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Smart Retail: Spencer’s food chain upgrades its telecom set-up

September 30, 2011
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Part of the RPG Group, Spencer’s Retail Limited (SRL) is a multi-format food-first retailer. It was founded in 1863 and is headquartered in Kolkata.

The retail major runs more than 200 stores (including nearly 30 large-format stores) across 35 cities in India, employing more than 7,000 people.

The chain offers customers both fresh and packaged food, as well as groceries. SRL also stocks electronics and electrical equipment, home and office essentials, garments and fashion accessories, toys and personal care products.

With a growing presence in the Indian retail space, SRL decided to upgrade its communications set-up to give itself a competitive edge. The company took steps to introduce technological advancements and upgrade its communications network. These initiatives were aimed at keeping pace with business demands, improving network connectivity, streamlining information flow and enhancing productivity.

tele.net takes a look at the development of SRL’s telecom infrastructure…

Legacy system

SRL was formed as a result of the merger of three companies under the RPG Group’s umbrella. Before the merger, these three companies had their individual communications infrastructure. All three operated independently of each other and ran on different technology platforms.

However, as business grew, the company felt the need to build an IT infrastructure that would facilitate efficient and contemporary work practices and improved workflow.

The shift

After SRL was formed, the company implemented an enterprise resource planning system (ERP), which delivered a single, unified database that contained all the data for various software modules pertaining to functions such as project management, materials management, financials, merchandising management, etc. The package also contained several modules that simplified SRL’s processes and made the supply chain more transparent.

Today, the company’s communications backbone comprises an MPLS-VPN network with bandwidth ranging from 64 kbps to 2 Mbps. This backbone, provided by Bharat Sanchar Nigam Limited (BSNL), connects 250 of the retail major’s locations.

A few locations are connected via radio frequency (RF) connectors, and where a wired copper connection is unavailable or where the location is of particular significance, the RF connection is provided as an additional one.

For last mile access technologies, the retail major uses multiple mediums such as DSL, optic fibre and wireless connectivity, primarily in the form of RF and Wi-Fi.

Its DSL, optic fibre and wireless medium set-ups are being provided by BSNL, while RailTel and TCL supply its wireless connectivity mediums. The company’s communications infrastructure was implemented both in-house and by external sources.

A host of enterprise applications are being used by SRL. These include web-based mediums that support applications like customer relationship management (CRM) and the company’s vendor portal, video- and audioconferencing that is available at nine locations, email and SAP Reporting. Mobility applications such as mobile email and mobile data connectivity are also being used.

SRL makes use of a data centre too. The data centre has more than 15 TB of storage capacity and houses the company’s SAP and web servers. The functions of the data centre include ensuring quality power supply and an air-conditioned humidity-controlled environment with a physical access control mechanism.

SRL uses co-location services in its data centre. These services are provided by Tata Communications. The company also has a disaster recovery data centre in place, hosted by Tata Communications.

Besides ERP, a number of software applications are used. These include business intelligence, CRM and supply chain management.

Security is a key priority for the retail major. To this end, it uses a host of security mediums such as access logs, security audits, user authentication, firewalls, proxy servers, penetration testing and operating system security patches.

The disaster recovery centre helps achieve redundancy. SRL also uses managed services, which has helped the company reduce costs, focus on its core competencies and manage systems better, as well as increase its service levels.

Challenges and benefits

Though the company did not face any major challenges while setting up its communications infrastructure, it was selective about adopting new technology solutions. Since the costs can be prohibitive at times, the IT team weighed the cost of these solutions against the benefits they would offer before deciding on investments. Identifying the appropriate technology partner can also be a challenge. Hence, the internal team followed stringent processes while selecting partners for such deployments.

While the centralised deployment of core applications has resulted in easier and more effective management, the robust communications platform has ensured application accessibility and a quality user experience across all outlets.

Moreover, the adoption of modern communications solutions has improved information access for internal users, thereby helping the decision-making process and improving the responsiveness to business challenges.

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