John Lewis will spend £500m on IT in the next five years, says Coby
John Lewis has put aside £500m to spend on IT over the next five years, a sum that demonstrates just how firmly embedded IT has become at what was once a rather staid department store chain.
At the helm of its IT operation is Paul Coby, who is five years into his role as IT director. Coby, who's been a prominent IT leader since November 2000 when he was appointed CIO of British Airways, began our interview by emphasising the importance he places on having a good working relationship with his IT suppliers.
While many IT leaders have told Computing how hard it is to work with the likes of Oracle, SAP and IBM - with licensing issues being the biggest complaint - Coby says that John Lewis has a "good working relationship" with Oracle.
"We have Oracle's e-commerce platform, which we put in in 2013, and we are in the process of upgrading that to a new version. We've also successfully put in Endeca, which is Oracle's search and navigation tool," says Coby.
The relationship has developed as John Lewis's e-commerce offering has grown, to a point now where it accounts for about one-third of the company's £4.5bn turnover.
So what's the secret to dealing with Oracle?
"One of the things we've been very careful to do is build a genuinely strategic relationship with Oracle. That means that my colleagues on the board and my boss [John Lewis CEO] Andy Street are planning to meet the top people at Oracle to discuss how we can develop the relationship," he says.
And this is no different to the way John Lewis deals with other key suppliers, such as Cognizant and Tata Consultancy Services (TCS).
"Working with suppliers always has its issues but I think it's about trying to align the overall relationship in a positive way. A big, strategic relationship with a third party has to be set up so that both sides find it beneficial, so that when you do encounter problems you can get them resolved, and I think that's what we try to do," Coby explains.
An increasing proportion of John Lewis's IT investment is going towards supporting and improving its online opperations, Coby says.
"I think six or seven years ago the online business accounted for only 15 per cent of our turnover. Now it has grown to one third. It is my job to make sure that continues to grow and to do that you need a strategy and a substantial investment in IT.
"We are investing, subject to affordability of course, about £100m on IT every year in the next five years, which is a very substantial commitment and a very substantial slice of our available capex investment," he says.
While third-party partnerships and investment are both key, Coby believes that the company must retain control of its technology, systems and platforms.
But is it then tempted, as Marks & Spencer was, to build its own e-commerce platform or, indeed, to switch to Amazon Web Services?
"We're not trying to do everything ourselves in-house and we're absolutely open to cloud services," says Coby.
The company has, for example, rolled out Google Apps for collaboration and email, and uses Salesforce as its CRM tool. But Coby isn't convinced cloud is the way to go for its e-commerce platform.
"I think there are things that we use the Oracle e-commerce platform for that are just not cloud-ready. We know we are pretty much pushing some of the limits with volume and availability [on the platform], particularly when we get to Black Friday and Christmas peak - but that is something that isn't ready yet in our judgment to go to the cloud," he says.
An attraction to DevOps
Coby is not the kind of IT leader to jump on a technology bandwagon just because of the hype that surrounds it. But DevOps is something that he is hopeful that John Lewis can embed into its IT team in the near future. He admits that the company is a a bit of a novice when it comes to DevOps, but adds that it is rolling out more agile development for its online and mobile platforms.
"We do release cycles every four weeks and have various agile teams working towards that," he says.
He says the company has "dipped its toes in the water" in terms of integrating its operations people with its agile teams, he adds that more progress in this front will happen over time.
"Clearly, the ability to turn up development environments and be able to release seamlessly onto your own environments is extremely attractive. So I wouldn't claim that we are in any sense mature in this, but we are certainly interested in it - and I know my operations team is excited by the possibility of it," he says.
Coby says his developers are also on board, but adds that both the Devs and Ops sides need careful management during the transition.
"For all of these things you have to be very disciplined to do them effectively; one of the great myths about agile is that it breaks down all of the barriers. It does enable you to be flexible but requires great self-discipline and an ability for people to manage different capabilities, and as you extend it to DevOps, it offers you fantastic opportunities but you have to do it in a very disciplined way," he says.
The firm wants to bring in expertise to develop its agile and DevOps capabilities, but Coby doesn't believe that these skills should be completely outsourced, or indeed that they should all be held in-house. Instead, he hopes to have the best of both.
"What we do know is, if you do these things properly there are things you need to own and there are things you need to ensure you get the best of what is available, but it is very important that the culture and the business objectives of your organisation are taken into account," he says.
And DevOps isn't the only area where John Lewis is keen to recruit. Coby says the much-talked about skills gaps in cyber security and big data are certainly real, and are areas the company finds it especially challenging to recruit for.
But he believes that the pool of "partners" that John Lewis employs has made this less of a burden. "Fortunately we've increased our [IT] partner numbers from 270 when I joined to about 550, and the plan is to grow that to 600 over the next year or so," he says.