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Coles Myer - the sharing, caring approachBy Adam TurnerMarch 6 00Next Retail giant Coles Myer will look to its IT operations as it cuts the fat out of its supply chain within a strategic review to be unveiled today.New chief executive John Fletcher plans to integrate Coles Myers supply chains over the next two years at what analysts estimate will cost more than $150 million.Coles Myer is Australias biggest private-sector employer, with more than 160,000 employees on its books. The group includes the Coles supermarket chain, Myer, Grace Bros, Target, Kmart, Officeworks and Harris Technologies.Fletcher, known for his background in the transport and logistics field as chief executive of Brambles, took over the reins as Coles Myer chief executive on September 10 last year. His first move was a program to reduce head office costs and re-engineer the buying functions, labelled Operation Right Now. It is supposed to produce savings of $0 million by 004.Coles Myer is a large purchaser of IT services and software.

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Working closely with PricewaterhouseCoopers, Coles Myer deploys software from German business software company SAP across the business as its core financial package. Target, Kmart and Grace Bros run JDA Software Group tools, Kmart uses software from US publisher i, and various legacy systems are in place throughout the group.Coles Myers entire business is already heavily automated through the use of industry standard barcoding technology for stock control and inventory management.There are considerable savings to be made by organisations such as Coles Myer through supply chain management (SCM), according to Richard Gerner, SAPs SCM business development manager and founder of the Supply Chain Councils Australian and New Zealand chapter.Even back in the late 10s, it was recognised through research in the US that companies who were considered best-in-class supply chain managers were spending around 6 per cent of revenue less on supply chain management than the average company, says Gerner.SAPs position is that we feel very confident that the fully integrated approach has massive efficiencies.Early returns on investment is the key to a successful supply chain restructure, says i Australias business development director Alec McQueen.The days of these two-year-long implementations are gone; CIOs and boards in general get very nervous when these very long implementations occur when they dont see any tangible benefit coming out of it, says McQueen.We encourage our clients at all costs to be analysing the value of the solutions that theyre implementing first and then identify and go after the highest-value opportunity in order to be able to use the time and money theyve got to be able to leverage the most value. That is unlikely to be a grand roll out of an enormous, overarching solution.Businesses are encouraged to break down the solution implementation into bite-sized chunks called business releases, which individually return value to the company. Retailers often focus on optimising their discounting strategy as their first business release, says McQueen.They start with that as a priority because they feel that those tools give them the best returns very quickly. The results have been exceptionally good, as they are able to manage and reduce their overall markdown budgets and save money that goes directly to the bottom line.One of the latest advances in the field, which Coles Myer may choose to implement, is the concept of Supply Chain Visibility. It enables each member of a supply chain to monitor other members in real time and quickly alerts them to problems elsewhere within the supply chain that will affect them.In my view, at the moment a lot of companies are nibbling at the edges of Supply Chain Visibility, says McQueen.I think that the time is right, the time for collaboration is coming now, especially in the retail sector. The technology is now scalable in order to be able to provide the back-up support to be able to do the type of collaboration that is required between a retailer and a supplier.Companies will have to overcome their fears of others prying into their IT systems if Supply Chain Visibility is to be embraced, says RMIT lecturer and logistics and supply chain management consultant Kerry Hammond.Thats the biggest deterrent to supply chain management - that people dont trust it. They think others can see into their system, which is not really true, says Hammond.This whole sense of sharing information is, in some sense, baring your soul - but, if you dont, the alternative might be that you dont have a business.Coles Myer declined to speak to Next before the release of its strategic review. Coles Myer - the sharing, caring approachBy Adam TurnerMarch 6 00Next Retail giant Coles Myer will look to its IT operations as it cuts the fat out of its supply chain within a strategic review to be unveiled today.New chief executive John Fletcher plans to integrate Coles Myers supply chains over the next two years at what analysts estimate will cost more than $150 million.Coles Myer is Australias biggest private-sector employer, with more than 160,000 employees on its books. The group includes the Coles supermarket chain, Myer, Grace Bros, Target, Kmart, Officeworks and Harris Technologies.Fletcher, known for his background in the transport and logistics field as chief executive of Brambles, took over the reins as Coles Myer chief executive on September 10 last year. His first move was a program to reduce head office costs and re-engineer the buying functions, labelled Operation Right Now. It is supposed to produce savings of $0 million by 004.Coles Myer is a large purchaser of IT services and software.

Working closely with PricewaterhouseCoopers, Coles Myer deploys software from German business software company SAP across the business as its core financial package. Target, Kmart and Grace Bros run JDA Software Group tools, Kmart uses software from US publisher i, and various legacy systems are in place throughout the group.Coles Myers entire business is already heavily automated through the use of industry standard barcoding technology for stock control and inventory management.There are considerable savings to be made by organisations such as Coles Myer through supply chain management (SCM), according to Richard Gerner, SAPs SCM business development manager and founder of the Supply Chain Councils Australian and New Zealand chapter.Even back in the late 10s, it was recognised through research in the US that companies who were considered best-in-class supply chain managers were spending around 6 per cent of revenue less on supply chain management than the average company, says Gerner.SAPs position is that we feel very confident that the fully integrated approach has massive efficiencies.Early returns on investment is the key to a successful supply chain restructure, says i Australias business development director Alec McQueen.The days of these two-year-long implementations are gone; CIOs and boards in general get very nervous when these very long implementations occur when they dont see any tangible benefit coming out of it, says McQueen.We encourage our clients at all costs to be analysing the value of the solutions that theyre implementing first and then identify and go after the highest-value opportunity in order to be able to use the time and money theyve got to be able to leverage the most value. That is unlikely to be a grand roll out of an enormous, overarching solution.Businesses are encouraged to break down the solution implementation into bite-sized chunks called business releases, which individually return value to the company. Retailers often focus on optimising their discounting strategy as their first business release, says McQueen.They start with that as a priority because they feel that those tools give them the best returns very quickly. The results have been exceptionally good, as they are able to manage and reduce their overall markdown budgets and save money that goes directly to the bottom line.One of the latest advances in the field, which Coles Myer may choose to implement, is the concept of Supply Chain Visibility. It enables each member of a supply chain to monitor other members in real time and quickly alerts them to problems elsewhere within the supply chain that will affect them.In my view, at the moment a lot of companies are nibbling at the edges of Supply Chain Visibility, says McQueen.I think that the time is right, the time for collaboration is coming now, especially in the retail sector. The technology is now scalable in order to be able to provide the back-up support to be able to do the type of collaboration that is required between a retailer and a supplier.Companies will have to overcome their fears of others prying into their IT systems if Supply Chain Visibility is to be embraced, says RMIT lecturer and logistics and supply chain management consultant Kerry Hammond.Thats the biggest deterrent to supply chain management - that people dont trust it. They think others can see into their system, which is not really true, says Hammond.This whole sense of sharing information is, in some sense, baring your soul - but, if you dont, the alternative might be that you dont have a business.Coles Myer declined to speak to Next before the release of its strategic review.

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