CASE STUDIES
Peacocks Outsources Operational Support to PMC
From its origins in Warrington, Cheshire in 1884 as a Victorian 'Penny Bazaar', Peacocks is now an established UK value-for-money fashion retailer with more than 550 stores in the UK. Experiencing significant growth in recent years, Peacocks continues to open stores in the UK and abroad. Through collaboration with fashion designer Pearl Lowe, it continues to strengthen its fashion credentials.
In response to the retail industry's constantly developing demands and in a drive to improve quality and reduce costs, Brendan McKeown, Group IT Director of Peacocks, recently reviewed the group's operational support system.
McKeown explains: "The operational work is a 24/7 service that looks after the out-of-hours side of the business.
It involves polling stores overnight for sales information, producing picking lists for warehousing, reports for sales, and dealing with store issues. My team dealt with a mountain of paper to prepare the necessary reports and operated a shift system to take out-of-hours and weekend calls from stores. Apart from the inherent problems caused by manual processes it left my team little time to devote to new projects."
"This had to change. We automated several processes and introduced business intelligence tools. This meant our core business system was no longer involved in producing multiple reports and many paper-handling tasks vanished; around 20,000 sheets of paper. We also introduced an Intranet which transformed the way we communicated with our stores and changed the volume of shift work involved."
Moving operational support to an outsourced solution
After looking at outsourcing as an option and discussing various proposals from a selection of third-party providers Peacocks chose PMC. McKeown continues: "The key point for me was PMC understood what I was talking about, and the operational support role. They knew what I wanted to achieve and proposed a way to do it. When someone understands your needs what they propose is that much better. Importantly, that understanding gives you a feeling of security."
PMC proposed outsourcing Peacocks operational support to its Indian offices but also developed a detailed transition and management approach to ensure success.
As McKeown states, they quickly overcame some initial concerns. "Naturally, the Board expressed some nervousness about outsourcing to India and asked some searching questions, mostly because of some poor press coverage. PMC's approach removed any doubts and reassured us we had made the right decision."
To make the transition, PMC involved both themselves and Peacocks in necessary background work. Following a series of meetings PMC undertook a detailed analysis of Peacocks systems and documented all the required processes. PMC then brought three of their Indian operating team to the UK to spend six weeks at Peacocks offices in Cardiff. Working alongside the Peacocks team ensured they understood the business before transitioning to India. PMC also appointed an experienced, UK-based operations manager.
McKeown confirms: "At every stage we knew that PMC had complete control. Their attention to documenting the process was key, getting the detail right was a major factor in achieving a successful outcome. Bringing members of PMC's Indian team to the UK increased understanding, confidence, and communication. We have daily conference calls not because there are any issues, but because I like to know what's going on and communication is excellent. We have built up a good relationship in a short time."
Once PMC had created proper documentation, they ran the service out of hours on-site in Cardiff alongside the Peacocks team. When that proved successful PMC moved the service to their Abingdon offices using the same Indian team, before transitioning the service to run out of PMC in India.
The service includes overnight batch schedules, polling sales information from stores used by the warehouse to create picking data to replenish store stock. The system also creates sales figures that senior management use to run the business.
Improved service quality and measureable cost savings.
McKeown cites some key business advantages: "Service quality is better, there are clear escalation procedures, increased flexibility and measureable cost savings plus better informed business decisions through improved information accuracy. Too many organisations view operational support as 'housekeeping' or a back up service. In reality it's a business critical operation and PMC has enabled us to deliver that service."
"In addition, I wanted to concentrate on developing new projects. Using PMC has freed me and my team to concentrate on those. We have time to focus on development as well as managing operations. Retail is a fast-moving industry and it's important to concentrate on new projects to help the business grow and develop."
PMC also provides Peacocks with second-line application support dealing with store issues after core business hours and at weekends. PMC's remit is to resolve anything that will impact trading or prevent Peacocks from polling their stores overnight.
"PMC deal with anything that stops the process hitting the buffers," states McKeown. "Also the application support changes have gone virtually unnoticed at store level – no escalations, no issues - and that's a massive bonus. We remain impressed by the way PMC delivers the service."