Retail giant Kingfisher to rollout SAP Business Suite on HANA

European retail giant, Kingfisher, is in the process of consolidating a mess of systems and applications into one centralised SAP Business Suite on HANA platform, which it hopes will drive revenues and cut an array of costs.

Computerworld UKspoke to Kingfisher’s CIO, Mike Bell, at SAP’s annual customer and partner event in Orlando this week, where he said that HANA is a game changer for the company and will allow it to finally get a single view of its product and supply chain data – something it has not been able to do previously.

SAP’s HANA allows companies to run both transactions and analytics in-memory, which provides great performance improvements and near real-time results.

Bell explained that Kingfisher’s systems environment was typical of a retailer in Europe, where it has grown through acquisition and accumulated a mesh of applications that were connected via numerous interfaces, which resulted in the company not having a consistent view of products and suppliers.

“It’s very difficult when you’ve got different systems, you can’t codify anything, and you can’t join it all together. We wanted common systems, common processes, common products, common ways of working, which will give us efficiency, margin, cash, ease,” said Bell.

“When I came into the business I had nine companies in six countries and all bar one had a form of SAP, some of it twelve years old, one of my systems had 5,500 modifications – the history of a mess. That’s the history of retail. If you go and look at Tesco’s architecture in the UK, it’s scary.”

He added: “Do we need nine different accounting systems? Do we need nine different category systems? Nine different coding systems? If we could get an idea about what we sell and what we need to sell in the future, then I can actually buy better, I can help my suppliers to do their planning better, I can carry less stock, I can get the stock on the shelf when the customer needs it. But doing that is a massive, massive issue.”

Kingfisher began engaging with SAP in June last year, where it started with what SAP calls a ‘design thinking process’. Bell, his team and SAP locked themselves in a room for a few days, assessed the company’s business problems, opportunities, and discussed how technology could be used as a solution.

This process ended with a prototype – not a technical one, but a solution that could be put to the business about how HANA could be used to solve the problem of complexity.

“Design thinking is almost structured blue sky. So we went through that process and identified a few things we could do to make money, where we were around procurement and sourcing. This is a big thing for us – getting commonality,” said Bell.

“I wanted to know every product I’ve bought for the last seven years, know the cost of that at every point of purchase, know the delivery performance of the supplier at every point of purchase, know every supplier that supplied it to me, know every customer sale – seven years of history, every time a product has been sold in every shop in my business. So we actually built a prototype to prove that HANA and this concept could work, but the scale and complexity of this prototype is amazing.”

He added: “If I can get the schedule right, I will be ordering less stock, dead stock in the water. We looked at that and the numbers are impressive, and we did that for only two of our businesses. We built it in 10 weeks and the amount of data is immense. The proof of concept proved that HANA as a platform will work.”

The prototype was put in place to test HANA as a platform, rather than test the applications. Bell was enthusiastic about the results and said that HANA is “fantastic” and will enable Kingfisher to carry out processes that before it thought would be technically impossible.

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