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Infosys enables a large Electronics Retailer realize its vision ‘buy anywhere, pick up anywhere, return anywhere’

Overview Country/ Region: USA Industry: Electronics retailer Customer Profile Retailer and manufacturer for the greeting cards industry in US. The company also has a major market share in retailing gifts and flowers. Business Situation The Client experienced several issues with its legacy Warehouse Management System (WMS) on the process, system and resource fronts. The Solution Infosys implemented an intelligent and efficient solution by leveraging possible functionality of Sterling Commerce and customizing around it to achieve the required results. The Benefit Client experienced increased profitability by reduction in shipping cost ,eased capacity constraint by zone shipping (ground order),achieved inventory optimization and fulfill order based on shipping distance optimization.

In a highly competitive and dynamic market place, supply chain operations and processes of retailers must adapt to allow for greater flexibility and more efficient execution. In order to target the more profitable multi channel customer, a retailer needs to leverage its inventory across multiple fulfillment locations, enable the efficient coordination of activities across the extended supply chain and provide the customer a single face regardless of systems and channels. The case study discusses how Infosys enabled a large specialty electronics retailer transform its order management processes to efficiently manage these complex fulfillment and delivery challenges while providing its multi channel customer with a consistent experience and high levels of service.

The Challenge
The client is a Fortune 100 company and North America’s number-one specialty retailer of consumer electronics, personal computers, entertainment software and appliances with annual revenues totaling well over $32 billion. The client operates close to 1000 retail stores; it also deals through commercial websites, catalogs and business partners. The client was looking at building a technology platform that will not only increase the existing business volume but also add more channels to reach their customers. With increasing sales and multiple channels in the direct to consumer business that contributes nearly $5 billion in revenue, orchestrating the order entry, fulfillment and delivery becomes a complex process. The direct channel order has an order volume of 15, 000 orders per day with over 1 million SKUs and 20 DCs in the fulfillment network. The existing processes and systems posed the following challenges: • Disparate order management systems leading to inconsistent order information and tracking • Lack of enterprise-wide and supply chainwide visibility due to lack of integration • Inefficient order fulfillment process leading to lower order fill rates • Lack of a common order management framework which prevented leveraging of existing systems and capabilities • Lacked flexibility to support future growth due to changing business scenarios such as enhanced payment handling, digital discount handling and legal compliance • Inefficient fraud handling leading to higher order cancellation rate • The internet business suffered from performance issues and stability

The Solution
The transformation of the existing system to a modern, multi channel order management system required a combination of strong direct to consumer business domain understanding, technology focus and best of breed order management package (Sterling SCM, formerly known as Yantra) knowledge. Infosys engaged in this initiative based on past credentials and experience in implementing such solutions at other large retailers. Infosys helped in developing a solution based on the Sterling Order Management System and by leveraging existing systems and capabilities. This solution • Enabled “Buy Anywhere, Return Anywhere” functionality by managing all the sales and fulfillment channels seamlessly thus improving and unifying the overall customer experience • Improved overall supply chain communication, coordination and collaboration which helped in increased order and inventory visibility. This was achieved by real time integrations with internal and external partners through efficient integration of order and inventory processes • Facilitated multi step distributed fulfillment processes by efficient leverage of inventory across all channels. This included coordinated product fulfillment from distribution centers (multi hop from vendors), stores and in store pick up • Enabled customer centric processes by providing customers a seamless buying experience and more realistic promises to guests by providing real time availability (ATP) by leveraging existing systems • Addressed issues and enhanced capabilities around legal compliance, tax and discount calculations, handling of multiple payment options • Improved fraud analysis capability and usability • Proposed best of the breed technology solution which is scalable and support future business growth

Program Snapshot
The program was executed over a period of 2 years, involving implementation of Sterling distributed order management and usage of technologies such as Websphere, Java, JSP, PL/ SQL and XML. It also involved major functional and technical upgrade of Sterling distributed order management thus impacting 15 major systems and close to 75 interfaces. The risks associated with these changes were handled through extensive application of tried and tested upgrade methodology, detailed integration environment preparation, performance testing and several mock launches. The program required migration of 15 million order and shipments with minimal production downtime. The program effort was approximately 300 person months. Infosys effectively leveraged the Global Delivery Model to deliver a high quality, rapid deployment solution to the client.

The Benefits
The client was able to achieve significant benefits from this customer centric solution developed using industry best practices and best of breed technology stacks. The solution helped improve the overall customer experience by realizing the vision of - “Buy Anywhere, Pick up Anywhere, Return Anywhere”. The benefits include -

• The Infosys multi channel solution to enable multiple payment options for online consumers helped the client improve order conversion rates, increased the target audience buying online (teenagers and people uncomfortable about using credit cards online), and improved margins (lower transaction costs associated with gift cards, increase in more profitable multi channel shopper). The estimated increase in revenues due to this implementation was around $50 Million • The client, one of the largest online fraud targets has been able to leverage the Infosys developed fraud solution to improve fraud detection rates, reduce fraud processing times and decrease the rate of unverifiable order cancellations. This has led to a direct impact to the bottom line by $20 Million annually • Increase in order fill rate from 65 % to 95 % within three months of implementing the solution, due to better leveraging of inventory across multiple sales channels, more efficient sourcing decisions and better integration of systems with partners. This reduced order transaction costs and improved customer satisfaction • Re-modeled fraud analysis process resulted in reduction of transaction and order processing costs through • Reduction in charge backs to credit cards • Automation and prioritization of fraud review process • Reduction in customer care calls • More efficient processing of fraud analysis - from 29 clicks to 3 clicks • Improved supply chain visibility leading to real time order status tracking thus improving the customer experience and more efficient order processing (quicker order turnarounds, lower transaction costs) • Reduced total cost of ownership through development of a common reusable ordering infrastructure based on best of breed technology and frameworks.

About Infosys
Infosys provides its clients with business and technology consulting services that deliver measurable business value to help you build tomorrow’s enterprise. Through a well-integrated end-to-end range of consulting, technology, engineering and outsourcing, Infosys clients derive the business value they’ve always been requiring from enterprise transformations. Our extensive research teams, including the award-winning SET Labs, ensure Infosys solutions are always cutting-edge and relevant. Our high investment in training - over 10,000 graduates a year pass through our Mysore campus, the world’s largest corporate university - ensures our people stay best-in-class. Infosys (NASDAQ:INFY) also believes in giving back to the communities with scholarships, libraries, schools, and many other Šelds through the Infosys Foundation.

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© 2011 Infosys Technologies Limited, Bangalore, India. Infosys believes the information in this publication is accurate as of its publication date; such information is subject to change without notice. Infosys acknowledges the proprietary rights of the trademarks and product names of other companies mentioned in this document.