Attendees at the annual PCATS conference this week listened to Doug Tidwell, an IBM expert, tell them they could replace many of their computers, software applications and data warehouses with service contracts to third-party suppliers. These suppliers are often referred to as "cloud" providers, in that they supply all the hardware and software [image-nocss] necessary for just about any automated purpose, with the retailer only needing a browser and online access.
In his presentation on Wednesday, he demonstrated purchase-order processes and the activation of virtual computers on his laptop via an online connection.
Cloud services will "revolutionize" business, said Tidwell (pictured), a senior software engineer for IBM, Research Triangle Park, N.C., much in the same way the "World Wide Web" did in the last decade.
Such services have the potential of cutting a wide range of costs, including equipment purchases, maintenance, storage and operational expenses. "Many businesses don't want to have the expense of buying all those servers, housing them and making sure they don't overheat," he told the gathering of about 100 conference attendees. "Or sometimes businesses buy [equipment] because they need a lot of bandwidth, but they only use that amount twice a month. One example can be with human resources, where payroll is being done on the 15th and at the end of every month."
A couple of the advantages he pointed out were scale and flexibility. If a retailer needed to ramp up because of a new acquisition, using a cloud provider would allow the addition of new processing capacity in a short amount of time. Similarly, with the earlier HR example, a retailer would not have to build an entire infrastructure for something in sporadic use. He or she would simply pay by use. Tidwell said typically the providers charge by amount of time retailers use the system or they employ a subscription-based payment model.
But the cloud solution would not be for all purposes, he said. For instance, processing delays may occur if a glitch happens on the third-party's end. This brings up two issues. The first is control. A retailer is unable to physically access the problem and would have to go through the provider's service center. The second is immediacy, where a book ordered on Amazon.com could take a delay without any customer backlash, confirmation of a debit transaction may not.
Security of sensitive material may also be an issue. Storing data at company headquarters may be a requirement, not just because of internal rules but as a mandate from a state or federal entity, he said.
This year's conference also represented the first PCATS meeting since its merger with the National Association of Convenience Stores (NACS) last fall. Gray Taylor, executive director of PCATS, the Petroleum Convenience Alliance for Technology Standards, Alexandria, Va., said the merger will allow PCATS to focus on program delivery.
Among many continuing developments, he said open architecture stands out, especially as the major oil companies withdraw from retail. Communication between devices on the forecourt, he said, will become an increasingly pressing matter.
PCATS is also pursuing industry interests an international front, recently pressing a global standards body to take into consideration the unique formats of fleet cards. Without the input, emerging standards would have been detrimental to fleet-card processing, Taylor said.
Commenting on the merger, attendee Pat Lewis, CEO of Oasis Stop 'N Go, Twin Falls, Idaho, described an "excitement" over the development. "[PCATS'] financial health is better than it's ever been. This year, we've had a good turnout [for sessions like] data security--where the big-oil brands are seeing how our work is beneficial."
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