Effective digital transformation begins with understanding what needs to change and how customers want to engage with an organization. That’s one of the key underlying principles at US retail institution The Home Depot, where the firm is tapping into Google analytics tech to reach such an ongoing understanding.
Home Depot has been cited regularly on diginomica as a powerful use case exemplar of effective omni-transformation in action over the years, even though there was a bump in the road last year when some of the prep needed to shed legacy systems took longer than anticipated. But regardless of that, the company has enjoyed a boom in business during the COVID crisis, as locked-down customers used enforced captivity to embark on long-postponed home makeovers, while most recently the firm outlined how it had managed its internal HR response to the pandemic using Workday.
The firm's relationship with Google dates back to 2016, well before COVID was ever heard of. Google Cloud’s BigQuery is used to provide up-to-date data to help manage 50,000+ items stocked at over 2,000 locations, ensure website availability and provide accurate and appropriate information to customers via the corporate call center.
Fahim Siddiqui is SVP for IT, leading a team that is charged with application development for Home Depot’s Online, Marketing, Merchandising and Supply Chain functions. Their role is to create and support technology platforms that provide the retailer with an interconnected and seamless experience, both for company employees and external customers. This has remained vital during the COVID crisis with Home Depot still able to open the doors of its physical outlets and experiencing a hefty uptick in demand. Siddiqui explains:
As an essential retailer, we must be able to provide our customers with the critical items they need and that they need most. In facing those challenges, our ability to quickly adapt our operations to meet those objectives was quite important. This was really based on a strong culture, our dedicated associates and our flexible and scalable technology. And when all that came together, we were able to pivot adopt and meet the needs of our customers as well as of our associates.
Everything comes back to the underlying data, he says:
When we think about digital transformation, a lot of time our eyes are drawn towards what systems changes are we going to make and what is it that we are going to automate? But really, the journey of digital transformation starts in all the different areas of the business. So as we start, we'll start really looking [from] the 'customer back' view and how customers are choosing to engage with us. What do we need to change to really connect with the customers in terms of our processes, our platforms and also, just how the work gets done together?
This is a long game, he adds, and one that involves a degree of re-evaluation and re-appraisal of established practice, he adds:
It’s not easy, because you have to unlearn a lot of the things that made you successful and to learn new things. The Home Depot has been on a digital transformation journey for a few years. Within that context, not only have we invested in new systems, we've also closely re-evaluated our legacy systems and understood what to retire, what to re-architect, and, more importantly, how to create an interconnected ecosystem, so that we can actually bring together the install journey, the online journey, the in-app journey, as one customer journey end-to-end. When all of that ties in together, you really can do magic.
Magic was in demand when COVID hit. Although Home Depot was, as noted above, able to keep its front doors open, it wasn’t a case of business as usual, explains Siddiqui. In common with other organizations, there was an acceleration of transformation activities, he notes:
For instance, our teams were able to deploy curbside delivery in a matter of days, and in some cases in hours. That's just something that we had never done before.
But now it was a necessary change in behavior as customer demand ramped up:
Something interesting happened. As home became a place where you are actually teaching and working, people started looking at their spaces differently. And as they did, that inspiration to action, identification of projects, identification of products, the selection of vendors, became a continuum and we started seeing more and more of the journeys starting in the digital channel.
This resulted in a philosophical change in terms of how customers engaged with the organization online, says Siddiqui:
When we talk about e-commerce generally, we think of 'Hey, I need this product, I click here and it gets delivered'. Now it's about, 'I have an inspiration. How do I connect that inspiration to what will fit?'. More and more of our customer journeys are inter-connected, meaning they start digitally, but the the purchase may be completed online, in the app, or somebody might go to the store.
Such a shift put additional demands on the fulfilment capabilities of Home Depot and its IT team as provider of the underlying tech enablement, he adds:
We had to really grow our technical capabilities. For instance, in a store you have a limited assortment. You still want to see that faucet, but you want it shipped in carbon black. Probably we won't carry carbon black in the store. For customers to know what's available in store, what can be delivered to them and by when and to bring all this information together really was a continuance of our online capabilities and our supply-chain capabilities.
Once again, it all comes back to data and how Home Depot understands and manages it, argues Siddiqui:
Our merchandising data really becomes the fuel for this. This whole experience and connecting it all together becomes quite important. Many times, it's not about a family of hardware that you want to buy. You may end up buying five different products from five different vendors, but they're all connected through our AI/machine learning project graph, so that you can know that they'll come together. We partner with Google to make sure that we bring those best practices in and really deploy the pipeline, using BigQuery [in] our data analytics pipeline.
We are on a journey of really consolidating our data, from real time to historical, in one place. We actually migrated all of our data warehouse to BigQuery over the last three years. The upside of that is now we have a lot more of this data together. There's only one place of truth, so there's never an argument in our organization about whether your copy of the data is the real truth or my copy of the data is the real truth. Once you agree on that basic principle, everything else becomes much easier, because now you are actually tying real time analytics to the view of the customer to the view of the product to the regions.
What this means it that Home Deport can boast access to genuine insights into what is it that customers are looking for today and what they will - perhaps - be looking for tomorrow, something that has come in particularly handy over the past ten months of the COVID outbreak, as Siddiqui recalls:
As we started in the pandemic, we were very concerned how many of our stores would be shut down and maybe only could do deliveries. To react to that, for instance, we looked at the trends on online. Our online business grew by more than 80% year-over-year, which was amazing. But over a period of three weeks we actually took a market delivery center and changed it to a parcel delivery center. Those are the types of things you really get to know when you have confidence in the data and you have confidence in the truth and you can then interpret and project.
As noted above, the DIY sector has been one of those in the retail industry to have ‘had a good war’ during the pandemic to date. That’s something that Siddiqui expects will continue into the emerging Vaccine Economy and the changed macro-economic and societal conditions that it will bring:
For us, the learning out of this is there's still plenty of unknowns, but as a values-based company, we know that we have to make decisions to support our Pro and DIY customers and make sure that we actually help be a substantial part of this new economy that's developing, with the shift from services to project and the shift from employment with one large company to many, many companies forming and creating really a new engine of productivity. So as we look ahead, we believe that immense opportunities lie ahead. We are a company full of builders and doers, constantly looking for ways to help the doers get more done.
And all with data as the foundation on which to build.