January is so depressing. Back at work we are left to contemplate the excesses of December, together with the mountain of work we put off doing last year because we would feel so much more refreshed after a ‘break’. Hmmm. So let’s start the New Year with some technology success stories to put us in a positive mood, rather than worrying about the overdraft and whether we will ever see the sun again.
As we’ve just had the traditional festive retail blowout, let’s talk about IT success stories in retail. Analysts predicted that retailers would have had a good Christmas sales period, in spite of recent interest rate rises. In the past, technology has had profound effect on sales, as we saw from the disastrous supply chain system at Sainsbury and the difficulties Morrison Supermarkets had in integrating its systems when it acquired Safeway.
But we are talking about beating the January blues with success stories here so Asda, Marks & Spencer, The Co-op, a revitalised Sainsbury and of course Tesco all deserve a mention.
Asda says it has boosted the sale of its own brand goods by £6.8 million because it upgraded its supply chain software and cut four weeks off the time to market. Sainsbury, having sorted out its rubbish supply chain systems, has seen its market share increase and The Co-op has integrated two separate IT teams into a single organisation, as well as consolidating systems from its financial services arm and group operations.
While the amazing turnaround fostered by Stuart Rose at Marks & Spencer, which reported a 32 per cent rise in half year profits last September, can’t be entirely claimed by IT, the fact that it has just topped a poll of user-friendly websites and poached Darren Stein, formerly of Vodafone, to head up its IT department, speaks volumes about the seriousness with which it has linked an effective IT strategy with long-term success.
But the IT daddy of them all is still Tesco, which as well as accounting for two thirds of all online grocery sales, is using technology to push the limits on its business intelligence and supply chains. It’s using the stuff to sell to its own customers, with Microsoft supplying PCs and software, as well as IP phones and internet connections. See, I’m cheering up already.
Back on track
Outside of retail, there are some notable IT success stories. Those organisations that adopt a strategic, grown-up business approach to IT are reaping the benefits. Take Network Rail, which announced its first profits since it took over from Railtrack in 2002 at the end of the year. It has cut £1 billion in costs and made a £747m profit in its last six months. At the end of 2005 we profiled the ailing not for profit organisation and predicted that the way technology was being used there would be a key ingredient in its revival.
A five-year IT strategy and business intelligence plan and a new IM team, aligned with the business, was installed. Back in November 2002 there were more projects than people at Railtrack but it is now totally focused on the business. In 2002 it didn’t even know what it was spending on IT but after the reorganisation it had a tight hold on what was going on, a much better relationship with the business and is now in profit. Then there are the likes of BA, which has enjoyed a well chronicled major turnaround, enabled by its use of technology and it is thundering towards the Terminal 5 project, where its use of strategic and tactical technologies will raise the bar yet again.
It goes without saying that internet-based companies like Amazon, eBay and Google, rely on their strong technical strategies to keep them at the top of their business games. But there is a major common denominator at all these successful companies. The key to technology successfully enabling businesses has to be the people who manage it, the CIOs. So hats off to those in charge of IT throughout the land.
Technology is finally getting the business recognition that it deserves and demonstrating that an integrated, effective IT and business strategy delivers bottom-line success.
There, that should have cheered you up. Happy New Year.