Astech wins ‘Retail Outsourcing Project of the Year’ at 2005 National Outsourcing Awards
23 Nov 05
Astech Consultants Limited, a leading independent supplier of business application consultancy and managed support services to the European retail industry, has won ‘Retail Outsourcing Project of the Year’ at the 2005 National Outsourcing Awards. The award is in recognition of Astech’s outstanding level of service in the provision of remote IT support for the Thresher Group’s central IT systems. Achievements to date include anticipated savings in comparable contract costs over five years in excess of 25%, improvements in hardware disk capacity utilisation avoiding £100k hardware costs and a reduction in management resource devoted to MMS™ and E3™ from 80% to approximately 10%.The Thresher Group has historically adopted a strategy to outsource all business applications, hardware and related support services. In January 2004, Peter Baxter, IT Services Manager for the Thresher Group, embarked on a search to find an appropriate partner to provide remote support for MMS™ and E3™, the Group’s core merchandising and warehouse replenishment systems[1].
Peter Baxter explains: “Our commitment to outsourcing reflects a determination that everyone at Thresher should be focused on achieving our core objectives as a retailer rather than tied up with technical back office and overhead administration. We can achieve this by leveraging the skills, expertise and resources of external suppliers who can also provide us with a more flexible service delivery environment than would be possible internally.”
The Thresher Group had three core objectives:
(1) Reduce signifcantly the amount of management time consumed in supporting MMS™ and E3™; in January 2004, the IT department was spending three quarters of its time managing contractors supporting these applications that accounted for only one eighth of the IT department’s budget;
(2) Reduce the cost of IT support by replacing expensive contractors with a more cost effective outsourced supplier that can look after day to day activity and take a holistic view of possible future requirements to ensue that the service remains inline with the business needs.
(3) Appoint a supplier with commitment and proven ability to work with other service providers who manage and deliver other critical systems for Thresher.
As Peter Baxter explains,Thresher reviewed a wide range of prospective Tier 1 to Tier 3 suppliers but were unable to find anyone with an ideal match to the company’s requirements.“Tier 1 players had plenty of pedigree but not JDA application experience. Tier 1 quality also comes with Tier 1 costs. Smaller suppliers had the application experience but a company of Thresher’s stature and size needed more confidence in their commercial robustness.”
Aware that this process was ongoing, Astech Consultants, an existing application development partner at Thresher, convinced Peter Baxter that Astech could deliver a business model for the provision of support services that would meet Thresher’s cost expectations and build on Astech’s very extensive and detailed knowledge of the business and its core applications. A detailed specification was drawn up by Thresher in partnership with Astech defining response times and service delivery levels and Astech made some specific recommendations on how the applications should be streamlined in order to make the provision of support more effective.
Rob Green, Store Compliance Analyst at Thresher with responsibility for stock traceability and the reconciling of stock differences within the store network, is delighted with the improvement in service levels since Astech’s appointment: “Service levels have much improved in terms of the level of information we receive, the speed of feedback and the quality of the response. In the past a query could be open for six months with no feedback. Today I am kept much more in the loop as to where a query is and who’s dealing with it, and, when it’s resolved, what the original problem was.
Peter Baxter concludes: “Danny Turner, Astech’s Managing Director, was pivotal in bringing this contract to fruition. It makes a change when the MD of the supplier is an enthusiast for your own applications, is not scared to be candid when providing advice on how best to utilise them, and clearly wants the agreement to work well financially for both parties.”
[1] Developed by retail specialist JDA, MMS encompasses inventory control and procurement, vendor, price and promotion management, financial control and merchandise receiving, allocation and replenishment whilst E3 integrates everyday replenishment requirements with logistical distribution and promotional management.
