Real-Time Retail

Feature Article | January 24, 2013 by Iris Nagel-Martin & Andreas Horn

Foto: Fotolia

Photo: Fotolia

Business operations are becoming more and more complex these days, and a lot of the work is done digitally. This affects virtually everyone, from global conglomerates to small enterprises, across all industries. Most companies face the daunting task of managing large data volumes in the best possible way. They want to set up and use their software and hardware as quickly and cheaply as possible, as well as detect and counteract problems early on.

“Increasing consolidation and globalization, combined with the arrival of new players on the global market, have intensified competition in the retail sector. Consumers are becoming more price-sensitive and can now compare prices faster and more easily than ever before,” explains Stephan Sieber, managing director at SAP Switzerland.

SAP recognized the problem

Companies need processes that run in near real-time if they are to tackle these challenges and coordinate their business operations. “Modern software can help retail enterprises introduce efficient structures, exploit cost potentials, analyze business data more quickly, and make fast and more precise management decisions,” says Sieber.

Here’s an example from the fashion industry. Globus, a subsidiary of Swiss retail giant Migros, is preparing for the new winter season and has to plan accordingly: What budget is appropriate? How should it be distributed across the various store branches?

Next page: Results in 45 seconds instead of 20 minutes

A company sets its budget based on previous years’ figures. For example, how much did it buy in the same season last year and how much was actually sold? This kind of planning depends on enormous volumes of data and is therefore quite time-consuming.

With in-memory technology, it is possible to analyze large data volumes and at the same time, lower IT costs. SAP HANA is the evolution of this technology and can be used for a variety of purposes. For example, a retailer that relies on SAP NetWeaver Business Warehouse (BW) for its planning can bring data from existing SAP applications and external data sources together into one standard format. SAP NetWeaver BW helps users with data procurement, modeling, and business process analysis, plus it supports lifecycle management.

Results in 45 seconds instead of 20 minutes

The solution runs on a traditional disk-based database and requires a certain amount of time to call up data. Software that is based on an in-memory database, on the other hand, takes its data from the main memory of a PC. Because the access speed is higher in this case, the data can be evaluated much more quickly. So users can get their desired results in 45 seconds instead of 20 minutes. The SAP HANA in-memory database is the foundation for the Business Warehouse, and as such, the reason for the SAP NetWeaver BW affix “powered by SAP HANA”.

Companies can use SAP NetWeaver BW powered by SAP HANA to analyze their key operating figures, such as sales volume or revenue, according to product, store branch, or time period. Real-time queries returning up-to-date business data help users cover the demands of the various company departments and thus play an important role in the decision-making process. The user interface has not changed and users do not need any special training.

Next page: Reducing storage requirements lowers costs

Migros is Switzerland’s largest retailer, with 627 stores. It was one of the first companies worldwide to switch its data warehouse to real-time computing with SAP HANA. Employees at its subsidiary Magazine zum Globus AG (Globus) have been using SAP NetWeaver BW since 2010 to control its entire range of products, the stocking of all stores in Switzerland, and much more.

Nonetheless, 37 department stores, an assortment of 800,000 articles, and a network of 3,500 suppliers generate an enormous volume of data. And that volume continues to grow.

Reducing storage requirements lowers costs

Globus used to store 550 GB of data in its data warehouse. Thanks to the SAP HANA compression method, that number has gone down to only 60 GB, a ninth of the original size. “This is important, because the less memory we need, the lower our licensing fees and maintenance costs,” reveals Alexander Weiss, head of processes and BW at Migros IT Services. Globus doesn’t just use SAP HANA to speed up frequently needed information; it also saves all its data from SAP NetWeaver BW in the in-memory appliance. As a result, queries and even forecasts that call up archive data are now faster than ever.

The challenge was to complete the implementation between February and May 2012, because the next planning period was already scheduled for June. “We decided to go all out and revamp the entire system. Just to be on the safe side, though, we kept our old installation running in the meanwhile,” says Weiss. Collaboration with partners like SAP, IBM, and Retail Solutions Inc. enabled Globus to launch the new system just eleven weeks after the hardware was delivered.

About Globus:
Magazine zum Globus AG (Globus) is a Swiss department store company with 14 department stores and 23 menswear stores in Switzerland. The chain became part of the Migros Group in 1997. In 2011, it achieved sales of 803 million Swiss francs. This makes it one of the leading department stores in Switzerland.

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