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How Super Retail Group is dealing with digital disruption

Nadia Cameron | April 24, 2014
Super Retail Group is undergoing big changes as its commitment to the customer extends from its stores to the online world where digital channels dominate the shopping experience.

It's a big internal cultural change, and a project driven by the group's corporate strategy of focusing on the customer experience, Hesketh says.

As chief of group IT, Hesketh sits on the executive leadership team and is involved in the development of corporate strategy. He points out that while the transformation project required technical capability to be a success, it also wouldn't have worked without the change management processes to go with it.

To ensure governance programs were appropriate, the IS team set up a product program management group under a general manager for business change. It used PRINCE2 methodology to run the program.

"Without the stores actually going through the process of understanding how these changes affected their jobs, and having the leadership out there in retail leading that change, none of it would've stuck," Hesketh adds. "This was very much a corporate strategy and one that again, combined governance with delivering actual change."

Cost versus value

Of course any conversation about transformation inevitably involves cost. At Super Retail Group, IT spend has gone up significantly in the last few years, partly as a result of growth, and partly because the business is operating near real-time, meaning information intensity is much higher.

Hesketh doesn't believe CIOs will ever get away from the cost discussion and says it's even more prevalent when IT is run as a shared service. "We deliver the capability and get the cost, but the benefit is often delivered in a different part of the business and they get the value," he admits.

"The challenge has always been to match up the value being contributed, to the additional cost we're actually bearing."

Hesketh achieves this by focusing on the customer experience, business benefits, and supply-chain capabilities being provided by IT. As a company, Super Retail Group also employs an overriding metric called 'return on capital', which positions capital against the returns generated and how those relate back into the different processes.

"I'm not being told you're spending too much, what I am asked is to show that the costs are appropriate," Hesketh comments. "How IT can alter the business' return through changes of processes or capability improvements is an important thing to demonstrate."

Within the IS team, there are also three key areas to juggle: Keeping the business running; omni-channel capability; and improving customer experience.

Another piece of the puzzle is developing team member capabilities to better support both the business and the end customer as their needs change. Hesketh explains one of the group's current corporate strategies is around team member engagement and retention.

"As a retailer we have quite a high turnover, but retention today sits at about 75 per cent," he says. "Understanding what sorts of people enjoy working here, if they want to stay, and how we make sure we're giving them what they need to deliver their job properly, is critical."

 

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