Our guest this week is Vinod Bidarkoppa.

Vinod is the Senior Vice President of Technology at Sam’s Club, where he is responsible for the strategic direction and management of all of Sam’s Club Technology and global teams.

Vinod is a proven leader with nearly 25 years of global technology expertise, working across omnichannel retail, healthcare, and the airline industry.

Prior to joining Sam’s Club, Vinod served as the Senior Vice President of Technology at UnitedHealth Group, where he was responsible for leading global teams to define and execute Healthcare Digital Transformation Agenda initiatives.

Join us as Vinod reveals how Sam’s Club rolled out its new Concierge Service in just six days, how the COVID-19 pandemic has impacted the way Sam’s Club thinks about innovation, and the greatest challenges facing retailers when it comes to implementing digital initiatives.

Episode 82  of RETHINK Retail was recorded on June 05, 2020. 

 


Hosted by Julia Raymond
Researched, written and produced by Gabriella Bock
Edited by Trenton Waller

TRANSCRIPTION

Julia Raymond:
Hi and welcome to the RETHINK Retail Show. In this episode, I am joined by my guest, Vinod Bidarkoppa. Vinod is the Senior Vice President of Technology for Sam’s Club. He is responsible for the strategic direction and management of all Sam’s Club technology and global teams to enhance the member and associate experience. Vinod is a proven leader with nearly 25 years of global technology expertise. He’s worked across omnichannel retail, healthcare, and the airline industry.

Julia Raymond:
Most recently, Vinod served as the Senior Vice President of Technology for United Health Group, where he was responsible for leading global teams to define and execute healthcare digital transformation agenda initiatives. Prior to that, Vinod served as the Group Technology Executive and Divisional Chief Information Officer at Tesco, leading worldwide engineering and operations. Wow. You have a very impressive background, Vinod. I am so excited to have you on the show today.

Vinod Bidarkoppa:
Thank you. Happy to be here, and I love to share some of my thoughts and what Sams’s is doing, what Walmart is doing, and I’m excited to be here.

Julia Raymond:
I’m excited to have you, and I always like to start off and just get a bit more about your background. What has your career journey been like so far?

Vinod Bidarkoppa:
Yeah, it’s been somewhat of a journey that has taken me into different domains and different countries and continents, if you will. I grew up as an engineer. Subsequently, I got my master’s in computer science. And then really, my first job out of school was with American Airlines in Dallas, working with some exciting airline industry problems and building complex products and platforms to solve some of the challenging business problems that airlines face.

Vinod Bidarkoppa:
And then a big break came in when Tesco came and wanted me to join their executive team to lead all of their global engineering and technology operations. That was the first time I came into retail with Tesco. For those who don’t know, it’s like Walmart, another very large, multi-country, multi-channel retailer, but it’s UK-based. So that gave me an opportunity to spend a lot of time in all the operating countries in the group role that I had there and spending a lot of time in Europe. That was a time when a lot of transformation happened in retail, driving from a store-centric business model to a more omnichannel-centric business model.

Vinod Bidarkoppa:
And after having spent a few years outside of the US, and then the healthcare industry was looking for, what they call a retail-ization of healthcare, and I thought that’s an interesting opportunity. So I spent a little less than three years there, and that’s when the Walmart opportunity happened, and I couldn’t wait to come and take this because everywhere I was in and around the different continents and Walmart was a competitor in some ways and was also the place where we shopped in other cases. And I couldn’t wait to come in and participate in the next journey for Sam’s and Walmart.

Julia Raymond:
Certainly. And, of course, Walmart, the largest retailer in the world. I mean, that’s such an exciting change to switch over from working at American Airlines, that was the first job you had and you spent, you said, years, a decade in that industry, I believe you said. And to then come back and work with the retail-ization of healthcare, super exciting. What takeaway do you have as far as, are there similarities between the airline industry or the healthcare industry to retail?

Vinod Bidarkoppa:
Yeah, a great question. Airlines are almost called “retail of a different kind” for various reasons. It’s a high capital intensive industry. You have to buy all the fleet. In retail, you’ve got all of the stores, or the clubs. Then you’ve got what’s called a “perishable inventory” in grocery retail. That’s similar to the butts in seats. That’s the inventory. If you don’t sell those seats, it’s lost forever. You’ve got a huge logistics challenge, as in you’re moving the planes, you’re moving the people around. There is the loyalty and the sales aspect of it, the yield management, the cargo. So there’s almost sort of a one to one corresponding mapping between the business processes from the plan, buy, move, and sell in the retail world and in the airline world.

Vinod Bidarkoppa:
And so I, personally, could relate to everything that happens in retail from my 15 plus years in the airline industry. And I couldn’t wait to come and bring some of that process-thinking, some of the technology. Because the airlines, actually, they’re one of the early ones to adopt a technology. If you go back and think of 2000s, in and around the year 2000, that’s when the disruption for the travel agency model happened. And you had the Travelocity.com, the Expedia.coms happen. And then there were the digital kiosks in the airport. And so I think there’s a huge digital disruption that happened in the airline industry in the very early 2000s. So what I saw in that trajectory of my career is, the retail industry was, particularly in Europe, was beginning to tap into that transformation, a similar transformation because they were all store-centric models earlier. And the consumers were used to using these little things called smart phones, having that kind of convenience and experience with airlines were expecting the same out of the retail industry.

Vinod Bidarkoppa:
And that’s when the retail industry started looking, “Okay, how can we then disrupt our store-centric model and bring a lot more digital into it?” And then that led to the omnichannel phenomenon, if you will. So in many ways, I think there are some parallels. And then the retail industry has adopted that in a massive way.

Julia Raymond :
Absolutely. And I love that you brought up the disruption that the airlines faced with digitalization. From the 2000s, I was speaking with Forrester analyst Sucharita Kodali and she mentioned the revenue streams of a lot of large corporations like Walmart, 20 years ago were not what they are today because there’s been so much innovation that has happened and so much shift. And when we talk about shift, the pandemic has caused so much of that so fast. And this is the hot topic right now in retail because there’s so much pressure. So from your perspective, you recently joined Sam’s Club as the new SVP of technology. How has the pandemic been impacting the way your company’s thinking about tech?

Vinod Bidarkoppa:
A great question. And again, in my parallel universe, I looked at what happened after 9/11 for the airline industry and how the airline industry had to adapt to the macro environment. I think we are in somewhat of a similar challenge and situation with the pandemic. I’m so proud of the associates at Sam’s Club and the way that we have risen to the occasion here, if you will. And I think there are three things that were front and center of all the things that we are trying to do. One is, how do we keep our members safe? How to keep our associates safe. Right? How do we extend into our community and help the community during this time? So backing up from that, technology is always the long pole in the tent, irrespective in a situation. And in this case, it became even more amplified because we really needed to correct and bring some of those safety experiences as well as the conveniences that our members wanted during that time.

Vinod Bidarkoppa:
A good example is the concierge app that we launched. This was to help our senior citizens as well as people with disabilities, people with immune disorders, and giving them the ability to shop confidently within Sam’s Club. There are many other examples. We did what we call the emergency app for our associates, where they could report back into the center about all of the things and the situations that were happening in the club during that time. We also implemented the club counter to help the clubs with social distancing. There are other exciting things that were done in a very short period of time. We worked to consolidate the packages in our FCs and then send them out as a common shipment to our members. We did many item limitations to our members when there was a run on toilet paper and hand sanitizers and so on. And subsequently, the meat products. So actually building all of that, building a tech convenience to our merchants as well as our associates in a very short period of time. To bring those better conveniences and experiences to our members was a fantastic experience, and I think the team really rose up to the occasion.

Julia Raymond:
I would say so. And it’s interesting because it sounds like it’s threefold. You said the first thing on your mind was, how do we keep associates safe? And not only did you address the customer, but you also addressed your associates and merchants, so three different groups. And it’s impressive that you also had an emergency app for your associates. Have you heard any feedback on the concierge app that consumers are using? Because I read it was rolled out in just six days, so I’d love to hear a little bit more about how you were able to roll it out so fast.

Vinod Bidarkoppa:
One of the things that stands out for Sam’s is the legacy of technology. There’s been a lot of innovation that’s been happening through the years. And Scan and Go has been out there for a number of years now, and our members love it. The Scan and Go was built as a very componentized, modular architecture and a platform. So when we sense the need for our members, particularly the senior citizens and members with disability and immune disorder, we thought, “What a great idea, if you can bring a concierge-type app for this set of cohorts or members during this weird period.” And we got an experience team, what we call within Sam’s, we have the concept of experience team, where it’s a combination of the business, the product, and the technology. We come together and sort of design think that problem, right?

Julia Raymond:
Mm-hmm (affirmative).

Vinod Bidarkoppa:
So as you put all of those heads together, the sum is always greater than the parts. And in this case, this was ideated in probably less than a day.

Julia Raymond:
Wow.

Vinod Bidarkoppa:
And then the team put together some building blocks of, how can we actually bring this to life in the fastest way? And then we were blessed that we had the scan and go app, which was the modular platform underneath that. And then the engineering team then, working with the product team, the business, started to figure out, “Okay, what are the components of the scan and go that I need to put together.” And pilot this in one club and, subsequently, expanded that nationwide. One of the reasons it was so successful is because we had the building blocks. And then we had to wire them dynamically to bring that experience and service to the market. And that’s really the ethos of how I see the value of technology and in building those core modular, decoupled architectures, so that we can really take those Lego blocks, if you will, and build that new model when it’s needed to bring a particular service to the market to a member or an associate. So that really helped us in our thinking, and that’s what we’ll continue to build on as the secret sauce of Sam’s Club.

Julia Raymond:
Mm-hmm (affirmative). And I love, Vinod, how you broke it down because I know your background is and at your core, you’re an engineer. And so I know you could probably get into the details of how exactly the technology works. But just thinking it as, “We had the foundation.” You said, “building blocks.” It was the Legos, the Scan and Go app. To be able to build off that, to roll out the Concierge service separately very fast. So really cool how you guys were able to execute that. And I must say, I use Scan and Go app myself, love it. Have always been a big fan. When the app first came out, I remember going into my local Sam’s Club. And your associates were handing out cupcakes as an incentive to download the scan and go app and give it a try, which I thought was great.

Vinod Bidarkoppa:
Thank you for being a member. And please, continue to share your feedback. We are never done. We continue to innovate and build on the feedback. And members’ feedback is something that we take very seriously in Sam’s Club.

Julia Raymond:
Mm-hmm (affirmative). Absolutely. And from your perspective, overseeing the project of the concierge app, where there any quick lessons that your team learned or any advice that you could give to other retailers who are going through the trenches right now, trying to push forward on digital innovation projects?

Vinod Bidarkoppa:
Yeah, for sure. I think for the team, I think it was a motivating win for the team. And just conforming their thought around why we need to architect and design in a modular way. Because who knew that we could bring a new growth channel, a revenue channel in less than six days? That’s phenomenal. And the reason this happens, and this is what, I think, I talk about with my leadership team and the broader teams is, a lot of companies think of digital as just that app or what people see on the glass screen. With the complexity of, particularly long-run legacy companies, is beneath the surface. It’s like an iceberg. What you see out there is just 10 percent. And there’s a big block, 90 percent of it, which is sitting under the surface of the water. And modernizing that digital core is really what unshackles all of that monolithic, legacy systems and applications that have been built for years and years. And if you can’t find a way to either decouple and modularize all of the digital core and unshackle that in a service-oriented manner and put all those microservices and what we call containers on the Cloud.

Vinod Bidarkoppa:
And basically, you’re enabling the business to then mix and match those services to visualize, “What is it that I can do to create those new services or experiences in the marketplace?” So that, I believe, is one of the ways that the other, not just retailers for that matter, any company. If the CIO, CPO would say is the first thing that a leadership team has to start looking at and understanding what is the tech that, in the atomization, how do you prioritize your initiatives? Do we have a strong product and engineering model to work in an agile fashion, bringing design thinking to the very front and center of the problem solving? Some of the three of four key tenets of how you could actually fast forward and tech enable your business.

Julia Raymond:
Mm-hmm (affirmative). And I love that you pointed out to find a way to modularize and put micro-services in the Cloud. And you mentioned design thinking a few times, and I just want to know from you, how would you summarize the concept of design thinking as it’s applied to big tech and retail?

Vinod Bidarkoppa:
Yeah. So most fundamentally, design thinking is about customer empathy. Right? You start from there. You have the customer as the center of, why are you doing this? And then once you start as an experience team, if you start from that member-centric, customer-centric thinking and then build on. And you have, what is the first MVP, the minimum viable product, how should it look like? How should it work? Right? You don’t solve for anything as a be-all and end-all. You build it and then you iterate and then you get the feedback from the market, from your customer, from your member, and then see what else needs to change because then… And it’s also about failing fast. And if things don’t work, we need to be able to say, “Maybe we don’t do this anymore,” because then you’re just continuing to self fulfill your own prophecy at that time.

Julia Raymond:
Absolutely.

Vinod Bidarkoppa:
Yeah, so the design thinking has those two or three core elements, which is start with customer empathy, build that model, where your experience team has a minimum viable product. And you get the feedback from that, from your customer, right? And then we can call that AB testing, whatever label that we want to give that. But based on that, you go to the next situation and the next situation. So that way, as your progress steps through that, you’re building a product that can delight your customer base.

Julia Raymond:
Mm-hmm (affirmative). Certainly. Well said. And speaking of apps, just throwing this question out there for you, it seems like every retailer has its own app. Do you think there will be a mass consolidation at some point, or is that just the future forward, you have to download the app for every retailer you’re working with?

Vinod Bidarkoppa:
Every retailer obviously wants its own window or door to their world. And you’ll see that happening with specific airlines, specific retailers. There will be some aggregator apps, if you will. I mean, Expedia.com is a good example. Right? You can think of that for the airline industry, it’s an aggregator app that will funnel into the specific inventory for the different airlines. Similarly, there are hospitality, hotel consolidators. And today, you can think of Google as maybe one of those apps. But I think, just as an American Airlines will have its own app as against an Expedia, which is a consolidated aggregator. I think Sam’s Club will continue to have its own app, right? Which is our window to the world, and we want to control that experience and the look and feel and how we present those great items at great prices and wanting to create those special moments for our member base. Because once it goes out, the consolidator or aggregator cannot give that native experience that the retailer would want to present. So I think it’ll be a world where there will be both those experiences. And if the customer wants to have a more native experience and get the best item price and experience, he or she would come have that experience with a specific app.

Julia Raymond:
Right. So the native experience you talk about, do you think that will be even more important because of the pandemic and the fact that people are buying more through e-ommerce channels versus in-store?

Vinod Bidarkoppa:
The pandemic is obviously driving a lot more e-commerce penetration. And Sam’s Club will drive. Our motto is to meet the member when, how, and where he or she wants to meet us. Keeping that in mind, I think, safety being the biggest concern for all our members. And that’s where, I think, scan and go is a fantastic app for them, if they want to come into the club. We also have our direct to home channels, so they can experience us on the web. They also can come and do a club pick up. So we have a plethora of those channels, if you will, an omnichannel experience that we love to give to our members. So all of that exists today, and we will only continue to make that even better as days pass and continue to make the shopping experience convenient. I think, if I can share something, the organizations look at it disjointly and not at the member. We will continue to have that connected customer experience, and that’s the expectation. And every leading retailer will want to go there. And Sam’s, obviously, is one of the leading retailers of omnichannel, which is bringing that experience to our members.

Julia Raymond:
Mm-hmm (affirmative). And the focus on the connected customer experience is really important. But would you say sometimes, you said retailers are not looking at it always from the customer perspective because of legacy systems, and the technology is hard to migrate. Or what would you say are the biggest challenges in general when it comes to innovation?

Vinod Bidarkoppa:
When I look at innovation, I call it the small eye and the big eye. The small eye is all those little things that you can drive during your course of work, you find those little opportunities. The big eye is one of those big moon shots of things that will actually shift step change in the way the members interact with us or the way we can drive productivity in a club and so on. And Sam’s has done a fantastic job. Scan and go is a great example. The Sam’s Now Club in Dallas, which is bringing together a number of innovations that have happened or are happening into that club experience, whether it’s navigating to find a specific item or bringing some items to life through an AR experience, VR experience, as well as the Concierge. It’s a business model innovation. We just created that new channel of growth. So that could be maybe a good example.

Vinod Bidarkoppa:
But broadly, I think where atomizations fail to have a culture of experimentation or don’t have tolerance for failure are looking only in the here and now and are not looking at a horizon which is two years away, four years away, and are not skating to where the puck is going to be. If that’s the culture that exists in atomization, it’s very hard to innovate. And we’ve been lucky, and we’ve got fantastic executive leadership all the way from Doug and Kat. So we are encouraged to experiment. We are encouraged to try those different things. And that’s driving the innovation, right? So it’s a culture that has to exist in the atomization. And that, I think, is the foundation of things for any company to be innovative in nature. And you will see that where the culture exists, you will see more innovative products and services come out of the atomization.

Julia Raymond:
Certainly. And I like that you said you think of it as the small eye and the big eye in innovation, in terms of small changes versus the moon shots. And so I think that’s a great way to break it down and think of innovation because small innovations are still innovations. And you mentioned that the testing that you’re doing, I know Walmart has a few labs as well. And there was a recent shop talk live poll webinar in late May, and they asked retailers, what do you think are the most significant long term changes we’ll see in the e-commerce business model because of the pandemic? And one of the options was virtual try on and testing options, and that was 17 percent. So I think AR/VR is definitely on the rise.

Julia Raymond:
So Vinod, circling back to the concierge app. When we think about the app in practice, it’s for, specifically, senior citizens and members at risk. This is an additional service that you guys have rolled out for them. Is it only available to senior citizens, or can any member technically use the service?

Vinod Bidarkoppa:
We targeted this service as a convenience for our senior citizens, members with a disability or immune disorder, but we have not stopped anybody else who wants to use that service.

Julia Raymond:
Can you walk us through what the process looks like for someone who is using the Concierge service?

Vinod Bidarkoppa:
Yeah, so it’s very simple and straightforward. A member drives up, an associate greets him or her, they get to look at what items are available on an iPad, the member chooses what items he or she wants, the associate runs inside the club, picks the items that the member has desired to be picked, the associate brings back those items, loads it up in the trunk, and then gets the credit card information, and the transaction is complete. It’s as simple as that. So it’s a very straightforward interaction that our members are delighted using this in the last three months since we have launched it.

Julia Raymond:
Well, I’d like to close out today, Vinod, and just ask you: There’s a lot of discussion about how consumer behavior may change in the long term, a lot of speculation. What habits will stay? Which ones will go? How do you think the consumer will change forever? Or what are your predictions?

Vinod Bidarkoppa:
I think because the member here, or at least for Sam’s Club, would love to get those conveniences. Safety being the primary concern for them. And the whole contactless shopping would get amplified. We’ve been adding more than 7,000 members using scan and go every day since COVID on an average. That just tells you the story. We’ve had Scan and Go option increase four to five times. And as those habits start forming, they stick. And once you get used to those conveniences, I think members just won’t accept anything else. And they demand those experiences. So I think, from that perspective, safety becomes very critical going forward. And to that end, I think the contactless shopping, the ability to shop, whether from a drop pick up perspective or through or online channels and omnichannel, will become a lot more critical.

Vinod Bidarkoppa:
And those companies which actually bring those experiences in a seamless way and in a way that delights the customer, providing those high MPS values with the ones who will be successful. I think customer journeys are less discrete and just span across all channels. And the mediums are [inaudible 00:35:25], and retailers must respond. Clubs will exist for a long time, but how we use those clubs, aligned with some of the other online services and mix of the club and online, in a way where the member wants to shop whenever or however and wherever is the way to go. And that, I believe, is the secret sauce to success.

Julia Raymond:
Yes, we are. And Sam’s Club was ahead of the game when it came to contactless shopping and payment with the scan and go app, because it’s been around way before the pandemic. So really interesting to hear how many new members are being added every day. I do agree with you, contactless shopping is probably one of the big trends here to stay and increase.

Julia Raymond:
Vinod Bidarkoppa, Senior Vice President for Sam’s Club, thank you so much for joining today. It was a pleasure having you on the show.

Vinod Bidarkoppa:
Thank you. I enjoyed the discussion today.