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  1. 1. DAVID LLAMAS, HARRODS IT DIRECTOR Managing Master Data & Multi-Channel Initiatives Through SOA “Anything is Possible…” 14 July, 2006
  2. 2. <ul><ul><li>Harrods Approach to SOA </li></ul></ul><ul><ul><li>Phase 1: Single Customer View </li></ul></ul><ul><ul><li>Phase 2: Customer Insight </li></ul></ul>Harrods SOA Vision 1 2 Contents 3
  3. 3. Harrods SOA Vision Harrods Approach to SOA 1
  4. 4. Harrods SOA Vision <ul><li>Harrods Knightsbridge Store </li></ul><ul><ul><li>Annual revenues circa 550m GBP (>970m USD) in one single store </li></ul></ul><ul><ul><li>5.25m annual visitors (350,000 average in one day) </li></ul></ul><ul><ul><li>> 1,000 tills in one location </li></ul></ul><ul><ul><li>16 directorates </li></ul></ul><ul><ul><ul><li>Beauty, Homes’ wear, Ladies’ wear, Men’s wear, Children’s wear, Fashion Accessories, Fine Jewellery, Food and Beverage, Furniture, Harrods Signature, etc. </li></ul></ul></ul><ul><ul><li>254 departments </li></ul></ul><ul><li>Harrods is a Multi-Channel Retailer </li></ul><ul><ul><li>Offline Store </li></ul></ul><ul><ul><li>Online Direct Mail and Internet… focus on growth opportunities </li></ul></ul>Everybody sees a Store… but there is more to it!
  5. 5. Harrods SOA Vision <ul><li>Margins are thin </li></ul><ul><ul><li>Low product profitability </li></ul></ul><ul><ul><li>Too much reliance on mark down selling </li></ul></ul><ul><ul><li>Cost reductions are important </li></ul></ul><ul><li>Competitive pressure </li></ul><ul><ul><li>Focused on the customer experience while optimizing the labor resources to support delivery </li></ul></ul><ul><li>Difficulty in building loyal customers through global brands and superior customer service </li></ul><ul><ul><li>Adaptability to customer preferences </li></ul></ul><ul><ul><li>Communicate a consistent message and brand experience across all customer touch points </li></ul></ul><ul><li>Rapid information sharing throughout </li></ul><ul><ul><li>Who, where and what </li></ul></ul>Retail Industry Drivers today
  6. 6. Harrods SOA Vision <ul><li>Our New Motto: “Anything is possible…” </li></ul><ul><li>Multi-Functional & Multi-Channel </li></ul><ul><ul><li>Product & services diversification means different business processes </li></ul></ul><ul><ul><li>Different business processes have different requirements (Multi-Functional) </li></ul></ul><ul><ul><li>But also, different customers have different requirements (Multi-Channel) </li></ul></ul><ul><ul><li>Different requirements need different solutions </li></ul></ul><ul><ul><li>Maintaining many solutions is expensive </li></ul></ul><ul><ul><li>… Providing every product & service and meeting high customer's expectations is complex and expensive!!! </li></ul></ul>Harrods Drivers
  7. 7. Harrods SOA Vision Harrods IT Drivers <ul><li>Current CIO pains </li></ul><ul><ul><li>Current architecture does not support the needs of the business </li></ul></ul><ul><ul><li>Complex technical environment that is difficult and expensive to manage </li></ul></ul><ul><ul><li>Systems not integrated </li></ul></ul><ul><li>Harrods IT Vision is to provide our business with a long term, agile, flexible, and cost effective infrastructure </li></ul><ul><ul><li>Agility </li></ul></ul><ul><ul><li>Flexibility </li></ul></ul><ul><ul><li>Low cost </li></ul></ul><ul><ul><li>Greater efficiency </li></ul></ul><ul><ul><li>Moving towards “The Predictive Enterprise” </li></ul></ul><ul><ul><li>Improved customer service </li></ul></ul><ul><ul><li>Effective supply chain and vendor collaboration </li></ul></ul>
  8. 8. Harrods SOA Vision … <ul><li>Goals and Objectives </li></ul><ul><ul><li>Reduce complexity of Architecture </li></ul></ul><ul><ul><li>Leverage existing systems </li></ul></ul><ul><ul><li>Provide Real-Time information </li></ul></ul><ul><ul><li>Drive towards a Predictive Enterprise </li></ul></ul><ul><ul><li>Maintain a Competitive Edge </li></ul></ul><ul><ul><li>Reduce On-Going Costs, but remain AGILE </li></ul></ul><ul><li>Harrods IT Strategy </li></ul><ul><ul><li>SOA architecture target to maximise investment in legacy and investment in new application suites </li></ul></ul><ul><ul><li>Overhaul of legacy systems over 3 years </li></ul></ul><ul><ul><li>Installation of key applications and replacement of proprietary systems with industry best-of-breed leading products </li></ul></ul><ul><ul><li>Integration across all platforms to deliver true business decision support in real-time </li></ul></ul>
  9. 9. Harrods SOA Vision Business Benefits and SOA Efficiencies <ul><li>Some of the Business Process Benefits… </li></ul><ul><li>Multi-channel Loyalty programs </li></ul><ul><li>Multi-channel Promotions strategy </li></ul><ul><li>Homogeneous customer experience </li></ul><ul><li>Unified multi-channel customer service </li></ul><ul><li>IT resource utilization – Enterprise wide Shared Services </li></ul><ul><li>Future IT Composite Applications </li></ul><ul><li>Multi-channel Customer Insight </li></ul><ul><li>Development Efficiencies </li></ul><ul><li>Increasing service reuse and reducing development costs </li></ul><ul><li>Reducing time to deployment of new services </li></ul><ul><li>Operational Efficiencies </li></ul><ul><li>Reducing infrastructure and management costs </li></ul><ul><li>Improving end-to-end process visibility, security, and/or control </li></ul><ul><li>Streamlining root cause analysis and automating triage </li></ul>
  10. 10. Harrods SOA Vision Other SOA Efficiencies… <ul><li>Business Efficiencies </li></ul><ul><li>Accelerating time-to-market of critical business applications and processes </li></ul><ul><li>Enabling easier compliance with policies (security, business, regulatory) from all functional areas </li></ul><ul><li>Maintaining business continuity across the enterprise through real-time response to security, performance or availability breaches </li></ul><ul><li>Seeing business metrics in real time </li></ul><ul><li>Integration Efficiencies </li></ul><ul><li>Reducing integration cost and complexity through the use of industry standards </li></ul><ul><li>Seamlessly interoperating with, and leveraging the capabilities of, key third-party infrastructure solutions such as identity management systems, directory services, enterprise management systems </li></ul>
  11. 11. Harrods SOA Vision Today… Point-to-Point Integration <ul><ul><li>Lack of end-to-end process visibility </li></ul></ul><ul><ul><li>Diversified/Bespoke integration with low or none reusability </li></ul></ul><ul><ul><li>Decentralized master data management </li></ul></ul>Server Consolidator TO POS Servers NTS15 NTS16 NTS17 NTS18 NTS19 NTS20 NTS25 NTS26 NTS27 NTS28 NTS29 NTS30 Consolidators WPKB0503A WPKB0503B KB - Riva Server Micros Servers: NTS88 NTS89 NTS90 Airports - Riva Server POS Servers: Gat N - NTS82 Gat S - NTS83 T1 - NTS84 T2 - NTS85 T3 - NTS86 T4 - NTS87 KB - Micros SAS Archive W2S063 SAS Archive OUTPUTS INPUTS SAP SAS400 Coda Rex SAP HACS Direct Mail CSS BT Exchange Rates (FEXCO) Cash Counting (Depros) Retail Analytics SIMS VAT Refund Executive Console DMS MQ Series (IBM) Live Interface (Intellicorp) GE (1) Claims AMEX Visa Access JCB Diners Ralph Lauren Krispy Kreme Kurt Geiger Waterston's Di Milo BAA Concession Sales Data Extracts Fexco (2) Claims Natwest (3) Claims REX Authorisation Limits Stored Value Cards SAS Explorer Internet Orders Natwest Hot Card File GE Hot Card File CODA HACS Operators Fexco Bin Ranges Natwest/GE Hot Cards Fexco Exchange Rates Consolidator FROM OLA Servers: NTS06 NTS07 NTS08 NTS19 NTS1201 Settlement Transaction Details Flash Sales FTP FTP FTP Operator Codes Cash Counted by Till with Tender breakdown Daily TLog TLog Sales Information Resource Planning Price Discrepenancy Outlook Reports Loss Prevention Query on Request Compuware Solve DM Beauty Children's wear Fashion Acc. Fine Jewellery Harrods Signature Ladies' wear Men's wear Sound & Vision Sports Toys Homes’ wear Furniture Card Handling Expense Ctrl Gift & Bridal ADACO Food & Beverage Card Handling Front-Office Front-Office Direct Mail Executive Console Delivery Management Proclarity Incentive Schema Audit System 3 rd Party Integration Front Office Back Office Transactional Database Transactional Database Key SAS
  12. 12. Harrods SOA Vision Tomorrow… Service Oriented Architecture <ul><ul><li>Composite applications provide an end-to-end business solutions improving visibility </li></ul></ul><ul><ul><li>Unified/Standard reusable integration </li></ul></ul><ul><ul><li>Master Data Management identifies unique entities across databases </li></ul></ul>
  13. 13. Harrods SOA Vision Progress to date… <ul><ul><li>SCV go-live Monday, 24th April 2006 </li></ul></ul><ul><ul><li>Core SOA Architecture, Q3 2006 </li></ul></ul><ul><ul><li>Harrods multi-channel Customer Insight Implemented, Q4 2006 </li></ul></ul><ul><ul><li>Harrods multi-channel Merchandise Insight Implemented, Q2 2007 </li></ul></ul><ul><ul><li>Single Customer View is a pre-step to a robust multi-channel retail CRM architecture… “Having a database of customer records is just data, having a clean and accurate database of customer records is INFORMATION ” </li></ul></ul>
  14. 14. Harrods SOA Vision Phase 1: Single Customer View 2
  15. 15. Harrods SOA Vision Today… <ul><li>Customer Databases </li></ul><ul><ul><li>Multiple incompatible data sources </li></ul></ul><ul><ul><li>Duplication of records </li></ul></ul><ul><ul><li>No sharing of information </li></ul></ul><ul><ul><li>Inability to recognize the customer at different touch points </li></ul></ul><ul><ul><li>No contact management, campaign history or analysis </li></ul></ul><ul><li>Marketing </li></ul><ul><ul><li>No coordinated contact strategy across channels. Best customers are bombarded with marketing offers </li></ul></ul><ul><ul><li>Store Credit Card database is primary source for marketing programs </li></ul></ul><ul><ul><li>No data available to encourage cross-sell/channel shopping </li></ul></ul><ul><ul><li>Little campaign analysis </li></ul></ul>IN-STORE INTERNET CALL CENTRE Mary Jones H Card: 6653225 Tel: 020 363 2689 SW1 Mary Jones H Card: 6653225 Tel: 020 785 4456 W2 Mary Smith H Card: 6653225 Tel: 020 756 8754 W2 SITUATION WITHOUT SINGLE CUSTOMER VIEW Who is Mary Smith? Mary Smith CUSTOMER PERCEPTION ACROSS CHANNELS IN-STORE INTERNET CALL CENTRE
  16. 16. Harrods SOA Vision Tomorrow… <ul><li>Marketing </li></ul><ul><ul><li>Unified brand experience across all touch points </li></ul></ul><ul><ul><li>Concentrate marketing resources on best customers </li></ul></ul><ul><ul><li>Target customers with personalized offers through multiple channels </li></ul></ul><ul><ul><li>In-Store, Direct Mail, Web, TM </li></ul></ul><ul><ul><li>Customer segmentation and modelling </li></ul></ul><ul><ul><li>Understanding of cross department sales to motivate cross-sell </li></ul></ul><ul><ul><li>Closed-loop analysis and continuous optimization </li></ul></ul><ul><ul><ul><li>Ability to measure campaign ROI </li></ul></ul></ul><ul><ul><ul><li>Test, learn and refine </li></ul></ul></ul>IN-STORE INTERNET CALL CENTRE Mary Jones H Card: 6653225 Tel: 020 363 2689 SW1 Mary Jones H Card: 6653225 Tel: 020 363 2689 SW1 Mary Jones H Card: 6653225 Tel: 020 363 2689 SW1 SITUATION WITH SINGLE CUSTOMER VIEW Who is Mary Smith? Mary Smith CUSTOMER PERCEPTION ACROSS CHANNELS IN-STORE INTERNET CALL CENTRE
  17. 17. Harrods SOA Vision Harrods SOA/SCV Integration Architecture USPS eView SAP BAPI eWay SQL Server eWay Oracle eWay X-Ref DB Customer Master DB Reference Files Standardise Match Survive Business Rules SAP DB SAS DB CSS DB Distribute & Synchronise Address Cleansing and Validation Service PAF The Sun Java TM Composite Application Platform Suite (Java CAPS) CAPSCAN Different Silos
  18. 18. Harrods SOA Vision Phase 2: Harrods Customer Insight 3
  19. 19. Harrods SOA Vision <ul><li>Main Issues/Opportunities </li></ul><ul><ul><li>Lack of a consistent or coordinated customer contact / relationship strategy across our directorates and channels </li></ul></ul><ul><ul><li>The primary source of data for marketing campaigns comes from our Store Card database. </li></ul></ul><ul><ul><li>There is very little campaign analysis or rigorous pre-launch campaign planning and no data is available to encourage department cross-sell or cross-channel shopping. </li></ul></ul><ul><ul><li>Traditional operating frameworks for merchandise pricing strategy, range planning and forecasting that limit our competitive advantage. </li></ul></ul>Harrods Business Insight Customer Insight • Single Customer View • Campaign Management • • • Basket Analysis Customer Insight • Single Customer View • Campaign Management • Contact Management • Segmentation • Basket Analysis Merchandise Insight • Merchandise Planning • Assortment Planning • Revenue Optimisation Merchandise Insight • Merchandise Planning • Assortment Planning • Revenue Optimisation Performance Insight • • Profitability Analysis • Forecasting & Planning Performance Insight • KPI Dashboard / • Profitability Analysis • Forecasting Operational Insight • Data Warehousing • OLAP Reporting • Loss Prevention • Fraud Analysis Operational Insight • Data Warehousing • OLAP Reporting • Loss Prevention • Fraud Analysis Business Insight Scorecard Business Insight
  20. 20. Harrods SOA Vision <ul><li>Customer Relationship Management </li></ul><ul><ul><li>“ CRM is the business strategy that aims to understand, anticipate, manage and personalize the needs of an organization's current and potential customers” </li></ul></ul><ul><ul><li>Who are our best customers? </li></ul></ul><ul><ul><li>What can we do to ensure they are retained? </li></ul></ul><ul><ul><li>How can similar customers be attracted? </li></ul></ul><ul><ul><li>How can the overall customer profitability be improved? </li></ul></ul><ul><ul><li>How can the right customers be targeted at the right time with the most appealing merchandise / marketing strategy? </li></ul></ul><ul><li>Goals and Objectives </li></ul><ul><ul><li>To provide Harrods with an ‘Operational’ CRM solution that enables the alignment of departmental strategies that will communicate a consistent message and brand experience across all customer touch points. </li></ul></ul>
  21. 21. Harrods SOA Vision Summary & Recommendations <ul><li>Check whether SOA is the right solution for your business requirements… Take into account the cost you spend every year redeveloping interfaces, how difficult is to maintain a point-to-point multi-channel solution or to manage your systems landscape, and what are your business missed opportunities by not having a flexible architecture </li></ul><ul><li>Align your future SOA projects with the business requirements to build the IT proposal with SOA </li></ul><ul><li>Once your are convinced about SOA, get your business to buy into SOA to reach financial support </li></ul><ul><li>Choose the right SOA solution according to its technical capabilities (openness , based on standards, good performance, good management capabilities, good development environment, flexibility), supported by a reliable supplier with a long term vision </li></ul>
  22. 22. David Llamas IT Director Harrods Ltd +44 (0) 77 6020 3152 [email_address] www.harrods.com