- Tech vendor costs have increased over 3x in the last 2 years and we don’t know why.
- We are losing revenue to data-informed competition.
- Trust breakdowns exist from opinion informed decisions between internal staff.
- Sometimes senior leadership cannot align in decisions of priority.
As I see it, my job is to assess risks for the business as it navigates through the waters of retail competition, creating methods and targets to measure predictability, protect and increase profitability, and project our financial moves in three-month, six-month, and annual strategies. Coming into this position, I was confident and I had this down to a science, I expected to hit every goal, and was optimistic for our future.
In that time, I’ve worked in lock-step with our Retail Operations Manager to compete for market share implementing new technologies to create a compelling customer buying experience, a new website that expanded our exclusively B2B phone order model to include B2B customer portals and now a B2C site selling direct to consumer, and now we have a vision for adding destination brick-and-mortar stores.
Each of these was meant to expand our reach and profitability, but the reality is that technology costs and complications have put me in a state of doubt as to whether we can be profitable with this strategy. We can’t handle what we have. Non-technical staff and 3rd parties are leading technology decisions and their biases are nickeling and diming us to death, and a lack of strong across-system data makes decisions seem like guesses. I don’t like guessing.
After a surge of strong tech moves, including a new ERP, 3PL agreements, and EDI, the maintenance of these half-implemented technologies began adding exponential costs and effort we never expected. Trying to manage all these systems while our Operations Manager attempted to add omni-channel loyalty and giftcards and other industry-standard features our competition already had, became a nightmare. We were paying uncapped scopes to multiple third-party vendors and still not getting access to the data I needed to make good decisions about our spend. It was common to coordinate 3 or more vendors on a single call to diagnose the source of a problem and sometimes learned the issue was "outside the scope" by all parties - which means technology solutions were delegated back to us, the least prepared group to solve it. I had no visibility across systems, so I was reading and cross-referencing reports from multiple systems that had me buried in minutia rather than being able to make any strategic choices to grow the business.
The worst part was that I was losing trust with our Operations Manager, who had been instrumental in helping get us to where we were, but now seemed to just add fuel to an ever-growing fire of tech solutions that weren’t working together and just meant more money to third party vendors and a greater reliance on more third parties.
If something didn’t change, my role was going to cease to be that of funding forward vision, and rather one of cutting loses, reducing spend, and preparing the company for transition to private equity under new management who already had these problems worked out. Or at best, we might regress back to the declining margins of B2B just to buy a little more time.
- Get Control of 3rd party vendor spend.
- Make decisions based on data rather than opinion.
- Trust that retail operations can achieve on measured growth initiatives.
- Trust that retail operations can restore predictability.
- I’m back to making decisions on our growth, not slowing our eventual demise.
We decided it was time to make a leap and hire a CIO, Mr. Disruptive as he’s now known. He looked at the mess of third-party service costs, integration nightmares, and incompatible technologies and said, "We’re changing all of this, or it's not going to work."
I trusted him. He shared his experience which help me find resolve in that what we were going through is normal and is called Digital Transformation. Our growth initiatives had naturally moved into something he called a Distributed Technology Architecture.
He brought in iPaaS.com, an integration platform as a service. It was a new concept to me, but our problems started to dissolve one after another. For starters, because it is a multi-tenant cloud platform, we were able to leverage other companies integration standards and investments rather than using our own. Point-to-point integration promises attempted by our API enabled application providers and third parties had become such a cost-prohibitive barrier, we didn’t know there was another way until we saw it ourselves. Instead of transferring data from system to system, which makes all systems prone the moment any change is made to any of the connected systems like an upgrade and since no one party was responsible for the integration space, that left a gap of responsibility whom nobody took ownership for. Now data all goes into iPaaS.com. Instead of paying ten service partners to argue over all the problems I previously described, we have technology monitoring not only the traffic in and out of each source application, but also standards on how systems are related to one another, which means we are free to assess each new project without the massive overhead in considering impacts to each previously connected systems and their 3rd parties. He called this “End to End ownership of Data” and this is the game changer that only iPaaS.com can deliver. Instead of being trapped by the old systems that had handcuffed us with a web of messy integrations, we could change them out anytime we wanted without risk of downtime.
Now rather than throwing money at tech issues and working from a place of confusion with our Operations Manager, I am back to doing what I am supposed to do, which is to make real decisions about how to grow the company. iPaaS.com provided a way to manage the bloated vendor costs with a budgeted Managed Services for Integration and Costs have not only gone down significantly, the money we would have to paid out in development services became a reasonable monthly outflow so we could manage the fees with cash flow, rather than capital outlay.
Mr. Disruptive has TV’s on the wall that change colors when applications are at risk, and let’s us know that it has already alerted the origin third party application delegate. Revenue is increasing due to the improved customer experience. And the new initiatives the Ops Manager can now implement, like a customer facing App and omni-channel customer experience, are easy and managed with a network of resources trained to meet our stated outcomes. The future is bright again.
At best, we might regress back to the declining margins of B2B just to buy a little more time.
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