The Best & The Brightest

As technology spending by retailers continues to bounce back from the doldrums of the last year, RIS News proudly unveils this year's "Top 50 Retailers" — the best and the brightest retail companies utilizing technology to drive their business success.

From TruServ and its president, Pamela Forbes Lieberman (on the list for the first time at #22), to The Limited (holding at #9 two years running), which created a completely separate operating unit for technology, you will learn which retail leaders are most adept at integrating technology strategy and implementation into the corporate plan to drive their businesses competitively forward.

Creating the Index

This marks the first time any publication has done a technology analysis of the industry on this level. We began by compiling the financial information on an initial list of 75 retailers pulled from last year's Top 50 as well as nominated by editorial board members, RIS News staffers and industry members including analysts and vendors. We then determined what percentage each retailer's revenues were of $3.23 trillion — the latest figure for the U.S. annual retail spend that was available from the Department of Commerce. That gave us the retailer's "Revenue Factor." Incidentally, the fifty retailers on this year's list represent almost exactly 25 percent of that total spend based on the numbers available to us.

The next multiplier was a composite factor reflecting the company's IT strategy and the reporting level of IT within the corporate structure. The IT strategy was determined by the number of technology implementations the company has accomplished over the last eighteen months and has scheduled for the next twelve.

The third factor was based on how companies rank collaboration with vendors and suppliers as a factor in their overall business strategy and success. Nine of the top fifteen companies gave collaboration the highest rating available.

The final factor was based on how each retailer was rated by industry peers on the use of technology for driving business success. In the end, readers cast just under 1,000 votes encompassing a total of 183 retailers.

When all factors were calculated, they were multiplied and the results on page 22 tell the story.

The Index

What does the RIS Index accomplish? The Index gives you a clear view of the competitive landscape. You can utilize it to see who is doing well the traditional way, with revenues, and who is doing even better by tying a strong technology vision into the total business strategy.

When you see smaller companies such as Pacific Sunwear (#44) and Chico's (#33), where revenue is clearly not what drove them onto the list, you can assume their recent and near-term technology implementations are extensive, IT is highly placed in the organization and along the way, the industry has noticed.

At the very top, you will see the expected dominators, Wal-Mart (#1), Home Depot (#2) and Target (#3). Naturally, they didn't get there on revenue alone, but rather visionary leadership and use of technology. Sears (#4) and JC Penney (#5) are next, driven to the upper ranks in some measure by the sheer volume of their business, but also by a highly placed value on collaboration and the high placement of IT in the corporate structure. At JC Penney, IT reports straight to the CEO.

As you move through the entire list, you find companies known to value technology highly, companies like The Limited, where Jon Ricker, president of the Limited Technology Services subsidiary, is one of the most admired leaders in retail technology, in part due to his willingness to facilitate change by letting his staff push the envelope. You also find the Army and Air Force Exchange Service (#10) where Luis Merced, SVP of MIS, is an outspoken advocate of continuing technology investment even in tougher economic times.

The Right Prescription

Walgreens (#26), returns to the list after a one-year absence and joins drugstore rivals CVS (returning at #28) and Rite Aid (back at #50). A number of years ago and ahead of its time, Walgreens was a pioneer in electronic prescriptions. Now with the rise of the Internet and handheld computers, the concept is gaining wider acceptance and Walgreens is again leading the pack. As with many other companies on the "Top 50," Walgreens makes the list as the result of scoring well in all categories and earning the respect and votes of its peers.