Clicks & mortar

Clicks & mortar

How Hamish Grant stitches together EziBuy's stores and online channels.

After a successful career in ICT, first in Wellington then contracting in the UK and Europe, Hamish Grant returned with his family to Palmerston North, his hometown, in 2006, thinking he might semi-retire. “My wife is English, but we met in Wellington,” he says, so the move to Europe was for personal as well as career reasons.

Grant spent 15 years in IT in Europe, contracting to a variety of companies for two or three years at a time.

He handled significant projects such as the transfer of the UK Stock Exchange to purely electronic operation — a project handled by interbank agency Swift. In such work, he was “always very customer facing, and very much involved with technology” — two directions that have steered his career since.

At the time, Grant’s parents owned a retail business in Palmerston North. When he and his family were visiting, “I would work the shop floor and also manage the shop on occasions.” Then he and his family moved back to New Zealand long-term.

“At that time, I’d been working for Littlewoods in the UK, a very big online retailer in the catalogue business. When I moved back Mum and Dad were looking to retire. So I did consider purchasing their retail business; I worked the floor and the store for a couple of months, then decided that my true passion and skills were really in ICT.”

He approached mail-order and online merchant Ezibuy for a role. Initially he was taken on as a business analyst, but soon after the IT manager left. “So I put myself forward for that role and was accepted. Then the chief operating officer left and I absorbed that role as well, becoming group IT manager.”

The two departures were coincidental, he says, not a sign of any underlying problem, but they presented him with an opportunity for a rapid move upwards. “I was being underutilised; I’d done roles similar to that before.”

Subsequently, he moved on to the CIO role with Ezibuy. The difference lies in the strategy content, he explains. “An IT manager is very reactive; when I took over the IT manager’s role, the IT department [as a whole] was very reactive. It was siloed, not customer facing and was always seen as the bottleneck.

“They’re certainly not like that now; they now sit on a very proactive side of the curve. In the past three years I have evolved them into a closely integrated department with the business; they are normally at the same level or a step ahead of the business in what they want to do. Therefore, we can be very strategic and very forward thinking and put solutions in place that don’t answer the tactical problem, but actually answer the strategic problem,” he says.

Moving off legacy systems

Part of that progress was moving Ezibuy off its legacy ERP, Ezibuy Main, that was built on early ‘90s technology, and on to SAP. The company had tried to migrate three times before and failed, Grant says and it was moving the company forward and strategically driving it on to SAP that acted as a catalyst for change.

“Ezibuy Main was built on Dataflex in the mid-’90s; there was a team of about 12 internal staff maintaining it. We are now down to a team of six and on SAP.” The change was achieved in two years, on time and on budget.

One secret to a smooth SAP implementation, Grant says, is to confine the product to what it does well. “Where a lot of SAP implementations go horribly wrong is that SAP is a fantastic core product that works well as an engine, but the business think they need to change it. We absolutely didn’t take that point of view and I was key in driving that; if you want to paint a car green, you paint it green but you don’t touch the engine. SAP is the engine; it is at the heart of the business.”

A lot of the IT staff at Ezibuy are skilled SAP integrators, Grant says. “For example SAP doesn’t do cross-sell and upsell very well at all. For a business like ours, we absolutely must do cross-sell and upsell. So rather than change SAP, we built our own CRM portal on the front end that can cross-sell and upsell. It tells SAP; ‘this is what the customer bought, this is how much they paid for it.’ SAP is the core of our world; promotions, customers, they’re all core to SAP. But if, for example, we want to mark that a customer is in a certain marketing quartile, then we wouldn’t put that in SAP.

“From SAP’s point of view, a customer is a name, an address and a shipping address and email and phone number, and it manages that well. Don’t change something that shouldn’t be changed.”

Another important factor Grant credits for the success of the SAP implementation is management of the relationship with the vendor. “My core philosophy is whatever vendor you’re involved with, it is a partnership. You don’t go to a vendor and ask them to do something for you and then forget about it. You work with them and you both share the responsibility and the direction; then you end up with a solution that you actually want.”

Trans-Tasman, multi-channel systems

In 2007, EziBuy took over bricks-and-mortar local fashion retailer Max Fashions and set about giving Max an online presence. “We went from a business portfolio of EziBuy with 10 retail stores and 700,000 active customers split over Australia and New Zealand, to a business that also had another 38 retail stores that approached a different target segment a bit more upmarket than EziBuy,” says Grant. “Max Fashions is now doing ‘reasonable amounts’ of business online in Australia and New Zealand. Then we added to our stable Profile, who are a uniform supplier. They supply people such as NZ Post, ASB, Burger King, BP and Wild Bean – significant companies.” Profile is in the B2B space, so the three companies have significantly different needs.

Profile has 50 main customers whose needs are relatively straightforward and can be satisfied quite easily, Grant says. Individual EziBuy customers (all 700,000 of them) present a wide variety of combinations of needs and payment modes. “The first sale we ever made in SAP — we just chose a random retail store — was a customer buying three items, two of which were two-for-the-price-of one and doing a return and using a gift voucher and paying for part of it on a credit card. It doesn’t get any more complex than that.”

EziBuy had 10 retail stores. “We are now down to eight because we have closed some of the small-format ones, just because they were not working to our business model. Those eight are all in New Zealand. EziBuy [bricks and mortar] stores are basically a showcase of our catalogue. So EziBuy Australia is now 60 percent of our customer base and 60 percent of our Australian custom is online. The other 40 percent are through contact centre and mail. In New Zealand 40 percent of our customers are retail, 30 percent are online and 30 percent are contact-centre.”

The Max online store is doing the equivalent of about four or five typical bricks-and-mortar stores, “and that is without us significantly pushing it,” says Grant.

“We have just gone through another migration of moving from a third-party distribution centre back to our own distribution centre in Palmerston North for the Max product, which has enabled us to push it harder and faster online, because we’ve got all the product in the same place.”

The distribution centre was already functioning when he arrived, he says. His main role was to tie the centre’s management system into SAP — though again a distance has been maintained. “We are not doing distribution management in SAP. We are doing it in a third-party product that we then interface into SAP.”

As Grant has moved between ICT and hands-on experience of the retail business, the most valuable lesson he has taken from his career path to date is the value of “absolute focus on the customer, both internal [in the business the IT department directly serves] and external [the customer that company serves]. This is a skill that I helped bring to the IT business in EziBuy.”

At EziBuy, rather than looking for business analysts on the job market, Grant has turned technical specialists already in the company into business analysts. “They have a very good technical understanding before they get the business skills, rather than the other way round. That might be rather unusual, but it’s certainly worked for us, because it means they can move very quickly from an idea to a solution, rather than just gathering the ideas and passing them to the IT team to figure out solutions.”

That, in turn, speeds up time to market “and in the retail business, especially cross-channel, time to market is everything”.

If something is “not firing”, be it a computer application or a promotional campaign, it has to be fixed within 24 to 48 hours, he says. “We don’t have a month to think about it.”

His biggest achievement to date in EziBuy? “Implementing SAP,” he says, without hesitation “and doing it without taking the business down for a single day. We changed the core of the company and it continued trading. We continued selling on the web, filling our retail stores and selling through them and taking mail orders and yet we swapped out a 30-year-old legacy core and put in SAP.

“My other biggest achievement is the moving of a siloed, internally-facing IT department to a customer-facing proactive department that the business relies on and gets pretty good service out of. My guys never say any more what the IT staff used to say, ‘it’s not my problem.’ No, I’m sorry, you’re in IT; everything’s your problem.”

One of the biggest immediate challenges — apart from just “driving the business harder and faster” is an upcoming hardware refresh of EziBuy’s contact centre.

The company is moving into computer-telephony integration and plans to enable customers to serve themselves in certain ways; to check the status of an order or the stock of an item online from their own PC. This change should take about a year, Grant says.

Critical feedback

EziBuy’s contact centre is very good at passing feedback to ICT, Grant says. “If there is a general groundswell of opinion out there in customer-land, then guaranteed there’s a problem. With communication goes filtering; the ability to know what is a problem and what isn’t. To do that you need to know your business well.”

Grant reports directly to the CEO. “The CEO has six direct reports and I’m one of them.” He also belongs to a management team of 12, which manages the whole group. “Even though Max and Profile [two other brands owned by the company] have their own general managers, they report to the management team”.

As a technology-focussed company, EziBuy “couldn’t function without the slickest, best, cleanest processes in technology, so it makes sense to have the CIO report directly to the CEO,” he says.

His top hint for leading and motivating a team? “Basically, involve them; share your thoughts with them; use them as a think-tank. If you have an idea, brainstorm it and take them on the journey as well.”

To relax, he dives, skis and does “blowkarting” — land-yachting. With two teenage daughters, one keen on horses and the other on speech and drama, he is kept fairly busy even outside work, he says.

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Tags strategyretailchange managementData managementSAPEzibuycustomer focushamish grantchange agent

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