Meijer cuts IT staff as it moves to the cloud
Meijer has become the latest company to lay off information technology (IT) staff as those functions are farmed out to a third-party technology vendor with expertise in cloud computing.
Fortunately, many of Meijer’s workers were rehired by the technology vendor and continue to work inside Meijer’s headquarters as contractors, according to reports in the Michigan area where the supercenter chain is based. Some positions are being eliminated.
“We are making changes to our ITS structure that will enable us to provide even more solutions in both the digital and physical space for Meijer customers,” said Terry Ledbetter, Meijer’s CIO, in a statement.
Many traditional outsourcing providers now offer strong cloud platforms or SaaS (software as a service).
The 2017 Harvey Nash/KPMG CIO Survey found “very positive feedback” around cloud computing. Larger organizations cited the benefits of cost savings and improved responsiveness from cloud technologies. Smaller firms remarked on the stability and simplicity while valuing the scalability of cloud solutions. The report stated, “Suppliers are providing robust, flexible solutions, while customers are much less ‘prima donna’ about the uniqueness of their estate, clearing the way for the exploitation of cloud technology.”
The same survey found a strong appetite for outsourcing with the goals of freeing up resources, gaining access to new skills and saving money. Hot outsourcing areas include application development, followed by infrastructure and software maintenance.
The “Store It As A Service” study from RIS News that came out last November found that, while options have long been available to retailers to outsource the help desk and payment processing, retailers are increasingly looking to outsource wireless networks, mobile devices and real-time analytics. Survey respondents were less enthused about outsourcing POS hardware update/upgrade, SaaS management and security.
The study added, “Outsourcing store IT, while generally understood and partially adopted, has more room to grow before it becomes fully developed and implemented beyond a few functions that have been around for many years.”
DISCUSSION QUESTIONS: Considering the advances being made in cloud computing, does it make sense for Meijer and other retailers to outsource as many IT functions as possible? Which traditional IT functions should stay in-house?