What’s Keeping CIOs Up at Night This Holiday Season
2019 has been a great year for IT—with many CIOs seeing their budgets increasing, often to fund digital initiatives and a significant uptick in their strategic role. However, those same digital projects, which typically center around customer personalization, ways to reduce the costs of customer engagement, and improve omnichannel cohesion, are still very much ongoing. One recent survey of 274 CTOs, CIOs, and CISOs found that 93% of digital projects were still in process, with the top two worries related to cybersecurity concerns (53%) and infrastructure still being too rigid to accommodate change (40%).
We repeatedly hear from CIOs in retail, financial services, travel, logistics, and other seasonally affected industries, that this holiday season will be a little more stressful than those that came before. CIOs are more accountable than ever to drive growth. Digital projects targeted at driving customer acquisition, spend, retention, and satisfaction will be instrumental to deliver it.
But as 451 Group shared on a recent webinar, “the glitter of the holidays can fade quickly when back-end systems can't handle the data growth and user concurrency," because the ripple effect can impact customer interactions, logistics, and inventory processes that ultimately influence churn risk, sentiment, average order value, margin, and much more.
Operational excellence will be under the microscope, particularly because customer expectations for a fast, cohesive, and responsive online experience are higher than ever. Customers are more mobile, more multichannel, and their collective demands can surge more rapidly and higher than before. Digital advertising, viral social media, online promotions, and other factors, add stress to new, immature, or under-provisioned parts of freshly established hybrid cloud enterprise infrastructure and on-premises database instances, often at unexpected times, in unanticipated ways.
Handled correctly, it can mean IT basking in revenue glory come January—a missed step can see the battle for digital budget getting a little harder for 2020 and 2021.
So, what are the four big worries keeping CIOs up at night this 2019 season?
With the increasing shift to mobile and more competition for share of wallet, speed is critical—from serving a page, looking up in-store inventory availability, processing a payment, or updating customer information. Just a one-second delay in responsiveness can result in a 7% drop in conversions. Consider that last year, 56% of shoppers waited until Super Saturday to buy, a surge in demand and over-taxed infrastructure can result in a substantial revenue lag.
The problem is that CIOs walk a tightrope between building a performant infrastructure and not over-provisioning databases, building too much virtualized infrastructure, and then ending up with wasted capacity or painful administration. Each year striking a balance seems to get a little harder—for example, the most significant transaction growth day compared to the year wasn’t one of the traditional “Cyber 5” days, it was the Wednesday before Thanksgiving that grew over 2x more than any of the other days.
One of the issues is that many relational database management systems (RDBMS) and typical NoSQL databases are notoriously inelastic and hard to quickly provision. That doesn’t work in an era of increased volume volatility; now it’s essential to be able to instantly add or shrink database capacity across all cloud, on-premises, and hybrid cloud infrastructure. A cross-platform distributed database architecture can help by quickly adding more nodes running on any cloud, whether Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform (GCP), or on premises, to ensure peak responsiveness during holiday surges.
There’s no more costly time to have an availability incident than during Thanksgiving or Christmas. Just an hour of an outage can cost millions during prime revenue periods, and critical issues can sometimes take hours to fix. And problems are much more common than you think, with 50% of companies surveyed reporting they’d had an IT downtime incident in the past three years, and over a third having experienced one during the past year alone. Moreover, 60% said that the issue could have been prevented if there had been better processes and configuration in place.
One of the problems is that infrastructure complexity is at an all-time high, taxing IT. Hybrid cloud and multi-cloud environments promised to provide strong SLAs, and that’s all true, but now the issue is the patchwork of proprietary databases, instances, and integrations across different technologies and APIs that make up modern digital apps. With each cloud vendor looking to lock IT teams into their particular stack, CIOs face more database fragmentation, which creates more failure points, less redundancy, and more IT resource devoted to monitoring it all.
Now, though, some of the largest retail, media, financial services, logistics and travel, and hospitality companies are using a different approach. By using a masterless database based on Apache Cassandra™ that runs across all their environments in a peer-to-peer architecture, they can dynamically route requests to any node based on availability, no matter where it’s running, whether public or private cloud, or an on-premises deployment. It’s an elegant way to secure uptime all the time, ensuring no single point of failure.
Omnichannel has been a priority for years—but the reality still presents a brutal technical challenge. Companies that get it right stand to outperform those that still have digital barriers between their online and brick-and-mortar customer experience, inventory management, fulfillment, and returns processes. An HBR study of 46,000 consumers found that companies that have a poor omnichannel experience lose out to the tune of between four and ten percent of customer spend versus their more omnichannel enabled counterparts. Further, 41% of shoppers still wish that stores would do a better job of sharing inventory information online. As competitors throttle up their omnichannel investments, falling behind is a recipe for holiday heartburn.
It remains hard for IT to keep up, as customer expectations around omnichannel continue to increase, like in-store pick up turnaround speeds, wanting mobile apps that provide a unified, personalized experience between their online behavior and in-store shopping, and numerous other areas.
Keeping pace has meant overcoming one of the most profound technical challenges that affect customer experience: inconsistencies across channels that often arise from separate data silos, which was noted as a top technical challenge in a recent Gatepoint Research, Pulse Report study of technology leaders.
But database silo barriers to omnichannel are becoming more frequent in the enterprise stack, not less. It’s why Macy’s is taking a different approach. With 700 department stores, and 180 specialty stores in 44 states in addition to their major digital properties, they’re moving away from dozens of individual database instances and repositories, toward a DataStax enabled cross-cloud database architecture running a distributed model that provides one federated schema. It’s the enabling database infrastructure for them to achieve a 360-degree customer view, and drive a seamless omnichannel purchasing, inventory, and fulfillment experience, uniting all their infrastructure.
While cybersecurity often competes with digital in terms of IT priorities, CEOs see it differently. A recent Conference Board Survey found that security is the top external concern for US CEOs. During the holidays, when up to 30% of revenue can be at stake over the period, and with a Deloitte survey finding that 45% of shoppers indicated they’d hesitate to shop at a recently affected company, a cybersecurity incident can crush both business results and brand confidence at an incredibly sensitive time.
Database infrastructure that spans multiple platforms and software providers is at a record high, and can often elevate cyber risks. For example, when multiple databases are in play across transactional, analytical, search, in-memory, key-value, tabular, graph, and roll-your-own open source databases across clouds and on premises, each with their security management, training, patch cycle, and documentation, it can all create risks around improper configuration, or unpatched software.
A better strategy to reduce database security risks is to standardize on a database infrastructure like DataStax Enterprise, that’s multi-model, providing coverage for all workloads (e.g., analytics, search) and data formats (e.g., tabular, graph), and is multi-cloud. That way IT gets a single console to manage roles, permissions, and data-level security, across all different database needs and clouds.
There are so many great ways to spend the holidays, including spending time with family and friends, giving back to your community, or assembling the perfect gift list. Worrying about an embarrassing uptime or security incident, or revenue leakage due to slow performance, or a poor omnichannel experience shouldn’t be one of them. To learn more about how DataStax is helping CIOs everywhere reimagine their database infrastructure to drive digital and operational excellence, download this white paper.
1. Data Management Strategies for Retailers, GatePoint Research Pulse Report, August 2019