How Neiman Marcus' CIO wants to frame customer experiences
It used to be that only businesses interacted with technology, but "now customers have the ability to create their own technology," said CIO Sarah Miller.
When most 12 year olds relished having a spelling quiz taped to the refrigerator, Sarah Miller was writing her first computer program.
Technology was always on Miller's horizon, and now she sits at the technical helm of a luxury retailer. As CIO of Neiman Marcus, Miller knows her business partners' basic expectations of technology is that "it just works," she told CIO Dive in an interview.
But now CIOs are expected to maintain the current infrastructure while creating new technologies.
Focusing on day-to-day operations was Miller's primary concern. But two years after her promotion to CIO from VP of enterprise applications, Neiman Marcus was able to reduce problems and incidents 65% by focusing on process and technology upgrades.
Automating the process to resolve issues played a role in reducing the number of incidents. "It's no longer around IT operational excellence, it's just being operationally excellent," according to Miller.
Her most pressing tasks have evolved from cloud migration to data-enabled personalization. As modern day customers strengthen their digital savviness, the way retailers serve customers has to adapt.
It used to be only the business interacted with technology, but "now customers have the ability to create their own technology," which leads to an expectation of how things should work.
"Regardless of whether it's a retail site or not, you have to perform," said Miller, and customers "are much more aware of what that experience should look like and so they're defining that experience for us."
To the cloud first
When Miller became CIO in October 2016, she had to undergo an enterprise wide modernization effort because there were still legacy technologies in place, "which creates risk for the company," she said.
She began walking through every component of Neiman Marcus' portfolio to determine how to migrate pieces from the current data center to the cloud-architected data center or directly into a cloud-native application.
Now, Miller has almost completed that process.
Miller credits good governance with allowing retailers to have a uniquely better handle of managing cloud-related budgets than any other industry.
Neiman Marcus' portfolio was predominantly on-prem, which meant the cloud introduced governance policies to monitor use and control costs. "We did a lot of research and talked to a lot of companies that had migrated to the cloud," she said, "and one of the biggest issues that they found [was] from a production standpoint."
Despite the success of the migration so far, Miller is "sure we'll continue to see challenges."
Shopping for data
Technology is empowering the store's most valuable asset: Its store associates. However, companies inundating their stores and customers with too much technology are missing out on the bigger picture: a personalized shopping experience.
A personalized shopping experience is best shaped by a combination of digital and in-person experiences. Miller's job is "all around removing the customer friction," she said. "We want to know when our customers are interacting with our technology."
"The most innovative things we're working on from a transformation perspective [are] really starting to use all the data that we have" for Neiman Marcus customers and products, said Miller.
The 112-year-old retailer is investing in data and analytics platforms to create algorithms around artificial intelligence and machine learning. In the past, Neiman Marcus has relied on vendors and external partners to create algorithms, but there's more pressure to create solutions in-house.
Miller wants to end Neiman Marcus' reliance on third parties, instead building a platform to derive insights and use cases.
AI and ML are playing a pivotal role in building personalized relationships, but the process is "a little bit different for Neiman Marcus," said Miller, because "we're not trying to create a transactional relationship with our customers."
Retailers often tempt customers with loyalty and member programs in exchange for personal information. There's value in personalization, and loyalty programs offer customers that experiential advantage when they offer up details and preferences.
At Neiman Marcus, however, personalization is equally achieved by "an interaction with a sales associate or a stylist," according to Miller. "Being able to feed that data and those insights to our sales associates" unlocks the possibility of a custom shopping experience.
The relationships then "connect our customers to our different brands," including Neiman Marcus, Bergdorf Goodman and Neiman Marcus Last Call. The cultivation of a customer-brand relationship outweighs the allure of a transactional relationship, said Miller.
"Retail companies have to start acting more like technology companies," she said. But while she doesn't define Neiman Marcus as a tech company, she does have to "frame the experience" in a technological way that resonates with consumers.
A seat at the table
Miller has the luxury of a C-suite already bought into the fundamental role technology plays in core business strategies. "I don't have to create a case for the technology that we need to invest in or implement," she said.
The retailer is trying to create an organization equipped for fast delivery and developments so Miller doesn't have to assert her authority. The "attention and the seat at the table [are] there" from a technology standpoint, she said.
Miller originally reported directly to then CEO Karen Katz. But in the last year, Neiman Marcus had changes in organizational structure, including a new CEO, which resulted in Miller reporting to new CFO Adam Orvos.
The shuffle in leadership "really hasn't changed anything," said Miller, it just gives technology a little more focus. She's now on a team with supply chain, finance and capital investments, which helps narrow the focus on companywide strategy.
"Our technology organization is very collaborative with our business partners," which helps shepherd ideas toward a transformational structure. The togetherness of the different lines of business help prioritize resource allocation, while improving cost structure to reinvest in the retailer's growth strategy.
Synergy among organizations is more attainable with this way of working, especially when "priorities have been set at the CEO level so we all understand and are [incentivized] around those priorities," said Miller.
The key is for the tech team to work directly with Neiman Marcus' business partners on developing what "stories that we want our use cases to create" and the resulting experience.
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