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Mobile telepresence trims costs for major Malaysian retailer

AvantiKumar | July 31, 2012
In a highly-competitive, low-margin retail environment, quick action often spells the difference between success and failure, said the IT director of Malaysian retail organisation Mydin.

Malik Murad Ali IT Director, Mydin Mohamed Holdings Berhad

PHOTO - Malik Murad Ali IT director, Mydin Mohamed Holdings

The urgent need to be able to make faster informed decisions led Malaysian retail organisation Mydin Mohamed Holdings (Mydin) to choose a real-time telepresence solution from US-based conferencing solutions provider Vidyo, said Malik Murad Ali, Mydin's IT director.

"In a highly-competitive, low-margin retail environment, quick action often spells the difference between success and failure," said Malik. "For an enterprise like us with stores dispersed across multiple locations, there was an even greater need for a collaborative tool that improves internal communications and enables timely, effective communication to facilitate decision-making. Furthermore, we had to foster better internal communications, due to exponential growth in Malaysia."

This steep growth was driven by two factors, he said. "First, rising inflation and food prices pushed more Malaysians toward the company's generically branded, cost-conscious lines of food, household items, soft goods and hard goods. Second, Mydin was selected by the Malaysian government to manage the stores of its new Kedai Rakyat 1Malaysia initiative, a programme championed by Malaysia's prime minister, Datuk Seri Najib Tun Razak, as a way to provide basic necessities at low prices. 1Malaysia allows low-income citizens to afford items such as rice, cooking oil, milk powder and diapers.

"We have grown from 4,000 employees in 2007 to 10,000 employees in 2012 and needed a telepresence solution that could work reliably and seamlessly across a range of devices," said Malik. "This would in turn, enabled us to get more personal with each other and collaborate at a faster pace."

Such collaboration would help make better and faster decisions, he said. "We started looking for a telepresence solution, three years ago, in 2009. Vidyo's solution was a natural fit for Mydin with its multi-platform functionality that delivers high-quality telepresence while integrating with existing devices. In essence, it could integrate into existing infrastructure, without expensive additions that were required by other telepresence systems."

Incorporated in 1991, retail organisation Mydin Mohamed Holdings has 100 outlets nationwide, which includes 10 hypermarkets, 18 emporiums, three bazaars, 54 mini markets (MyMydin), nine convenient stores (MyMart) and six franchise outlets (Mydin Mart).

 Mobile, cost effective

Given the nature of the business, cost was a great determinant in the deployment of the telepresence solution, Malik said. "Other telepresence solutions required an initial investment of at least one million Ringgit [US$315,060] per telepresence room and would be only confined to one telepresence room per branch.  We have 100 stores across Malaysia! Vidyo only required us to invest RM 200,000 [US$63,044] as a startup to collaborate with 100 stores across Malaysia and we could instantly use it on our personal devices such as the mobile phone and laptop, rather than be confined to one room."

"When Mydin determined that slow internal communications - as a result of a growing workforce geographically dispersed - could be improved, we immediately recognised how our solutions could resolve their communications issues," said Vidyo senior vice president, market development, Marty Hollander. "Our current telepresence solutions enable Mydin to speed up its communications and decision-making processes by providing real-time visual feedback beyond calls, e-mails and messaging." 

"Vidyo's Adaptive Vidyo Layering (AVL) architecture enables telepresence-quality multipoint video conference that runs on off-the-shelf hardware, such as tablets, smartphones and desktops, over everyday networks, including the Internet, LTE [long term evolution], 3G and 4G," said Hollander. "We make this available at a fraction of the cost of conventional telepresence systems." 

"Immediate benefits included enhanced real-time collaboration between staff, which has raised our quality standards with the accelerated decision-making during the course of the day's business," said Mydin's Malik. "VidyoMobile, for instance, allows operations managers to share visual information that enhances quality control across all of Mydin's stores, while our procurers travelling abroad use VidyoMobile to show managers back home what potential new products look like and their unique selling points, leading to wiser, faster purchasing decisions."

"Vidyo has essentially provided our managers and executives virtual, real-time access to any corner of the company's operations, while on-the-go," said Malik. "It has also expanded the bandwidth of our employees to successfully manage a larger number of geographically distributed stores, driving growth and sales. We previously launched one store opening per month; now, by collaborating faster internally with Vidyo's solutions to take on the strong consumer demand, we are able to launch up to 14 store openings per month."

Another welcome benefit is the saving of business costs and time, he added. Business costs have been trimmed tremendously since the implementation of Vidyo's solutions.  With the option of our employees joining meetings on VidyoConferencing room systems, desktops, laptops or tablets from wherever they happen to be, travel costs and associated downtime have been greatly reduced."

"In one critical meeting with important partners in Hyderabad, where required Mydin executives were unable to attend in person, half-day meetings over a course of three days were conducted, using the HD100 VidyoRoom system in Kuala Lumpur and a regular laptop running VidyoDesktop in Hyderabad," said Malik. "The meetings were successful and the communication was excellent, resulting in a 100 percent return on our investment in Vidyo solutions from that very first meeting alone."

Before and after

Malik said that though company started looking for the right telepresence solution in July 2009, the suggestion to check out Vidyo came from one his close friends. "Within the first trial of the VidyoMobile product on my mobile device, I was keen to deploy the solution company wide.  It was not difficult to train the users on how to use VidyoMobile as it was as simple as using any app on a mobile device. The effort was more to train them on the protocols of video conferencing such as location, usage of headphones and when to mute the microphone."

"Beyond increasing the bandwidth to match the requirements of telepresence conferencing capabilities, there were nothing else we had to change or localise, from a technology standpoint," he added.

"By using AVL technology, it can eliminate costly Multipoint Control Units (MCUs) for multi-point connections," added Vidyo's Hollander. "Vidyo's low-latency and error resilient telepresence technology further ensures reliability of service and high-quality natural telepresence anytime and anywhere, as required by the client. This bridges geographical distances by facilitating employee interaction regardless of location, significantly improving the speed of communication and decision-making in Mydin."

"Before personal telepresence solutions like Vidyo, we connected through phone and SMSes, which were ok at best; but given our rapid growth, we needed to speed things up when collaborating on matters that were more complex, like human resources and pricing of our goods," said Mydin's Malik. "With Vidyo, we are able to connect visually, enabling us to connect faster, understand each other better and be more productive across the organisation. We are able to read each other better - as a lot of communication is non-verbal - and reach mutually-beneficial conclusions easily." 

However, as this was a new technology to the company, it did cause changes in behaviour. "It does take time to get used to the process and protocols, and some departments do use it more than other departments. The departments that do persevere often derive the maximum benefits but the others are slowly catching up."

"All the stakeholders in our ecosystem have responded very well to this system," he added. "As Vidyo's technologies integrate easily into currently-used devices; our staff find it eases the learning and use of Vidyo's telepresence capabilities."

Consider the cost as well as BYOD

"The top three things companies need to take into account are the setup costs; that the solution must be available at anytime and anywhere, and easy integration into current infrastructure is also an important consideration," said Malik.

"Vidyo proved to be technologies are excellent at integration with current organisational and consumer devices, where the technology leverages the latest developments in these devices to bring telepresence to the mobile phone and make it personal."

"In fact, the rise of the Bring Your Own Device [BYOD] phenomenon is underscoring how important it is, to be able to integrate into current technologies and infrastructures," he said.

"As Mydin grows, Vidyo's scalability ensures that its solutions can continue to be seamlessly scaled up to shoulder the load of Mydin's business communication needs," said Vidyo's Hollander. "Our ability to quickly leverage the latest hardware innovations and new consumer devices will enable Mydin to stay ahead of its competitors by embracing new technologies without having to compromise on communication capabilities; all of this, while staying cost-effective."

He said that in April this year, Vidyo reported an 82 percent increase in revenue for the fiscal year of 2011, with a revenue boost of 115 percent in Asia-Pacific markets. "We also added 1,000 new customers globally within the past year (from April 2012), bringing the total to 1,850.We expect to see the Vidyo platform redefine the marketplace in Asia Pacific by setting new quality thresholds and total cost of ownership savings that far surpass traditional MCU-based technologies. In anticipation of rapid growth and rising demand, we have doubled our staff strength across the region and plan to set up more offices across the region this year."

"As we look to continue expanding rapidly in the next three-five years, adopting the Vidyo solution has provided the collaborative framework for our employees to support the company's growth strategy for the near future," said Mydin's Malik. "Personal telepresence will not only extend the current capabilities of the management to oversee a wider network of stores; real-time high-quality exchange of visual information will enhance productivity and efficiency, keeping the business nimble and moving faster than the competition. These capabilities will continue to propel our growth and success. I do foresee that video conferencing will be the second most important way and conducting meetings besides the traditional face to face."


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