You may not have heard of dunnhumby, I most certainly hadn't, but it's very likely that that the company holds some sort of information about you. That's notbecause it's some sort of NSA/GCHQ government agency, but because it spends its time analysing the customer data from some of the world's largest companies, as part of their wide-ranging loyalty programmes. For example, if you've ever bought something and are part of a customer engagement scheme with the likes of Tesco, Coca-Cola or Macy's, then the chances are dunnhumby knows a little bit about you. Andrew Hamilton, globel head of strategic planning at the company, told me that although dunnhumby may traditionally be defined as a 'marketing services' company, it refers to itself as a 'customer science' business. He said:
We work with retailers around the world to help them understand their customers, help them make business decisions, set their strategies around their customers to improve their customer loyalty and improve their sales. As part of that, we help them understand how to use their data with suppliers, help them understand their customers, and in turn commercialising that data.
Although dunnhumby's customer facing business is very interesting, it is also going through a significant change management programme as it prepares to rip out all of its on-premise back office systems and replace them with Oracle's cloud-based Fusion applications. And when I say all of them, I mean all of them. Hamilton explained that the company is planning to buy into the following Oracle cloud products:
- Oracle Sales Cloud
- Oracle Marketing Cloud
- Oracle ERP Cloud
- Oracle HCM Cloud
- Oracle Hyperion Managed Cloud Service
- Oracle Business Intelligence Managed Cloud
All of these had previously been run on-premise and dunnhumby is carrying out the project with the help of consultants, KPMG. On a side note, if you want to understand a bit more about the progression and development of Oracle Fusion, take a look at Den's post with Debra Lilley, who has been an Oracle consultant for the past 25 years and understands the ins and outs of the Fusion products. But back to dunnhumby – Hamilton said that the decision to go with cloud was driven by the company's growth over the past six or seven years, in order to take advantage of scale, as well as cost savings. He explained:
Two main areas of benefit for dunnhumby through the use of Oracle's cloud, will be efficiency savings through automation, as well as the ability to boost mobile working capabilities. Hamilton said:
I guess there was nothing wrong with what we were doing before, but in the time since we implemented those systems, our company has doubled in size. We have probably gone from three countries to 30 countries in terms of where we operate, and so for us the real issue was that any company that is thinking about staying ahead needs to think about their technology choices carefully and how we can maximise our investment to help our bottom line.
“What we liked about the cloud, and particular Fusion, is that it is an integrated system – that's one software partner to work with. And Oracle has a good reputation in leading edge cloud-based technology. That and the total cost of ownership benefits, which are obviously helpful for a company of our size. We thought, let's focus on the things that we are good at rather than trying to maintain servers.
If you take the fact that we have some older systems and some inefficient processes, where people are moving data from a system into a spreadsheet, then manipulating the spreadsheet, then feeding it into another system – there will be tremendous benefits not only for HR and finance teams, but also the regular teams.
Also, in order to approve a purchase order today, I have to be connected to our network, be on my laptop, be connected to the VPN or sitting at my desk. This [the cloud] gives us a choice and a mobile option to allow employees to do the work where they want to do the work, making it more convenient and more efficient.
Hamilton wasn't willing to reveal what on-premise systems the company is currently using, but did say that dunnhumby had made the “classic mistakes” with on-premise implementations– e.g. heavy customisations, which as a result have made it difficult to upgrade.
- Oracle Fusion - Debra Lilley's perspective (diginomica.com)
- Siemens moves to Oracle for cloud HCM, not SAP SuccessFactors? (diginomica.com)
- Cloud, cloud, cloud for Oracle, but Wall Street's unimpressed (diginomica.com)
- Wall Street unimpressed as Ellison argues Oracle's profit miss is due to cloud success (diginomica.com)
Before settling on Oracle in October last year, the company underwent a lengthy analysis of all the main on-premise and cloud vendors. It now expects to go live with all of the new systems in a 'big bang' approach on the 2nd March next year. Hamilton said that the selection process has probably been the biggest challenge to date, as different stakeholders involved had different preferences for each of the systems.
I think there were people that were very eager to pick their favourite, whether it be a finance product, or a CRM product, or a HR product, and wanted to go and pick their favourite in each of those areas. Which is very suggestive. But what we really had to do was get people behind the benefits of an integrated suite by explaining some of the things I mentioned before - the total cost of ownership, not having to migrate data between systems, less upgrades and regression testing, all with the built in BI and analytics. But I guess in our culture those weren't the first things that we leapt to, and we initially went out to go and find what were the best in breed in each of those areas.
Interestingly, Hamilton doesn't really see this as a software programme. He sees it as a huge change management programme for dunnhumby, as the organisation is currently planning how it is going to change its processes and internal models to get the best out of the cloud software. The company has just gone through a global design phase for this and is planning to realign its processes so that they fit with the out-the-box product, as Hamilton is keen to steer clear from customisations in future.
I don't think the technical migration will be particularly difficult. We are not looking at this as just a systems programme, it's a fundamentalchange management programme in the organisation – when you are replacing the systems and all of the associated processes, you are touching every employee. I feel like the success of this is going to be how well we manage the change, rather than the technical change itself.
We are changing them to take advantage of the cloud-based software - one of the great benefits for us is that the cloud-based software doesn't let us fall into the trap of over-customising. It draws us into best practice processes with a very simple, easily upgradeable system that pushes us in the right direction.
One person's flexibility is another person's complexity. So if I say we need to be really flexible on this accounts payable process because of a nuance in a particular country, that might create a lot of complexity on the back end for the team that has to design that. Then when we come to upgrade it, it might be something that isn't standard and creates all kinds of problems. That's not a situation we want to get into.