Romanian Distribution Committee Magazine, Volume 9, Issue 3, Year 2018

KNOWL E DGE E NGI NE E RI NG

COGNI T I VE COMPUT I NG AI , I NS T I T UT I ONAL  S PI RI T UALRE CONS T RUCT I ON ANDL E S S ONSL E ARNE DF ROMPROGRE S S I VEBRANDS

VOL UME9 I S S UE3 2018

Artificial Intelligence, Institutional-Spiritual Reconstruction and Lessons Learned from Progressive Brands

A recent Discussion Paper launched by McKinsey Global Institute approached a simulation of the impact of AI (considering five broad categories of AI: computer vision, natural language, virtual assistants, robotic process automation, and advanced machine learning) on the world economy, following its new research trying to shed light on how to adopt and absorb artificial intelligence (AI) technologies, to allow firms, employees, and countries the capture of AI benefits and to have a more global view on the dynamics of AI for a wide range of countries. Research findings revealed that AI-driven productivity growth is affected by significant factors (such as labor automation, innovation, and new competition), the size of the impact being determined not only by macro factors (such as the global connectedness or labor-market structure of a country) but also by micro factors (such as the pace of adoption of AI). With regard to the impact of AI on net employment, for instance, McKinsey’s representatives (Bughin et all., 2018) argued that its adoption and absorption taken as a whole might not be as significant as many fear. Of course, skilling and reskilling people to work with AI will not be a simple task for companies’ leadership.

We see here some links such as: with the holistic approach of the organizational knowledge dynamics which was put forward for discussion in August this year by Professor Constantin Bratianu (Bucharest Academy of Economic Studies), who paid particular attention

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to “the organizational knowledge spectrum and on the entropic transformations of rational, emotional, and spiritual knowledge in the motivation and decision-making processes;” (Bratianu, 2018) with what was pointed out in July this year by The European Business Review – during an interview of Dr. Mayra Beers (Director of Strategy and John S. and James L. Knight Research Fellow for the Center of Leadership at Florida International University) and Dr. Nathan Hiller (an Academic Director of the Center for Leadership and an Associate Professor of Management and International Business at the same University) – that as the world advances we see changes in leadership style, but it is important to always pay attention to that vision capturing purpose and commitment from the followers; (Beers and Hiller, 2018) with the opinion expressed in August 2018 by other McKinsey’s representatives (Caramitru and Weddle, 2018) according to which working adequately on organization’s health while facing digitalization, automation or agile it is essential today (in order to transform successfully and drive performance).

But another special link which we consider as being imperative to be brought into this discussion is the recommendation made also in August this year by Philip Kotler and Christian Sarkar to learn a lesson from progressive brands (as opposed to regressive brands which actively pursue policies hurting the Common Good) such as the Tata Group, whose set of straightforward guidelines are ensuring in its pursuit of growth and profits to not lose its core beliefs about sustainability. (Kotler and Sarkar, 2018) And this recommendation comes within the context of the so-called “A Manifesto for Just Capitalism”. (FIXCapitalism, 2017, 2018) It is well-known that as the Romanian Distribution Committee’s (CRD) status clearly points out the importance of seeking to promote sustainable development, CRD organized in the year 2000 together with the “International Foundation Health – Environment – Sustainable development” and in partnership with “Ion Raţiu” Romanian Parliamentarians Club, the Symposium “The Economy of Ideas and Sustainable development”, first reported by the Magazine “Tribuna Economica”, no. 18/3 May 2000. The discussions which took place at the Parliament House, on the occasion of the works of this Symposium, on May 16, 2000, were based on a study (“Sustainable development: principles and action”, Beniamin Cotigaru, Theodor Purcărea, coordinators, Millenium Publishing House, May 2000), interdisciplinary research representing a turning point in developing a national strategy for sustainable development. In this study the focus, from the very beginning, was centered on the need for enterprise reconstruction on the basis of negotiated competency, in the context of spiritualization of economies. The opportunity to exploit the model of Product Development Research/CDP in meeting sustainable development was also discussed, within this context, CDP representing product trajectory as a specific methodological instrument. In Annex 1 a Research-Development Program (with 4 subprograms) “Sustainable Development” was presented.

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Six years after the above mentioned Symposium, on May 24, 2006, Professor Beniamin Cotigaru, received the “RESPAD Trophy” Diploma awarded by CRD on the occasion of the Symposium “Institutional-spiritual reconstruction of enterprises, requirement for sustainable development in the knowledge society”, organized in Călăraşi County Council Hall by the Romanian Distribution Committee in collaboration with the Bucharest University of Economic Studies (ASE Bucharest) and UGIR 1903 (on the basis of the volume which appeared in April 2006 at ASE Publishing House and in which, at page 488, reference is made to „RESPAD Trophy” offered by CRD, among other things emphasizing the correlation between real success and the vision of the training team. The Association of Faculties of Economics in Romania - AFER’s Volume “Pages from the Romanian Economic Higher Education History, 1843-2013”, launched on the occasion of the celebration of 170 Years of Economic Higher Education in Romania and the 100th Anniversary of the initiation of the First Congress of Romanian Economists (this celebration took place Friday, November 22, 2013, being hosted by the historical Aula Magna of the Bucharest University of Economic Studies) made reference at page 225 to the volume launched in Călăraşi County Council Hall.

On April 3, 2013, on the special occasion of the celebration of the centennial of the Bucharest University of Economic Studies (ASE Bucharest), the Romanian Ministry of National Education awarded the Diploma of Honor to venerable Professor Beniamin Cotigaru for his significant contribution to the development of education and scientific research in the field of Commodity Science, in honor of his outstanding performance. We need to remind ourselves that the venerable Professor Beniamin Cotigaru passed away four years ago, on October 2, 2014. It was a tremendous loss for all those who knew him, but also for the academic world. May his memory be for a blessing.

Theodor Valentin Purcărea Editor-in-Chief

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References Beers, M. and Hiller, N. (2018). When Work Meets Passion: FIU Center for Leadership on Co-creating a Better Future with Today’s Leaders. The European Business Review, July 5. Retrieved from http://www.europeanbusinessreview.com/when-work-meets-passion-fius-center-for-leadership-on-co-creatinga-better-future-with-todays-leaders/ Bratianu, C. (2018). A holistic view of the organizational knowledge dynamics. Holistica Journal of Business and Public Administration, Vol. 9, Issue 2, pp. 7-22. DOI: 10.2478/hjbpa-2018-0009.

Bughin, J., Seong, J., Manyika, J., Chui, M. and Joshi, R. (2018). Notes from the frontier: Modeling the impact of AI on the world economy, Discussion Paper McKinsey Global Institute, September. Retrieved from https://www.mckinsey.com/featured-insights/artificial-intelligence/notes-from-the-frontier-modeling-theimpact-of-ai-on-the-world-economy?

Caramitru, R. and Weddle, B. (2018). Your organization’s health: the ultimate competitive edge, McKinsey, August 13. Retrieved from https://www.mckinsey.com/business-functions/organization/our-insights/theorganization-blog/your-organization-needs-a-check-up?

Kotler, P. and Sarkar, C. (2018). “The Regressive Brand: The Dark Side of Brand Activism”, The Marketing Journal, August 20. Retrieved from http://www.marketingjournal.org/the-regressive-brand-the-dark-side-ofbrand-activism-philip-kotler-and-christian-sarkar/ *** A Manifesto for Just Capitalism, FIXCapitalism, Posted on July 25, 2017, January 20, 2018. Retrieved from http://fixcapitalism.com/a-manifesto-for-just-capitalism/ *** http://www.crd-aida.ro/our-team/beniamin-cotigaru/

The Magazine is the result of a true partnership, by bringing scientists and practitioners together proving the passionate pursuit of knowledge for wisdom, the real passion for acquiring and sharing this knowledge inviting the readers to maturing interdisciplinary dialogue and building a transparent culture network.

Extending Information and Communications Technologies’ Impact on Knowledge Based Society through Artificial and Collective Intelligence -Part 3-

Prof. Eng. Ph.D. Victor GREU Abstract The paper is continuing our prior general analysis on the role of artificial intelligence (AI) and human intelligence (HI) in the context of Information and Communications Technologies (ICT) exponential development as driving factor of the Information society (IS) progress toward Knowledge Based Society (KBS).

Here some detailed aspects of the implementation and optimization of the emergent CI proliferation and use are approached, considering that the optimization of these processes at Earth scale has a huge importance and must aim the preservation and improvement of humankind life and evolution as main criteria.

The complex processes of the AI-HI and the ICT support are not independent, but they are working in a mutual dependence, which reveals and explain their exponential evolution and proliferation in IS/KBS, so the identification of the mentioned leveraging mechanisms are very difficult but, on the other hand, any progress in this direction is desired for optimizing and then efficiently using them in all activity fields at Earth scale.

The analysis shows that the efficiency of AI-HI applications is strongly depending on the human expertise/education and responsibility, when properly designing or using AI in CSOURS/CSENS and generally extracting information/knowledge from data all over the World, aiming the humankind stable progress in every activity field and ... beyond.

A special attention and analysis was given to improving the quality of human contribution for CI and generally to the optimization of the complicate processes where AI and HI are implied, from design to the implementation.

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This way, we have to face every day, from designing to implementing or using AI/ICT, the fundamental question whose wisdom to trust? (WWTT?), recalling the prominence of HI and human wisdom (HW), because definitely behind any AI/ICT product/service is HI and HW! As a conclusion, we consider that (WWTT?) is not necessary a question to be answered, but an alarm signal to prevent the consequences of not carefully choosing our decisions or analysing our options for designing and implementing AI-HI projects, but generally any project in the ICT/IS/KBS fast changing and complex context.

We consider that WWTT? could be really understood and perhaps properly followed, as an alarm signal inside and outside AI-HI, for a sustainable development of ICT/IS/KBS and humankind life on Earth.

Keywords: artiďŹ cial intelligence, human intelligence, Big Data, crowd wisdom, collective intelligence, crowdsourcing, machine learning, knowledge engineering, natural language processing, opinion mining, information society, knowledge based society.

JEL Classification: L63; L86; M15; O31; O33

1. How Information and Communications Technologies support the intelligence Intelligence is the ability to adapt to change - Stephen Hawking We live in a complex and fast changing reality, but a first step to understanding it is to observe that our World is more and more divided in two: the physical world and the information world.

The more correct perception is that along with the physical world, we have to witness how the information becomes not only an increasing new parallel/associated world, but the main value.

Here we have to point that it is not the virtual reality (VR), nor even the augmented reality (AR) that we are talking about, although information is an elementary notion which is difficult to define and measure, but it is practically associated with every physical entity (as AR is also starting to express) and ... more!

In fact, the Information and Communications Technologies (ICT), as the main driving factor of the Information Society (IS) toward Knowledge Based Society (KBS), have progressively built this new World, giving to information a concrete meaning by continuously influencing all human activity domains and even Earth ecosystem.

This way we can better understand the essential link Stephen Hawking made between the reality problems and intelligence, suggesting that it is the main ability we have to develop for humankind survival and progress on Earth.

The intelligence role analysis is also our prominent goal, not only in this paper, but in other similar approaches we have made too [3][22][18].

Speaking about intelligence, we have to show that not only human intelligence (HI) should be considered, but all kind of natural or artefactual ways to optimize the change, facing all challenges of the implied complex processes, at Earth scale.

Making the link with ICT above mentioned context, including advances like Cloud, Big Data, Internet of Things (IoT) and artiďŹ cial intelligence (AI), we have to observe that AI is perhaps the most dynamic and important element we should analyse, considering its huge benefic implications, but also challenges[13][14][16][19][21][25][26].

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Another reference point for further analysing intelligence issues is to recall Albert Einstein’s quotation, “The true sign of intelligence is not knowledge but imagination”, which is an argument for the opinion that HI is still superior to AI by the unlimited capacity of imagination and in fact shows the way both cooperate, generally as collective intelligence (CI), to humankind progress with ICT general support – as we have already suggested [3].

In order to sustain these opinions, some actual examples and trends could also express the ICT support, but, for such complex processes, a systemic approach is necessary and has to begin with identifying the main areas of development and challenges of the ICT/AI/HI context.

Continuing our prior general analyses [3], here we approach some detailed aspects of the implementation and optimization of the emergent CI proliferation and use.

We consider that the optimization of these processes at Earth scale has a huge importance and must aim the preservation and improvement of humankind life and evolution as main criteria, which is also very well expressed in [1]: “Human-Centered Collective Intelligence (HCCI) is an emergent research area that seeks to bring together major research areas like machine learning, statistical modelling, information retrieval, market research and software engineering to address challenges pertaining to deriving intelligent insights and solutions through the collaboration of several intelligent sensors, devices and data sources... Some of the key quality concerns of interest in CI scenarios span the gamut of security and privacy, scalability, performance, fault-tolerance and reliability... I dive into the design of optimal architectures that allow humans and intelligent systems to work collectively to solve complex problems” Without limiting our approach to the above concept and content, it is clear that the general purpose of CI must be to “allow humans and intelligent systems to work collectively to solve complex problems”.

A first amendment to the above content is to recall the importance of crowd wisdom (CW) in crowdsensing (CSENS), especially in crowdsourcing (CSOURS) and generally in CI[6][22].

This means that we want to emphasize, for the dramatic evolutions of ICT/AI, the role of imagination for innovation and the efficiency that HI could bring in the CI processes, based on life experience and expertise.

For the systemic approach, here it is essential to recall the prominent leveraging and linking role the general context of ICT/IS/KBS support has in CI progress. This way CI could be characterized by some features, as expressed in [5]: “The growth of human collective intelligence follows the improvement of media Media, Cultural Evolution and Knowledge...

Displayed around each people, community, thing, place, work of the mind...

Interaction through holograms in VR or AR, by Google glasses or tablet...

Embedded powerful tools for selection, exploration, analysis, synthesis, semantic distances measurement...”

Of course, beyond these systemic connections and interfaces, a huge diversity of networks, equipments and software/applications represent the concrete support of implementing CI, including the AI-HI symbiosis.

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It is important to observe the complex processes where the AI-HI and the ICT support are not independent, but they are working in a mutual dependence, which reveals and explain their exponential evolution and proliferation in IS/KBS. This is why the identification of the mentioned leveraging mechanisms are very difficult but, on the other hand, any progress in this direction is desired for optimizing and then efficiently using them in all activity fields at Earth scale.

Although it could appear not the most important level, we consider that the efficiency of AI-HI applications is strongly depending on the human expertise/education and responsibility, when properly designing or using AI in CSOURS/CSENS and generally extracting information/knowledge from data all over the World, aiming the humankind stable progress in every activity field and ... beyond.

This opinion is also confirmed by the way collective memory, personal responsibility and knowledge management are presented in [1]: “Personal responsibility of collective memory  Actions in the digital medium: subscribe, buy, comment, record, broadcast, hyperlink, tag, approve/like, participate to a group, communicate etc.  Every digital action sculpts the collective memory.  We are all potentially readers, spectators, authors, critiques, editors, publishers, curators, librarian and co-responsible of the collective memory.  Knowledge society citizenship: help/orient others.

Personal Knowledge Management 1. Attention management: Define interests, priorities, areas of expertise (acquired and aimed); Stay focused, avoid distraction, keep in mind the big picture; 2. Connection to valuable sources–Information streams from people and institutions 3. Gathering and aggregation of data streams 4. Filtering – Manual and automatic (according to 1) 5. Categorization – Tagging, folksonomies, classifications, ontologies” Confronted with such a large context, it is important to “keep in mind the big picture” and try to best match all the components with the responsibility of living in IS and building KBS, knowledge by knowledge!

Among the components, we have already pointed that the main mechanisms of developing CI have a systemic role, so it is useful to observe how the ICT support could be better used, i.e. how to combine technological innovations with new ideas from CW in new productive actions and expression forms, as is suggested by[12]: “We are witnessing an unprecedented convergence of advances in processing power, interconnectivity, cheap data storage, high fidelity rendering, physics simulations, and natural language technologies. The combination of these technological innovations lays the foundation for new mediums of communication, allowing us to tell stories in ways never before possible. Each new communication medium changes both what stories can be told, and how stories can be told.”

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Consequently, AI and HI could bring together new stories/actions in new productive ways, including new business models, products and services, by refining knowledge every day and ... every way.

A more concrete imagine of these mechanisms is naturally offered by the most dynamic field of applications of ICT support, the economy, where AI-HI are cooperating for speeding the progress, as it is given by the next example[24]: “Knowledge engineering is key for enhancing organizational capabilities to gain a competitive edge and adapt and respond to an unpredictable market environment. Such knowledge can be generated from collected data which is often considered complex.

Organizations are collecting vast amounts of data to transform them into real-time information in order to attain successful decision-making support systems. It is more than likely that such processes can be challenging; yet such knowledge must be extracted from thoughtfully designed and implemented data warehousing, and mined to obtain the required information... Firms are collecting vast amounts of data daily and developing advanced data warehouse systems to secure the data. Their intention is transforming it into vital information, or knowledge, for developing decision support systems” Here we consider that the mention of Knowledge engineering is a relevant confirmation of the crucial importance of AI-HI for the approach of IS toward KBS, as we have already presented[26][22], but still needing to be timely analysed with all associated implications as ICT support is exponentially increasing.

It is also worth to observe that the role of refining knowledge, essential in KBS, is so important because it exploit data “transforming it into vital information, or knowledge, for developing decision support systems”, exceeding economy and having benefic influence for all activity fields, for humankind evolution and beyond ... for Earth ecosystem.

In addition, the prominence of data mining and the mandatory “thoughtfully designed and implemented” applications reveal the essential role of human contribution in such complex processes.

This way we could conclude that a special attention and analysis must be given to improving the quality of human contribution for CI and generally to the optimization of the complicate processes where AI and HI are implied, from design to the implementation.

2. Recalling a perpetual dilemma of science: whose wisdom to trust?

The optimization of ICT development, where it is obvious that AI and HI are prominent and interdependent factors, is a complex and very difficult multicriteria problem, as we have already presented [18][9].

Even if we could restrict ICT development to the applications where AI and HI are the main ingredients, which anyway are fast extending, a realistic short analysis should focus on the most relevant criteria of the optimization and then link them with HI or AI as it is the case.

Among the most important criteria for generally optimizing ICT for IS/KBS and especially the AI-HI symbiosis, by our opinion, include the sustainable development of ICT/IS/KBS, having as concrete components the green ITC (climate changes, carbon

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footprint reduction, Earth resources saving etc), humankind survival and healthy progress in Earth ecosystem.

In order to best promote these aims, both AI and HI must perform best in part but especially in their interdependent development, as it could be further analysed by some examples, where the best solution is to get maximal reach of the weighted above criteria, using or creating the highest technology.

In the same time, we have to observe that each case needs an appropriate combination of weighting the prominent criteria, which in fact could be another very difficult problem, especially in complex cases where evaluating or measuring all criteria is nearly impossible, but usually could be approximated.

As section 1 was mainly focused on ICT/AI support, here the human contribution in the AI/HI symbiosis will be pointed considering, in a first approximation, that HI could be generally associated with “wisdom”, although for humans the wisdom is more than HI, but when comparing with computers, AI tends to reach HI and perhaps in the future this will be closing to wisdom.

More than these, we consider that, in order to provide a sustainable development, in the conditions of emergent penetration of AI/ICT in vital areas like self driving cars or planes, but not forgetting critical infrastructures like energy, IoT or health systems, the trust in “that intelligence” is the key factor.

With simpler words, we will face every day, from designing to implementing or using AI/ICT, the fundamental question whose wisdom to trust?

This way we came back to the prominence of HI and human wisdom (HW), because definitely behind any AI/ICT product/service is HI and HW, from designing to implementing or using it! So the Albert Einstein’s quotation (The true sign of intelligence is not knowledge but imagination) is again relevant.

The new and complicate situation is that the efficiency of human capacity to build and properly use AI/ICT systems/services is more and more leveraged by ... AI, so the pressure on properly designing them is naturally increasing.

Still, the human intrinsic capacity remains essential for HI potential and this is why it is the first criterion for selecting people involved in CI projects, i.e. this is here the first meaning of whose wisdom to trust?(WWTT?), but this is not the only case.

As a matter of fact, WWTT? is not a new issue, nor an exclusive scientific one, but generally is a decision matter people have to take every time in a diversity of problems, depending on individual philosophy, as one could naturally ask: why worry for everything?

We believe that the answer will be always depending on the education/expertise level of individuals and on this basis the philosophy could be considered then.

The truth is that we take a decision even when we say that is not the case to take a decision or seriously think to something, but this option will surely have its consequences.

This way we have just came back to the point, as there are many situations to answer WWTT?, as for choosing experts, ideas, models, algorithms or technological solutions!

As a conclusion, we consider that (WWTT?) is not necessary a question to be answered, but an alarm signal to prevent the consequences of not carefully choosing our

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decisions or analysing our options for designing and implementing AI-HI projects, but generally any project in the ICT/IS/KBS fast changing and complex context.

We have to notice then that it is possible that sometimes a better contribution to come not from the person who has the highest ranking, but usually this is not the case, proving just the importance of CI, where relevant contributions could come from many places.

In fact, as we already have pointed by “interdependent development”, HI/HW and AI are in a vicious circle of mutual influence, but the real dilemma is not which is the first, because we have showed that human is prominent.

We have recalled “science dilemma” considering just the need to carefully/precisely select/optimize human contributions (HI/HW), but not neglecting to also select AI contributions, using as much as possible scientific/technical means (without excluding HI for AI selection), especially in the actual ICT context/support, where AI, Cloud, Big Data or IoT could help to find in each case the best solution.

Coming back to the actual importance of CI and CSOURS, a relevant example of AI role in evaluating CSOURS by machine learning is given by [11]: “We present the design of CLOWDER, which uses machine learning to continually refine models of worker performance and task difficulty. Using these models, CLOWDER uses decision-theoretic optimization to 1) choose between alternative workflows, 2) optimize parameters for a workflow, 3) create personalized interfaces for individual workers, and 4) dynamically control the workflow”.

The advantage of optimizing the CSOURS workflows by machine learning (AI) is obvious, but the real case applications could be very complex and complicated, not only by the number of “alternative workflows or parameters”, but by the necessary metrics to evaluate them in the diversity of matters/jobs associated with the workflows.

We have just arrived to one of the most difficult actual problems of implementing the most advanced ICT: the lack of appropriate performant models.

Here the models would express the metrics to evaluate the workflows and generally the contributions, either from HI or AI on spot, i.e. to answer anytime the essential question: whose wisdom to trust?

As there is such a huge need of mathematical models for the very complex areas or systems, the heuristic approach is more and more extending for some classes of applications, so it fits very well with CI. A good example for such areas is the user experience measuring[22] and this is also expressed in[4]: “The digital age is characterised increasingly by the collective. The information generated by tapping into the minds of many is driving decisions in both the public and private sector; research is becoming social. On the back of this, a new science has emerged – known as opinion mining – which uses the latest advances in artificial intelligence (AI) to mine public opinion for sentiment. This structured data is known as opinion data. By analysing online public opinion, governments and global organisations can now access a set of insights that can shape strategy and better measure the public’s experience of their policies, service and brands.”

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We consider that this area has a special importance by its potential to be expended in other fields of IS/KBS, as “governments and global organisations” could be influenced to use refined knowledge for a sustainable development, including ICT pace and trends, benefic for humankind and Earth ecosystem, as we have mentioned in section 1.

This possibility is also confirmed by other sources, as is expressed in the next example [8]: << The crowd, as a group of people, think, make decisions, learn and act. Imagine obtain and store all these reactions, information and beliefs in one place, this is crowdsourcing. “Crowdsourcing is the process of obtaining needed services, ideas, or content by soliciting contributions from a large group of people, and especially from an online community, rather than from traditional employees or suppliers.” is the crowdsourcing definition. Well, let’s now consider to take the opportunity to data mine crowdsourcing results and import it, in a serial way, with matching techniques into this “consciousness”. Our AI system will learn by a several big amount of data, which means we will have a lot of different instances of each object and a different connection to each other.

By using this, the power of crowd, we maybe be in place to say that this consciousness will use a catholic “think” way to act and react to different circumstances and it will start to have an objective consciousness, an its own consciousness. In this way, the AI system that will be created would be used in common problem solving issues that would compare standard knowledge with crowd’s opinion - thoughts. >> Again it is pointed the importance of refined knowledge and how this could leverage the sustainable progress, but more than this, it is suggested the model of evaluating the progress by “compare standard knowledge with crowd’s opinion - thoughts”.

Speaking of models we can come back to the above mentioned “meaning of whose wisdom to trust?”, as it is possible to choose between different complex sets of data using machine learning (ML) with the appropriate models or algorithms, as it is largely presented in [17]: “Today, machine learning (ML) has impacted an enormous number of industries; including retail, healthcare, robotics, mobile app development and travel. Usually, people interchange the terms Artificial Intelligence and Machine Learning. However, they are different. Artificial Intelligence is the concept of making machines capable to performing tasks without human intervention, such as building smart machines; while Machine learning (ML) is a subset of AI based on the idea of making computer algorithms that automatically upgrade themselves by discovering patterns in existing data without being explicitly programmed. The whole processing of ML tools depends on data. The more data an algorithm obtains, the more accurate it will become and thus, the more effective the end results will be” In addition to these general ML features, some prominent areas and ways of implementing the AI/ML resources and models, for improving life and generally the progress of IS/KBS, are also given:

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“At present, ML-based NLP (Natural Language Processing) is still in its infancy.

Right now, there’s no such algorithm available that could understand that various words have a different meaning in different situations and act successfully. However, it is expected that such algorithms will come into existence in the future...

In 2014, Skype launched an application called Skype Translator which translates speech from one language to another in real-time. Since then, it has undergone various updates. If it continues to evolve in the same way, we will soon be able to enjoy high-quality international communication – eradicating language barriers...

Machine learning is also becoming a buzzword in the healthcare industry. It is used for different purposes, like drug discovery and robotic surgery.

Recently, Google created a machine learning algorithm that helps detect cancerous tumors on mammograms, while Stanford is using the technology to identify skin cancer...

Machine learning tools, along with Big data analytics is used by the mobile app developers and marketers to understand how the users interact with a mobile app and group the data under different categories for predicting next step to be taken for engaging users and increasing the conversion rate.”

For sure all these areas are very important for human life, but health diagnosis is vital, while predictive analysis has the potential to be used beyond user experience domain, in the complex context of ICT implications in all activity fields or other critical areas like climate changes forecasts [15].

The relevant challenges of AI in the medical domain, centered on (WWTT?), have been recently presented in [2]: <<The health care industry may seem the ideal place to deploy artificial intelligence systems. Each medical test, doctor’s visit, and procedure is documented, and patient records are increasingly stored in electronic formats. AI systems could digest that data and draw conclusions about how to provide better and more cost-effective care...

So what’s the holdup? It’s not technical, says Shinjini Kundu, a medical researcher and physician at the University of Pittsburgh School of Medicine. “The barrier is the trust aspect,” she says. “You may have a technology that works, but how do you get humans to use it and rely on it?”

Most medical AI systems operate as “black boxes” that take in data and spit out answers. Doctors are understandably wary about basing treatments on reasoning they don’t understand, so researchers are trying a variety of techniques to create systems that show their work>> We consider that in this case we meet perhaps one of the most relevant confirmation and support for our paper aim, as here we can see not only the importance of thrusting the new AI-HI projects, but more than this, the benefits toward performance obtained if we responsibly and creatively link AI with human expertise and imagination, i.e. just what the doctors strive to do.

After these examples, the above mentioned difficulty of implementing the most advanced ICT, as AI-HI projects, we mainly have identified as (WWTT?), has become clearer, although we have observed just the iceberg tip.

Perhaps a more comprehensive picture of CI implementation challenges as (WWTT?) is that presented and detailed analysed in [7] for organizations incumbents:

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“Control One key concern, common to all forms of collective intelligence, is a loss of control, which can manifest itself in a variety of ways. One is, simply, unwanted and undesirable outcomes — the collective makes a decision that could harm the company, revealing either a flaw in managers’ thinking or the improper application of collective intelligence. Another is unpredictability — a decision might not necessarily be bad per se, but the organization is caught unprepared to deal with it. A third is unassigned liability — who is responsible for a poor decision made collectively? Moreover, companies need to be aware of the potential for snowball effects. Through self-organization, an opinion might gain nonlinear momentum through self-amplification. This can lead to public relations nightmares if the collective involves participants external to the organization. Consequently, one of the biggest issues with respect to control is whether to include outsiders in the process.”

In the same paper, our above concern about the implications of subjects/jobs/applications diversity when answering (WWTT?) is also confirmed with concrete arguments: “As mentioned earlier, decision making that makes use of a collective requires a company to strike the right balance between diversity and expertise. Certain problems lend themselves to a diversity-based approach more than others, but no amount of diversity will help if the participants are completely ignorant of the issues. Another factor to consider is the actual composition of diversity: In the same way that sampling biases exist in polls, the diversity of a large population can also be skewed, leading to distorted decisions. Thus, organizations need to decide which people to involve based on the ability of those individuals to understand the problem at hand and collectively make positive contributions to solving it.”

An interesting presentation of the same challenges, this time pointing the AI benefits and associated responsibility (including Dependency Dilemma), we also identified in the area of projects design and generally in the HI side, is shortly expressed in[10]: << For me, the greatest advantage of dependence on AI accrues to the engineers, scientists, venture capitalists, start-ups, and mega-corporations creating dependence on AI. For sure there are, and continue to be, benefits on the user side of the equation as embedded technical intelligence enables the doing of things, the creating of things, the grasping of things, [which was] never possible before. Those benefits are the result of our using technology to free up effort for more fruitful application, not from looking to technology to do the work for us.

These benefits stem from what John Markoff, in his latest book, Machines of Loving Grace, calls IA: “intelligent augmentation” as distinguished from AI. The term, AI, Markoff writes, coined in 1964 by math and computer scientist, John McCarthy, was designed to “mimic” or replace human capabilities. “Today,” according to Markoff, “the engineers who are designing the artificial intelligence-based programs and robots will have tremendous influence over how we will use them. As computer systems are woven more deeply into the fabric of everyday life, the tension between augmentation and artificial intelligence has become increasingly salient.” He adds that there is also a paradox: “[The] same technologies that extend the intellectual powers of humans can displace them as well.” >> This concluding and severe remarks are also relevant for our repeated concerns [9][15][18] about the necessity to analyse all the consequences of AI/ICT fast pace of

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development, but if these are not sufficient, the author finally also launched an alarm signal which is multiplied by quoting other authors: <<In a reflective step back from his 1980s profile of MIT’s Media Lab, Whole Earth Catalog founder, Stewart Brand, mused that “New technologies create new freedoms and new dependencies. The freedoms are more evident at first. The dependencies may never become evident, which makes them all the worse, because it takes a crisis to discover them”.

That observation was made more than a quarter century ago – and it seems that little to nothing has changed. Echoing Brand’s observation, Vardi tells Cherry that “We run away with technology and deal with the consequences later”. >> Finally we consider that WWTT? could be really understood and perhaps properly followed, as an alarm signal inside and outside AI-HI, for a sustainable development of ICT/IS/KBS and humankind life on Earth.

3. Conclusions Continuing our prior general analyses, here we have approached some detailed aspects of the implementation and optimization of the emergent CI proliferation and use. We consider that the optimization of these processes at Earth scale has a huge importance and must aim the preservation and improvement of humankind life and evolution as main criteria.

The complex processes of the AI-HI and the ICT support are not independent, but they are working in a mutual dependence, which reveals and explain their exponential evolution and proliferation in IS/KBS. This is why the identification of the mentioned leveraging mechanisms are very difficult but, on the other hand, any progress in this direction is desired for optimizing and then efficiently using them in all activity fields at Earth scale.

We consider that the efficiency of AI-HI applications is strongly depending on the human expertise/education and responsibility, when properly designing or using AI in CSOURS/CSENS and generally extracting information/knowledge from data all over the World, aiming the humankind stable progress in every activity field and ... beyond.

A special attention and analysis must be given to improving the quality of human contribution for CI and generally to the optimization of the complicate processes where AI and HI are implied, from design to the implementation.

We have to face every day, from designing to implementing or using AI/ICT, the fundamental question whose wisdom to trust? (WWTT?), recalling the prominence of HI and human wisdom (HW), because definitely behind any AI/ICT product/service is HI and HW! As a conclusion, we consider that (WWTT?) is not necessary a question to be answered, but an alarm signal to prevent the consequences of not carefully choosing our decisions or analysing our options for designing and implementing AI-HI projects, but generally any project in the ICT/IS/KBS fast changing and complex context.

We consider that WWTT? could be really understood and perhaps properly followed, as an alarm signal inside and outside AI-HI, for a sustainable development of ICT/IS/KBS and humankind life on Earth.

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References [1] Ivor Addo, Designing human-centered collective intelligence, Dissertations (2009 -) Dissertation, Theses, and Professional Projects,Marquette University, 2016 [2] Eliza Strickland, Making Medical AI Trustworthy, IEEE Spectrum, aug2018 [3] Victor Greu, Extending information and communications technologies’s impact on knowledge based society through artificial and collective intelligence –(Part 2), Romanian Distribution Committee Magazine, Volume 9, Issue 2, Year 2018.

[4] JP Kloppers, Data mining for social intelligence – opinion data as a monetizable resource, may 12, 2017, http://dataconomy.com/2017/05/data-mining-opinion-data/ [5] Pierre Lévy, Collective Intelligence, SENAC 2014, https://pierrelevyblog.files. wordpress.com/ 2014/03/ collective-intelligence-senac.pdf [6] Victor Greu, Extending information and communications technologies’s impact on knowledge based society through artificial and collective intelligence –(Part 1), Romanian Distribution Committee Magazine, Volume 9, Issue 1, Year 2018.

[7] Eric Bonabeau, Decisions 2.0: The Power of Collective Intelligence, Magazine: Winter 2009 Research Feature January 09, 2009 [8] Chaniotakis M. George, How CrowdSourcing techniques would help Artificial Intelligence to advance, http://crowdpolicy.com/blog/crowd-solutions/crowdsourcing/howcrowdsourcing-techniques-would-help-artificial-intelligence-to-advance/, dec2014.

[9] Victor Greu, Searching the right tracks of new technologies in the earth race for a balance between progress and survival, Romanian Distribution Committee Magazine, Volume 3, Issue1, Year 2012.

[10]Jeff Robbins On the Use of AI - the Dependency Dilemma.docx On the Use of AI – the Dependency Dilemma September 2, 2016 http://sites.ieee.org/spotlight/ai-ethical-dilemma/ [11] Daniel S.Weld, Mausam, PengDai, Human Intelligence Needs Artificial Intelligence, WA-98195 2011 AAAI Workshop - San Francisco [12] Jeffrey David Orkin, Collective Artificial Intelligence: Simulated Role-Playing from Crowdsourced Data, Dissertation, MIT, Feb. 2013.

[13] Ece Kamar, Severin Hacker, Eric Horvitz, Combining Human and Machine Intelligence in Large-scale Crowdsourcing, Proceedings of the 11th International Conference on Autonomous Agents and Multiagent Systems (AAMAS 2012), 4-8 June 2012, Valencia, Spain [14] *** , Transforming data into knowledge, Collective Learning group at the MIT Media Lab, 2017, https://www.media. mit.edu/ groups/collective-learning/overview/.

[15] Victor Greu, Information and communications technologies go greener beyond IOTbehind is all the earth-Part1, Romanian Distribution Committee Magazine, Volume 7, Issue 2, Year 2016 [16] Daniel S. Weld Mausam Christopher H. Lin Jonathan Bragg, Artificial Intelligence and Collective Intelligence, https://homes.cs.washington.edu/~weld/papers/ci-chapter2014.pdf [17] Bhupinder Kour, The Rise of Machine Learning and AI is Improving Lives in 2018, https://www.smartdatacollective.com/rise-of-machine-learning-ai-improving-lives/ [18] Victor Greu, Tomorrow’s paradox: refining knowledge by smarter information and communications technologies while humans tend to become a limited factor of performance, Romanian Distribution Committee Magazine, Volume 7, Issue1, Year 2016.

[19] Thierry Buecheler , Jan Henrik Sieg , Rudolf M. Füchslin and Rolf Pfeifer,

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Crowdsourcing, Open Innovation and Collective Intelligence in the Scientific Method: A Research Agenda and Operational Framework, Proc. of the Alife XII Conference, Odense, Denmark, 2010 [20] Victor Greu, Information and communications technologies drive digital disruption from business to life on earth -(Part 1), Romanian Distribution Committee Magazine, Volume 8, Issue 2, Year 2017.

[21] Anas Baig, Artificial Intelligence Can Solve The Biggest Crowdsourcing Problem, Aug 11, 2017, https://crowdsourcingweek.com/blog/artificial-intelligence-can-solvebiggest-crowdsourcing-problem/ [22] Victor Greu et all, Human and artificial intelligence driven incentive-operation model and algorithms for a multi-purpose integrated crowdsensing-crowdsourcing scalable system - paper submitted to International Conference Communications 2018 (Politehnica University of Bucharest, Romania Military Technical Academy, IEEE Romania), June 2018.

[23] Ioannis Karydis, Spyros Sioutas, Markos Avlonitis, Phivos Mylonas and Andreas Kanavos, A Survey on Big Data and Collective Intelligence, ALGOCLOUD 2016, Aarhus, Denmark, August 22, 2016, Revised Selected Papers [24] Nelson Sizwe. Madonsela, Paulin. Mbecke, Charles Mbohwa, Integrating Artificial Intelligence into Data Warehousing and Data Mining, Proceedings of the World Congress on Engineering and Computer Science 2015 Vol II WCECS 2015, October 21-23, 2015, San Francisco, USA [25] Sergej Zerr, Collective Intelligence: Crowdsourcing groundtruth data for large scale evaluation in Information Retrieval, https://eventos.citius.usc.es/keystone.school/ files/slideszerr.pdf [26] Victor Greu, The Exponential Development of the Information and Communications Technologies â&#x20AC;&#x201C; A Complex Process Which is Generating Progress Knowledge from People to People, Romanian Distribution Committee Magazine, Volume 4, Issue2, Year 2013

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Retail Therapy as a Behavioral Act of the Modern Consumer Cosmin TÄ&#x201A;NASE

ABSTRACT Retail therapy is suggested as a way for consumers to achieve happiness from the negative emotional state of modern life. The practice of retail therapy has been referred to as compensatory consumption because it occurs â&#x20AC;&#x153;when an individual feels a need, lack, or desire which they cannot satisfy with a primary fulfillment so they seek and use an alternative means of fulfillment in its placeâ&#x20AC;?. In compensatory consumption behavior, consumers shop when they are feeling negative moods such as anxiety, depression, frustration, loneliness, and stress. In addition, during economic downturns, consumers tend to spend more time shopping, albeit purchasing lower quality and lower priced products. Some researchers suggest that the use of shopping to ward off negative moods may lead to shopping addiction, necessitating financial and psychological counseling. Furthermore, the waste generated by over-consumption is environmentally unsound and unviable. This article is focused on the concept of retail therapy, revealing the personal benefits, possible issues, and research development surrounding the topic.

Keywords: E-tail, Compensatory Consumption, Self-treating Purchase, Customer Feelings JEL Classification: L81, M31

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People turn to shopping as an emotional outlet. Negative connotations regarding retail therapy exist, and today scholars are reexamining retail therapy as a distress-motivated act of consumption from a psychological and emotional perspective. A variety of perspectives can be used to analyze shopping therapy as a face-to-face transaction, an online experience, and a simulated experience in order to explain the emotional component related to shopping.

The well-known expression “Treat yourself” has gained traction in recent years, forming a specific image about shopping for therapeutic purposes. Many people view self-treating as an impulsive, albeit cathartic, activity often used to excuse indulgent behavior. As such, shopping has been critiqued for its supposed lack of validity and success as a form of therapy. Shopping in an effort to improve one’s sense of well-being goes by many names: self-treating, compensatory consumption, and most notably, retail therapy. Each name is accompanied by a slightly different set of connotations, implications, and biases. Retail therapy is shopping that is motivated by any type of distress, and may occur when someone experiences a need or desire that cannot be satisfied or properly resolved. The inability to quell these desires results in the use of shopping as a “substitutive action to achieve emotional satisfaction.” Contrary to negative connotations on retail therapy, shopping has been shown to positively impact one’s mental health and well-being.

Initially, retail therapy was discussed for its economic effects. As the term gained popularity, its effectiveness and validity came into question. Doubts regarding practically all aspects of retail therapy arose, resulting in a negative stigma. Most recently, the psychological connections between retail therapy and the reduction of negative emotions is undergoing experimentation and analysis.

Although retail therapy is viewed mainly as a maladaptive practice, there are proven benefits and many researchers feel that retail therapy has been viewed too harshly. This complicates the initial understanding of the practice.

Personal factors, specifically liminality, self-esteem, and negative emotions, impact one’s likelihood to engage in purchasing behaviors. Liminality is the notion that one feels a discrepancy between who they feel they are and who they feel they should be, and is linked to low levels of selfesteem and negative emotional states. Simply, liminality is the feeling that one is not living up to their own expectations. Liminality and negative emotional states were shown to have a positive correlation with compensatory consumption. These correlations are especially significant when an individual is in close proximity to clothing. Establishing a relationship between negative feelings and increased purchasing adds validity to the existence of retail therapy, but does not address the merit of the practice. Instead, it focuses on its possible economic results. Considering most retailers, shops, and brands value their revenue over the sanctity of consumer health, retail therapy was accepted as a pretense to usher customers into shops. L’Oréal is an example of a company that used this notion of reducing liminality, and therefore increasing self-esteem, to entice buyers. Its 1971 slogan “Because I’m Worth It” draws upon a superficial understanding of the effects liminality has on purchasing behaviors. Through the guise of helping women empower themselves and granting them the ability to reduce liminality by providing them with a product that they believe they deserve, the consumer rationalizes their purchase of high-end hair dye.

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Despite establishing the existence of retail therapy, there are many experts that fight the notion of shopping to improve one’s emotional state. Plastow writes that “the consumer is destined to remain as unfulfilled as he or she ever was, regard- less of what excesses of consumption are attained.” Atalay and Meloy analyze and disprove some of the common misconceptions regarding retail therapy, like those outlined by Plastow. The claims that retail therapy is impulsive and ineffective in providing lasting improvements in mood have been argued since the term was coined in 1986. According to Atalay and Meloy, self-treats can be either a planned or unplanned aspect of retail therapy. Self-treats are effective in repairing mood and can be planned strategically for this purpose. The idea of using an impulsive treat in a strategic manner may seem contradictory, but there are often subconscious intentions behind these actions. There are four main categories of selfregulatory functions: thoughts, emotions, impulses, and performance. Regulating all of these aspects can become burdensome. Our focus often shifts between the categories based on in-the-moment prioritization and needs. So, a conflict between one’s emotional regulation and impulse regulation may cause an individual to transfer some of their internal control from one category to the other to alleviate conflict and provide oneself with solace Individuals will most likely prioritize emotional well-being over impulse control, meaning that a seemingly impulsive purchase could be a strategic move resulting from a subconscious attempt to improve one’s mood. Also, either planned or unplanned treats lead to feelings of guilt or regret when the purpose was mood-boosting. In fact, contrary to ideas perpetuated by Plastow and professionals with similar sentiments, negative feelings continued to decrease post-purchase regarding their “mood repair item.” This indicates that a self-treating purchase acquired to increase mental wellbeing and improve mood will continue to be a source of positivity for that individual and may have long-lasting positive effects on one’s emotions.

Specifically, according to a recent psychological experiment, retail therapy has a significant effect on reducing residual sadness. Residual sadness occurs when negative emotions linger after the occurrence of a sadness-inducing event. Similar to the established correlation between liminality and low self-esteem, sadness is greatly influenced by one’s feelings of control over one’s environment.

When an individual feels they have limited or no control over their environment, particularly while handling a negative outcome, they are more likely to experience sadness. Feelings of sadness increase comfort-seeking behaviors and motivate the restoration of control. Shopping provides individuals with an opportunity to regain personal agency over one’s environment, which can lead to a reduction in residual sadness. The initial experiment focused on the “browsing” component of shopping by using a hypothetical prompt and simulating the experience of online shopping, meaning no legitimate spending took place. Despite excluding the physical purchasing of material goods, this study maintained that the act of browsing increased one’s sense of control. Ironically, the lack of self-control normally attributed to the act of retail therapy actually seems to restore a sense of agency that was perceived by the consumer as lost.

With the rise of online shopping, it is viable to wonder if the effects of shopping via the internet are similar to that of shopping offline. Currently around 8 in 10 Americans engage in online shopping, a number that is projected to rise in upcoming years. As with shopping in person, an

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emotional component exists within the context of online shopping. Many online shoppers “report experiencing positive feelings and satisfaction from the interactivity of shopping online.” This introduces a virtual counterpart to retail therapy: “e-tail therapy.” The concept of e-tail therapy is used primarily in relation to hedonic purchasing, which is when the item is acquired out of selfinterest or desire instead of necessity.

Although most studies are primarily focused on the success of retail therapy in various circumstances, there are many valid concerns regarding this topic. Retail therapy can become disruptive within one’s life. Because retail therapy often entails making unnecessary purchases, a major concern with relying on this process is the possibility of accruing debt. It is not beneficial to continue shopping past one’s financial limits, as this can result in the exasperation of negative feelings instead of the minimization of them. Additionally, one should not rely on purchasing behavior to eliminate the cause of one’s problems.

Despite its efficiency in eradicating negative emotions and restoring personal control, retail therapy does not address the underlying is- sues perpetrating these feelings. Retail therapy is viewed as a “catharsis, a purging of the emotions” and not a direct response or resolution to an emotional catalyst. Because there is no direct resolution within retail therapy, it is unhealthy to depend on it when dealing with problems that would benefit from a proactive response, like addressing the problem directly and working to solve it. Retail therapy can become a crutch for the user and is considered a maladaptive practice by many scholars and healthcare practitioners. The term for this practice is compulsive buying disorder. As with most disorders, it can be difficult to realize when an activity transitions from a treat to a compulsion. This is especially true when considering shopping, due to the positive relationship between one’s emotional response to purchases and one’s repeat purchasing intentions. Because an individual is more likely to engage in repetitive buying if they receive a strong sense of gratification from their purchase, it is important to establish boundaries while engaging in retail therapy.

Concerns aside, retail therapy can be, and frequently is, used to reduce anxiety, stress, sadness, and other negative emotions in low-stakes situations. A third of the United States population, including both men and women, shops as a way to alleviate stress. One’s subjective emotion does not have an impact on their likelihood to engage in retail therapy as a mood-repair behavior. This means that people who are consistently experiencing a happy, sad, or some more neutral state of being are likely to engage in retail therapy at some point. Those who do report engaging in retail therapy, report that doing so “provided a positive distraction, an escape, an indulgence, an elevation in self-esteem, activation, a sense of control, and a social connection.”

Conclusion After analyzing a variety of perspectives on retail therapy, there is data suggesting value to the phenomenon. Shopping inherently provides people with a hedonic high, stimulating a flood of dopamine and serotonin to be released within the brain. Furthermore, a variety of economic and psychological studies provide support past that of a mere chemical reaction. Consumer research has

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established the existence of a correlation between customer feelings and purchasing behaviors.

Social and psychological studies press further to test the relationships and analyze the effects of this process. Through these studies, it is established that retail therapy provides individuals with an outlet for negative emotions. Some of the common critiques of self-treating were disproved by establishing that there is often a strategic aspect to these purchases and rarely significant guilt or regret postpurchase when the motive is mood-regulation. However, there are legitimate concerns involving the use of retail therapy on a regular basis, most notably the development of a compulsion. Retail therapy can be used intermittently to regain a sense of personal control or provide an escape from a negative environment or headspace, in spite of the complications mentioned and the overarching negative attitude regarding the practice. Retail therapy does not replace legitimate therapy and should not be considered a cure-all for negative feelings. However, it is an effective and valid form of self-care that requires little time or money to reap the benefits.

References [1] Rick SI, Pereira B, Burson KA. The benefits of retail therapy: making purchase decisions reduces residual sadness. J Consum Psychol. 2014;24(3):373-380.

[2] Yurchisin J, Yan RN, Watchravesringkan K, Chen C. Why retail therapy? A preliminary investigation of the role of self-concept discrepancy, self-esteem, negative emotions, and proximity of clothing to self in the compensatory consumption of apparel products. Asia-Pac Advances Consumer Res. 2006;7:30-31 [3] Kang M, Johnson KKP. Retail therapy: Scale development. Cloth Textiles Res J. 2011;29(1):3-19.

[4] Garg N, Lerner JS. Sadness and consumption. J Consum Psychol. 2013;23(1):106-113 [5] Bui M, Kemp E. E-tail emotion regulation: examining online hedonic product purchases. Int J Retail Distrib Manag. 2013;41(2):155-70 [6] Kang M, Johnson KK. Letâ&#x20AC;&#x2122;s shop! Exploring the experiences of therapy shoppers. J Global Market. 2010;1(2):71-79 [7] Atalay AS, Meloy MG. Retail therapy: A strategic effort to improve mood. Psychol Mark.

2011;28(6):638-660.

[8] Plastow, M. Retail therapy: The enjoyment of the consumer. Br J Psychother. 2012;28(2):204â&#x20AC;&#x201C;220 [9] Lee L. The emotional shopper: assessing the effectiveness of retail therapy. Foundations and Trends in Marketing. 2015

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The Future of Retail Impacted by the Smart Phygital Era Theodor PURCĂREA

Abstract Smartphones’ role in improving the retail customer experience is rising within the constant disruption and transformation. The need for harmonizing the digital environment with the in-store environment is clearly recognized within retailers’ struggling of adapting to the new reality and to improve the shopping experience, blending digital experiences with physical ones, keeping up with major mutations, having adequate insights from the analysis of data, and ensuring this way the retail renaissance, including by considering mobile and artificial intelligence as disruptive forces in retail. The last but not the least, retailers need to take into account the renewed interest in retail apps.

Keywords: Retail Renaissance; Shopping Experience; Customers Data; Smart Phygital; Mobile Marketing Trends; JEL Classification: L81, L86, M31, Q55 “Whether consumers or businesses, customers are increasingly at the epicenter of the economy, which is all about improving how customers are served.”

Klaus Schwab, Founder and Executive Chairman of the World Economic Forum

Smartphones’ role in improving the retail customer experience In November 2017, the reputed Professor Philip Kotler wrote that he is impressed by the fact that so many citizens are simply becoming physically and mentally dependent on the online shopping. He showed, among other aspects that: compared to in-store purchasing (U.S. shopping centers, malls and store-based retailers) the rate of online buying is growing much faster; as the number of stores independent of online will be reduced by a Darwinian process of the survival of the fittest, there are some options of the surviving stores such as: offering both in-store purchasing and online purchasing, offering more customized service, building community, using BOPIS etc.; it is necessary to adequately answer to the new threat represented by Smart phones, taking into account the growing frequency and intensity with which customers want a lower price. (Kotler, 2017)

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In an article published on the first day of September 2018, a Content Marketing Manager who supervises Vision Critical’s blog and social media marketing program attracted the attention on the fact that: not only on the growth in both brick-and-mortar and e-commerce sales reported by well-known U.S. retailers (Target, Walmart, Nordstrom, Home Depot, reminding that according to Deloitte the retail industry’s growth between 2017 and 2022 is pegged at 11.7%), but also on a net increase of 4,000 new store openings in 2017 (recorded by IHL Group); retail renaissance presupposes not only to really understand customers and take advantage of insight, but also to improve the retail customer experience within the constant disruption and transformation, using the adequate technology. (Claveria, 2018) Four days later, two representatives of the full-service retail design and experience agency SET argued that brick-and-mortar can be maintained as a primary touch point despite the creation and curating of the new ownable channels, by taking lessons to learn on the future of retail from the last mall built in U.S., The Mall at University Town Center (UTC) in Sarasota, Florida, which is housing 100+ stores. (Heathwood & Tauber, 2018) Opened in 2014, this Mall at UTC was also impacted by the digital and mobile paradigm shift (the convenience of all of consumers’ favorite stores in one place as central business proposition being damaged by the rapid development of online shopping and smartphones), being forced to adapt to the Omnichannel (seen as a single-revenue system enabling cross shopping and returning behaviors) effect, by ensuring a digital presence which creates a seamless experience, harmonizing the digital environment with the in-store environment, minimizing customer confusion and encouraging the traffic from digital to in-store to increase.

At the end of August this year an analyst of Ihl Services, Inc. (research & investing information) made reference (while approaching the topic of “Retail’s Radical Transformation/Real Opportunities” in U.S.) (Holman, 2018) to one of their reports showing that despite the projected retail growth in 2018 (+ 4,4-4,6%) “Retail Apocalypse” is still too often reported (see the figure below):

Figure 1: Evolution of retail in U.S. Source: Holman, L. (2018). Webinar Replay: Retail’s Radical Transformation/Real Opportunities, Ihl Services News, August 30 (work cited)

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Two month before, in June this year, Mi9 Retail (presented as the fastest growing provider of enterprise software for retailers, wholesalers, and brands) showed that beyond the headlines with regard to “The Death of Retail” the retail sector as a whole is growing, the unsuccess of some retailers being due mainly to the weak Web strategy, poor Omni channel execution and underinvesting in stores. And in order to survive retailers need to adapt quickly.

At the end of June 2018, while approaching the topic of “Surviving the Retail Apocalypse: Foursquare’s how-to guide for designing the Mall of the Future”, the Head of Analytics and a Manager, Analytics at Foursquare (a technology company using location intelligence to build meaningful consumer experiences and business solutions, and offering hosted technology and data to build context-smart, location-aware apps), showed, among other aspects, that: as the industry leader in analyzing foot traffic behavior everywhere, they have this unique ability to observe the footfall patterns of millions of Americans during their visits, differentiating between malls and the venues inside the malls; in order to achieve the success or failure of a new retail location opening, the so-called “categorical fit” (opening venues which tempt people in by complementing the existing ecosystem) is considered to be the main factor; examining the foot traffic of a panel of U.S. users who have been active on the Foursquare City Guide or Foursquare Swarm apps (including partner apps) and visited a mall when it opened any type of venue in 2016 and 1H 2017 across all shopping malls (classified according to the Foursquare’s own system which separates out the most high and low end malls from the rest of the spectrum) within America, Foursquare’s cited report identified five tips: to invest in the right secret weapons; to know malls’ audience, and be realistic about what works; to add the right food options (and a burger joint, which is attracting 5% more shoppers on average); to avoid hobby shops and keep a close eye on apparel (depending on the local situation); to make some big changes (expressing their optimism about malls opening lifestyle centers and other experiential elements). (Puetsch and Schoppmann, 2018) Improving the shopping experience, blending digital experiences with physical ones At the end of August 2018, Mi9 Retail added that retailers must continually improve the shopping experience, embracing the digital transformation and keeping up with rapidly changing technology, recommending not only the use of better-quality data in order to drive wiser decision-making and to consider an integrated suite for greater productivity, but also to know when to replace the legacy systems and to select a software provider built to support ongoing business growth. And very recently, on the occasion of the Paris Retail Week 2018, September 10-12 (the European global event for retail professionals bringing together at Paris Expo Porte de Versailles 800 exhibitors and 40,000 retail professionals from all over the world), Mi9 Retail attracted attention and emphasized the good qualities of its innovative unified retail suite, also remarking the opportunity offered by this Paris Retail Week to retailers and industry experts of exploring significant topics such as experiential marketing and “Smart Phygital” (the seamless integration of online and offline channels), blending digital experiences with physical ones.

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The concept of “phygital” appeared in October 2014 within the context in which Lowe’s (having at that time more than 1,835 home improvement and hardware stores and 260,000 employees) announced the introduction by the Lowe’s Innovation Labs, that holiday season, of two autonomous retail service robots (in an Orchard Supply Hardware store in midtown San Jose, California; Orchard Supply Hardware – OSH – operated at that time 71 stores in California and two stores in Oregon, these neighborhood hardware and garden stores being focused on paint, repair and the backyard operates) so-called “OSHbot” (incorporating scanning technology first developed for the Lowe’s Holoroom home improvement simulator; developed through a partnership between Lowe’s Innovation Labs and Fellow Robots, a Silicon Valley technology company, partnership being initiated through SU Labs, a Singularity University program, Singularity University being headquartered at NASA Research Park in Silicon Valley) in order to study how robotics technology can benefit customers and employees, improving customer experiences.

No wonder that within this framework the main theme of the Paris Retail Week 2018 “Smart Phygital” (coming after the Paris Retail Week 2017 conference “Live Retail: Authentic and Human Commerce”, pledging for creating a genuine and more human retail experience) reflects major mutations such as: Artificial Intelligence (AI) seen as the link between IoT, robotics, virtual and augmented reality opening the window of merging off- and on-line experiences; shops (designed “like at home”, shop layout being replaced by scenography) seen as rehumanising the purchase process by digitalizing (personalization of offers being enabled by CRM, the customer being accompanied by sales staff equipped with tablets, in-shop transaction becoming invisible, while off- and on-line retail is reconciled by click and collect). As shown by Retail Design World, at the Paris Retail Week 2018 (the fourth edition of this type of event) there was a New Shopping Experience (NSE) section for 14 experiential retail pilot schemes (such as: “virtual reality displays developed for a DIY retailer, an RFID-based in-store treasure hunt designed to entertain children, and a nutrition coach project that links recipes to shopping lists with an in-store scanning function”) targeting the improvement of the future retail experiences.

The term of “Smart Phygital” was coined this year within the framework of the study (presented at Paris Retail Week 2018) conducted by Paris Retail Week and Havas Paris which surveyed French, Chinese and American consumers and identified five major trends believed to change future retailing (including a focus on a combined future of physical stores and digital technology): “from the path of purchase to the path of life – consumers expect retail to be accessible all of the time; the conversational age has finally begun – 2018 marks the year of acceptance for voice assistance; from customer care to ethical manufacturing – environmental factors are now affecting customer decisions; big data, safe data and dirty data? – data has become the new ‘black gold’; new trendy discount – new ways to seduce a generation of customers whose financial means are inversely proportional to their influence.” (Retail Design World, 2018) Findings from this above mentioned study revealed, among other aspects, that: 37

74% of the American respondents consider that physical shops are making an effort to adapt to their lifestyle, compared to the French (71%) and the Chinese (61%); 94% of the Chinese prefer to be able to purchase at any time and in any place, compared to the Americans (77%) and the French (74%); 83% of young Chinese (18 - 24) make purchases on their mobile phones as they would in shops, compared to the young Americans (74%) and the young French (56%); 81% of the Chinese think that vocal assistants could very well replace keyboards or computer screens, compared to the French (63%) and the Americans (62%); 86% of the French day that everyday products are dangerous for their health, compared to the Americans (76% ) and the Chinese (72%); 83% of the Chinese consider that they are prepared to pay more for a company or a brand managing their data ethically, compared to the Americans (65%) and the French (62%); 91% of the Chinese consider that there are too many intermediary in retail trade, compared to the French (88%) and the Americans (66%). (Paris Retail Week, 2018) The basis for Paris Retail Awards 2018 was technological innovation (three criteria being considered in the final judgement: innovation of the solution presented, efficiency on the market and profitability of initial results obtained), the service providers and the initiatives in terms of solutions for retailers being placed in different categories: CRM: From lead to customer; Digitalisation of the point of sale; Customer experience (360°); Logistics; Store solutions & design; Technology. And this within the context in which the “Smart Phygital” theme was developed in significant plenary conferences during the Paris Retail Week 2018 (Smart Phygital – agile and global retail ecosystem; Smart Instore - The future of tomorrow’s store; Smart Customer Experience - Knowing and identifying consumers; Smart Supply Chain – Understanding the developments in the sector).

Delivering adequate insights from the analysis of data It is interesting to note that in March 2018, while stating from the very beginning that “Paris Goes Smart Phygital”, (Forhez, 2018) an Oracle’s representative argued that retailers are enabled by data, customer insights, virtual/augmented reality, machine learning and predictive analytics to make the relationship with the customer more authentic, humanized transactional, and this within the context in which the path to purchase is defined by CRM, Omni channel and bots. And among other aspects he described the interesting experience of visiting the pop-store Etam and Undiz right off the Avenue des Champs-Élysées (opened on December 16, 2017; Etam Group has 748 stores in France, 2125 in China and 262 in the rest of the world, and its Undiz label was launched in 2007). (FashionUnited, 2018) Also recently, Repsly, Inc., a software-as-a-service company (a data-driven retail execution platform bringing together brands’ observational, activity, and sales data into one system; a retail execution software for innovative brands such as Canon, illy, and Adidas), (Field Technologies Online, 2018) underlined the importance of three key types of data (activity data, observational data and sales data) for high performing consumer-packaged goods (CPG) field teams which know how to harmonize their activities with the in-store conditions so as to make 38

the biggest impact on sales in every account. (Repsly, 2018) These three types of data can be leveraged so as to take a data-driven approach to (see figure below): expanding in-store footprint, merchandising at shelf, executing and maintaining brand promotions, running in-store sampling events, and increasing chain penetration. These high performing CPG field teams are using the Repsly’s powerful mobile app which allows them to be equipped with the necessary store-level data and customizable data collection tools capturing insights from their field.

Another interesting opinion expressed at the beginning of September 2018 was that of a retail software executive with global experience in innovating solutions for the retail and CPG industries (currently serving as SVP Americas at TXT Retail, an Aptos Company), who showed, among other aspects that: collecting and integrating customer data with other useful information is required as a first step of the necessary retailers’ customer-centricity, in addition to the purchasing and browsing data already owned by them being recommendable to capture customer profile data; in order to enable companies to correctly respond to changing conditions retailers need to deliver forward-thinking insights from the analysis of data, building a broader number of adequate assortments, every assortment planning decision being informed by successfully leveraging shopper data. (Charness, 2018) Ensuring the retail renaissance, including by considering mobile as a disruptive force in retail Recent findings from an in-depth study conducted by Deloitte – and significantly entitled “The great retail bifurcation. Why the retail “apocalypse” is really a renaissance”– revealed that: the so-called “balanced” retailers (which account for the majority of closures and bankruptcies) are generally doing worse than either “price-based” retailers or “premier” retailers, consumers being more likely to recommend the last two retailers (which opened more stores over 2015– 2017 than closing them) than those “balanced”, which is putting forward for consideration that both more in tune with the changing needs and better at meeting the expectations of consumers are the retailers at either end of the spectrum than those in the middle; there is a high correlation to income of the likelihood of making an online purchase versus buying in a store because consumers’ spending behaviors across channels and categories is profoundly affected by their own both perceptions and realities of financial well-being; those retailers which will be able to offer a value proposition aligned with consumers’ needs (by capitalizing on consumers’ experiences of their economic well-being or lack thereof), improving consumers’ access to options with the help of the exponential advancement in technology, will be those which will ensure the retail renaissance. (Lobaugh et all., 2018) In September 2018, eMarketer selected, organized, and presented using well-known expert knowledge a new “Mobile Marketing Trends Roundup”, revealing key trends in mobile marketing today, including the impact on retail sector considering the increasing American consumers’ time spent on mobile: the role of an aggressive mobile strategy to both capture mobile buying and ensure a positive CX leading to a mix conversion (online/offline), considering 39

the evolution shown in the figure 2 below; the game-changing role in shopping played by the mobile device, eMarketer estimating that the majority of e-commerce revenue by 2021 will be generated by the mobile commerce which will account this year for 39.6% of total ecommerce sales; the small and medium-sized businesses (SMBs) need to better the Movement Science (Verve) and the importance of mobile apps (the medium of the moment), embracing mobile shopping while also understanding the behaviors and attitudes of the adopters of m-commerce (not only of the Millennial but also of Gen Z shoppers) as shown in the figure 3 below.

Figure 2: How does US Retailersâ&#x20AC;&#x2122; mobile web offering compare to the full functionality of the desktop site experience? April 2018 Source: Retail Systemes Research (RSR), â&#x20AC;&#x153;The State of Online Commerce 2018: High Hopes,â&#x20AC;? July 20, 2018, cited in Mobile Marketing Trends Roundup, eMarketer, September 2018 (work cited)

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Figure 3: Understanding the behaviors and attitudes of the adopters of m-commerce (according to Verve) Source: https://on.emarketer.com/rs/867-SLG-901/images/verve-infographic-ypulse.pdf, cited in Mobile Marketing Trends Roundup, eMarketer, September 2018 (work cited)

At the mid of September this year, a discussion organized by RetailWire.com (the retailing industry’s premier online discussion forum), with the view to see if mobile is the most disruptive force in retail since online selling began, (Anderson, 2018) revealed interesting opinions of 25 experts, such as: retail’s biggest traffic driver is mobile shopping (according to a Salesforce Report – Footwear News; providing shoppers the ability of accessing information while physically shopping was the greatest impact on retail (Mark Ryski, Founder, CEO & Author, HeadCount Corporation); real-time price transparency was created by the mobile phones which are the way ensuring both the product discovery and selection process (Paula Rosenblum, Managing Partner, RSR Research); artificial intelligence (AI) is the most disruptive force in retail since the advent of e-commerce, mobile being a game changer (Lee Peterson, EVP Brand, Strategy & Design, WD Partners); the disruption was caused by the fact that the entire shopping process was taken under control by shoppers, mobile technology enabling not only the immediacy, but also the fulfillment and expectation of instant gratification, while the shopping journey became an individual journey with almost limitless paths and destinations (Adrian Weidmann, Principal, StoreStream Metrics, LLC); the smartphone made consumer more empowered than ever (Dick Seesel, Principal, Retailing In Focus LLC); digital transactions were enabled by the mobile technology to be made in places where stores couldn’t even exist before (Ananda Chakravarty, Retail Thought Leader); more retailers will be push by mobile to start both using and offering omnichannel selling (Charles Dimov, Vice President of Marketing,

OrderDynamics); as retailers increasingly recognize that CX (which is driven by recognition, access, information and ease) is growing in importance relative to price promotion, being enabled in mobile, there is a growing investment in mobile relevance (Phil Rubin, CEO, rDialogue).

Instead of conclusions: A Renaissance for Retail and Retail Apps, while diving deeper in customers’ data This year, in our two previous issues, we shave seen that retailers are challenged to better understand the evolution of shoppers’ habits and expectations, enabling them to share their feedback, covering the gap between what retailers understood with regard to consumer behavior’s shift and their slowly reaction, ensuring a smart and seamless shopping experience, creating a digitally connected environment (including an emotional connection), continuously improving their capabilities associated with customer engagement (including their mobile mindset) and their predictive and intelligent marketing capabilities, translating data and insights into action, improving data driven CX. And this, of course, while continuing the constant pledge to advance on the way of following the (above and below identified) trends and doing something about them.

There is no doubt that retailers need a better understanding of their customers’ shopping patterns and to deliver at least the expected CX, improving the shopping experience with the help of data-driven analytics (diving deeper into data necessary to make more informed decisions), solving real problems faced by customers, these customers’ data being turned into powerful actionable insights, as recently underlined by Mi9 Retail ( for example, Mi9 Intelligence is a business intelligence system made exclusively for retailers).

In June this year, on the occasion of a CustomerThink Technology Innovation Webinar, Todd Marthaler (Marthaler, 2018) from Calabrio, Inc. (a recognized leader in contact center solutions, named a Leader in the Forrester WaveTM Workplace Optimization Suites, Q3 2016, and named a Visionary in the 2017 Gartner Magic Quadrant for Workforce Engagement Management), argued that as there is a problem with today’s data (85% analytics inform sales and marketing changes, 50% rely heavily on just a single point, and 68% executives admit to a “if it ain’t broke don’t fix it” attitude toward change), it’s time to act as shown in the figure 3 below.

At the end of August this year, an article published by eMarketer and entitled “What Shoppers Want from Stores of the Future” (Garcia, K., 2018) attracted our attention, by making reference to a survey conducted by RIS News (Technology Insights for Retail & Grocery Executives) in June 2018 about the ways US internet users changed their shopping behavior compared with five years ago, and revealing the new shopping options wanted by consumers, as shown in the figure 4 below.

Figure 3: Itâ&#x20AC;&#x2122;s time to transform (according to Calabrio) Source: Marthaler, T. (2018). Building the AI-Powered Customer Experience Center of the Future, CustomerThink Technology Innovation Webinar, June 21 (work cited)

Figure 4: What new shopping options/technologies would US digital buyers like to use? May 2018 Source: Garcia, K. (2018). What Shoppers Want from Stores of the Future, eMarketer, August 31 (work cited)

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Findings from the above mentioned survey revealed unsurprisingly that: “grab and go” technology (allowing consumers to self-checkout using their smartphones) is already the leading new shopping option wanted by consumers; 55% of respondents shopped at malls less often, and 83% shopped online more; 24% shopped more in brick-and-mortar locations, and 31% shopped in-store less. On the other hand, coming back to the survey (presented by eMarketer in September 2018 within the above mentioned “Mobile Marketing Trends Roundup”) conducted in July this year by Retail Systems Research (RSR), it was underlined that: 87% most of the surveyed retailers thought the physical store would not lose its importance in the future, 63% of the retailers with an average annual sales growth rate of 4.5% or more (so-called “winners”) even considering that their stores will become just another option among others for consumers to shop their brand; 60% of the respondents said that borrowing from what consumers like about online shopping and translating it in-store was their biggest opportunity to most improve their stores; the top choice for making their stores more relevant would be rolling out new technologies if there is enough money for it.

It is also worth mentioning that just two weeks before this article published by eMarketer the same author highlighted in eMarketer Retail “A Renaissance for Retail Apps”, (Garcia, 2018) in North America a majority of mobile retail transactions occurring via app, and mobile retail app usage being on the rise, the renewed interest in retail apps being explained not only by the continued growth of mobile commerce, but also by both marketers reducing friction and making apps more personalized, and users’ increased time spent in-app.

So let’s move from following these trends to actually doing something about them.

References Anderson, G. (2018). Is mobile the most disruptive force in retail since online selling began?

RetailWire, Sep 14. Retrieved from https://www.retailwire.com/discussion/is-mobile-the-mostdisruptive-force-in-retail-since-online-selling-began/ Charness, P. (2018). Want To Reinvent The Customer Experience? Start With Assortment Planning, Retail Touchpoints, 05 September. Retrieved from https://www.retailtouchpoints.com/features/executive-viewpoints/want-to-reinvent-the-customerexperience-start-with-assortment-planning Claveria, K. (2018). Why the retail apocalypse is really a renaissance, and what your company can do about it, Customer Experience Update, September 1. Retrieved from http://www.customerexperienceupdate.com/edition/weekly-nps-roadmap-2018-09-01?

Forhez, M. (2018). Paris Goes Smart 'Phygital', Consumer Goods Technology, March, 3.

Retrieved from https://consumergoods.com/paris-goes-smart-phygital Garcia, K. (2018). What Shoppers Want from Stores of the Future, eMarketer, August 31.

Retrieved from https://retail.emarketer.com/article/what-shoppers-want-stores-offuture/5b883889ebd40005bc4dc79b?

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Garcia, K. (2018). A Renaissance for Retail Apps, eMarketer Retail, August 15. Retrieved from https://retail.emarketer.com/article/renaissance-retail-apps/5b749eceebd40005bc4dc772?

Heathwood, W. & Tauber, S. (2018). Lessons On The Future Of Retail From The ‘Last Mall Built In America’, Retail TouchPoints, 05 September. Retrieved from https://www.retailtouchpoints.com/features/executive-viewpoints/lessons-on-the-future-of-retailfrom-the-last-mall-built-in-america Holman, L. (2018). Webinar Replay: Retail’s Radical Transformation/Real Opportunities, Ihl Services News, August 30. Retrieved from https://www.ihlservices.com/news/analystcorner/2018/08/webinar-replay-retails-radical-transformation-real-opportunities/ Kotler, P. (2017). “Will the 4th Industrial Revolution Kill Store-Based Retailing?” The Marketing Journal, November 2. Retrieved from http://www.marketingjournal.org/will-the-4thindustrial-revolution-kill-store-based-retailing-philip-kotler/ Lobaugh, K., Bieniek, Stephens, C. B. and Pincha, P. (2018). The great retail bifurcation. Why the retail “apocalypse” is really a renaissance, Deloitte Insights, Deloitte Development LLC. Member of Deloitte Touche Tohmatsu Limited. Retrieved from https://www2.deloitte.com/content/dam/insights/us/articles/4365_The-great-retailbifurcation/DI_The-great-retail-bifurcation.pdf Marthaler, T. (2018). Building the AI-Powered Customer Experience Center of the Future, CustomerThink Technology Innovation Webinar, June 21. Retrieved from Webinar062118 Puetsch, F. and Schoppmann, M. (2018). Surviving the Retail Apocalypse, Foursquare, Jun 28.

Retrieved from https://medium.com/foursquare-direct/surviving-the-retail-apocalypseaf7011f4f9b7 Schwab, K. (2016). The Fourth Industrial Revolution: what it means, how to respond, The World Economic Forum, 14 Jan (first published in Foreign Affairs). Retrieved from https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-andhow-to-respond/ *** https://www.calabrio.com/about-calabrio/ *** The Top 3 Reasons Retailers are Struggling – and How You Can Survive the “Retail Apocalypse”, Mi9 Retail, June 6, 2018. Retrieved from https://mi9retail.com/survive-the-retailapocalypse/ *** https://foursquare.com/about *** Are you ready for the retail renaissance? Mi9 Retail, August 28th, 2018. Retrieved from https://mi9retail.com/are-you-ready-for-the-retail-renaissance/ *** Mi9 Retail Draws Crowds at Paris Retail Week 2018, Mi9 Retail, September 13th, 2018.

Retrieved from https://mi9retail.com/mi9-retail-draws-crowds-at-paris-retail-week-2018/ *** The Future of Shopping has Arrived and its Name is OSHbot, Lowe’s Companies, Inc., Newsroom, October 28, 2014. Retrieved from https://newsroom.lowes.com/news-releases/thefuture-of-shopping-has-arrived-and-its-name-is-oshbot/ *** Smart Phygital, the 2018 main theme, Paris Retail Week, August 17, 2018. Retrieved from https://en.parisretailweek.com/Programme/guiding-thread

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*** Experiential retail pilot schemes to be presented at Paris Retail Week, Retail Design World, News, 4 Sep 2018. Retrieved from https://retaildesignworld.com/news/experiential-retail-pilotschemes/ *** 'Smart Phygital' future for stores says Paris Retail Week study, Retail Design World, 22 Jun 2018. Retrived from https://retaildesignworld.com/news/smart-phygital-future-for-stores/ *** Welcome to the Smart phygital era! When the retail ecosystem becomes intelligent and agile, Paris Retail Week. Retrieved from https://en.parisretailweek.com/Press/Pressreleases/Welcome-to-the-Smart-phygital-era!-When-the-retail-ecosystem-becomes-intelligentand-agile *** Paris Retail Awards 2018: finalists' hour! Retrieved from https://en.parisretailweek.com/Press/Press-releases/Paris-Retail-Awards-2018-finalists-hour *** Paris Retail Week - the European event dedicated to 360° retail, Paris Retail Week, Press release. Retrieved from https://en.parisretailweek.com/Press/Press-releases/the-European-eventdedicated-to-retail *** Etam et Undiz ouvre un Pop Store sur les Champs-Élysées, FashionUnited, 3 Janvier 2018.

Retrieved from https://fashionunited.be/fr/actualite/retail/etam-et-undiz-ouvre-un-pop-up-storesur-les-champs-elysees/ *** https://www.fieldtechnologiesonline.com/doc/repsly-announces-strategic-partnershipdestini-leading-product-locator-store-level-data-intelligence-platform-0001 *** 3 Types of Data You Need to Explode Sales in Your Highest Priority Retailers, Repsly.

Retrieved from https://www.repsly.com/three-types-of-data-ebook *** Mobile Marketing Trends Roundup, eMarketer, September 2018. Retrieved from https://on.emarketer.com/rs/867-SLG901/images/eMarketer_Roundup_Mobile_Marketing_Trends_2018_3.pdf *** Movement Science: An Advertiser’s Guide to Activating Mobile Device and Location Signals. Retrieved from https://www.verve.com/sign-up/emarketer-movement-science/ *** How Retail Analytics Boost Sales and Improve the Customer Experience, Mi9 Retail, September 5th, 2018. Retrieved from https://mi9retail.com/how-retail-analytics-boost-sales-andimprove-the-customer-experience/

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Léon F. WEGNEZ (by courtesy of) – Defending Consumer Rights, “Distribution d’aujourd’hui”, 58ème année, Décembre 2017, Brussels Sharing with our distinguished Readers a well-known source of usable and useful knowledge…

Prof. Dr. h. c. Léon F. WEGNEZ is an Honorary Member of the Romanian Distribution Committee, and distinguished Member of the Editorial Board of our “Romanian Distribution Committee Magazine“. He was honored by the European Retail Academy (ERA) as the 2015 “Man of the Year” (the distinguished personalities who have been honored by ERA in the last six years were: Philip Alexander Nobel, John L. Stanton, Léon F. Wegnez, Romano Prodi, Klaus Toepfer, and Robert Aumann). Knowing our distinguished readers’ thirst for knowledge, we offer you, by courtesy of this remarkable personality, the above mentioned article published in the prestigious “Distribution d’aujourd’hui”.

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Thematic University Network: ISO, HACCP, IFS Bernd HALLIER

Prof. Dr. Bernd Hallier, President of the European Retail Academy (ERA), an Honorary Member of the Romanian Distribution Committee, and distinguished Member of the Editorial Board of “Romanian Distribution Committee Magazine” (he is also Honorary Member of the Romanian Scientific Society of Management - SSMAR) attracted our attention on great events happening in the first quarter 2018, and allowed us to present them. It is also worth remembering that: immediately after visiting Romania for the first time on the occasion of the 24th International Congress of the International Association for the Distributive Trade (AIDA Brussels), Prof. Dr. Bernd Hallier sent us, in May 2008, a memorable letter we have referred initially in the Journal of the Romanian Marketing Association (AROMAR), no. 5/1998, and also later, in 2010, in the first issue of the Romanian Distribution Committee Magazine; the Romanian-American University has awarded Prof. Dr. Bernd Hallier a “Diploma of Special Academic Merit”; the “Carol Davila” University of Medicine and Pharmacy, Bucharest, has awarded Prof. Dr. Bernd Hallier a “Diploma of Excellence”. It is well-known that based on the preparations for the 200 years Anniversary of the University of Bonn, the two international networks EQA (Education Qualification Alliance) and ERA (European Retail Academy) signed a Memorandum of Understanding (MOU, signed by the Chairman of the Board of EQA, Christian Gruetters and Prof. Dr. Bernd Hallier for ERA) to institutionalize the so-called Thematic University Network conceived as an excellent platform for global dialogue, whose vision and mission were explained jointly by Prof. Dr. Brigitte Petersen, President of the International Center for Food Chain and Network Research (FoodNetCenter Bonn, founded in 2006 as interdisciplinary center of the University of Bonn, and having as main objectives: interdisciplinarity; contribution to university profile; outstanding research & development; Focus Groups: Food Waste, One Health, Responsible System Information) and Prof. Dr. Bernd Hallier (ERA).

The International Standardization Organization (ISO) The International Standardization Organization (ISO) was founded in 1947 and is headquartered in Geneva/Switzerland. More than 150 countries are member bodies,

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corresponding members or subscriber members. ISO standardization needs the following seven procedures: preliminary work item – new work item proposal – working draft – committee draft – draft international standard – final draft international standard – publication international standard. Those standards are descriptions - they are not a guarantee for a quality itself.

Since the 80ies Prof. Dr. Bernd Hallier pushed within the food business the ISO Packaging norms as a rationalization tool: based on the module 400 x 600 mm sales-cartons and palettes by 1200 x 1000, 1200 x 800 and 600 x 800 can flow most easily from production via transportation units and depots finally into the shelves of retail. Not only efficiency was increased by this system but also damage in the transportation flow decreased: saving food waste too. More about ISO here.

Hazard Analysis and Critical Control Points (HACCP) HACCP is standing for Hazard Analysis and Critical Control Points; its principles are required to be put in place, implemented and maintained permanently by food business operators according to the EU Regulation No. 852/2004 of the European Parliament and of the Council on the hygiene of foodstuffs.

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There are seven main steps of HACCP: Hazard analysis – Identification of critical control points – Critical limits at critical control points – Monitoring procedures at critical control points – Corrective actions – Verification procedures – Documentation and record keeping (see more: link).

The IFS (International Featured Standard) The IFS (International Featured Standard) was created in 2003 by the German Trade Association HDE and its French counterparts FCD; later Italian Trade Associations joined.

Today IFS is acting worldwide. The basic idea of IFS is the fact that on the one hand side the European Law and National Laws require from food companies or food outlets to implement all relevant actions to secure food safety and on the other hand also individual suppliers/retailers develop marketing profiles with „add-ons“ to the legal requirements to gain higher margins.

Those companies then need a control/audit for their claims. IFS’s ambition is to harmonize those individual demands to one level of control to get more efficiency via an unified standard.

The IFS-standard is benchmarking the individual steps and partners of the Total Supply Chain by an evaluation system which has four main categories: - A: full compliance with the requirements (20 points) - B: almost full compliance – but small deviations (15 points) - C: only a small part of the requirements are implemented (5 points) - D: the requirements are not implemented All scorings are reported and explained in an IFS Audit Report. Based on the first evaluation all enterprises have the chance to secure and improve their market position by an action plan of continuous optimization of their products and services.

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We are continuing to unlock the necessary insights so as to maximize “SANABUNA” (http://www.crd-aida.ro/activitiespartnership/sanabuna-2011/) opportunity initiatives, improving consumers/patients experience, including by making them aware of various risks, such as those revealed in the article below. We are pleased to allow researchers share their ideas and discoveries, ensuring our readers to get access to Health, Nutrition, Fitness and Wellbeing insights (http://www.sanabuna.ro/the-second-international-congress-healthnutrition-fitness-and-wellbeing-for-central-southeast-europe-sanabuna-2012-took-place-on-the19th-21st-october-at-the-art-museum/), because we are all consumers/patients needing gaining better insights in order to take good decisions.

ASSESSING CLINICAL FINDINGS IN THE DIABETIC FOOT Pavelina Mihaela ANDREI1, Victor Ștefan IONESCU1, Simona CARNICIU2 and Constantin IONESCU-TÎRGOVIȘTE3 1

Carol Davila University of Medicine and Pharmacy, Faculty of Medicine, Bucharest, Romania Carol Davila University of Medicine and Pharmacy, Faculty of Medicine, Bucharest, Romania 3 N. C. Paulescu National Institute of Diabetes, Nutrition and Metabolic Diseases, Bucharest, Romania Corresponding author: Constantin Ionescu-Tîrgoviște E-mail: cit@paulescu.ro Abstract Type 2 diabetes mellitus places an ever increasing cost on economies and patients’ quality of life. One of this disease’s complications is known as the diabetic foot. It refers to signs and symptoms that can be roughly classified in 3 groups: neuropathic, vascular and infectious. This review aims to list the most clinically-accessible signs and symptoms and to classify them according to their impact on quality of life in 2 groups: mild and severe.

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Keywords: diabetic foot, clinical exam, complications JEL Classification: I; L80 INTRODUCTION

Diabetes mellitus (T2DM) is a frequently encountered disease in today's medical practice, and one of the fastest growing as well. This disease's impact has arisen almost simultaneously with the development of modern society; questions about modern lifestyle have started to be asked and be answered accordingly. It is estimated that a number of 592 million patients will be diagnosed with diabetes mellitus in 20351.

Factoring its costs paints a grim picture: as a permanent disease, patients often survive decades with gradually-worsening symptoms, complications and decreasing lifestyle quality.

But, what is also important is the economic burden of diabetes: a 2012 study showed estimated costs of $245 billion for treating T2DM patients in the US alone2.

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In this review, we are addressing the diabetic foot: a recently-described group of symptoms, spanning all diabetic complications that pertain to the inferior limb’s most distal portion. We will focus on the clinical presentation of this syndrome and we will also be reviewing the relationship between these conditions. Finally, we will examine risk factors for the more serious diabetic foot complications. Pathophysiology of these lesions is beyond the scope of this article, being a complex field which warrants its own pieces of work instead.

REVIEW T2DM is a disease with an unwavering course: sooner or later, complications hinder the life of every diabetic patient. Chiefly, diabetes induces multiorgan alterations that can be attributed primarily to excessive blood glucose, hyperglycemia. Out of these, the most frequent is neuropathy. After two decades of evolution, virtually all patients present with some degree of nerve affection. Other changes take place in the body's circulatory system: angiopathy of both the large and the small blood vessels, visible throughout the body, almost no organ spared.

How do these changes affect the inferior limb? As previously stated, T2DM complications can be roughly classified into either neurologic, vascular or infectious conditions, with the former two showing increased prevalence and earlier onset than the latter. This grouping is equally valid for the diabetic foot, which exhibits signs and symptoms of all categories. Most are non-lifethreatening, thus warranting their inclusion in an appropriately-termed low-risk class; however, 4 of them carry a serious potential of decreasing quality of life or even being lethal: neuropathic arthropathy, ulcers, gangrene and amputation.

It has been shown that almost 85% of limb amputations are preceded by foot ulcers3. As usual, primary prevention is key - but, failing that, finding a practical way to predict ulcers would do much to elevate patient awareness and to sound an alarm. This high percentage validates an effort to attain means of secondary prevention of serious diabetic foot complications. Any such practical tool would have to be:  Rapidly computable,

 

Comprehensible for both physician and patient and Based on easily attainable analyses. This could include both laboratory parameters and clinical findings.

The rationale having been explained, we will begin describing the most frequent class of signs and symptoms, under the name of diabetic neuropathy. Some of the most common findings are the loss of tactile and vibratory sensitivity. At this stage, motor nerves are affected as well as proprioception. A turnkey point of further research would be to understand how many patients are aware of these changes, before being tested for them at the physician's request. Further in the evolution of T2DM, patients can also begin to lose thermal and pain sensitivity. The autonomous nervous system is affected next.

Peripheric neuropathy in the absence of other complications has been shown to increase ulceration risk by 70%.

Among other clinically-evident complications of diabetic neuropathy there are cutaneous ones.

Calluses, hyperkeratosis, and skin fissures appear frequently and share common causes. Chiefly, these multiple mechanisms can be attributed either to continuous microtrauma due to diminished tactile sensitivity, or foot deformation.

Inappropriate footwear is a usually overlooked factor in this context. Half of all calluses are associated with an underlying foot ulceration, which can be discovered at a cursory glance by the presence of a hematoma. Hyperkeratosis can be usually found in the calcanean area, along with fissures. Out of these 3 complications, hyperkeratosis was reported the most frequently, being observed in 27.1% of neuropathic T2DM patients. Calluses and fissures accounted for 3.7% and 3.5% respectively3.

Sympathetic nerve fibers are affected, which leads to sebaceous and sweat glands diminishing in size and atrophying. Clinical manifestations such as dehydrated skin and hair loss follow naturally.

The same mechanism leads to another interesting and relatively rare finding (4%): neuropathic edema. This type of edema is defined as a diagnosis of exclusion, in the absence of cardiac, renal or venous failure. Its characteristics include normal local temperature, single- or twosidedness, worsening with orthostasis. Increased

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blood flow due to autonomic dysregulation contributes to the development of this edema, while also leading to venous insufficiency, as a result of varicose vein development.

Onychodystrophy or even nail atrophy may occur as a result of continuous trauma. Subungual hematoma can arise due to the same causes and is correlated with the degree of sensory loss.

The second group of diabetic foot complications spans two types of vascular affliction.

Pathologically, atherosclerotic lesions (the first kind) have a greater extent and develop earlier in T2DM patients than in non-diabetic subjects. The other type of vascular damage has been described

by Mönckeberg as calcification and sclerosis of the arterial tunica media. Vascular lesions arise both on large and small blood vessels.

Since these alterations take place at the tissue level, they cannot be minutely examined. Despite this, a reliable way to quantify arterial damage is the ankle-brachial pressure index. It has an elevated value, of more than 1.3, owing to vessel incompressibility. What can be found at a routine examination is diminished or absent popliteal pulse; the pedal pulse can suffer the same change.

Diminished or absent pulses can be ascribed to peripheral arterial disease. It may be present in any of the 4 Lériche-Fontaine stages, with the expected signs and symptoms (discolored or cold skin, intermittent claudication, ischemic ulcers).

Its prevalence increases from 15% at 10 to 45% at 20 years from T2DM diagnosis. It is important to differentiate ischemic from neuropathic ulceration: the former is painful, has a clear demarcation and is not surrounded by a callus. Its base is usually necrotic, and a necrotic crust can be found adhering to the surface. Sometimes, a neuropathic ulcer can develop in a patient with peripheral arterial disease, thus being termed ‘neuro-ischemic’.

Vascular complications also play a part in the aforementioned skin damage and hair loss, in addition to diabetic neuropathy. It has been shown that cutaneous blood flux is decreased in diabetic patients, as a result of arterio-venous shunt opening.

Wound healing capacity is gravely affected, both due to blood vessel deterioration and hyperglycemia affecting physiological functions of all the proteins involved in this process. Excess protein glycosylation leads to impaired function and increased healing time, readily apparent in the case of a diabetic foot ulcer. Additionally, 40% of patients have a recurrence within 1 year after healing, with up to 65% of ulcers reappearing in 5 years’ time4.

Abruptly-installed pain and edema may ensue in the presence of diabetic muscle infarction. This is a rare phenomenon, most frequently observed in the lower limb, in females, in T1DM and after 14 years of disease evolution. It has been surmised to occur due to diabetic arteriopathy.

Infections are the third major group of possible complications in diabetic foot patients. The most common is fungal disease, found in 38% of patients. Out of these, tinea pedis and onychomycosis, both caused by Candida albicans, are discovered most frequently. As for bacteria, Staphylococcus aureus is responsible for the majority of the bacterial infections, especially those associated chronic wounds. A recent study revealed significantly decreased bacterial diversity of the skin microbiome in diabetic patients, as opposed to non-diabetic controls5.

Any of the following forms of infection may be encountered:  Skin or soft tissue infection (abscesses, necrotizing fasciitis)  Cellulitis  Acute osteomyelitis  Chronic osteomyelitis We will now continue with describing the second set of diabetic foot complications. As previously discussed, these are serious and should prompt the physician to warn the patient well in advance. In general, it is exceedingly hard to convince people about the nature of statistics in evidence-based medicine. It gets even harder when the subject is a future, potentially life-changing event, such as the amputation of a limb. Therefore, an instrument that would facilitate the patient’s understanding of this otherwise difficult-to-grasp concept would be immensely useful. A simple sheet of paper, color coded to represent various risk levels, has been put forth as a solution to fulfill this role. The inner

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workings of such a system will remain the subject of an altogether different article.

To begin, foot ulcers are the most common serious T2DM complication. Typically, patients present with a profound skin ulceration, with the bottom of a pink color, surrounded by a callus, at the calcanean level. It usually appears in typical high-pressure gait zone. No pain is associated with this lesion. Cellulitis or osteomyelitis can be discovered at the same time. The prevalence of foot ulcers in diabetic neuropathy patients has been reported as 3.5%. Out of all T2DM patients, it has been estimated that 15% experience foot ulcers at least once. It has been shown that primary prevention is ‘very likely to provide costsavings’ for patients at moderate or high risk of diabetic foot ulcers6.

Foot ulcerations arising from sensory deprivationrelated trauma have been termed ‘neuropathic ulcers’, as opposed to lesions that did not have prior nerve damage as a contributing risk factor.

Diabetic foot ulcers can also have ischemia as pathogenic mechanism, or they can bear a mixed, neuro-ischemic origin.

Risk factors for the development of diabetic foot ulcers are:  Infection  old age  diabetic neuropathy  peripheral vascular disease  smoking  poor glycemic control  previous foot ulcerations or amputations  foot deformities  renal failure  impaired ability to look after personal care Following foot ulcers, the so-called neuroarthropathy of the foot, or Charcot foot, is another grave development for T2DM patients. It is attributed to the loss of autonomic innervation, combined with an adequate degree of bone blood flow. This leads to osteopenia and decreased bone resistance, and is readily apparent through specific clinical findings.

Pes cavus, or high instep, along with claw toes lead to a deformed gait pattern and pressure redistribution. Thus, certain areas are exposed to

stress of a much higher degree. This is a decisive factor in trauma development, and indeed in the development of foot ulcers, in addition to infections. Any of the foot articulations may be affected.

Finally, gangrene is the endpoint of diabetic foot complications. It can develop de novo, following a traumatic event in several days (usually, at most 72 hours), or it can complicate a milder form of infection. It can be caused by aerobic bacteria (type A Streptococcus, Staphylococcus aureus) and anaerobic bacteria (Bacteroides, Enterobacter, Proteus). Ketoacidosis is a possible development.

Risk factors for gangrene include:  Neuropathy  Pathologic alterations of the large and small blood vessels  The previously-described trauma-incurred skin lesions  Diabetic retinopathy  Loss of joint mobility  Lack of patient education regarding diabetic foot lesions.

Taking all of these into account, the development of foot gangrene and subsequent amputation can only be regarded as failure of treatment.

CONCLUSION Signs and symptoms of the diabetic foot may vary from patient to patient, but certain pathological processes are almost always present to some degree. It includes a range of signs and symptoms that we have tried to classify in mild or severe.

The most common of the so-called benign findings is neuropathy. It is the starting point and a risk factor for most of the others. Most of the clinical signs are easy to discover and their pathogenesis is well-understood.

It is reassuring that the upsurge in diabetic patients has not been reported to be accompanied by a corresponding rise in the prevalence of complications. Patients still need to be made aware of the risks that high-severity symptoms entail, and ideally physicians should resolve this issue by introducing an easy to comprehend risk assessment method. Primary prevention has the potential to ease T2DM-derived economic burden

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and increase patient quality of life by averting limb amputations.

REFERENCES 1. Guariguata, L. et al. Global estimates of diabetes prevalence for 2013 and projections for 2035. Diabetes Res. Clin. Pract. 103, 137– 149 (2014).

2. American Diabetes Association. Economic Costs of Diabetes in the U.S. in 2012. Diabetes Care 36, 1033–1046 (2013).

3. Ionescu-Târgoviște, C. Istoria neuropatiei diabetice în România. (2013).

4. Armstrong, D. G., Boulton, A. J. M. & Bus, S. A. Diabetic Foot Ulcers and Their Recurrence.

N. Engl. J. Med. 376, 2367–2375 (2017).

5. Gardiner, M. et al. A longitudinal study of the diabetic skin and wound microbiome. PeerJ 5, e3543 (2017).

6. Barshes, N. R. et al. A model to estimate costsavings in diabetic foot ulcer prevention efforts. J. Diabetes Complications 31, 700–707 (2017).

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