Tesco is to use new integration technology to re-use key, existing UK mainframe assets in its key entry into the US market next year.
The retailer’s current supply chain management system monitors and controls its entire in-store inventory. But Colin Cobain, Tesco group IT director told CIO UK the UK mainframe system for store ordering was essential to extend its global supply chain fulfilment footprint in other markets.
“In other countries, like Korea and Japan, we have established the bedrock – including tills system, back-office, core communications, financials and so on – now we need to go on and build on that with store ordering, space planning and merchandising, for example, to make sure what we’re delivering is constantly innovating to improve the customer offering,” said Cobain.
The US expansion, announced last month, served as a good point at which to develop the highly sophisticated, in-house UK store ordering system on more modern platforms across the rest of the world. The US had no legacy systems, said Cobain.
The move will also yield considerable savings for Tesco, as it will be able to use its existing servers and will be able to avoid investing in additional support for their international operations. The decision to extend the supply chain system also fits into the company’s strategic imperative to create a common Operating Model across its country operations.
“Elements of our common Operating Model are already in place and benefiting some of our businesses,” said Colin Cobain, group IT director at Tesco. “Micro Focus’ modernisation expertise is not only helping us maintain the momentum behind this strategic IT project, but is also playing a key role in the development of our United States presence. This project will help us meet our goal of opening our first store in 2007.”
Tesco will modernise and extend its unique Continuous Replenishment (CR) application to run on the latest IBM System p servers running AIX, in addition to its IBM System z mainframe running z/OS. Micro Focus software will be used to create a port for the COBOL-based CR application to AIX. This will allow Tesco to maintain a single source stream for both the mainframe and UNIX versions of the application, ensuring future enhancements to the UK-based high powered mainframe application are rolled out seamlessly to all international countries on the existing IBM System p servers in more cost-effectively.
In February 2006, following extensive consumer research, Tesco announced its plans to open stores in the US that will be modelled on its Express concept, which currently operates in five countries. The research indicated that the US grocery market is worth $600 billion (£310bn) a year and is expected to expand by 40% over the next five years.