Dive Brief:

• Grocery wholesaler and retailer Supervalu has tapped Sungard Availability Services to replace its aging mainframe IT infrastructure with cloud technology as part of a massive project transformation and upgrade of a network that supports more than 2,000 grocery stores.

• The agreement with Sungard AS allows Supervalu to replace fixed-cost, in-house hardware equipment with variable-cost cloud-based services that Supervalu can scale and adjust as needed. The company can move workloads off of those legacy platforms to a secure, highly-scalable cloud platform.

• "We plan to strengthen operations across our enterprise and add shareholder value by transforming our approach to technology," said Supervalu CTO Chad Mead, in a statement. "Technology has become an essential factor in competing in this market, and our planning with Sungard AS suggests that we can build a more flexible and responsive mainframe infrastructure that drives growth."

Dive Insight:

In many industries, companies are capping their ongoing investments in maintaining legacy in-house computing and networking gear and migrating the workloads typically conducted on these systems to the cloud. The clearest reasons to do so in most of these cases are to reduce operational costs and improve flexibility.

The story is no different in the case of Supervalu, noted Mead. Rather than spending time, money and space on an in-house mainframe IT infrastructure, Supervalu can shift that labor, use those funds and fill that space with efforts that have more obvious and direct competitive value. That, in turn, could help Supervalu get in a better position to deal with a grocery sector that is shifting rapidly.

The wholesaler and retailer is no stranger to technology investment. Supervalu arguably was on the cutting edge in the grocery market when it launched its first mobile app back in 2012. The company also is no stranger to the cloud, as it partnered with Oracle last year to give the grocers in its network access to analytics and other information and resources through the Oracle Cloud.

Now, it's taking that medicine itself, and getting additional benefits like disaster recovery and back-up services in the bargain. Supervalu is even putting itself in a position to offer white-label disaster recovery and other services to retailers in its network, something which many small and independent grocers the company works with probably have never had access to.

Yet, even with the cost and flexibility advantages of cloud computing and networking, committing to transform your own IT infrastructure — one that has been in place for many years — is a huge, and somewhat frightening under-taking. According to technology analysts, retailers have not always been willing to embrace changes in how they manage IT. But in a more competitive and customer-centric era, they may no longer have a choice.