As new systems and digital capability continue to evolve the way retailers run their businesses, Essential Retail is gauging the views of the sector's main figureheads, via a series of exclusive interviews. This week, it's the turn of UST Global's head of retail, Jonathan Vardon.

This week saw businesses and technology firms join government representatives for the Confederation of British Industry's (CBI) Cyber Security Conference in London, which took place at an a time when the topic of cyber risk is increasingly becoming a matter of debate at boardroom level.

According to the CBI, most businesses now recognise that cyber breaches are not only a major monetary, intellectual property and a data privacy risk; but also create issues around brand reputation and customer trust.

The presence at the event of Dr Tony Collins, head of cyber security skills, knowledge & growth for the Department for Business, Innovation & Skills, alongside the department's deputy director for cyber security & resilience, Giles Smith, underlined the government's commitment to raising awareness of the dangers of online attacks to business. There were no speakers from the world of retail, though, which is arguably indicative of the wider industry's slow response to this fast-emerging threat to their operations.

Former Boots IT director Jonathan Vardon, who is now head of retail at technology solutions and services provider UST Global, says that high-profile cases of cyber crime in retailing have ensured the subject is beginning to become a more significant part of executive strategy within retail. Target, in the US, is the clear example of how a data breach can cost a business millions of dollars to rectify.

“There are a handful of retailers that are starting to get their houses in shape, including firms that work with us, but there are a large number that haven't even started to think about it,” he explained to Essential Retail.

“We're starting to see the beginning of the change, we're starting to see the chief information security officer – or CISO – whose job it is to gather information about what's going on across the estate and put in place some of the basics.”

But why have retailers been so slow to react? The latest British Retail Consortium (BRC) Retail Crime Survey, published at the start of 2015, found that the majority of UK retailers believe cyber attacks remain a critical threat to their businesses, with hacking and theft of data the primary concerns.

The BRC also urged the National Crime Agency to share more information about emerging threats.

Vardon says the perpetrators are getting increasingly sophisticated and it is not an easy process to predict future moves.

“You don't know what you don't know. You believe you've got the right security in place to protect against potential hacks, but hacking into banks or retail is almost becoming a trophy for the hackers and they are constantly looking at ways they can get their brand into the marketplace.

“It's like graffiti.”

The former retailer, who has been at UST for just over one year, having spent a brief spell as Co-operative Group CIO following his departure from Boots, says responsibility for tackling the issue of cyber-crime lies in two camps. In part, he explains, it lies with the retailers themselves, who must recognise the market is always changing “and that hacks are getting more advanced”, and it is also the responsibility of organisations such as UST, who can bring insight into and solutions relating to what is being shared about organisations on the "Dark Net".

“Having access to information about information intelligence you'll be amazed at what is going on via the Dark Net,” said Vardon.

“What we're trying to do is bring visibility for our clients so they can start putting the right strategy and security in place. Honestly, if I told you some of the info that's being shared on there it would make you faint.”

As is the modern way of the technology industry, UST is developing and cultivating partnerships with an array of companies – many of them start-ups – to ensure it is being introduced to disruptive technologies that could help solve some of the major challenges faced by its business customers. One of the areas it has placed substantial focus this year is cybersecurity.

Based on this work, UST has launched a company called Cyber Edge which Vardon says is “bringing to market some of the most advanced cybersecurity capabilities that are available anywhere, right now”. The portfolio, which includes analysis of the Dark Net, where the majority of major cybercrime incidents are discussed and formulated prior to being launched, has been established to help organisations be proactive and defensive in their approach to digital threats.

The team is made up of hackers and security specialists, many of whom are associated with the 8200 division of Israeli intelligence. Although based in Aliso Viejo in California, UST has a development centre in Tel Aviv, Israel, and it is across these two locations from which Cyber Edge operates.

As part of the company's agreement to have a base in Israel, where it has the opportunity to tap into the wealth of technological innovation arising in that region, UST is looking to train around 10,000 people over the coming years, on cybersecurity and the various other pain points facing modern businesses.

The work being undertaken in Israel, as well as partnerships being created with start-ups in different fields of technology around the globe, is giving UST a chance to tap into what Vardon describes as "a new marketplace" to help find solutions to the challenges facing retailers and other sectors looking to make a shift from legacy systems to new ways of operating.

He said: "The large retailers that have been going for 20-plus years are hampered and restricted a lot by the legacy spaghetti which they need to unpick in order to identify the appropriate investments and strategies to simplify their estate and enable their businesses to be more responsive and agile for the market, while not completely writing off tens of millions of pounds of investments they have put in place over the last five to ten years.”

“We've got some huge retail, healthcare and banking clients who are working with at the moment to move towards a more agile, enterprise way of operating.”

Vardon lists the three major issues facing today's retailers, as follows: working out how to use data to create a more personalised shopping experience; developing a better customer experience in general; and modernising supply chains.

Cybersecurity is not far behind in that list of priorities for retailers, according to the ex-Boots man, but it might only take one more Target-like incident for the industry to elevate the issue to its number one concern.

Further discussion forums like the one held this week by the CBI will be required for education purposes, but is clear more involvement and research into the problem from the retail world is needed to ensure awareness remains high and that potential threats discussed on the Dark Net are prevented from becoming a reality.

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