Just seven months after Boots completed its £7 billion merger with Alliance Unichem on 31 July 2006, the combined company became the target of a private equity bid. Alliance Boots’ deputy chairman Stefano Pessina, along with private equity giant Kohlberg Kravis Roberts, first launched a £10 billion offer to buy the retail and pharmaceutical wholesale company in March.
When CIO 100 spoke to Rob Fraser, IT director of Alliance Boots’ health and beauty division (formerly Boots the Chemist), the bid had only just emerged and he was understandably reluctant to provide details about its IT strategy.
What he could say was that Alliance Boots’ IT division has achieved a great deal over the past 12 months. In particular, the retail and wholesale group had restructured its outsourcing agreement “to be fit for purpose post transformation,” says Fraser, referring to the completed implementation of technologies, including electronic point of sale and pharmacy systems.
Part of this restructuring involved Alliance Boots bringing back inhouse some front line IT services from IBM last spring. The returning employees are responsible for central IT functions, including the IT help desk, service management, electronic point of sale software development and support, batch scheduling and business analysis – all functions previously carried out by IBM.
Alliance Boots continues to use IBM for telecommunications, applications development – such as for the Advantage Card kiosks – datacentre management and till maintenance until 2012. It also has a long-term contract with IT services supplier Xansa, which has an offshore unit in India.
Over the next 12 months, Alliance Boots plans to replace its existing Advantage Point terminals with 1,000 new kiosks in stores. The kiosks “provide one-to-one marketing” to customers, says Fraser, who is one of three IT directors at Alliance Boots. Simon Liebling is IT director of community pharmacy, while Anthony Roberts is IT director of wholesale and commercial affairs.