ICT321 Architecture and Systems Integration Assignment 1 Case Study: RetailCo’s $1 Billion Business Transformation RetailCo is one of the two largest players in the Australian retail market. In 2001, RetailCo was increasingly threatened by its key rival. The existing IT systems had evolved over time within individual parts of the business and were impeding its ability to rapidly respond to competitors. For example, RetailCo’s rival had modernized its merchandising and store replenishment systems and, in the words of a senior RetailCo manager, “was using these to devastating effect.” The biggest impact was felt in RetailCo’s largest business unit – its Supermarkets division – where low margins and high volumes required the ability to compete on price and have the correct stock levels in stores at all times. The competitor’s more sophisticated platform gave it a substantial advantage in both of these areas. “You could go into the competitor’s supermarket and get ‘two for the price of one’ or tier-type pricing. They used this to devastating effect to us. Our legacy systems couldn’t do it.” IT Strategy Manager “Once you have automated store replenishment, you know that the stock is going to be there. Being out of stock on just a few key items makes a huge difference. People stop coming back, and once they have drifted away, they don’t come back again.” IT Strategy Manager Many of RetailCo’s core business systems were aging, some being more than two decades old. The platform contained about 600 applications with extensive duplication. Lack of integration between different business units’ applications hindered company-wide initiatives. Although an EA function did exist, it had little influence on, and visibility of, business unit initiatives. Most of the IT investment and implementation choices were made at divisional and project levels. Limited central control over technology selection made efficient procurement challenging. “The vendors were dividing and conquering. Whether the contract was for hardware, for software or for systems integration, the relationships were held individually with all the different silos. Were we getting the best deal? Of course not.” CIO A new CEO was appointed in late 2001. His top priority was to improve RetailCo’s competitive position. A few months later, in March 2002, he announced a new strategic plan for doubling RetailCo’s financial performance within five years. The key focus areas included instilling a sense of “one team,” cost reduction and a continuous business - improvement program (including merchandising process integration, supply-chain optimization and shared services). The planned transformation, which the CEO acknowledged would be “no walk in the park,” depended heavily on a major overhaul of the IT platform, and a new CIO was hired in late 2002 to lead the technology delivery. His brief was to raise RetailCo’s aging platform up to world’s best practice. This marked the beginning of one of the largest IT-enabled business transformations undertaken in the Australian retail sector. Page 3 of 8 ICT321 Architecture and Systems Integration Assignment 1 Over the course of its five- year delivery timeframe, the change program impacted more than 150,000 employees across six key business units (Supermarkets, Fuel, Hardware, Clothing, Office Products and Department Stores) and cost RetailCo about $1.2 billion. Despite the complexity, pace and scope, most of the 120+ enabling IT projects were completed on time and to budget, delivering reduced costs and improved integration within and across the business units. The transformation’s ambitious key financial goal of doubling profits within five years was successfully met. RetailCo’s EA team played a critical role in the success of the transformation, both in defining the vision for RetailCo’s new digital platform and in guiding the organization on the journey toward that vision. The team took a year to renew RetailCo’s EA capabilities and to develop the EA principles, vision and roadmap. The result of the EA planning process included: • An overview of RetailCo’s existing platform (left panel in Figure 2) • A vision for the new platform as the transformation outcome (right panel in Figure 2) A set of guiding EA principles for the transformation was also reported: 1. Shift from a business-unit focus to a process focus 2. Simplify the IT platform 3. Consolidate and renew IT 4. Buy not build 5. Adopt a two-vendor policy 6. Be transparent and accountable 7. The project manager is king During the period, the technologies available to meet organizational IT needs have evolved considerably since then, shaped by trends such as data analytics, cloud-based services, social media and mobile devices. These trends have had a profound impact on the building blocks of EA, including the available enterprise applications and how these applications can be delivered. However, the fundamental challenges of EA and large-scale business transformations remain unchanged: making choices about the right systems to best support an organization’s strategies, deciding how to best fit these together, determining the appropriate Page 4 of 8 ICT321 Architecture and Systems Integration Assignment 1 level of organization-wide sharing of systems and managing the sequencing and dependencies among the many interrelated projects to deliver the new digital platform. End of Case Study For more details about this case study, please refer to the original article. • Tamm, T, Seddon, P, Shanks, G, Reynolds, P, & Frampton, K 2015, ‘How an Australian Retailer Enabled Business Transformation through Enterprise Architecture’, MIS Quarterly Executive, vol. 14, no. 4, pp. 181-193. URL: http://misqe.org/ojs2/index.php/misqe/article/view/665 Assignment Task Assume you are a member of the EA team, and needs to apply Enterprise Information Architecture Reference Architecture to provide an information centric solution to achieve the vision shown in Figure 2. Your target audience is executive business people, who have extensive business experience but limited computing knowledge. Unfortunately, you have to complete this task in a short period (< 4 weeks), without any direct information source from the business body. The design you provide will mainly depend on your experience, understanding, and vision about information system. However, you are free to design and include any functional and non-functional components that you feel important in RetailCo’s case. Keep in mind that there are no correct or wrong answers in the design as long as they are reasonably explained. The following outline is recommended for the assignment. A complete marking sheet is attached at the end of this document. Title Major Outcomes 1 Introduction 2 Conceptual Architecture System Context Diagram * 1 (10 marks) Architecture Overview Diagram * 1 (10 marks) 3 Logical Architecture Logical Architecture View Diagram * 1 (10 marks) 4 Component Model Component Relationship Diagram * 1 (10 marks) Component Interaction Diagrams * 1 (10 marks) 5 Operational Model Logical Operational Model Diagram * 2 (10 marks each) 6 Conclusion The content of the assignment mainly consists of a set of diagrams and clear explanations for them, following the templates provided by EIA RA. Templates for each type of diagram can be found in the textbook. You need to customize the templates to include or exclude elements to reflect your thought and design. Chapter 9 of the textbook provides a good example of applying Enterprise Information Architecture Reference Architecture. We will also practice the usage of EIA RA in tutorials. Page 5 of 8 ICT321 Architecture and Systems Integration Assignment 1 Report Format Your report should be no less than 2,000 words and it would be best to be no longer than 3,000 words long. The report MUST be formatted using the following guidelines: • Paragraph text – 12 point Calibri single line spacing • Headings – Arial in an appropriate type size • Margins – 2.5cm on all margins • Header – Report title • Footer – page number (including the word “Page”) • Page numbering – roman numerals (i, ii, iii, iv) up to and including the Table of Contents, restart numbering using conventional numerals (1, 2, 3, 4) from the first page after the Table of Contents. • Title Page – Must not contain headers or footers. Include your name as the report’s author. • The report is to be created as a single Microsoft Word document (version 2007, 2010, 2013 or Office 365). No other format is acceptable and doing so will result in the deduction of marks. Please follow the conventions detailed in: Summers, J. & Smith, B., 2014, Communication Skills Handbook, 4th Ed, Wiley, Australia. Referencing The report is to include (at least 5) appropriate references and these references should follow the Harvard method of referencing. Note that ALL references should be from journal articles, conference papers, technical papers or a recognized expert in the field. DO NOT use Wikipedia as a reference. The use of unqualified references will result in the deduction of marks. End of Assignment 1