Stop Whining And Blow Up Your IT Department

Written by Todd L. Michaud
October 10th, 2012

Todd Michaud runs Power Thinking Media, which helps retailers and restaurants tackle the convergence of social, mobile and retail technologies. He spent nine years delivering technology platforms to more than 10,000 retail locations as VP of IT for Focus Brands (Carvel, Cinnabon, Auntie Annie’s, Schlotzsky’s, Moe’s Southwest Grill, Seattle’s Best Coffee) and Director of Retail Technology for Dunkin’ Brands (Dunkin’ Donuts, Baskin-Robbins).

A victim mentality seems to be sweeping through the retail industry. Every day, good retail organizations make horrible decisions (or, in some cases, do not make a decision) that even they know will have a long-term negative impact on their business. “Tech Titans” don’t exist in retail. There are simply those who willingly embrace IT as a core part of the their business and their overall value proposition and there are those who live with outdated sensibilities about IT’s role.

If your organization is spending too much time and money maintaining legacy systems, it’s because you either made poor decisions in favor of short-term gains or lacked long-term vision. If your IT leader (I won’t even assume you have a CIO) is trapped working for your CFO or your IT budget is based on a percentage of your sales, you deserve the spaghetti diagram that is your IT infrastructure. Showrooming is a self-inflicted wound. These problems aren’t new. You have been watching them build like a slow-moving train for at least a decade. Changing CIOs every three years hasn’t really worked either, has it?

When I first joined the retail industry about 10 years ago, I came from the high-tech world. I used to joke with my techy friends that you could be a superstar in retail technology as long as you were up on technologies from 10 years ago. How retail was so far behind in its “best practices” that you had to “unlearn” things to keep from going crazy with frustration. How a franchise organization was basically a collection of small businesses whose owners would rather pay a mobster for protection than invest in technology for their stores.

And while that description always got a laugh, it really wasn’t funny. Not much has changed in the last 10 years. Every day, retailers make decisions that save them time and money in the short term but just add to their technical debt. Every day, business units sign contracts with third-party providers in an effort to remove the roadblocks set up by their IT department’s bureaucracy and project prioritization process. This forms a new type of technical debt that I call “Cockroach IT.” Somebody turns on the lights, and everyone is left wondering where all this IT came from.

Recently, there was a lively debate over at RetailWire with several retail industry experts about my thoughts on IT budgets. It seems like most of those involved in the debate disagreed with my prescription on how traditional retailers need to behave to compete with the likes of Amazon and others. I am truly surprised by anyone who believes that small adjustments to existing systems are really the answer. It is time to adapt or die.

Anyone who has spent even a week working in retail technology will tell you that the entire system is more than just broken in the sense that all “IT is broken.” One of the biggest problems is that technology expertise is quickly becoming a four-horse game. For the longest time, it made sense to have traditional IT (like corporate infrastructure and finance/accounting support) separated from retail technology (like POS and inventory management). But as E-Commerce became a larger part of a traditional retailer’s world, many organizations carved out IT staff specifically to support this function. Today, we have the emergence of a fourth concentration of required skills: marketing technology.


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