Integrate expectations

Despite the difficulties retailers faced with early ERP implementations, the need to provide information to managers, buyers and merchandisers remains.

As retailers seek greater control over their businesses, most recognise that legacy systems and point solutions must be integrated if they are to make key performance indicators available across the enterprise.

As UK retail sales slow down, retailers need to know at an instant what margin they are earning on each product line. They will also need to quantify the performance of categories, stores, promotions and customer segments.

This is a challenge for retailers with a large legacy systems base. However, it can be relatively easy to start the process by automating a particular area of the business, which can then be the trigger for future developments.

Once an otherwise sceptical workforce sees what can be achieved, buy-in is more likely to happen. However, in the longer term, piecemeal implementations can have only a limited impact.

They can be replicated by competitors and divert attention from the goal: to work from the centre outwards.

The piecemeal approach can disguise the simple fact that, unless core systems are integrated, retailers will not have access to important data, and individual solutions cannot be fed with integrated data and will not generate integrated data.

The solution is to start to implement one of the fully integrated systems such as SAP or Retek, as most large retailers have already started to do.

And these solutions are not exclusive to large retailers; most software vendors have created a set of templates that contain processes common to most retailers so that they can get the benefits right away.

Early attempts to use such systems suffered from too much complexity due to poor software, poor implementations, high expectations and trying to do things too quickly.

However, the software is now much more robust, and the issues of implementation are better understood. Far more of these implementations are achieving success.

Retailers should plan to implement such an integrated solution. They should look at those that have done it and see the problems they have confronted and the real benefits they have achieved.

Chris Montagnon is a non-executive director at Novasoft UK.