While retailers are investing heavily in technologies such as AI and AR, the same cannot be said for investment in their workforce.
Businesses across the UK are shifting their focus towards emerging technologies as they look to drive efficiencies and maintain margin – and the retail sector is no different.
With traditional bricks-and-mortar businesses striving to compete with established technology giants such as Amazon, innovation has become a priority area for investment.
“More than a third of retailers confess to a lack of understanding about how these technologies could add value to their business and be implemented effectively”
Our research, detailed in the Hitachi Capital Consumer Finance A Blueprint for Retail Investment whitepaper, found that 70% of retailers now consider investment in automation, artificial intelligence (AI), augmented reality (AR) and blockchain a priority.
The flipside of this, however, is that more than a third of retailers confess to a lack of understanding about how these technologies could add value to their business and be implemented effectively, which could stifle productivity.
Bridging the skills gap
If the UK retail industry is to harness the power of technology, the industry must not only overcome the obstacle of capital investment, but also focus on bridging the skills gap across the sector.
It can do this by training and upskilling the current workforce, alongside attracting new talent.
Retail managers need to understand how to implement new technologies to increase productivity levels and interpret valuable customer insights gathered from AI and predictive analytics.
“The Government’s Industrial Strategy noted that, within the next two decades, 90% of roles will require digital proficiency in some capacity”
More importantly, IT skills must be central to recruitment and training programmes to ensure retailers are attracting and fostering the best talent available.
The Government’s Industrial Strategy noted that, within the next two decades, 90% of roles will require digital proficiency in some capacity.
However, currently 23% of adults lack at least some basic digital skills.
Investing in tomorrow’s workforce
Although the wider skills gap is a key area of interest, it is notable that retail was not identified as a specific focus.
Moves were made in March last year to address issues faced by the high street with the creation of the Retail Sector Council, but its remit falls more widely than the specifics of recruitment and it will need time to demonstrate an impact.
It is clear that retail is not a priority for the Government, but it certainly should be.
“A tailored strategy from Government is essential to increase productivity levels and diversify skillsets for the workforce of tomorrow”
When compared with other sectors, the opportunities facing the retail industry are substantial and unique.
For the sector to meet the demands of customers and businesses, a tailored strategy from Government is essential to increase productivity levels and diversify skillsets for the workforce of tomorrow.
While there are challenges, UK retail can truly flourish in the digital age.
Vincent Reboul is managing director of Hitachi Capital Consumer Finance
Reboul has 18 years of experience in financial technology, retail banking and ecommerce. He has held leadership roles at household names such as Bank of America, M&S Bank and HSBC, and was general manager of UK Credit for PayPal. His most recent previous appointment was as financial services commercial director for Shop Direct, one of the largest etailers in the UK with more than 3 million customers.