NCR Voyix and the Opportunities in Retail

Thank you, great to be here.

Thanks. So I've been in NCR Voyix for about eight years now, and about a year ago we split the company. NCR was made up of both ATMs as well as digital commerce. We split the company between ATMs and digital commerce, and NCR Voyix was formed. NCR Voyix is made up of three businesses: the retail business, the restaurant business, and our digital banking business—think of it as our digital commerce set of businesses. I'm responsible for our retail business here at NCR Voyix. My background is in building stores, and so that was forever a demand on capex and always been a champion and seen as this incremental way to grow a business. I recently had a conversation with someone from that store development world and they asked me what is the single most impact you can have on the customer experience in the store. And they thought it would be something physical because that's my background. And I said, it's checkout, it's POS. And they were like, what? Can't be. And I said, yes, very much is.

Absolutely, I do. Every retail decision maker needs data and data insights in order to run and grow their business. The way they provide experiences both to their guests and their team members or store associates is through data to drive decisions—whether it's inventory, pricing, marketing mix, promotions, product placement, merchandising, or building a brand. The way they get the data is through their store system, and point of sale is at the heart of those store systems. A lot of retailers would call it the heartbeat or the soul of the store. IHL did a piece earlier this year where they said 40% of retailers were looking to change or upgrade their store systems because their systems today aren't up to the task of providing the amount of data, as fast, with all the different challenges retailers have today—whether it be shrink, labor challenges, or changes in consumer demand and preferences. Planning for inventory when you have buy online pickup in store, planning for both inventory and labor, it's a very different challenge than you had pre-pandemic where buy online pickup in store wasn't nearly as prevalent. We call this an upgrade imperative that retailers are going through around their store systems, and the point of sale software is at the heart of that upgrade. That's really what the spin was all about for us on the retail side—shifting our model and transforming our business to a platform-based software and services model. We're providing next generation point of sale as well as self-checkout software where we reimagined and replatformed and brought a whole next generation set of capabilities to our customers. The company itself has gone through a digital transformation, and we're partnering with and leading the reinvention of store systems in the industry. We have the honor of serving 67% of the largest 400 retailers by revenue, and I'm honored to have the privilege to serve this wonderful team here at NCR Voyix and all these excellent customers, some of the largest retailers in the world all the way to small median businesses with one or two stores.

Yeah. I've never met a retail store or a retailer—whether it's the CEO, the COO, the CIO, any store operations leader—doubt you'll ever find one that'll wake up one day and say, 'Boy, I'm really looking forward to making a change to my point of sale.' They know they need to. They know that a lot of the store systems today can limit them—it's some of the older, aging technology—and they know they need to get data and insights much faster than they get today. But as I said from the beginning, people will say that the point of sale is the heartbeat of the store. It's a big change.

What we actually advise customers is there's actually a more evolutionary path you can take. We strongly encourage and partner with our customers—retailers that leverage other technology providers—a revitalization path that allows for continuous operations without a tremendous amount of undue risk while also getting benefits they don't have today injected into their business. It's much more of a lower-risk, more pragmatic path to this upgrade imperative. We worked with over 50 different providers around the world in reimagining our self-checkout solution. Before I go into the specifics, I think it's really important to talk about the team. Being the number one self-checkout provider in the world, one path would have been to do more of an incremental approach—maybe a new operating system, a new user interface, some new features and functionality. Another path would have been to reimagine everything from scratch, leverage all the experience and learnings we have, and do something truly next generation—almost like the free app on iPhone. Our team here at NCR Voyix had the courage and conviction to undertake that reimagination around three key principles: speed, intelligence, and innovation. Our aim was to enable self-checkout to become a true consumer engagement touchpoint to drive amazing experiences not just for guests or consumers but also for store associates or team members.

Absolutely. Let's talk about speed. Our new self-checkout application is powered with our Edge software, which enables a retailer to stay up to date with new features and functionality that they can deploy across their lanes and stores in a matter of minutes—when in the past that would have taken months. Think the principles of agile software development and deploying new capabilities just like you would on a website or digital channel. How do you run your physical stores like you do your digital channels? How do you test different user interface options, pricing options, color palettes, seasonal themes, just like you would on a website? How do you do A/B testing? We answer all those questions with our next generation self-checkout capabilities. The next principle is intelligence—providing retailers with real-time insights on store operations from our platform. Our platform provides actionable insights from all the rich data coming from every one of those devices, giving retail store operators much clearer insight to make decisions and predict issues that impact operations and guest experiences. Like, how many self-checkout lanes do I need that have cash versus card at different peak times? How do I take all my historic transaction data, social media feeds, events, weather, and optimize the self-checkout experience and layout of the front end? We can't be static anymore; we need intelligence to inform that agility. The third principle is innovation—think future compatible. People like to say future proof; we don't necessarily believe in future proof. I'll say future compatible. I'll use the Tesla example where autonomous driving was envisioned in the first Teslas, but the software feature wasn't there—the cars were ready to accept it when the software was ready. We designed our next generation self-checkout to be future compatible. Today most of self-checkout is barcode scanning, but we know artificial intelligence, computer vision, RFID, palm payments, retinal identification for payment—all coming to retail stores. These terminals need to be true consumer engagement endpoints. All of the technology, both physical interfaces ready to accept new software and anticipating these multiple signals of input and engagement, have been provided in this next generation set of capabilities. When we talk about the hardware—a configurable, modular fabric, truly being able to change cash versus card in a self-checkout unit. Programmable digital LED lights that enable navigation for consumers, advertising, or seasonal and local event communication. Let's turn this into a true digital touchpoint that can be intuitive and provide a better experience for consumers and store associates.

Absolutely agree, 100%.

I'm glad you asked me about it because that's a subject I'm really passionate about. Two ways to think about it. One way is: how do I take all the great things we do in the cloud and extend them into a store from a technology perspective? Cloud data centers are clean, well-protected, with great compute, storage, and networking capabilities. Stores aren't always that perfect—you could be in a convenience store, a grocery store, a specialty store—without the perfect environmentals that a data center has. But you still have the same demands. It's important that we enable retailers to operate their stores like a digital channel, and Edge is that technology—that store operating system, if you will—that enables that to happen. It sits between the hardware and the application layer. We support both virtual machines—so a Windows-based monolithic application in a virtual machine—and Kubernetes containers right on bare metal. We can do that both on a server pair in the back of the store and then a thin client out distributed in the stores, with applications running on those servers. But now we can bring those applications and leverage all that compute out in the lanes or POS terminals, almost like a distributed computing farm where if one unit goes down, applications fail to the other. You're able to leverage all that existing hardware investment as you modernize. We can support both virtual machines as well as container-based applications in the same virtual instance—and that's a first in the industry. That Edge capability fuels all of our next generation applications, but we also provide Edge as a platform for third-party applications, whether developed by the retailer or another third party. They can leverage that store operating system to deploy third-party or homegrown applications. We think it's a real differentiator and enables what we aspire to provide—next generation retail store architecture for the industry, so you can reimagine how store systems should work going forward.

Absolutely, absolutely.