Case Study 2 - Retail Store Background:
Kasey Holding’s Ltd runs a chain of newsagents. Over the last 5 years, they have expanded and now have four sites in different districts of Bristol. Two of these were part of their original chain and share similar systems whilst the other two sites were bought from independent traders in the last 12 months. These have different systems ranging from an off the shelf newsagent application which provides all of the required functionality including stock management to the other extreme with very little computerisation.
They have very few computer problems but would like to get all of their shops on a centralised stock system. This will allow them to getter better control of buying as they can move stock between shops. They also have lottery terminals and ways of providing electronic top up for mobile phones.
All of the stock ordering for newspapers and magazines is controlled via an internet website and if this is not available, it can be very cumbersome to place orders.
Health check findings:
- The service support processes are not a priority as the company has very few issues and when they do, they seem to get by. The business partners want to focus on selling to their customers and not creating a mini IT department.
- The supplier base is very fragmented. They have a number of common contracts (such as the Lottery terminals, on-line stock ordering and the phone top up) but the other suppliers around internet access, administration packages, PC support and other peripherals seems to be fragmented. The key thing is that the company do not know what level of service they should expect.
- Whilst the company is aware of its risk points, no IT Continuity plans are in place. The key areas of importance seem to be stock ordering and stock management.
- The company is going through a growth phase and is looking to redefine its IT systems. This is a great opportunity to start looking at system design from the point of availability and capacity.
Recommendations:
Short Term
- All of the services used by each location should be listed in a spreadsheet and the site using each one notated next to the service name. This is the starting point of a “Service Catalogue”.
- For each service/site, the underpinning contracts should be reviewed and the key measurements for availability, support hours and any response/fix times should be clearly identified. This will start to clearly document what level of service should be expected and where multiple suppliers are providing similar services.
- Once this review of the “provided service” is carried out, they should create a new column against each service and record their “required service”.
Medium Term
Two distinct phases of work are now required;
Phase 1 – define a standard set of services used for each shop based on two criteria:
Criteria 1: Use the best mix and match solution from the current service’s and deploy this to all sites
Criteria 2: Create a standard solution for all sites using a fit for purpose application package
Phase 2 – Review the current support contracts and investigate new support contracts for both criteria. Where possible, try to standardise the support around a single supplier who will give discounts for the multiple sites and an additional discount for each new site introduced. Once this groundwork has been completed, create a final report showing the capital and revenue costs for each option.
When carrying out this exercise, the systems should be reviewed considering both capacity issues (to ensure that if the business continues to expand, they have the ability to put this solution into the new sites) and availability requirements (i.e. deciding whether they want to focus on “reliability” or “recoverability”). You may wish to consider reducing the cost of support contracts by allowing certain processes (such as stock ordering) to be carried out from any site. This could reduce a PC support requirement from an 8hr fix down to a 2-day fix.
Once the final requirements are made and agreed upon, the new service should be taken up and a clear set of “Service Level Agreements” documented.
Long Term
At this stage, Kasey Holdings Ltd should have
- Standardised their services which now fit around their business strategy
- Reduced their support cost's
- Have a clearer understanding of their support contracts
With this in place, the business partners can now decide whether to focus on the service support processes (for example start to implement release management to continue their IT service strategy) or to consider investigating their IT Service Continuity plans. This decision will need to be taken based upon the initial view that they are retailers and do not want to be side tracked with mini IT issues and processes.