Latest / Best of Business / Carolyn Young: Retail NZ CEO on the impact of Friday's global IT CrowdStrike outage

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Carolyn Young: Retail NZ CEO on the impact of Friday's global IT CrowdStrike outage · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks EDB. Follow
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  Speaker 2: So, retail across the country experienced difficulties on Friday, as
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  Speaker 2: you probably know, and through it and through into Saturday,
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  Speaker 2: as payment systems went down, Retail New Zealand was urging
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  Speaker 2: customers to be patient. In Retail New Zealand CEO Carolyn
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  Speaker 2: Young joins me, now, good morning. Were retailers prepared for this?
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  Speaker 2: Could they be prepared for this?
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  Speaker 3: I don't know if anyone was prepared for this. Really,
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  Speaker 3: It's not something anyone had expected, obviously, a global IT
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  Speaker 3: outage impacting you know, everyone across the globe, from airports
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  Speaker 3: and airlines, to banks, to retailers to people at home.
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  Speaker 3: It was a massive outage that had instantaneously and reminded
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  Speaker 3: us how interconnected we are with each other today.
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  Speaker 2: Could something have been done to prevent the effect this
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  Speaker 2: had on retailers?
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  Speaker 3: Look, it's hard to know right at this stage if
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  Speaker 3: you could prevent something of this magnitude, But I know
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  Speaker 3: that a number of the banks and the payment gateways
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  Speaker 3: will be looking at, you know, what occurred and how
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  Speaker 3: could something be looked at? To ensure that it doesn't
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  Speaker 3: occur again. But when something cut around the line so quickly,
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  Speaker 3: you know, it's very difficult to manage that when it's
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  Speaker 3: outside your control and you work on a platform like
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  Speaker 3: Windows where that was impacted.
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  Speaker 2: Carolyn, what kind of ongoing effects will this have? How
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  Speaker 2: many sales do you think we've likely been lost because
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  Speaker 2: of this? I've been able to calculate that yet.
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  Speaker 3: Yeah, No, haven't been able to calculate that. You would
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  Speaker 3: need to see some data around payment transactions and do
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  Speaker 3: some analysis if we can get some daily transactions. Certainly,
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  Speaker 3: Friday night was more difficult than yesterday, that's sure. You know.
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  Speaker 3: Friday night was a situation where it was unfolding in
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  Speaker 3: front of us, and some payments were going through and
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  Speaker 3: some weren't, and some point of system styles were working
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  Speaker 3: and some weren't. So, you know, it was a little
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  Speaker 3: bit more to understand exactly what was happening and how
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  Speaker 3: the impact would roll out into Saturday. And relatively speaking,
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  Speaker 3: Saturday was a relatively smooth trading day, especially compared to
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  Speaker 3: Friday evening.
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  Speaker 2: Yeah, yesterday, my producer was at a supermarket and I
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  Speaker 2: was at a large retailer, and both had a selected
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  Speaker 2: group of checkouts working or computers working, they were still
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  Speaker 2: having to go through the process. Is that one of
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  Speaker 2: the problems that it's just not a quick fix. It's
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  Speaker 2: not like, oh okay, sorry, here's a new update, run it,
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  Speaker 2: We're good to go. Yeah.
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  Speaker 3: Look, it's a really complex space, isn't it, Because you know,
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  Speaker 3: if you take one one part of them, if you
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  Speaker 3: look at the payment system and the gateways that occur
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  Speaker 3: through a contact list or credit transaction, it's not just
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  Speaker 3: hitting one space. It's not just going to the bank.
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  Speaker 3: It's going through a number of different providers to ensure
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  Speaker 3: that that transaction is completed. And so that means that
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  Speaker 3: any one of those providers could be hated along the way,
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  Speaker 3: which would mean that the transaction doesn't complete. So, you know,
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  Speaker 3: you reliant in a whole system of people and businesses
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  Speaker 3: for the whole business to work. So that's what makes
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  Speaker 3: it much more complex, And obviously people would have been
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  Speaker 3: a little bit cautious about some of the fixes ensuring
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  Speaker 3: that they worked correctly. You know it, people would have
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  Speaker 3: been swamped on Friday and Saturday with helping people with
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  Speaker 3: you know, the blue screen of death that a number
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  Speaker 3: of a number of people had on their computers, So
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  Speaker 3: just making sure that the fix that you did for
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  Speaker 3: that blue screen of death was appropriate, because you know
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  Speaker 3: that there's always opportunities when things like this happened for
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  Speaker 3: scammers to come out and try and make more chaos, right,
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  Speaker 3: So it's about making sure that the fix is actually
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  Speaker 3: the accurate one and it's going to work for yours.
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  Speaker 2: And of course, Carolyn, whenever something like this happens, we
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  Speaker 2: ask the question, are we too reliant on technology? Should
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  Speaker 2: we use all cash?
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  Speaker 3: Yeah? Well, look, cash is obviously king in a crisis, right.
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  Speaker 3: We do know that from the floods in Auckland and
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  Speaker 3: the cyclones that hit the East Coast last year that
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  Speaker 3: you know, technology wasn't effective in those crisis situations. In
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  Speaker 3: cash with king, So you know, it is helpful if
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  Speaker 3: people do have an ability to have some cash reserves,
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  Speaker 3: so if they need to get some essentials from the supermarket,
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  Speaker 3: or they need some fuel or something, that they're able
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  Speaker 3: to do something. But we recognize that not everybody has
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  Speaker 3: to bear cash, but you can obviously still transact with cash,
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  Speaker 3: so you could do some you can have some of
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  Speaker 3: your regular payments that you pay with cash, so that
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  Speaker 3: you're prepared for something like this, but it is sort
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  Speaker 3: of really challenging. And you know, the f Transaction system,
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  Speaker 3: compared to the Contact List one, the old F POD
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  Speaker 3: system does have the ability to work offline, and that
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  Speaker 3: does make the ability for retailers and essential providers to
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  Speaker 3: continue to transact when systems go down cal.
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  Speaker 2: And there have been reports of aggressive behavior from consumers,
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  Speaker 2: which really just sucks because we're all in this together.
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  Speaker 2: It's not convenient for anybody, is it.
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  Speaker 3: Yeah, no, it's not. And people were frustrated on Friday night,
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  Speaker 3: not really understanding what was happening and why transactions weren't
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  Speaker 3: going through, knowing that they had money in their bank
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  Speaker 3: account and you'd get a message saying that your transaction
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  Speaker 3: was declined. I myself got caught up in that member.
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  Speaker 3: I've quite dumbfounded as to why that happened. But I
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  Speaker 3: just used another form of payment and that went through fine.
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  Speaker 3: But people do tend to jump at the retailer rather
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  Speaker 3: than try and think about what the solutions are. If
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  Speaker 3: you don't know what the issue is at the time,
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  Speaker 3: it's not helpful to blame someone and be aggressive around that.
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  Speaker 3: So it was a little bit disappointing.
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  Speaker 2: Thank you so much for your time this morning, Carolyn Plea.
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  Speaker 3: Sure that was.
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  Speaker 2: Carolyn Young there from Retail New Zealand.
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