Parker, Cisco global retail industry director about Cisco’s current investments and efforts to help retailers and merchants secure customer credit card data and maintain compliance with PCI DSS.

Here are some key points from our conversation:

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In Between the Numbers: Big Pipes and Lean Stores

June 24, 2011 at 9:02 am PST

 Thinking about the ICT future of the store with my colleague Bharat Popat.  Doodling at the mental whiteboard.

 Current state in the lower left.  It’s client-server architecture. Three to six servers per store, depending upon segment and store size. Fat-client POS and desktops. Fans and hard drives. Ongoing break-fix maintenance contracts.  A network pipe just big enough to each night send out batched transactions, inventory, and other performance data, and download the price-item files, promotions, and performance reports.

 Now, a line from the lower left current state all the way to the upper right future.  From the “as is” to the “will be.”  Figuring three to five years.  An assumption that a retailer will want to lead the segment and compete worldwide. 

 Hmmm.

 Grab the pen and draw the line, and as you do so, calculate the evolution of technology and of consumer expectations.  Calculate the impact of global e-commerce, of multi-channel and omni-channel, of smart phones and tablets, of social networks and social shopping.

 Calculate the impact of content clouds and IP video, of augmented reality and “mashops” of virtual into the physical. Calculate the impact of right time data analysis. Calculate dynamic video messaging.

 Calculate how to cut time-to-capability down to weeks, not years.  Calculate how to do more and spend less.

 Now multiply it all by the demographic weight of the tech-savvy Millennial generation.  

 Do the math.  Yes, I’m prejudiced -- I’m a proud Cisco guy.  But it’s the math (not the badge) that leads me to this future state: a retail store that’s a living, breathing website.

 A retail store that’s built on a lean, network-based architecture and a significant increase in network capacity to and from the store.  

 Lean store and big pipe.  

 More about these calculations in weeks ahead.

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Contributing to retail industry – Cisco participation in industry standards bodies

One of the areas Cisco contributes  to the retail industry is in the participation in industry organizations and standards bodies to help broaden adoption and encourage interopability of technologies.

Cisco retail architects Christian Janoff and Bart McGlothin both contribute to industry organizations.  Christian Janoff has just been re-elected to the Payment Card Industry board of advisors.  Bart McGlothin current sits on the  technical committee of National Retail Federation  ARTS Group (Association of Retail Technology Standards ) as vice chair of the mobile integration workteam.

I sat down with Bart and talked about the role of Cisco at ARTS and retail industry standards contribution.

ARTS (Association of Retail Technology Standards ) is the technical arm for industry standards for National Retail Federation.  ARTS develop white papers, best practices and standards used in in-house retail solutions as well as vendor products.

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In Between the Numbers: Penney’s Big News

June 15, 2011 at 11:07 am PST

 Thinking about the hiring of Apple’s Ron Johnson as the next CEO of J.C. Penney Co.

 I think it’s a brilliant move. for these reasons:

 Because – most of all – it signals that  J.C. Penney has determined that its future will be more dependent  upon its ability to create value through the  delivery of a differentiating, sustainable, and omni-channel brand experience than by the differentiation of its products.

 It signals an acknowledgement that apparel and domestic product is largely commoditized.

 It signals an acceptance of Wall Street’s insistence that the same-old merchant prince approach to the business is not going to move the dial.  

 Bravo, Penney’s.

 Johnson inherits a business that has declined some 11% in revenues since 2006, that doesn’t have iPhones and iPads to dazzle shoppers and drive traffic, and which has a brand aura more akin to Sears than to Apple. 

  He has huge challenges in front of him.   Like – it should be said – most of US retailing.

 But I like the odds.

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