Fresh thinking about tech turned around the fortunes of UK cycling store Halfords. Its CIO Anna Barsby explains how.
A few years ago the UK cycling and motoring retailer Halfords looked to be a spent force. Beseiged by stealthy online competition, it seemed to be facing the same fate as its stricken high street counterparts Woolworths and Blockbusters. Indeed, when current Matt Davies became chief executive of Halfords in October 2012, profits had just fallen by 27 per cent.
Skip forward to 2014 and the company is in fine health. Its 2013 half-year results saw that cycling revenues had increased by 14.2 per cent and that cycling repair sales had gone up by 27.2 per cent, while online sales had also soared by 16.9 per cent.
The re-birth of cycling
There’s an element of good timing to this. In 2012, Great Britain went from a nation of also-ran cyclists to world leaders – as Team GB dominated the 2012 Olympics while Bradley Wiggins and Team Sky won the Tour De France. It led to a transport revolution in the UK as cycling became an accepted form of day-to-day transport, causing a rise in bicycle sales.
Halfords was well-placed to benefit, if it could re-configure its operation for the times. Technology would prove the key. As Anna Barsby, CIO of the company, says: “Halfords is a part of the British retail framework and an historic part of our high street. The key for us is to get better at being part of people’s lives as we’re an ‘infrequent’ retailer. Technology provides a solution. It gives us the power to push ourselves into our customers’ homes to trigger a visit.”
Barsby joined the new Halfords team in March 2013 from a business change role at TUI Travel, where she had also been head of IT projects and programs. Before TUI, she had been with Whitbread and before that, spent a stint in financial services and Sainsbury’s from 2002 to 2006.
New interactive in-store technology
Some of the changes she introduced are clearly visible in store. Halfords is rolling out a new store format rolling with more screens in them, and an app that enables customers to enter their car registration number to display the exact part they need. Staff use tablets with YouTube to show customers the products in greater detail. And the firm is working on interactive in-store technology that can size people for a bicycle just from standing in front of a screen. Meanwhile wi-fi is going into every store.
However, similar investment in tech is taking place in operations as the business goes ‘omni channel’. Halfords delivers to its stores once a week, but as business-wide changes take effect, Barsby says that more regular deliveries will smooth the business. “It’s just about a single customer view. Customers order wherever they like and we must deliver wherever they like.”
A bigger job for Barsby has been reorganising the internal buying of tech, moving much of the activity to the cloud. “The business was buying IT services itself and we had very poor integration,” she says.
“The IT team relied on overtime to carry out routine work and we had no architecture, PMO or business analysis teams. HP partnered with us for the SAP upgrade, moving it into their cloud, and it’s all gone really well. I’m looking at cloud wherever we can, as we have two peak times of the year – Christmas and summer – and I want to be able to flex up and down.”
Team transformation
This was a major project, and one that required Barsby to rally the team. She says: “My first big job was to sort out the people in the team – fix the basics in year one and then spend two years of transformation as part of a three-year plan. The key thing for me was to get their hearts and minds, and tell them it’s going to be amazing. There was a culture of order takers and I’ve had to coach a few people to get them to tell me what they think. It’s a very different role to challenge the business, so it’s been a big culture shift.”
“Also, we’ve now got them thinking what the customer journey is, not what their job is, as it’s not about the systems. This has helped change the culture and it’s now firmly about the customer and what the customer will see in 2017.”
To help drive through the technical changes, HP and Tata are working on the data centre rationalisation, IBM is looking after application rationalisation, while Fujitsu recently secured the contract to do in-store break fix maintenance and will work on the store hardware refresh.
Barsby says Halford doesn’t want to roll out new tills, so is looking at tablets with card-swipe technology. “Tills cost too much and we can move to e-receipts – which is great for CRM.
We aim to reduce the OPEX by 15 per cent and cut the CAPEX by 20 per cent in 2017.”
– Mark Chillingworth, CIO.co.uk Editor in Chief
* This article was first published on CIO.co.uk
