Staffing issues continue to plague the retail industry, but Scott TumSuden, VP and Head of Retail Strategy and Growth Acceleration at Cognizant, believes the sector is on the brink of a transformation — one that’s being accelerated by the rise of generative AI and automation.
“Staffing in general in retail is a perennial problem,” TumSuden said in a recent conversation. “There’s about 60% annual turnover in most retail businesses and ultimately, that yields a lot of waste and inefficiencies.”
TumSuden explains that this constant churn leads to a “flywheel effect” of added costs and operational drag.
“When you have turnover, you have inefficiencies. You have a lot of waste, you actually add extra cost, right? Because then you’re having to retrain people, you’re having to research people, you know, you have to rehire people.”
But while staffing challenges are hardly new in the industry, TumSuden is optimistic that today’s technological advancements could mark a turning point.
“I actually think we’re on the dawn of a new age finally,” he said. “There are some opportunities to change that with the way that technology’s evolving — and generative AI in particular — to help address the churn, which then helps to address the efficiency, which then helps to address the usage of labour and making labour and workforces more effective.”
As AI capabilities mature, TumSuden sees them playing a vital role in reshaping not just roles, but entire operating models. “There are certain jobs that will be hopefully eliminated,” he said, noting the potential to phase out “low-end, highly automatable, highly mechanical jobs” — many of which are already being handled by tools like chatbots in customer service.
But it’s not just about elimination. TumSuden sees generative AI enhancing customer-facing and operational roles as well.
“You can actually provide better service because the generative AI can leverage all the data and the information about what products are relevant substitutes and probably be more knowledgeable than an individual associate.”
He points to the common “buy online, pick up in store” model as an example of a task ripe for reimagining. “You have a store associate picking and packing orders off the shelves during business hours when they could be servicing a customer,” he said. “They are servicing a customer because they’re picking and packing that order. But the reality is that they’re actually not — they’re doing a routine task.”
While robotics may eventually handle the physical work of picking products, generative AI already offers near-term solutions. “You can leverage the technology to figure out more efficient ways to pick and pack,” TumSuden said. “You can organize your stores maybe in a different way.”
That reorganization, he noted, could even challenge the longstanding practice of placing high-demand items in store corners to increase browsing. “You can say, ‘Hey, I’m gonna hit you with a little popup, ’cause the beacon on your phone says I know you’re here…’ and I can actually lay out my store in such a way that it’s actually more engaging.”
According to TumSuden, this shift frees up associates to focus on higher-value activities: “Ultimately in our mind, the goal is to free up your store associates so they can spend more time on servicing customers and less time on those complex tasks.”
The integration of generative AI also brings transformative potential for workforce support and development — two key levers in combating high turnover. “One of the things is how do you get help if you’re a store associate and you have a problem in the store?” he said. “What happens today is that’s a very painful process a lot of store associates have a bunch of different apps.”
TumSuden says Cognizant is already working with clients and partners to build agent-based systems that simplify problem-solving for frontline staff. “We see the world evolving to a single app and talk to an agent that can help them with solving that problem. Which makes their experience better and also creates a better roll through customer experience.”
Training, he added, is another overlooked area ripe for disruption. “Training is something that really hasn’t evolved in decades. If anything, it’s gotten worse,” he said. “But if you think about it, with synthetic AI and with generative AI, you can actually build more bite-sized customized training.”
He sees “a big unlock” coming in onboarding and upskilling, where AI can support a more efficient and enriched learning journey for new hires. “Once they’re up to speed leveraging agents to actually help them solve problems when they occur that is a huge transformation in the workforce.”
Despite ongoing fears about AI replacing human workers, TumSuden takes a more nuanced view.
“I don’t think I believe — or we believe — that we’re gonna see a decline in the retail workforce,” he said. “I really do believe that what’s going to hopefully happen is there’s a bit of a renaissance. Retailers see that the real value that they bring to the table versus a brand is they bring that customer intimacy and that’s where they differentiate.”
And that differentiation, he says, is precisely what retailers should be leaning into — with the help of technology finally mature enough to support it.
Cognizant, which operates globally and has a strong presence in the Canadian market, is already seeing these trends take hold across borders. “We work with a number of large customers in Canada,” TumSuden said, mentioning names like Canadian Tire and Circle K. “We’re seeing similar trends. They’re just manifesting in a slightly different sequence because of the local market dynamics.”
As generative AI and automation become more deeply embedded in retail operations, TumSuden sees one thing as clear: the associate of the future is not going away — they’re just going to be more empowered, more supported, and more essential than ever.
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