Secure Networks form the Backbone of Profitable Retail Initiatives
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(0)Overview: The retail environment has never been tougher. While competitive pressures hold prices down, there is no
corresponding relief for costs. The best path to lowering operating costs is capital investment in IT
infrastructure.
Retailers may try to compete on customer service. But infrastructure is increasingly required to keep that
promise too. A study by Alliance Data Systems of consumer attitudes shows the top four influencers of
shopping preference as: Reasonable prices (86%); Quality merchandise (68%); Handles returns fairly
(65%); and “I can always find what I want“ (64%). Information systems have a direct influence on each of
these criteria. Beyond their effect on pricing, electronic connections allow retailers to more efficiently
manage multiple suppliers to assure consistent quality of goods. Access to databases enables smooth
handling of returns. And the electronic underpinnings of a supply chain are essential to guard against out-ofstocks.
In short, to increase revenues, retailers must leverage technology to enhance customer service by improving
communications and tightening supply chain, while reducing costs by streamlining internal operations. An information network built on secure infrastructure and maintained securely is the necessary backbone for
these capabilities.
The significance of security in the provisioning of data systems has now been underscored by adoption of
the Payment Card Industry (PCI) Data Security Standard. This initiative by all major credit card issuers is
aimed at reducing the billions of dollars in fraud and theft perpetrated annually. While each member bank
will determine the compliance process and penalties for its customers, the potential assessment of damages
and dramatically higher fees are a threat to any retailer's bottom line.
The good news is that the same secure systems that satisfy PCI standards are the basis for increasing
operational efficiencies and improving customer satisfaction. And those are the keys to profitability.
