Retail Insider held its first Breakfast Event of the year with Paul Clarke, Chief Technology Officer at Ocado, who outlined how its unique business model has resulted in it building all its technology in-house.
Senior executives from Sainsbury’s, Deliveroo, John Lewis, Marks & Spencer and Schuh were among those who heard how Ocado is unusual in combining cutting edge hardware and software to power its futuristic central fulfilment centres (CFCs) that use robotics and artificial intelligence among other technologies.
Heading up its software technology developments is Clarke who says: “When I first went around the Hatfield CFC before joining Ocado it was like all my Christmases arriving in one go because these facilities are at the intersection of hardware and software which fascinates me. Ocado made a pivot early on to build all its software technology in-house because our disruptive business model, based around centralise fulfilment, meant that there was no off the shelf template or solution available.”
The new CFCs are at the heart of the business and are scaleable and resilient with the ability to pick a typical 50 item order in a matter of minutes. This is made possible by swarms of robots that roam across a huge 2D chessboard. Under every chess square are stacks of bins containing groceries that the robots retrieve and bring to pick stations. Such solutions within Ocado are the source of continual innovation.
Although the news of late has been about Ocado signing deals to supply its Ocado Smart Platform (OSP) technology proposition to Sobeys and Casino, Clarke says the company will continue to deliver groceries in the UK.
“Not only is it an extremely profitable business which helps fund the ongoing investment in our technology platforms but also it has made us the best in the world at what we do – being able to test our innovations in our own retail businesses is invaluable,” he explains.
Its hybrid model has made it difficult for Ocado to be pigeon-holed as a retailer or a technology company but this has not affected its vision and Clarke says it has resolutely stuck to its strategy. With the recent deals under its belt some validation has been made of its approach.
For now the one area of concern for Ocado Technology is finding sufficiently qualified people to join the organisation. This is a view that will undoubtedly be recognised across the retail industry.
Glynn Davis, editor, Retail Insider