Premier 100: Computerworld introduces 'Best in Class' awards for IT

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  • Burlington Coat Factory Warehouse Corp.

    Burlington Coat Factory Warehouse was looking for a new operating system so its stores could deploy new tools and redeploy existing applications and services to take advantage of a Web-based architecture. With an eye on saving money and building on its past success with Unix, the company chose Research Triangle Park, N.C.-based Red Hat Inc.'s Linux for its 250 stores and 1,250 systems.

    According to Michael Prince, vice president and CIO at the Burlington, N.J.-based company, the project was completed in a little more than four months. Linux is now deployed on the back end of all the company's stores and is slated to be expanded into front-end point-of-sale systems during the next few years.

    The move to Linux was a natural one, Prince said. "Linux is as much Unix as anything," he said. "A lot of our choice of Linux was really a choice of Unix over Windows."

    By choosing Linux over proprietary operating systems, the company saved money on licensing fees and made remote administration easier. Prince said he also likes the operating system's stability. "It's a very stable and efficient operating system. It doesn't crash," he said.

    "This is one place where Linux is beginning to shine in retail," said Dan Kusnetzky, an analyst at market research firm IDC in Framingham, Mass. "Burlington was one of the earliest examples, and we're seeing more of them now."
  • Corning Inc.

  • In the late 1990s, manufacturing operations at Corning's display technology division were aligned with customers on a regional level. The company's plant in Japan served Japanese customers; the U.S. plant served customers here. But when customers ordered more computer displays than ever before, company officials found their business model didn't scale.

    "We learned that our existing model just wasn't cutting it," said Corning CIO and Vice President Richard J. Fishburn. "[For display technologies], we needed to create a virtual factory."

    The Corning, N.Y.-based company continued to operate two melting lines in which the glass for displays is created. But after brainstorming sessions involving its operations people, Corning found ways of using its finishing lines -- where the raw glass is turned into displays -- more strategic by adding a supply chain module to its enterprise resource planning software from Pleasanton, Calif.-based PeopleSoft Inc.

    The project, which is still under way, is on schedule and under budget, Fishburn said. "It used to take us five days to do the planning for tomorrow's production. Now we can do it in an hour," he said.

    The bottom line: Better planning efficiency means that Corning doesn't have to build excess capacity, wastes less raw materials and can ship orders more efficiently.
  • FedEx Corp.

  • FedEx Corp. wanted to help customers navigate the fast-paced world of international trade. So Robert B. Carter, executive vice president and CIO at FedEx, set about developing FedEx Global Trade Manager, a free Web-based guide to international shipping for small and midsize companies.

    The project began in 1997 and launched in August 2000, on time and on budget. By designing its own system and integrating it into an Oracle Corp. database, Memphis-based FedEx was able to help customers understand global trade regulations, prepare import/export forms, learn about shipping restrictions or embargoes, and find out about special licensing requirements. Last month, the system added a tool that can be used to determine various charges and fees for shipments.

    "Global Trade Manager makes it easier to ship internationally, which can be an intimidating experience," said Carter.

    Now, 70,000 registered customers use the services, and that number is growing by 300% year over year. Without giving details, Carter called it "among the most profitable [projects] at FedEx."
  • Galactic Ltd.

  • Galactic IT Vice President Anthony Okrongly wanted to take the traditional employee suggestion box and use Web technology to automate and beef up a program that would allow clients' employees to better offer cost-saving or revenue-generating ideas through a company intranet.

    The solution: Arlington, Texas-based Galactic came up with Ideaworks, a program that quickly showed how it could save money. When the program was tested internally, for example, one employee showed how having all Galactic workers use the same kind of pen could save thousands of dollars.

    The Web version of the program went live for Galactic employees in March of last year, with Version 2 development outsourced to Bryte Software Design in Irving, Texas. The new version, unveiled in January, can handle up to 100,000 registered participants in up to a dozen client programs.

    Galactic makes money from Ideaworks through the administration and fulfillment of incentive awards for clients. Revenue for 2002, Okrongly said, is projected to be $20 million to $30 million, an anticipated return on investment of 2,000% to 3,000%.

    "This project exemplifies what many small companies will have to do in order to create value for their customers using the Web," said Philip Anderson, professor of entrepreneurship at INSEAD, an international business school in Fountainebleu Cedex, France. "The company is moving fast and can pick off some significant customers before competitors show up."
  • GFInet Inc.

  • GFInet had a problem. The New York-based online trading services company had an outdated infrastructure dating back to the 1980s that didn't allow customers to conduct online trades. That led to the company's FX Options project, aimed at enabling online currency trading via a virtual private network or the Internet.

    The options market "traditionally trades over the telephone," said CIO Russ Lewis. But creating a new channel for customers allowed GFInet, a subsidiary of brokerage services provider GFI Group Inc., to boost transaction volumes by as much as 30%.

    GFInet's online trading system is now "a state-of-the-art technology platform," Lewis said. It's being rolled out to bank trading rooms worldwide and to the company's brokerage desks in New York, London, Tokyo and Sydney. The Java-based system runs on an Oracle database and uses Los Altos, Calif.-based Talarian Corp.'s SmartSockets for messaging.

    GFInet is now "more of a one-stop shop" for financial services, said Andrew Koslow, chief operating officer at San Francisco-based brokerage firm The Financial Cafe.com. GFInet consolidated "different trading technology that you don't typically find among other providers all in one house," he said.
  • HON Industries Inc.

  • Another company looking to update legacy systems was HON Industries in Muscatine, Iowa. The company, a manufacturer of office furniture and fireplaces, often couldn't accurately measure the capacity of its own warehouses; on occasion, more products would be shipped to a company storage facility than it could handle.

    With that in mind, CIO and Vice President Malcolm C. Fields set out to create an optimized system that would cut distribution costs, improve the timeliness of shipments and reduce inventory. Despite obstacles including a company shakeup and employee resistance to change, the implementation team wrapped up the advance-planning and scheduling system in March 2001 at a cost of $2 million. Although the project was six months late, Fields said it has far exceeded expectations.

    How did HON Industries do it? By replacing mainframe code with software from SynQuest Inc., a Norcross, Ga.-based maker of supply chain management software. The SynQuest application allows HON to take a product order, factor in shipping and scheduling variables, then decide which factory can best build and ship the product.

    Although Fields wouldn't offer exact numbers, he said the new system lowered freight costs, improved scheduling accuracy and bumped the number of inventory turnovers from 16 to 19.
  • Lenox Collections

  • If you want to revamp your retail Web site, do you outsource the job or have your own employees do it? At Lenox Collections, Vice President of IT Bob Palmer turned to his in-house team of developers to figure out to improve online sales at LenoxCollections.com, provide customers with more information, update the site design and better align online products with other sales channels.

    A division of Lenox Inc., Langhorne, Pa.-based Lenox Collections makes fine china and collectibles. When Palmer decided to update the company's Web site, he first eyed big-budget Web portal software from Redwood City, Calif.-based BroadVision Inc. and IBM's WebSphere line. In the end, however, he let his team use San Francisco-based Macromedia Inc.'s off-the-shelf ColdFusion Web development tools.

    "If you have experienced, talented Web developers, and we have, then it's not difficult to do," he said. "You have to ask yourself: 'Do I want to bring in an army of consultants at $150 or $200 an hour when the organization has very talented Web developers who understand our business and cost less?' "

    Once the update was in place, Palmer found that as much as 70% of the software code could be used elsewhere by the company, including the site of England-based retailer Brooks and Bentley. More important for Palmer, the company saw a 115% sales increase in the fourth quarter of 2001, compared with the same quarter in 2000. Much of that was driven by a boosted browser-to-buyer conversion rate and the addition of new features.

    "The ROI comes when people use the site more and you complete more sales," said Palmer.
  • Staples Inc.

  • Shoppers at Staples already had the option of ordering merchandise from the company's Web site and paying for it with credit cards. But the Framingham, Mass.-based office supplier wanted to do more with its in-store kiosks: It wanted customers to be able to consolidate orders on the Web and in stores into one transaction they could pay for with cash, check or credit card at the cash register.

    Staples also wanted a custom-configuration system that customers could use to design their own PCs at the in-store kiosks and online, and built one using a configuration tool from Calico Commerce Inc. in San Jose.

    To pull off the project, Staples modified the Microsoft Commerce Server software that powers its site, its IBM AS/400-based custom-built order management system and its Windows NT-based point-of-sale system. According to Michael J. Ragunas, chief technology officer at Staples.com, the IT department also had to build capabilities into its back-office systems to reconcile orders and payments.

    Now, customers in any of Staples' 1,100 retail stores have access to 7,000 or 8,000 stocked items and 50,000 items offered through Staples.com. Staples has logged close to $4 million in sales per week on the kiosks and has eliminated its inventory of PCs in more than 200 stores, Ragunas said.

    The project has been good for business. "We know that customers who shop with us in multiple channels spend more with us overall -- 2.5 times [more] if two channels, 4.5 times if three," Ragunas said.

    "The fact that you can consolidate your purchases and choose multiple ways to make purchases in the store puts them a level ahead at this point," said Geri Spieler, an analyst at Stamford, Conn.-based Gartner Inc.
  • State Street Corp.

  • Wall Street trading systems may seem high-tech, but back-end processes required for trading are often a lot lower-tech than most people would think. Case in point: Traders who rely on service providers such as Boston-based State Street to do accounting, settlement and financial transfers frequently notify the providers of a trade by fax and with critical information missing. That led to lengthy delays for State Street on more than half of its settlements, according to John A. Fiore, the service provider's executive vice president and CIO.

    And it was expensive.

    The situation pushed the company to devise a financial transaction management system that automatically processes more than 80% of its requests by identifying the source of the fax and automatically plugging in whatever's missing from a database of information on traders. The system, which won't be fully in place until the first quarter of next year, was custom-coded in Java, using Oracle databases running on Sun Microsystems Inc. servers. It's tied to underlying systems with IBM's MQSeries message-oriented middleware for communications among applications.

    "Even in its early stages, it's showing tremendous business value, even though there are so far no metrics from the operations side of the house," Fiore said. "That it has come off as scheduled and we haven't had problems deploying it has been a tremendous plus for the IT organization."
  • Wesco Distribution Inc.

  • Wesco Distribution in Pittsburgh is one of the nation's biggest distributors of electrical products and maintenance, repair and operating supplies for large companies. The company stocks more than 140,000 items from hundreds of manufacturers and its customers order more than 900,000 products, many of them not in stock.

    Therein lies a problem. Until recently, when Wesco sales representatives got orders for out-of-stock items, they had to call manufacturers directly for a price or check various Web sites for pricing and availability. Although orders for out-of-stock items made up just 20% of Wesco's business, gathering information on those purchases took up to 40% of the sales force's time, said Russ Lambert, Wesco's director of e-commerce.

    That led Wesco to dock its logistics systems with those of its major suppliers, a difficult task, given the company's 20-year-old, proprietary systems. The solution was to build an Internet gateway with a common set of doorways allowing inbound and outbound paths to the old system. To integrate the various systems, Wesco used Austin, Texas-based Vignette Corp.'s content management software and San Jose-based BEA Systems Inc.'s WebLogic application server.

    Since the e-procurement system went live in June, Wesco's 1,000 salespeople in 400 locations have had direct access to finished goods inventory systems and can provide order information while a customer is still on the phone. That heads off lengthy phone calls, has increased the number of out-of-stock items sold and saves the salespeople time.

    Lambert estimated his company could save $12 million per year if the new system saves 1,000 salespeople just three hours a week. ROI, he said, has been a "slam-dunk."

    "It has been a great proof of concept about the power of direct linkage in the supply chain," he said.

Computerworld staff contributed to this report.

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Copyright © 2002 IDG Communications, Inc.

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