Intelligent personal assistants: an opportunity for retailers?

Alexa is arguably the tipping point for intelligent personal assistants; with Amazon’s open source approach to sharing its app (“skill”) development capabilities the sky’s the limit for this new, disruptive form of natural language driven customer experience. But what could retailers make of this opportunity? Here are some ideas…

It’s not the hardware but the cloud analytics that matters

Critical to any retailer using an intelligent personal assistant to innovate their brand is that these use cases should primarily focus on the business outcomes from using its cloud analytics capabilities, not the front-end device itself.

A retailer, for example, could use Alexa to provide instore guidance to shoppers to help them find items or make simple queries, physical customer browsing behaviour captured in the cloud that when combined with online experiences enables deeper, more contextual forms of personalisation across all this retailer’s channels.

An opportunity to simplify (and risk of complicating) customer journeys

A unique strength of an intelligent personal assistant is that it has the potential to smartly rationalise customer queries and transactions – an opportunity to turn chatbots into compelling conversational experiences a customer would have a preference for using over engaging a person or using a digital channel.

But there remains a significant user experience design challenge for its natural language driven interface – at what point does the buying journey become too complex for this channel and risks increasing friction for a customer? Any form of customer experience that requires a customer to look at detailed product information or make comparisons between products could be difficult and hard to follow through spoken voice generated content alone.

Alexa’s use of APIs could enable a retailer to combine this channel with its mobile e-commerce site (or in-store tablets) for example to create a seamless, holistic experience where complex information is shared visually driven by a customer’s voice commands and smartly informed by Alexa’s AI.

Bricks and mortar as a truly experiential destination

Perhaps the most exciting thing about Alexa (and intelligent personal assistants in general) is the potential for them to create unique, personalised experiences instore – a direct, deep relationship between a customer and a retailer’s brand. And because its cloud driven this enables interconnectivity (IoT) with other instore technologies such as targeted digital signage, interactive mirrors, social media engagement and mobile point of sale.

If you would like more information about how digital transformation can benefit your retail business, leave a reply below or contact me by email.

Bob Dylan was right about Digital Transformation

Bob Dylan is recognised as one of most influential writers of the 20th century.  He is not though, seen as an inspiration for the digital age. Perhaps he should be? With his 1964 song, “It’s Alright, Ma (I’m Only Bleeding)”, he states that “He not busy being born is busy dying”. With this line he couldn’t have been more prescient.

Organisations need to continually “be busy being born” and innovate or face the alternative.

Think about it: what differentiates companies hobbling along the digital highway from the ones paving the way? The ability to embrace change, refuse status quo and turn the business into an ever evolving entity. 

Put another way, being digital is about reconciling the pace of adoption of new technologies with the pace of their commoditisation. The latter recently experienced a dramatic acceleration, while the former is often stuck in old-world mode.

 

Old world versus Digital world

Twenty years ago, adopting new software was a big deal. There were limited numbers of vendors in each market segment. Software customisation or process transformation was necessary to take advantage of technology. Integration was complex, ongoing maintenance and support often presented challenges. All of this resulted in expensive acquisition costs, from both a financial and an effort perspective. Long-term supplier contracts were the norm.

Once software was installed, and the vendor proven, it was a lot easier for an organisation to allow the vendor to expand its footprint through additional modules and products rather than go back to the market to look for alternative solutions.

From a vendor perspective, selling and delivering software was costly requiring a large sales team to reach customers and negotiate complex contracts. Vendor delivery teams would need to be highly skilled building bespoke integrations to satisfy the specific needs of customers.

New software integration was expensive, risky and therefore needed careful consideration. Adoption pace was slow as software was seen as complex far from being a commodity.

Today, the pace of commodization has increased by an order of magnitude, mainly due to Cloud technologies. Let’s have a look: what does innovation mean today in the enterprise world? Big data maybe, machine learning and AI, blockchain or IoT?. All these have already been turned into commodities. Fancy running some machine learning algorithms on your customers database? AWS has an API for that. Conducting a first run shouldn’t take more than a few hours of work. Same goes for most of big data technologies, IoT, blockchain and even virtual reality.

as-a-Service paradigm

The as-a-Service paradigm has drastically reduced costs, complexity and risks of adopting new software and technologies. The SaaS model for instance through turning CAPEX into OPEX, has abolished any notion of commitment.

Should your company use this marketing software over this one? Who cares? Use both, allow yourself to pay a bit more for one month or two, then keep the one that perfectly meets your needs. Going further, why even consider it at company level? One department may prefer one software because it measures what they want in the exact way they want, while another department may prefer another one. With almost no acquisition and no integration costs, why try to over rationalise at the expense of business value and user experience?
Standardisation is still to be considered on non-differentiating applications, but at a much less prominent position.

The Digital highway

All this said, most of old world companies are still considering innovation with the same eyes as before, missing business opportunities and losing ground to new entrants.

If conducting an IoT experiment means running an RFP, conduct a 6-month PoC and sign a multi-year contract, then you may be doing IoT, but you’re still hobbling on the digital highway.

Velocity is key to transforming your company into an ever evolving, fast learning, business.

“He not busy being born is busy dying

Thanks to Clara, Gavin, Jian and Robin for their kind guidance.

More on the subject:

What do you think? Leave a reply below or contact me by email.

Image courtesy of Getty Images

Personalisation of the retail returns experience: a new form of competitive advantage?

UK retailers are losing billions of pounds a year from managing reverse logistics costs for returned items across their physical and digital channels. Because of the multiple touch points involved margin can often deteriorate to a point where writing off the item as a loss is a better outcome than resell.

A key area of risk is online women’s fashion retail where customers may order multiple sizes or variations of the same item and then return those that don’t meet requirements. It’s estimated on average a returned clothing item costs a retailer an additional £15 to process back through its supply chain regardless of channel – extra cost that significantly reduces margin at full price (and much worse when further price discounting is applied).

But could personalisation (the application of big data analytics to pro-actively meet an individual customer’s changing needs) deliver a better outcome for both customer and retailer? Could such an approach incentivise a customer to self-manage the reverse logistics process or even be persuaded to keep the unwanted item (so reducing, or even eliminating, the additional £15 cost)?

For example, rather than a customer filling out a paper form using a nondescript reason code for a return, he or she could use a loyalty card smartphone app that captures their reasons as spoken voice text. Not only would this be more convenient (and user friendly) than form filling, it also provides the retailer with richer data about a customer’s preferences to enable better targeted personalised offerings in the future.

Secondly, the app could lever cloud big data analytics to make an on the spot personalised counter offer to the customer alongside the standard return. This could draw from the customer’s buying history and social media behaviour. The counter offer could ask the customer to give the item to charity in exchange for a future discount (so eliminating the return cost and refund while driving future sales and positive brand reputation). Alternatively it may make a third party offer for a ‘no return’ outcome (so driving cross- or up-sell opportunities with little cost impact).

Fundamentally, the counter offer approach is primarily driven by the need to preserve and, ideally, grow a retailer’s margin – the economic case. In addition, by gathering better data about an individual enables greater personalisation to build and retain their loyalty and reduce the volume of unwanted items (for example, future purchasing of clothing items online may include specific recommendations for an individual customer about size and colour based on this gathered insight). The app could also utilise a retailer’s existing core systems (e.g. databases) and new digital technology (such as cloud analytics or machine learning) together successfully – the opportunity to use the best of both worlds to create disruptive competitive advantage.

If you would like more information about how Sopra Steria can help your organisation benefit from cloud analytics please contact the Sopra Steria Digital Practice.

Come on vendors, get it together: Office 365, Google, Dropbox, etc

For many of our customers, large and small, their first foray into the beautiful world of cloud computing is driven by a less beautiful compelling event related to one of the following:

  • On-premise email servers (typically Microsoft Exchange) require an upgrade of either software, hardware or both
  • Licensing and upgrades of the Microsoft Office suite, typically as part of some enterprise-wide licensing agreement (or maybe an audit!)

So, if you are approaching a refresh, what should you do?  There’s a myriad of comparisons out there on the web comparing the features and costs of Microsoft Office 365 against Google Apps so I won’t add to that. To cut to the chase, feature-wise they are approaching parity but of course it depends on the specific requirements of your organisation. What I wanted to cover was the usual corporate dilemma, and why Microsoft is currently (and probably for a long time) the right answer.

The logic goes like this.  I really quite like the idea of using Google Apps, it’s a bit easier to administer (in my view – but partially as it’s less rich and maybe doesn’t expose all the cruft of Exchange in the config pages), it’s just feels a bit more hip and happening. Although to be fair, Microsoft have managed to shed their corporate image and loosen up a bit, as demonstrated by this identification challenge that tickled me when you are registering for Office 365…

But, I really only want to have one vendor and configuration to manage – surely I can get everything I need from one vendor in 2016?  It really depends what line of business you are in, but certainly for us as a professional services-based business some customers will expect materials to be sent to them in Microsoft Office formats (Word, Excel, PowerPoint).  Whilst other vendors can work in this format or I could use LibreOffice, I know that the interoperability just isn’t quite good enough. And my finance team are going to rebel if I don’t give them Excel, so… I really need to buy Microsoft Office – and this is when the costing dimension comes in. Pricing starts at £7.80/month/user for up to 300 users for Office 365 with the ability to download all the Office client applications (jumping to a pre-discount £14.70 for the Enterprise E3) – and that immediately makes a Google Apps-based solution unattractive as you basically have to pay for many of the services twice, e.g. email services, Skype or Hangouts etc from both Microsoft and Google.  A masterstroke of lock-in from Microsoft.

OK, so I accept this as a fact of life, and resign myself to going “all in” with Office 365.  Not so fast.  Like many organisations today, I might have a BYOD or CYOD policy and I know that my users have both PCs and Macs. That sounds fine – Office 365 supports Macs.  Yes, the Mac implementations of Word, Excel etc are a bit different (mainly as a result of the weird double menu bar thing – why have one “Insert” menu when you can have two?) but the apps are pretty good these days.

But the issue comes with file sharing and synchronisation on the Mac. Whilst there is a Mac client for syncing your OneDrive so you can work offline etc, it does not sync shared files – and so the only way you can access them is via the web interface – not something that you are going to enjoy on the train on the way home.  This fact is a little buried here – there’s more evidence of Microsoft’s sense of humour with this statement…

So that leaves us with an issue as to how to support collaborative file sharing across our organisation.  This is what Dropbox (in my experience) does best – it just works across clients.  So you end up having to have at least one other vendor product to plug this functionality gap, which is frustrating.  I was talking to a start up the other day – they are not big but they’ve active subscriptions for all three – i.e. Google Apps (as the email search is the best), Office 365 (as they need the client apps) and DropBox (for the file sharing).  I bet this is much more common than it should be.

But, it’s on Microsoft’s Office 365 roadmap so maybe I’ll be able to have just one subscription in 2017.

If you want to read more on comparisons of Google Apps and Office 365 etc – this is a great resource.


Beamap is the cloud consultancy subsidiary of Sopra Steria

Cloud adoption consideration #5: Drive adoption

This is the fifth and final post of a series of blog posts discussing the five main considerations critical to successful cloud adoption by enterprises.  If you missed them, the previous posts are here.

Today’s topic is about how to make sure that all your hard work is appreciated.

Let’s imagine that we’ve got a clear strategy, put the technology fundamentals in place and we’ve refined our operating model to ensure we can scale and industrialise our cloud-service consumption.  We can’t fail, right?  Well – even with all these necessary conditions in place, our experience shows that the consumers of cloud-services in your organisation may still not consume.  There can be many reasons for this – gaps in cloud awareness, bias, internal politics etc.  The solutions lie in good old change management techniques such as communications at multiple levels, education and briefing sessions, stakeholder management and capture and publication of good metrics to show what is really going on.

The key point is that you cannot assume that you can “build it and they will come” – adoption is not a given and the barriers to adoption of cloud services can be subtle and often invisible, so a metrics capture regime and publication is required to surface them.

Recommendation

Our recommendation is to consider these mechanisms to drive adoption as part of the initial cloud programme structure and scope, but also “bake in” as an inherent part of the operating model revisions that we’ve discussed previously.

One technique to drive early adoption is to find and nurture evangelists with candidate “early adopter” projects and this is an approach we see very often.  The trick is making the leap from this initial activity to broader mass adoption in your enterprise that is self-sustaining – i.e., doesn’t need outside influence from the cloud programme to keep the flywheel going.

Wrapping up

In this series of blog posts we’ve outlined five of the top factors that we feel are critical to successfully realising the oft-quoted promises of cloud computing for large enterprises.  There are technology challenges for sure, not least of which is a whole bunch of new skills required in a discipline that is rapidly changing all the time, but fundamentally this is an exercise in change management and we believe in these fundamental building blocks as the basis for a comprehensive strategy.

Of course, there are more than five things to get right – and infinite ways to fail – but that’s what makes it interesting!  Thankfully, our experience is that we are past the phase of disputing the benefits of cloud computing – now the opportunities are clear and it’s all about good execution.  We’d love to help you with your journey!


If you want to read more about this and the other four considerations for successful enterprise cloud adoption, have a look at our white paper.

What are your thoughts about successful cloud adoption by large enterprises? Leave a reply below, or contact me by email.


Beamap is the cloud consultancy subsidiary of Sopra Steria

Cloud adoption consideration #4: Leverage the benefits in your application teams

This is the fourth of a series of blog posts discussing the five main considerations critical to successful cloud adoption by enterprises.  If you missed them, the previous posts are here.

Today’s topic is about moving past the initial technology implementation phase to really realise the maximum enterprise benefit from cloud adoption.

At Beamap[1] we live and breathe cloud computing all day every day, but it’s important to not lose sight of the fact that really it is not an end in itself, it is just an enabler.  It’s all about the applications.  An issue that we see in enterprises is that they have access to more agile cloud services, but the workloads that they run on them are still architected and developed in much the same way.  So cloud has been “adopted”, but the biggest benefits come from fully leveraging the hard-fought benefits throughout the application lifecycle.

Vendor application issues

This is one of the real blockers on accessing the full benefits.  The harsh reality is that most commercial applications out there are still not really architected to fully exploit cloud services.  Application vendors have all the same problems that enterprises do in tracking the cloud market, and so support for features such as auto-scaling is often lacking (even worse, the vendor is likely to have “cloud-washed” their app in a marketing sense, so it’s hard to tell where the shortcomings are).  Hence there is a long long tail of application rework required by vendors and in the meantime cloud is used simply as a hosting platform for these applications, which makes the business case against traditional hosting models much harder to make.

Internally developed application issues

For internally developed applications, the same issues are playing out, but require changes to the architecture, development and operations processes – and this takes time.  Organisations need different skills and tools to implement and really get the benefits from continuous integration, continuous delivery and blue-green deployment practices, containerisation, serverless computing etc.  And then there are the real game changing higher-level PaaS services to be exploited, or the use of commodity IaaS services to deliver a scale of operation at a cost point that was unimaginable just a few years ago – for machine learning, big data processing, artificial intelligence and IoT.  In addition, like everything else in the world of cloud computing, this is not a static challenge, so in your applications teams there’s an ongoing need for training around opportunities, best practices and standards development related to the ever-improving cloud services.

…and what to do about it

There is a phasing and investment profile issue here that needs to be considered in the cloud business case work – whilst the target is to have a set of beautiful cloud-native applications, the creation (or conversion) of these applications takes longer than it does to stand up private cloud services, and certainly way longer than it does to access public cloud services.  The size of internal cloud platforms and the operating model to support all cloud services only need to scale a touch faster than the application demand that is able to consume these services.  When the application development capabilities don’t keep up with the cloud services that they can consume, that’s when you have a problem and are missing a trick.


If you want to read more about this and the other four considerations for successful enterprise cloud adoption, have a look at our white paper.

What are your thoughts about successful cloud adoption by large enterprises? Leave a reply below, or contact me by email.


[1] – Beamap is the cloud consultancy subsidiary of Sopra Steria

Cloud adoption consideration #3: Avoid overly technology-led approaches

This is the third of a series of blog posts discussing the five main considerations critical to successful cloud adoption by enterprises.  If you missed them, the previous posts are here.

Today’s topic is about a common anti-pattern that we see – when organisations see cloud adoption as primarily a technology problem to solve.

Working on cloud has become great CV fodder in the last few years, and so everyone wants to work on the new cloud implementation project and get exposure to the new technology.  Obviously enterprises want to harness this energy, but there is a trap, and it comes back to the need for a cloud adoption strategy and an underpinning business case – i.e. why are you doing it.  Is it to become the world’s leading authority on cloud computing?  Should your organisation be focusing its energies on its core business operations, markets and customers, or pushing the envelope with ground-breaking cloud implementations?

Technologists (and I’m counting myself as one here) love this stuff – introducing complexity, sometimes at the cost of the original business goals.  So consider the following questions…

How many cloud providers do you really need?

A common emerging enterprise adoption pattern is to manage multiple cloud providers via a brokerage solution that gives a single point of control across them.  It’s a valid strategy, but do you really need this?  Is it to reduce the risk of lock-in?  For vendor negotiation leverage?  The risk here is that a great deal of complexity (a barrier to the very agility you are trying to achieve) is introduced, leading to a “lowest common denominator” set of cloud services and a maintenance nightmare as you engage in a never-ending and never-winning chase of the cloud vendors’ latest feature releases.

Do you really need internal/private and public cloud offerings?

In the enterprise market, we could perhaps characterise the last few years as being very focused on private cloud, as the traditional hardware and software vendors desperately tried to defend market share from the public cloud usurpers.  Now the tide is turning more in favour of the public cloud providers, but there is a massive inertia in large enterprises towards on-premise initiatives hence, for example, Microsoft’s focus on positioning for hybrid cloud with Azure Pack and Azure Stack.  This is understandable – there’s typically a huge data centre investment, and an operating model that has been painfully refined over the years to feed and water that investment.

So ask yourself these questions:

  • Are you reinventing something that already exists from the public providers?
  • Are you pursuing an evolutionary step that you can avoid?

Are you really that unusual?

A common statement we hear is “ah, but we are unique/different” – but we would argue that this is rarely the case.  It can certainly be true in the SaaS adoption case, but is much less likely to be the case for IaaS services.  If this argument is used to justify custom development for cloud services, be suspicious.  It’s unlikely that AWS and their kind have not solved all these challenges already, and if they haven’t, ask yourself why they haven’t…it’s likely because it’s not a genuine need.


If you want to read more about this and the other four considerations for successful enterprise cloud adoption, have a look at our white paper.

What are your thoughts about successful cloud adoption by large enterprises? Leave a reply below, or contact me by email.


Beamap is the cloud consultancy subsidiary of Sopra Steria