Modernisation in Retail: The Strategic Imperative for Agility, Innovation, and Sustainable Growth

The retail landscape is in constant flux, with change being the only certainty. External pressures like economic shifts, geopolitical dynamics and rapidly evolving customer demands are pushing retailers to their limits. This is especially true for those burdened by outdated legacy systems, which can turn software modernisation into an uphill battle.

This is where software modernisation transitions from a technical concern to a strategic imperative that is key for retailers who are looking to build a resilient, agile, and future-ready retail business. In this article, we'll explore practical strategies for adapting, innovating, and driving tangible value through modernised software.

Why Modernisation is a Non-Negotiable for Retailers

In an environment where external pressures emerge unexpectedly and intensify rapidly, battling internal system inefficiencies can overwhelm engineering teams. This often pushes innovation and the adoption of transformative technologies like AI to the back burner.

There's a critical need for systems that are capable of rapidly adapting to shifting market conditions and customer expectations. Retailers who continue to rely on obsolete, legacy software will inevitably lag behind their competitors. Such systems hinder the ability to react swiftly, optimise operational efficiency, and maximise new opportunities.

Many retailers possess vast amounts of data, yet legacy infrastructure often makes data management, analysis, and leveraging it for strategic insights incredibly challenging. With retail margins shrinking, there's an increasing focus on finding new ways to monetise data to create new, profitable revenue streams. This, however, is only realistically possible when data infrastructure is modernised and optimised for accessibility and analysis.

Codurance has helped many leading retailers modernise their software systems to reduce risk, enable growth and scalability. Learn about how we did this here.

Redefining Value: Measuring Engineering Success Beyond Revenue

Every company expects its engineering teams to develop products and features that drive revenue. However, if we narrowly define the value of engineering solely through its revenue-generating capacity, we risk overlooking critical metrics that demonstrate its broader, foundational contributions to success. Having clearly defined objectives and key results (OKRs) ensure that software modernisation is measured and aligned to the company OKRs, and contributes towards the overall success of the business.

Beyond direct revenue, engineering is a critical function in streamlining operations, enhancing compliance, bolstering data security, and maintaining invaluable customer trust. Its impact ripples across entire organisations, improving efficiency and reducing risk.

A successful system is also a secure one. Relying on legacy and outdated systems presents a significant security risk. Codurance’s Software Quality Assessment (SQA) helps organisations assess code security and identify vulnerabilities in both proprietary and third-party code. Book your Software Quality Assessment demo to get clear, in-depth and independent expert analysis of your bespoke software products, people and processes to help inform your strategic business decisions.

Establishing a clear connection between the engineering function and the C-Suite is paramount when communicating performance and success. When leadership understands the multifaceted importance of engineering (far beyond just revenue generation) it significantly strengthens the case for ongoing investment in software modernisation. This holistic view fosters a culture where technology is seen as an enabler of comprehensive business success.

Read our case study where we partnered with Artlogic to deliver a Software Quality Assessment, which gave them a clear understanding of the current state of not just their software, but also their processes and team’s technical skills too.

Integrating AI Strategically

Today's customer experience is rapidly evolving, and retailers aiming to capture a greater share of the customer wallet must deliver what consumers now expect: hyper-personalised experiences, often achievable at scale only with the strategic assistance of AI.

Before even starting to experiment with new AI tools and features, retailers must first think about how they plan to strategically and effectively integrate AI into their business. AI tools can be very expensive to operate so measuring return on investment (ROI) and consistently questioning the ‘why’ behind AI investments is vitally important, especially as products and features begin to scale. It’s easy to fall into the trap of implementing tools such as AI Assistants because competitors are doing this, however this does not necessarily mean this is the right thing for your business or will benefit customers or the bottom line. 

Many organisations inadvertently fall into the trap of creating a siloed 'AI team' solely responsible for experimenting and building POCs to identify potential new and innovative solutions for the business. This isolated approach can unfortunately create organisational silos and decelerate the widespread adoption of AI across the entire company.

The more effective alternative is to embed AI capabilities directly into existing products and within cross-functional teams. This strategy facilitates faster iterations of new products and features, enables the early rejection of unsuitable ideas before they start costing too much and allows teams to rapidly pivot to the next phase of development or iteration.

The potential for high-impact AI use cases in retail is immense. It can transform customer experiences and significantly boost efficiencies of both developers and staff across the entire business. AI’s potential in areas such as improving productivity, predicting maintenance needs proactively, and automating routine tasks are huge, freeing up valuable engineers’ time that can be spent on more complex, creative problem-solving.

Read our new ebook which we’ve developed following an AI Hackathon which explores where AI adds value (and where it doesn’t), the role of prompt engineering in quality output and how to use AI with purpose and discipline.

Robust Foundations for AI Adoption

In a highly-competitive industry like retail, companies are always looking for ways to get ahead of competitors. This is also true for the rollout of new AI offerings, however, before embarking on a new AI strategy, retailers must first ensure they have correct data handling procedures and governance frameworks in place. It is important to move fast and efficiently on new deployments, but at the same time, the systems must continue to operate as normal and potential risks must be thoroughly assessed.

Addressing critical concerns, particularly security and confidentiality, must be the top priority before the rollout of any new AI tools or features. Rigorous testing is essential to ensure their security, reliability, fairness and effectiveness. The risk of exposing sensitive data increases with the use of advanced tools like chatbots and AI-driven analytics, however, through exhaustive testing and well-trained engineers operating the models, these tools can be deployed safely and securely.

With Codurance’s Data and AI Readiness Assessment, companies get clear, independent recommendations to evolve their data strategy and kickstart AI adoption.

Conclusion

Retailers who proactively embrace these principles will not only remain competitive but will also position themselves advantageously to adapt and thrive amidst future market challenges.

If you're assessing your business's readiness to innovate and adopt AI technologies, consider leveraging a Data and AI Readiness Assessment. Alternatively, feel free to reach out to our team to learn more about how we’ve helped major retailers successfully transform their legacy software into powerful, futureproof systems.

Watch the discussion we had with industry leaders on legacy modernisation and strategic AI adoption in retail below.