Morrisons, the fourth biggest UK supermarket, has announced plans to overhaul its aging, bespoke IT estate. But it will avoid “leading edge” technology.
The company will £110-million investment package was part of its preliminary results revealed last Friday. It will fund the migration from 30-year-old, bespoke systems to packaged equivalents in-house, across a number of areas including its stores, warehouses, distribution, payroll and financial systems.
"We will not be seeking to implement any 'leading edge' technology, as we believe our competitive advantages come in other areas, such as in-store service," said Mark Bolland, Morrisons chief executive. He said it would not be needed, on the strength of other customer propositions including high levels of service.
The IT plans are part of a wider, £450m spending package to also overhaul Morrisons’ stores, warehouses and distribution centres. It also announced plans to reduce it carbon emissions, following the moves of Tesco and Marks & Spencers among others already this year.
Since acquiring a large chunk of the Safeway estate in March 2004, Morrisons has faced challenges integrating the more modern IT of its newer business. In switching off supply-chain IT in inherited warehouse depots two years' ago it admitted at the time it would revert to some manual processes.
This affected vehicle satellite tracking systems, Linux-based warehouse picking software and communication devices, as well as a system for tracking delivery times and what stock is sent to stores. The supermarket also cited the dual running cost of both supermarkets’ IT systems as part of the reason for issuing four profit warnings in the year after the Safeway deal was completed.