Power Tools 1993 November - Disc 2/Power Tools Plus (Disc 2 of 2)(November 1993)(HP).iso/custref/50916596/50916596.txt

Text File | 1993-05-30 | 21KB | 410 lines

Leading Retailers Rely on Open Systems-Based
HP OpenSTORE to Enhance Customer Service

RISCON `92 Workshop Summary:
Camelot Music and Strawbridge & Clothier

[Figure cover (Photo), Caption:  HP OpenStore provides an open solution
bringing computing power to the store level to better manage inventory
and improve customer service.]

In October 1992, Hewlett-Packard hosted a workshop on Open
Systems: Applying Technology for a Competitive Advantage as part of
RISCON '92 in New Orleans. Jeff Siegel, Marketing Manager for HP's
Store Automation Program, moderated a presentation and discussion
featuring representatives from two retailers implementing HP
OpenSTORE--a comprehensive, integrated store-automation solution
based on open systems.
   This summary presents highlights of that workshop, including
comments regarding enhancing inventory management and customer
service through in-store processing as well as issues relating
directly to migrating systems and applications away from the
traditional mainframe environment.

[Sidebar:  "The proprietary midrange platform that we were on was not
going to be large enough to support our business long-term."]

An Integrated Solution
In late 1990, Hewlett-Packard introduced HP OpenSTORE, a
comprehensive, integrated store automation solution based on open
systems. Explained Jeff Siegel, Marketing Manager for
Hewlett-Packard's Store Automation Program, "HP OpenSTORE consists
of hardware, advanced technologies and software applications, HP
consulting, implementation services, and support. We originally
targeted HP OpenSTORE to meet the store automation needs of large
retailers, but it now supports enterprisewide automation as well."

[Sidebar:  Leading Retailers Choose HP OpenSTORE
Hewlett-Packard installed HP OpenSTORE in over 5,000 retail stores
in just two years since its announcement in late 1990. Among
retailers relying on HP OpenSTORE's open systems solutions are:

United States:
Breuners
Camelot Music
The Home Depot
JC Penney
Kmart
Kroger
Long's Drugs
Revco
Sam's Wholesale Club
The Source Club
Southland
Strawbridge & Clothier
Taco Bell
Thrift Drug
Wal-Mart

International:
Big W (Australia)
Carrefour (France)
Cifra S.A. (Mexico)
Sainsbury PLC (United Kingdom)]

   HP's integrated approach is critical in this era of multiple
solution elements, Siegel stressed. "In-store servers, workstations
or PCs, point-of-sale (POS) terminals, POS integration, database
management software, wireless handheld computing devices, and
retail applications software all come from multiple vendors. What
HP OpenSTORE does so successfully is integrate individual
retail-solution elements into a single, comprehensive solution that
meets the most complex requirements. Additionally, HP OpenSTORE
incorporates client/server computing and sophisticated network
management to provide integration capabilities that begin at the
store and extend throughout the retail enterprise."

Store Power
Utilizing RISC-based computing, HP OpenSTORE provides retailers
with new levels of computing power and greater price/performance --
often implementing powerful RISC-based systems in areas in which
only PCs were previously cost-justifiable, such as small-format
stores.
   "HP OpenSTORE has been warmly received," Siegel reported. "In
the two years following its introduction, Hewlett-Packard has
installed over 5,000 UNIX-based store systems as well as hundreds
of other non-store systems for automating merchandising,
financials, distribution, catalog fulfillment, import management,
GIS, network management, HELP Desk, POS polling, and other
functions. This averages out to 200 systems a month. In fact, HP
OpenSTORE now provides open systems-based automation to many of the
nation's leading retailers, including Wal-Mart, The Home Depot,
Kmart, and JCPenney, and Strawbridge & Clothier. Just as important,
smaller retailers like Camelot Music have also found new
opportunities to enhance customer service and responsiveness with
HP OpenSTORE."

Small-Format Retailers
As the open systems concept has taken root for store automation,
significant changes have occurred. As Siegel explained, "Small
format retailers, who historically deployed point-of-sale (POS)
controllers as under powered in-store processors (ISPs), are now
cost-effectively implementing powerful RISC-based UNIX servers.
These support relational databases and serve as both ISP and POS
controllers. Large format retailers are deploying this technology
to support UNIX-based retail applications and act as servers to PC
and UNIX-based clients. Camelot Music and Strawbridge & Clothier
represent two highly successful retail implementations of HP
OpenSTORE."

Camelot Music--a RISC First
Headquartered outside Cleveland in North Canton, Ohio, Camelot
Music is a 350-store chain operating in 34 states and selling home
entertainment products and merchandise--prerecorded audio, video,
and related accessory items. "330 of our stores are located in
malls and range in size from 2,000-7,000 square feet," stated Jim
Sage, Camelot's Vice President of Information Systems. "Our 1991
sales totaled approximately $370 million, and we expect that figure
to grow by 15% annually."

[Sidebar:  HP OpenSTORE Customer Profile #1:

CAMELOT MUSIC
Merchandise:   Home entertainment products--prerecorded audio,
video, and related accessories
Headquarters:  North Canton, OH
Stores:   330 (310 in malls) in 33 states
1991 Sales:    $370 million]

[Sidebar:  "We won't be faced with any box swaps, and RISC
architecture offers greater long-term potential."]

   Camelot is the first small-format retailer to deploy RISC-based
servers for in-store processors and point-of-sale controllers.
Declared Sage, "Prior to installing HP OpenSTORE, Camelot stores
used electronic cash registers and handheld portable data capture
devices. Since these two technologies could not be interfaced, it
was impossible to match unit and dollar sales. As a result, our
data accuracy was suspect. Additionally, all our cash reporting to
corporate was manual and we utilized few automated tools since we
didn't have in-store processing capabilities. Further, our customer
transactions were slower than necessary since we lacked scanning
and price lookup capabilities."
   More advanced technology, Camelot reasoned, could contend with
two key business challenges. "Much of Camelot's sales involves
about 500 CD and cassette titles (of a total of 15,000) whose
demand curves are unpredictable," Sage remarked. "Replenishment
from corporate was difficult. Senior management saw full automation
as the answer, pushing replenishment of the 500 key titles down to
the store level and giving more decision-making power to store
managers."
   Camelot also saw enhancing customer service through automation
as the key to future success. According to Sage, "Customer service
offers a true competitive edge in retailing. We looked ahead and
wanted to provide the customer with the ability to walk up to a
voice-activated terminal connected to the ISP, do queries against
a 100,000 SKU database, and place special orders. We wanted to
implement suggestive selling systems based on customers' prior
purchase habits, too, and that means providing sales associates,
who might know rock but not jazz or classical, with more
information."

[Sidebar:  HP Orchestrates a First...Integrating IBM Cash Registers
In-depth experience with major retailers prepared Hewlett-Packard to
manage and integrate a total solution for Camelot Music. The success of
Camelot's TRIMS/HP OpenSTORE solution rests greatly with the in-store
integration of TechPoint POS software residing in both an IBM 4684 cash
register and an HP 9000 Series 800 Model F10 server. Hewlett-Packard is
handling all the pilot and roll-out phase testing and integration at
its Dallas Staging Center, then sending HP engineers to each Camelot
store for implementation while centrally managing these activities from
Camelot's local HP office.]

   However, Sage related, "The proprietary midrange platform that
we were on was not going to be large enough to support our business
long-term. We had to migrate all our applications to a UNIX/open
systems environment and throw away a ten-year investment in
software and training because we were locked into that proprietary
platform."
   Camelot envisioned collapsing its POS controller and in-store
processor into an HP 9000 Series 800 Model F10 server. "We couldn't
afford a PC to control the point-of-sale and the UNIX machine to do
all the other things we wanted to do," revealed Sage. "But the
price of RISC-based ISPs had dropped so dramatically that we were
able to afford them. We saw this as enabling us to put the power of
technology closer to the store and our associates and leapfrog the
competition by skipping two generations of POS."

HP Implements TRIMS
Camelot turned to Hewlett-Packard for total project management
and integration of its $4 million HP OpenSTORE implementation.
Named TRIMS (The Retail Inventory Management Strategy), the system
will enable Camelot to improve customer service and provide better
selection without increasing inventory. "HP had been working on the
open systems technology longer than the other major computer
vendors," Sage said. "The result we've seen is better
development/support tools and more experienced open systems
professionals in the field. In addition, HP has an excellent
quality and reliable reputation, the sales support is excellent,
and HP was more willing to partner with other computer vendors."
   The TRIMS system consists of five major components: POS and
in-store automation, merchandising/accounting, warehousing,
communications, and executive information systems. Explained Sage,
"Each of Camelot's stores will use a UNIX system-based HP 9000
Series 800 Model F10 business server as an in-store processor (ISP)
integrated by HP with an IBM 4684 cash register and utilizing
American Power's uninterruptible power supply and TechPoint
point-of-sale (POS) software. We will network the ISPs to an HP
9000 Series 800 Model 855S located at our headquarters."
   An HP 9000 Series 800 Model 865S will run accounting and
merchandising forecasting software from Richter & Associates. An HP
9000 Series 800 Model 870S will control warehousing and inventory
with software from Alpha & Omega Integrated Control Systems. To
provide total information access to store managers and headquarters
decision-makers, Camelot will utilize the ORACLE relational
database. "We wanted a common development environment," added Sage,
"so the development groups do all the development across the
company."
   Moreover, Sage commented, "Camelot headquarters will achieve
complete automation with approximately 150 HP Vectra workstations
linked via a Novell Ethernet Local Area Network to two HP business
servers. Operating in a pure client/server environment, networked
HP Vectras will handle such functions as real estate, construction
and maintenance while accessing any information in the data
center."

Advance POS
The TRIMS' POS roll-out, scheduled for early 1993, will provide
Camelot with a wide range of advanced business functions to ensure
that the chain has "the right product in the right places at the
right price." Camelot's IBM 4684 cash register will capture sales
and display prices after scanning barcodes. It will also authorize
charges and report cash and sales information for manager and
headquarters analysis.

[Sidebar:  Open Systems and Expanding Market Share
According to Tom Ritten- house, Corporate Vice- President and
Controller of Strawbridge & Clothier, "In today's economy, retail
growth will be accomplished by expanding market share. That means
responding more quickly to the marketplace. We think open systems
can help us do that. And as a capitalist, I appreciate the fact
that open systems gives me a choice of vendors. We did our homework
over a 14-month selection process. We knew DEC and Sun were in the
business and IBM was getting in, but we were impressed when we
found out that Wal-Mart and Home Depot were going to
Hewlett-Packard. HP's proposal fit into our strategy and was very
competitive. They came across as a lean, knowledgeable, highly
professional organization. They were committed to open systems. And
HP has demonstrated its ability to implement what it sells."]

   "Phase one backroom applications will provide end-of-day
balancing/reporting, ordering, and forms mail/messaging," Sage
reported. "We'll implement phase two POS capabilities before
Christmas 1993, and these will include price lookup (PLU), store
receiving, store warehouse returns, store transfers, cycle
counting, and model stock overrides. Managers, store associates,
and customers will also be able to access and order items from a
data base containing 100,000 selections."
   Subsequent phases will provide such capabilities as CD ROM to
enable Camelot customers to view short video clips and listen to
audio clips, analysis of deep catalog versus hot merchandise, and
a complete store Electronic Information System.

Open Systems Economy
The addition of so many new applications will be made possible
by Camelot's commitment to open systems. "We feel HP is clearly the
leader in open systems," Sage stated. Open systems will provide the
company with what Sage termed "the ability to select the
`best-in-class' solutions for our users without worrying about how
they will fit into our enterprise-wide network." What's more, Sage
added, "HP OpenSTORE will provide TRIMS with long application life
and protect our investments in hardware, software, and employee
training."
   Camelot's HP 9000 Series 800 systems are based on PA-RISC, HP's
industry-leading RISC architecture. The UNIX system/RISC
combination provides a true multi-user, multi-tasking operating
system, applications portability, and interoperability. "The
hardware is scalable," Sage pointed out. "We won't be faced with
any box swaps, and RISC architecture offers greater long-term
potential. Also, we didn't want to be constrained by memory or disk
limitations. And very important, we'll be able to dial in and
support our stores without interrupting business."
   In a retail environment in which only the fittest survive,
Camelot Music expects to sing the praises of its new TRIMS/HP
OpenSTORE system and stay in tune with prosperity for years to
come.

Strawbridge & Clothier--Open Systems Migration
Located in Pennsylvania, New Jersey, and Delaware, Strawbridge
& Clothier operates 13 traditional department stores serviced by
two distribution centers plus 25 (soon to be 26) Clover discount
stores serviced by a single distribution center. "Corporate MIS
serves both divisions," revealed Bernie Hogan, Manager of
Distributed Processing. "We've been recognized as a leader in
defining and implementing industry standards, a reputation of which
we're proud."

[Sidebar:  HP OpenSTORE Customer Profile #2:

STRAWBRIDGE & CLOTHIER
Merchandise:   Traditional department store and general merchandise
Headquarters:  Philadelphia, PA
Stores:   13 Strawbridge & Clothiers department stores and 25
Clover discount stores in Pennsylvania, New Jersey, and Delaware
1991 Sales:    $1 billion]

   To enhance its response to the marketplace, Strawbridge &
Clothier recently chose to replace its IBM/Series 1 computers with
HP 9000 Series 800 store servers. "With the assistance of Migration
Solutions, Inc. of Minneapolis," Hogan disclosed, "we'll emulate
about 325 programs and protect our application investments until we
complete our new programming."
   Strawbridge & Clothier supports very complex functionality,
according to Hogan. "We integrate time and attendance into the ISP.
Twenty-two to twenty-five ASCII CRTs per store support numerous
local or host applications. POS supports full price lookup and
price management. We have online ticket printers, RF devices for
price verification, inventory management systems, and more. It's a
very complex system," Hogan admitted, "but it's working very well."

A Different Approach
Strawbridge & Clothier takes an approach far different from that
of most retailers moving into open systems. "We've been working in
a vertical fashion as opposed to a horizontal fashion," Hogan
declared. "Other strategies call for rolling out to as many stores
as possible, then adding enhance- ments. We, however, prefer to
thoroughly test and evaluate all our technologies in just a few
stores. When we roll out, the systems will be right."
   Informix and its tool sets have become Strawbridge & Clothier's
standard for software development, Hogan advised. "Our efforts are
very complex, including imaging and workflow, portable netware
under HP-UX to merge DOS and OS2 with the UNIX system environment,
and a radio frequency-based warehouse locator system. Just
recently, we implemented a gift certificate system developed under
HP-UX online."
   To make these functions workable, Strawbridge & Clothier is
taking a new approach to its ISPs. "Our old ISP was a controller of
processing functions," Hogan said. "The new ISP under HP OpenSTORE
will be more of an in-store server. It's going to ask, in effect,
`What can I do for you?' POS, time and attendance, and some other
applications will become clients of the in-store servers."

The Client/Server Environment
"The key to any migration strategy," Hogan asserted, "is
understanding standards. Sometimes, I wish I could go back to the
days when there was only one way of building a system--when you
put all the information in one box and attached dumb terminals. But
those days are over. To maximize the productivity of client/server
technology, you have to get a solid understanding of these
standards and know which are right for you and your environment."
   Hogan cited support from top management as the key to entering
the client/server-open systems environment successfully.
"Management has to clearly and consistently communicate what you're
doing and why. Training and education are vital, too. We've
probably done more in this area than in any other year I can
remember. We've had training from HP, and we've had Informix do
in-house training. You also need a strategy for building bridges to
and from your legacy systems."
   Strawbridge & Clothier is using Migration Solutions' Series/1
migration tool to emulate the Series/1 in the HP world. "This will
allow us time to build our new in-store server applications," Hogan
confided. "Meanwhile, we're tackling such issues as administration
of networks, relational databases, and the UNIX system."
Client/server networking also draws Hogan's attention.
"Client/server applications make great demands on the network. In
the past two years, we've revamped our local area network and our
wide area network. We've standardized our protocols--TCP/IP, some
IPX, SNMP for network management. Our objective, quite simply, is
that anybody on any box will be able to get to any other box
seamlessly."

Fiber Optic Backbone
In 1991, Strawbridge & Clothier implemented an FDDI fiber optic
backbone through its corporate headquarters to deal with all LAN
connectivity issues. According to Hogan, "This was one of the
wisest decisions we ever made. As new technologies emerge, we have
only to change in a horizontal fashion, not vertically. On the wide
area basis, we have a totally integrated voice and data network.
It's a mesh-type architecture using T1 and T3 technologies. While
we see a decrease in voice traffic, there's an increase in data
traffic. When we're finished, we'll probably be running about 128
kilobits per second between the stores for data traffic."
   Without question, the `90s are a time of transition for
retailers. The move to open systems, typified by the wide
acceptance of HP OpenSTORE, offers retailers outstanding
opportunities to stay competitive and profitable in the years
ahead. HP and open systems provide retailers like Strawbridge &
Clothier and Camelot Music with the tools to use information
strategically and cost-effectively as they improve their
competitive position.

Disclaimer: All products mentioed herein are the registered
trademarks of their respective companies.

Technical information in this document is subject to change without
notice.

(c)  Copyright Hewlett-Packard Company 1993
All Rights Reserved. Reproduction, adaptation, or translation
without prior written permission is prohibited except as allowed
under the copyright laws.

Printed in USA  M0193
5091-6596E

Associated files:  50916596.DOC, AA659601.TIF, LA659603.TIF,
LA659606.TIF
Leading Retailers Rely on Open Systems-Based HP OpenSTORE to Enhance
Customer Service;  RISCON `92 Workshop Summary:  Camelot Music and
Strawbridge & Clothier