Retail giant Marks & Spencer (M&S) has recently announced a seven per cent drop in sales of certain product ranges, partly due to the persistent rain that has been keeping shoppers away from the high street.
While most CIOs target reduced operating costs, or increased productivity, the chief aim for M&S’s Darrell Stein is to increase sales through technology.
“My main target is to increase sales, so it’s more about sales generation than cost saving. I’m supporting Marks & Spencer’s ambitions to become the leading multi-channel international retailer,” he tells Computing, but admits that his second priority is to ensure that costs are as low as possible.
His third target is to evolve the IT department, which has previously focused on the delivery of large programmes, into a team charged with delivering smaller, more innovative projects.
However, that is not to say that big IT programmes are finished at the retailer. Stein has overseen the implementation of new enterprise resource planning (ERP) and point-of-sale (PoS) systems in recent years, while a new bespoke HR labour-scheduling system from payroll management software provider Ceridian is currently being delivered. On top of that, he is also implementing supply-chain management software from JDA in his buying department for general merchandise, in an attempt to improve availability of certain products in store.
“We want to get more of what the customers want, when they want it,” he says.
In line with Stein’s principal objective, improving availability is expected to drive targets of a five per cent uplift in food sales and seven per cent in “general merchandise”.
Bringing online in-house
One of Stein’s more interesting projects is to migrate M&S’s entire online platform from its current host, Amazon, to an in-house solution, which is slated to go live in the first quarter of 2014.
And it is more than just the website at stake - it is also the order-management systems and in-store applications.
Stein explains that the decision to move was down to several strategic drivers, including the fact that Amazon, as a competitor, should not be such a key business partner.
“We went live with Amazon in 2007,” says Stein. “The M&S site is a veneer on top of the Amazon code. The site has helped to grow our business from $200-300m per year to close to $1bn per year, but it’s not great for innovation.”
He adds that when new online products – or even small coding changes – are required on the site, the process is sometimes delayed because Amazon might not want to make the change, or might be slower to implement the request than the business would like.
“Amazon is a competitor,” says Stein. “So when all the technology you’re basing your business on is owned by the competition, you’re not in a very sound position strategically.”