All Posts in Technology

|In: Industry Commentary|Last Updated:

In the Minneapolis winter, hot soup makes an appealing lunch. At a local eatery specializing in such fare I learned an important lesson for IT.

This restaurant serves soup in bowls and “bottomless” bowls. Bottomless gets you unlimited refills. Here’s your challenge: As an IT analyst, devise a system to keep track of who’s entitled to those free refills. How would you do it?

Would you print a card at the register with a bar code, to be scanned to verify which customers should get refills? Would you ask bottomless customers to show their receipts each time they return for another helping? Or …

Design your solution before you read how the restaurateur handled the problem.

Okay ready?

Bottomless customers get a differently shaped bowl.

Every time I eat there I wonder if I’d have found this simple solution. Ask yourself, and your analysts and designers too, because if they restrict their thinking to IT they can cost you a lot of money. Sometimes, a second type of bowl can replace a million lines of code.

Whether you’re selling soup or silverware, hardware or handbags, you’re in retail. And while IT has tremendous importance in the retail back office, in the store itself its importance is limited. Which is ironic, because CRM is one of the hot applications of IT these days, and most retailers live and die on good customer relations.

Take data warehousing, one of the most important tools in what we usually think of as a CRM implementation. You can use data warehousing to collect terabytes of customer information and slice it, dice it, cross-correlate it, and do multidimensional scaling if that will teach you anything.

When you’re done you’ll learn (among other things) which customer segments, and maybe even which customers do and don’t buy which products from you.

Pick up a copy of Paco Underhill’s excellent book on retail, Why We Buy, and you’ll see the importance of watching shoppers shop. If you watch shoppers in action you’ll learn something data mining can’t teach you: Why (for example) your older customers aren’t buying concealer from you. It isn’t their demographics or your branding. It’s a merchandising problem: You’ve placed the concealer on the bottom shelf. Shoppers have to bend down for it, and it’s in a high-traffic area besides, where other shoppers brush buy them on their way to pharmaceuticals. For older shoppers bending down is bad enough. Being “butt-brushed” (Underhill’s term) makes it intolerable, driving them to forgo the concealer despite their need for it.

If you’d relied on data warehousing and data mining alone, you’d have adjusted your inventory planning to stock less concealer. This would have reduced waste — a good thing to do. By going into the store and watching actual shoppers actually shopping you rely on observation — a more powerful tool than mere inference. You’d know to move the concealer to a higher shelf, increasing sales instead of fine-tuning inventory. That’s much better.

There’s a double-barreled lesson here for IT. The first is to recognize when an IT solution is incomplete. To take another retail example, I once discussed the possibility of setting up “register-pop” in a client’s stores. Similar to the familiar screen-pop used in CTI-enabled call centers, which helps telephone agents interact more effectively with callers, register-pop would identify shoppers at the register and provide information that could help store clerks up-sell.

Ultimately, we decided against this approach. While technically feasible, it would have provided just-too-late information. By the time customers reach the register they aren’t shoppers anymore. They’re buyers — they have what they want, have already waited in line, and don’t want to go back into the store for more stuff.

Some advanced retailers are looking into an alternative that identifies shoppers before they reach the register. It relies on an advanced face-recognition technology called the Sales Associate. By giving the sales associate a wireless PDA connected to a central customer database, they hope to make their sales force more effective in helping regular customers.

That’s the first lesson — that IT solutions are often incomplete. The second lesson is more universal: Infer when you must, but watch when you can. This is true whether the subject is merchandising, customer interface usability, or whether a process design will work in your warehouse. Given a choice, don’t guess, don’t assume, don’t even ask.

Position yourself unobtrusively and … observe.

Comments

|In: Industry Commentary|Last Updated:

“Machines don’t serve us, we serve them.”

This phrase was one of many repeated by Thomas Friedman of the New York Times from the Davos Conference recently. Normally a reasonable feller, I’m afraid Friedman got the point but missed its meaning.

The point? We’re on the verge of technology backlash. The irony of wireless technologies, designed to untether business professionals and executives from their desks, is that they increasingly tether these increasingly tense individuals to technology. Which is worse: Being tied to the inbox on your desk, or to your PDA, pager, cell phone and portable microwave?

At the Davos Conference, also known as the World Economic Forum, 1,000 of the world’s most influential people hear and discuss radically new ideas. Usually, a key focus is on what technology is going to do for us. Friedman reports that this year, participants worried more about what it’s doing to us. And that’s where the discussions missed the point.

What triggered a lot of this discussion is the need to be 24/7, always on, and always available so as not to be left behind. Many of the participants took this personally.

There’s no question that lots of business leaders and business-leader wannabes turn themselves into 24/7 always-on individuals. It is, to them, the price and burden of success, or so they say.

But is it, or is it simply a way to feel important? Keep in mind, these are the same people who complain about IT promoting technology for technology’s sake. Then they buy a WAP-enabled cell phone or sign up for wireless e-mail on their PDA, just because it’s available.

Friedman described a presentation by Microsoft researcher Linda Stone, who described a phenomenon she calls “continuous partial attention.” Most of us have been guilty of this at one time or another, reading our e-mail while talking to someone on the phone, and muting that conversation to answer our cell phones. Personal technologies are, of course, to blame.

Except, of course, that they aren’t. With apologies to Hamlet, the fault lies not in our technologies but in ourselves.

Continuous partial attention isn’t a new phenomenon. Back when the only personal information technology was the telephone, executives frequently accepted phone calls and scanned The Wall Street Journal while meeting with hapless supplicants. Technology may have democratized this form of bad manners, but it certainly didn’t invent it.

Another data point: I have, over the years, watched quite a few commuters reading their morning newspaper while driving during rush hour, and quite a few more putting on make-up. I much prefer those who talk on their cell phones — at least their eyes are pointed in the general direction of forward motion.

For those who think the new technologies require them to be available and alert at all times and in all situations, I offer the following: Didn’t you ever learn anything about the basic skills of management?

It’s quite true that increasingly, customers expect businesses to be available whenever they’re ready to buy something or need help with something they’ve already purchased. Except for banks (and someday they’ll figure it out, too), most businesses have found ways to accommodate this expectation, expanding availability by using automation, multiple shifts, and setting up operations in multiple time zones.

That’s whole businesses. Individuals who accommodate their need for extended availability by using personal technologies need to expand their repertoire. Among the alternatives: delegation, voice mail, e-mail, and not checking your messages until it’s convenient. Because while the number of situations that may require immediate attention may be very large, the number that require your immediate personal attention is very, very small. If that isn’t true — if you’re the only one who can deal with emergencies that may crop up at any moment — then there’s something very wrong with how you’ve organized your work.

The solution: Organize your work differently. And stop thinking you’re so essential to everything that you have to be continuously available.

Maybe, though, the problem really is with these new technologies. It may be that we need to make them more user friendly. In that spirit, here’s a suggestion to the designers of PDAs, cell phones, pagers, and everything else we carry around with us: Make the Off button bigger.

Comments