The role of the CIO in retail: a first-hand opinion

The editors of Global CIO discussed with Ahmet Hakan Göral, CIO at Boutique Rugs and winner of the Project of the Year 2023 contest, his current projects, the approach to digital transformation and the specifics of the role of CIO in retail.

 Please tell us a few words about yourself.

My name is Ahmet Hakan Göral. I’m an IT executive with 17 years of professional experience. I worked in the telecommunications, aviation, and retail industries. Currently, I’m working as the CIO of Boutique Rugs LLC.

 Your company Boutique Rugs sells rugs and home decor. What are the specifics of this business from an IT point of view?

We operate four websites and distribute our products across various online marketplaces. With each sales channel presenting unique requirements, we aim to establish a flexible system tailored to accommodate the distinct needs of each platform.

 The issue of digital transformation, how relevant is it for you? Tell us about the key milestones of this process at Boutique Rugs.Digital transformation is very important for us.

Digital transformation is not only a goal for the IT department but the whole company. Each department is brainstorming its processes for digitalization and optimization. Digital transformation not only decreases our costs but also automates the processes that return to customer satisfaction.

 What are the main goals of digital transformation for you and what projects have already been implemented to achieve them?

From an IT perspective, I don’t want to take the responsibility of doing anything manually. Because of that, we keep developing self service portals and automated flows. In some of our projects, we are also using machine learning and AI.

• Rug counter, a mobile application that counts the products on the shelves in our warehouse.
• Dynamic pricing, dynamic buffer, smart return portal, etc.

 Our community is already familiar with one of your projects - an AI Rug Counter for the warehouse, which has won in the Project of the Year contest. As I know it is developed by your team. In what cases do you think it is right to use in-house development and in what cases - off-the-shelf solutions?

As I mentioned before, we need to have a flexible system that can be adapted to different needs. For example, the previous warehouse management system that we used was not flexible enough to optimize our processes and we decided to develop it internally.

While making a decision, initially we search for the applications that we can use. This is of course the quickest way. But we also need to consider the cost and capabilities of the solution. In the Rug Counter app, there were similar apps that can count perfect round shapes, but the products in our warehouse might be in different shapes which requires machine learning and AI for a software to learn the patterns and give a more accurate output. We trained our code with more than a hundred images for improved results.

 Do you use outsourcing? In what cases?

Yes, we do. Especially if we need a special skill with a limited time period. For example, we are working with a partner for data analytic and decision making systems.

 What about the IT team working in your company? What are your key areas of focus?

Our target areas are:

• İmproving self service channels. We don’t want to be the owner of data correction or defining campaigns on our system. We are in contact with the business departments and we are developing the tools that they need to use.
• Cost optimization. It is always easy to purchase a 3rd party application and use it. But this brings license costs. Before purchasing a new license or renewing our license, we evaluate the cost of the license and the opportunity cost of having a more flexible system. We make our decisions depending on the metrics.
  For example, we were using a good self service return portal application. But after a while, we wanted to optimize our processes but this solution had some limits. So we decided to develop it internally
• Integration and consistency. We want to eliminate having the same data on different platforms as much as possible. Our solutions are integrating with each other so that we are showing a consistent data across different platforms.

 You have been working as CIO at Boutique Rugs for 4 years, what challenges have you faced during your work and how did you deal with them?

During those 4 years, not only did our company grow and our processes change, but also industry and user behaviors are changed too.

3 years ago we re-platformed our ecommerce solution and also extended our warehouse. We worked really hard to implement the new solutions and setup a WMS. But right after going live, we found major bugs and understood that the WMS could not meet our needs and we made a critical decision to develop a WMS internally.

 How do you think the role of a CIO in retail is different from other industries? What skills and personal qualities help you in your job?

Previously I worked in the Aviation and Telecommunication industries. The telecommunication industry is more stable and the customers are not changing dramatically, because the customers generally have commitments.

In the aviation industry, there are fewer alternatives. Even if you are not the best option, sometimes the customers have to choose you because there are no other alternatives.

But in retail, the alternatives are limitless and we have to focus on customer satisfaction while optimizing our costs and processes. We need to make sure that we understand the customer needs and trends to be able to have loyal customers.

 What are your plans for development? Share your most important projects for this year or next couple of years.

We also project to increase our international volume and sell on offline channels.