Smart IT Cooks Up A ProFusion Of Goods

HP, OMI, UniKix Provide Food For Thought In The Grocery Industry.

Carr Gottstein Foods, the largest food and drug retailer in Alaska, is a leadingexample of how a progressive organization can thrive in a intensely competitive industry.With 43 stores in Anchorage, Fairbanks, Juneau, Kenai and other Alaskan communities, Carrhas earned its place with new technology and hard work.

Most Alaskans recognize Carr Gottstein Foods by its Carr Quality Centers, the company'sretail outlets. But behind the scenes, Carr also operates Alaska's most complete full-lineof food warehouse and distribution centers and manages its own freight services and retailand wholesale divisions. Together, these divisions provide Carr with criticalmerchandising benefits, cost advantages and operating efficiencies.

What is responsible for Carr's success? Is it better IT? Enthusiastic employees? Or aburning customer focus?

IT/Quality Fusion

Keen observers know that it's all of the above. Carr sticks with a smart strategy:providing competitively priced, high-quality grocery and perishable merchandise, whileensuring customer convenience and satisfaction. But how do they do that? Three years ago,Carr created the Fusion (for Future Vision) Business Process Reengineering Team. The teamdecided that by integrating their business applications, Carr's business partners wouldhave instant and direct access to relevant business information.

Looking For Deliverance

An open systems plan could deliver seamless access between the company's financial,purchasing and distribution management systems. So, a critical part of the plan was toimplement an efficient, distributed software application that provided grocery industryexpertise. They also wanted daily purchasing recommendations and instant ordertransmittals via EDI and fax. In addition, the IT team wanted a technology partner willingto commit to an aggressive installation schedule and code for custom changes.

But that couldn't happen with their IBM mainframe. "The Fusion strategy required asystem that could deliver account status, item detail, inventory information, costing andpricing information to any of our associates -- all at sub-second response times. OMI metthose needs," recalls Larry Walsh, director of Management Information Systems andFusion team leader for the purchasing installation at Carr.

Starting with a multi-faceted requirements document, the Fusion team looked atsolutions from more than ten software and system vendors, finally selecting OMIInternational (Dallas, Texas), a middleware software developer with specialized solutionsdesigned for the grocery industry. OMI's technology partner for its specialized grocerysoftware is UniKix Technologies (Billerica, Mass.). UniKix serves as the translator forOMI's software, enabling OMI's applications, originally written in CICS COBOL to also runon UNIX platforms. "We had sixteen bullets on our wish-list and OMI met more criteriathan any other potential vendor," says Walsh.

A Body Of Expertise

OMI's expertise lies in four areas of logistics management: Biceps PurchasingManagement; Triceps Warehouse Management; ABS Customer Billing; and Prompt PaymentReconciliation. OMI's Biceps and Prompt systems offer unique features specificallydesigned for the grocery business.

These applications effectively manage facilities with less than 50,000 square feet tothose with more than 1 million square feet. The Carr IT team realized that integration wasa key strategic component, where all inventory and purchasing data were combined foroptimal buying decisions in a real-time, online system.

Biceps provides daily recommended orders, vendor performance statistics, priority itemdetails, gross profit exception alerts and the ability to rapidly switch between screensfor an instant review of any vendor, item, or pending order. Biceps forward buying andpromotion management capabilities were also key factors in the decision to select OMI.Prompt provides Carr with a three-way invoice match capability -- a computer comparison oftheir purchase order costs and deals, net received quantities and the vendor's specificinvoice details.

"We were looking for [that kind of solution] for over 10 years," says Walsh."Grocery deals, vendor chargebacks, broker billbacks and free-goods promotions arevery complicated. The tight integration between Biceps and Prompt is a real advantage forus."

Only seven months after the project began, the Fusion team celebrated the unplugging ofthe mainframe. "Every MIS associate hit a designated off-switch. And, forty-sixswitches later ... our CEO pressed the final 'off' button," recounts Walsh."With that, 20 years of mainframe dependence ended."

Northern Lights

When the lights came back on, two HP 9000 K200 servers were on the job. "The powerof the [HP system] and the protection offered by RAID and mirrored disk technology was theright way to go [for us]," notes Walsh, who purchased the first two HP 9000 K200systems sold in Alaska.

An important factor in the hardware decision was the need to link 100 online users,including several associates in freight and receiving locations in Washington State. Witha focus on smart buying, the project team wanted every employee to have immediate accessto common data to monitor margins and have access to vendors' deals and sales/orderinformation the moment the transaction entered the system.

"We wanted a vendor willing to commit to an extremely short installation timeframe. Because of spiraling maintenance costs on our mainframe, we demanded a short,aggressive implementation schedule. The OMI/UniKix installation team did an incredible jobof handling the project management and custom coding for our complex installation. Theydelivered the complete installation within a very short time frame and the system hasworked well," says Walsh.

Vision Implementation

According to the Fusion team, the key to the successful implementation was choosing theright system and the quick response from HP, OMI and UniKix's on-site installation staff.OMI's Biceps and Prompt software helped new users become expert users and the system isnow in daily use by more than 110 associates. OMI's in-depth knowledge of the groceryindustry helped Carr's IT team realize that OMI offered the best business solution. Withthe UniKix middleware facilitating OMI's industry expertise and the affordability and theuse of the HP hardware, Carr is well positioned to compete.

And Carr's senior management is confident that the OMI and UniKix advanced informationtechnology will help them continue to provide their traditional level of "LegendaryCustomer Service." "We're very optimistic about where we're going with thesecompanies. Their products have the specific features and flexibility we need to help usmaintain the right levels of inventory, which is critical in this highly competitive andseasonal business," Walsh summarized.

--Brian Newlove is director of the Business Partners Program atUniKix.