Since joining Halfords as CIO in March 2013, Anna Barsby (pictured) has faced significant business challenges, including a risky cloud upgrade and taking on the task of digitising front-facing customer technology.
Speaking to Computer Weekly, Barsby said Halford's SAP system is the backbone of what the retailer uses, but an upgrade was long overdue, with it being implemented more than 10 years ago.
“We hold all our transactional data from our stores on there,” she explains, saying it interacts with its Manhattan warehouse management system, as well as its customer relationship management (CRM) system.
And an upgrade of this size undoubtedly came with risk.
“There’s complexity running a programme and upgrading SAP, which is pretty much at the heart of our system estate,” she says.
“And it was our first move into the cloud at the same time. Going into the cloud with anything has its unknowns, but with SAP as our first foray it just felt risky.
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“Culture was a really big one for us,” she adds. “Once agreed on HP, we decided we also wanted to move from a physical server to the cloud.”
Barsby says while the move to the cloud increased risk, the retailer only needed one period of downtime to complete the upgrade.
And, so far, the five-year HP contract has gone without a hitch. It started the programme in September 2013 and HP delivered fully in May 2014, and has since had a period running live with no problems.
Barsby says the cloud option gives Halfords the flexibility to ramp up during peak retail times, such as Christmas.
HP’s Helion cloud provides Halfords with 24/7 operations, management and monitoring of its SAP systems, as well as flexible and cost-effective infrastructure.
“And it’s a fully managed service,” says Barsby. “We’re not interested in what’s in the cloud or on servers – just that it’s a managed service from our side.”
Scale and flexibility
Barsby says scale and flexibility of its applications is also very important. Halfords, which has more than 12,000 employees and generated revenues in excess of £870 million in 2013, is moving to modularise its applications, rather than having one big system.
“We want to put in an integration layer, so we’re not having the situation where we have a massive change freeze,” she says.
Being able to swap capabilities in and out quickly is the direction SAP seems to be going, adds Barsby, who says this helps with becoming a multi-channel retailer.
She says the introduction of all the new channels has been tricky because some of Halford’s systems were implemented before commerce solutions became so sophisticated.
According to Barsby, it’s difficult to future proof with so many advancements.
“Our store system was put in before the web channel became sophisticated,” she says.
Halfords' physical stores are its USP
While Halfords knows it needs to embrace multichannel, Barsby says the retailer’s stores are its USP.
While customers may research online, they are still very likely to come to store to pick up a new bike or come in to help get a car accessory fitted.
“We’re a specialist retailer,” she says. “We give advice and guidance and we’re service-led – we can build your bike for you. So there are lots of reasons to come into Halfords, and we’re very different from an Argos, which is trying to find the most efficient way of peddling boxes out of the store.
“It’s tricky – the industry is getting to the point where every retailer is realising what their blend is themselves. Digital transformation has become business strategy – but the blend of online, digital and bricks and mortar is different for each type of business.”
Barsby rates Halfords’ multi-channel business at an eight out of 10. “We rebranded and relaunched our website this year,” she says, noting how its different products are bought in different ways.
She says people who buy car accessories, a kid’s bike or a child seat don’t tend to buy them at the same time or as part of the same consumer journey.
“With a car part you want an efficient journey, but with a bike purchase you’re far more likely to browse,” she says. “You have to understand the different journeys.”
Barsby explains the best outcome of the SAP upgrade is it enabled delivery to stores five days a week, when it used to only be weekly.
“We couldn’t do it from a technology point of view – because the overnight batch processing was taking so many hours in the old infrastructure, we had to do it over a period of a couple of days, but we’ve cut that by 10 hours and we’re able to do it in a couple of hours overnight,” she says.
She adds this has enabled the retailer to provide a quicker click-and-collect service, which is a huge part of the retail business, with 92% of orders placed online collected in store.
But the other challenge of the multi-channel trend is having a single view of stock: “It’s always the nirvana,” she says. “I didn’t realise when I first came into retail what a challenge that is. And now with a new channel it’s harder than it used to be.”
The future of digital transformation at Halfords
Barsby says gaining this single view is on the roadmap for 2015. Meanwhile, the retailer is playing around with the likes of quick response (QR) codes, but concentrating on fixing the basics and making sure the network and infrastructure is robust.
We’re fixing the basics as well as looking at more fun stuff, like putting tablets in every store to help with the extended range so a customer in store can see the extra 100,000 product lines online
“We’re fixing the basics as well as looking at more fun stuff, like putting tablets in every store to help with the extended range so a customer in store can see the extra 100,000 product lines online.
“We’re trying to do some more customer front-end digital stuff,” she adds. “But you’re not able to do digital without back end.”
Barsby says the key thing is to try and balance the technology transformation while delivering all the business projects that need to drive and grow the business. She says Halfords has a relatively new executive and commercial and supply chain director, and her challenge is to enable them to move their areas forward.
“I’m trying to minimise saying no,” she says. “And that’s getting less and less thankfully, because I don’t like saying it.”
But she says people in Halfords have been very understanding and know how much IT has to do and the journey it is on. Currently, the IT team consists of around 80 permanent staff and another 20 contractors.
“We’re all in it together,” she says. “We used to have a separate department but we’ve moved the tech and web development into IT.”
Barsby says IT wasn’t strong enough in the past to tackle digital on top of everything else, yet trading, IT and digital shouldn’t be a be a separate function. “We all do digital now,” she adds.
And Halfords is about halfway through its digital and technology transformation.
“In the end, I want our customers to be saying things like, ‘I can see and access online's extended range in store’ and ‘ordering is straightforward’, but what do we do to get the business in that place?”