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Live from IMPACT – Multi-channel retailing on SOA

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Erik Klein from the WebSphere Commerce group at IBM and Scott Young from a consultant. Erik started by discussing the inhibitors to moving to multi-channel and customer-centric. These include:

  • Siloed business units
  • Applications that don’t integrate or support multi-channel operations
  • Redundant data in multiple systems, no single version of the truth

The different domains – web, store and enterprise – tend to have their own problems and opportunities. Yet cross-channel shopping is picking up with 22% offline sales influenced by websites, 55% of online buyers who sometimes buy offline despite doing their research online and 45% of those who buy online and pick up in store buy additional items. Need therefore to create a single brand experience while allowing them to shop how they like and create an integrated process.

Order capture, order processing and order fulfill (from in-store inventory) must all be integrated to merge web and store shopping. So, online, you need to be able to find nearby stores, search their inventory, manage the order through to fulfillment in the store and ultimately supporting reverse logistics and returns. IBM’s approach seems to revolve around an Order Hub or DOM (Distributed Order Model).

Erik tried to match SOA and how it delivers thing to business drivers. Personally I think SOA enables things like a focus on customer satisfaction, streamlining operations, cost control, adaptability and business user empowerment. It is not, however, enough to deliver customer satisfaction or adaptability or business user empowerment. I think you need decision services too as services build using traditional approaches are still not really adaptable or suitable for business users to change, unlike rules-driven decision services.

IBM sees WebSphere Commerce as a service-oriented platform for this kind of thing with lots of elements exposed as composable services. The Retail Integration Framework pulls together various retail systems with WebSphere and supplies examples, best practices, links to a partner ecosystem. He listed some best practices:

  • Start small
  • Delight Customers
  • Drive store traffic by integration to allow in-store pickup and return
  • Tie in-store operations and POS to order management
  • Ensure you can support all your channels

Scott Young then discussed Tractor Supply Company – the largest operator of retail farm stores with 764 stores in 43 states. Focused on recreational framers and ranchers and those who like rural life. Typical products include livestock products, maintenance products and hardware, work clothing etc. $2.3Bn.

Tractor Supply had some implementation goals – attracting, retaining, growing and converting customers. Wanted to extend their brand online and have a consistent commerce experience across the web, call centers and stores. Scott went through the various phases they had identified and the success of it. Tractor Supply were keen to bring their brand online but this meant extending their order fulfillment processes and signing up a fulfillment vendor to support individual shipment, updating their order management system etc. It is not just about the website. The ecosystem includes SAP for order management, Product Information Management, Store operations, the e-commerce platform and various third party systems such as shippers and logistics companies. It is this complexity that makes SOA such a good fit, especially in terms of adopting an Enterprise Service Bus (ESB) to link the necessary services. He showed the integration between WebSphere Commerce and SAP to illustrate the number of touch points. Each integration has lots of touch points.

He wrapped with some recommendations:

  • Adopt ESB and other middleware patterns as part of the platform for SOA
  • Apply SOA best practices at integration points to minimize future interface changes
  • Make external sources stick to industry standards where they exist
  • Use XML messages with validating schemas
  • Make sure the Enterprise Architect is from the company, not the vendor

The multi-channel environment is one that often needs enterprise decision management or EDM. After all, as soon as you have complex pricing or returns policies or similar then shared decision services become critical.

The room is small, packed and hot!

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