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Is Tesco driving its suppliers’ IT spend?

September 30, 2009 Categories: IT Boom Hunter
IT Boomhunter

Retailing giant Tesco has, according to the Harvard Business Review’s John Quelch, ”taken the lead in promoting its  [corporate responsibility] Sustainable Consumption Initiative, now being copied by Wal-Mart.”

In an article highlighting that CR programmes are not just surviving, but thriving, in a recession Quelch says that  Tesco “plans to require carbon footprint information to be placed on the label of every product sold in its stores.” He ties this back to the trend that shoes a growng segment of consumers worldwide considers CR evaluations important in selecting among brands across a wide range of categories.

Terry Leahy, Tesco’s CEO, wants to make it easy for consumers to incorporate environmental impact criteria in their purchasing. As he says: “To achieve a mass movement in green consumption is to empower everyone, not just the enlightened or the affluent.” Corporations cannot change the world on their own. They need to empower their customers to help change the world for themselves.”

For all of Tesco’s major suppliers, this must be a hell of an ask.  They are effectively demanding CR measurements and focus back up their supply chain. For those suppliers, these demands can surely only only be met by using actionable using data driven from IT systems. Certainly to accurately measure carbon footprint across product lines going foward will require IT support. This resonates with my earlier post this month that revealed CIO’s challenges for 2010 and beyond, that many CIOs are heavily focused on interrogating data to support decision-making. If you can help Tesco’s suppliers out with this challenge right now, you’re well placed.

No comments | Posted by Lindsay Willott

A tale of two retailers

July 1, 2009 Categories: Building a lead generation engine

The impact of differing IT investment strategies was apparent this week in the difference between comments made by the House of Fraser and ASOS (As Seen on Screen).

In an interview with House of Fraser’s IT Director, Computing reported that established players are too far in to their old systems to change: “We have made such a big investment in our core platforms, so I cannot see us moving away from them,” said their IT Director.

“Nowadays it is not about wholesale replacement anymore, but about maximising and consolidating what you have. We have spent a lot of time and money on our systems over the past couple of years and it is now time to sweat the assets ­ and that is not a bad thing,”

“You can understand why financial trading needs to be at the sharp end of technology, but retail is all about consistency of delivery, operability and cost of ownership.”

“We never used to allow people to access the internet, but when we moved to the new building we provided everyone with web access, with some simple rules to protect us and the staff,” said Gray.

The rules mean that sites such as Facebook, Twitter and YouTube are banned and can only be used by the e-commerce team.

Does this bricks-and-mortar based organisation feel a little constrained, maybe even a bit backward-looking in its strategy? Certainly it feels as though House of Fraser could talk more about what IT can contribute to customer loyalty, or selling a wider product range… With the demise of many high street players in the recession, embracing technology’s role in engaging with customers makes more sense than ever.

This compared with Computing’s report on the role IT has played in ASOS’s astonishing success.

“The company reported a 92 per cent profit increase to £14.1m compared with £7.3m in the previous year. Sales also rose to £165.4m from £81m reported in 2008.”

A major back-office overhaul has supported the Asos’ positive performance. The programme covered buying, merchandising and fulfilment, with the rollout of a new warehouse management system at the firm’s Hemel Hempstead warehouse.

“Use of social media was also one of the highlights for the firm over the past year, with official pages being set up on Facebook, MySpace and Bebo.

With Twitter, the firm used a different approach, by allocating 55 staff members to actively talk to customers in addition to providing real-time news, offers and service updates. As a result, Asos now claims to have the largest Twitter following of all UK retailers.

Another initiative in social networking is the launch of Asos Life, a platform which allows customers to talk to each other and key people within the firm.

“It is clear that the structural shift to online continues and I believe that Asos is ideally placed to exploit it,” said chief executive Nick Robertson.”

No comments | Posted by Lindsay Willott