“Creating an architectural foundation for innovation”

Michael Scheibner has been CEO of GK since 1 June 2023. He has been with the in-store technology specialist, which is now part of Fujitsu, since 2009, most recently as Chief Strategy Officer. According to data from Datos Insights, GK is the world’s number one POS software provider in terms of new installations in the retail sector. As CEO of the market leader, Michael Scheibner regularly talks to the top executives of the world’s largest retail companies and is familiar with many of their strategies. In the run-up to EuroShop in Düsseldorf, he shared his thoughts with Björn Weber, whom he has known well for 16 years.

Retailers cannot invest in all the exciting technologies on display at EuroShop. What advice do you give the top managers of the retail companies you meet regularly to help them focus their strategies and structures?

Michael Scheibner: There is no doubt that retail companies with efficient and innovative IT systems have a clear advantage over the rest of the market. Based on what I have heard in my conversations with executives from the retail, IT and software architecture sectors in various regions around the world, there are clearly structural reasons for this. However, the experience of recent years has also clearly taught us that, in the medium term, it is not the retail companies that introduce as many independent innovations as possible that will prevail, but those that have created a powerful foundation in the form of a Unified Commerce Architecture.

What do you understand by a Unified Commerce Architecture – is it just a new word for omnichannel capability?

Michael Scheibner: In fact, one of the goals of this architecture is to create consistent shopping experiences for customers. But not only across sales channels, but also within sales outlets. This includes more consistent and faster checkout experiences at staffed checkouts, self-checkouts and in the mobile sector, as well as, for example, the smooth collection of e-commerce orders. With this kind of architecture, retailers can also offer their customers more flexibility when it comes to payment by quickly and easily introducing new payment methods and processes.

But you are not just referring to checkout technology when you talk about this kind of architecture?

Michael Scheibner: Absolutely right. A Unified Commerce Architecture provides the basis for optimising all retail processes and for faster innovation without delays caused by fragmented legacy systems.

Real-time visibility into inventory enables more accurate decisions about pricing, replenishment and profit margins. It also enables predictive customer engagement, where customers can be seamlessly recognised and served without operational friction. Last but not least, it puts loss prevention on a whole new footing, while even improving operational control and customer experience, especially at self-checkouts.

Has the retail industry focused too much on innovation and too little on modernising its core software landscape?

Michael Scheibner: In fact, the last decade has been largely characterised by the accumulation of technologies. These were primarily integrated by layering new applications on top of older ones and connected via increasingly complex API networks and interfaces to ensure that the entire system worked together smoothly. This model was sufficient when the customer journey was still relatively linear. However, it is becoming less and less suited to the environment retailers face today.

Today’s retailers need to be more flexible, serving more contexts and customer segments, more payment methods, more loyalty interactions and more channels than ever before. Once they reach a certain level of complexity, fragmented systems can no longer handle this reliably, or only at very high costs, ultimately putting retail companies at risk of no longer being able to meet customer expectations for speed, accuracy and security.

Let’s break this down specifically for the introduction of self-checkouts – in Germany, the number of SCOs has doubled in the last three years.

Self-checkouts will play a central role at EuroShop because, in times of labour shortages, they are a practical solution that meets customers’ need for a fast checkout process. But ultimately, they also ruthlessly reveal – alongside discussions about personnel strategies and service – how good a retail company’s technological basis really is.

If the systems are fragmented, the introduction of self-checkouts often becomes a stress test. This is because every weakness becomes apparent: loyalty programmes sometimes fail to recognise customers reliably, age restrictions delay the process, items are incorrectly identified or priced, or security rules contradict each other. The result is a checkout experience that appears unstable. Added to this is the problem of inventory discrepancies, which makes SCO a very challenging issue for many retailers from an economic perspective.

With a consistent, modern Unified Commerce Architecture, many pitfalls can be avoided in advance. This starts with the fact that SCO is then just a POS variant that uses the infrastructure and technology of the other front ends in its entirety. It also means that the entire issue of customer loyalty, which is an integral part of a Unified Commerce Architecture, does not have to be connected separately, but is already provided by the platform. And what we are seeing right now is that technologies already integrated at the platform level, such as computer vision, are very quickly becoming reliable operating tools rather than experiments. As a result, security and customer experience are no longer in conflict, but reinforce each other.

For all these reasons, the future of self-service checkout is no longer determined solely by hardware, but also by how well item recognition, customer identification, payment logic and loss prevention are integrated into a single, unified system.

If you could give just one sentence of advice to all retail representatives visiting EuroShop, what would it be?

Michael Scheibner: Those who invest in the right commerce architecture now will lay the foundation for future success – those who hesitate may lose out.