Communications and business visibility are critical to any company in the fast-moving retail industry. Daniel Stanton finds out how Al Fahim Enterprises, operator of luxury brand Paris Gallery in the UAE, is using IT to stay ahead of the chasing pack.
When fashions change so quickly, retailers have to be quick to adapt. In its commitment to constant change, one of the Middle East's leading fashion retailers has recently upgraded its business platform and communication system.
Al Fahim Enterprises, which operates Paris Gallery, the luxury goods retailer, has just completed phase one of its rollout of SAP for Retail for 400 users. The initial phase of implementation, which is one of the largest retail software deployments in the region, includes mySAP ERP 2005, SAP NetWeaver Business Intelligence and SAP NetWeaver Portal, to be followed by the implementation of applications including mySAP Customer Relationship Management, SAP Forecasting and Replenishment and SAP Extended Warehouse Management in the second phase. Once the initial phase is completed in the UAE, in partnership with KPMG, Al Fahim Enterprises will roll out the retail solution in Saudi Arabia and Qatar.
The software will support all aspects of the operation, providing real time business visibility and operational excellence across all core retail processes while enabling top-line revenue growth and cost reductions. Al Fahim Enterprises will implement NetWeaver as its information and business process foundation. Essam Enany, president SAP Arabia, says: "We are pleased that Al Fahim Enterprises has selected SAP to drive the company's future growth and innovation. The retail industry has grown significantly in the region and is tipped to be one of the fastest growing sectors. SAP understands that retailers need the ability to quickly adapt and innovate to continue to create value for their customers. Our solutions allow companies such as Al Fahim Enterprises to flexibly design, implement and execute new, agile business strategies and processes."
Majed Al Mutairi, CIO, Al Fahim Group, says: "Our vision is to be internationally recognised as a leading retailer of luxury goods in this region. This is a set of tools that are enabling Al Fahim Group to achieve that vision and objective."
The group had clear aims in mind when it started looking at ERP systems. "We wanted to streamline, integrate and automate our business processes," says Al Mutairi.
"This has enabled us to integrate various company business units and provide for accurate, consistent and available information. It has allowed us to standardise processes across the group." Previously, Al Fahim Enterprises had different systems operating in different parts of the operation, making it difficult to obtain a clear view of the business at any one time. With the implementation of SAP, that should be made easier.
Proper planning and change management was key to the success of the first phase of implementation, according to Al Mutairi.
"We identified the risks we could foresee happening and formed plans to mitigate those risks," he says. "We have achieved almost all of what we set out to achieve. SAP is a key enabler for us bringing in international best practices and building competencies to achieve our strategic plans for the future."
J.K. Nair, team lead, finance and control, agrees. "SAP can provide a single view," he says. "It helped us to understand best practices."
From a human capital management perspective, the implementation of phase one has enabled Al Fahim Enterprises to implement organisational management, a centralised payroll, analytics, workflow, and e-recruitment. It has also helped contribute to a paperless office through the introduction of electronic forms, and ESS (employee self service) and MSS (manager self service) systems that allow users to serve themselves, reducing their demands on HR staff to carry out simple or repetitive functions.
On the retail side, SAP has allowed Al Fahim Enterprises to work on organisational structure, stock replenishment, and global product classification, meaning that each product has only one definition across different business areas, avoiding duplication and repetition. "The preliminary phase provided room to develop and allowed a better understanding of the project," explains Shadi Badran, retail team lead. Now the group is in a good position to know what it needs from the implementation of the other modules in order to achieve its business objectives.
"We need to utilise our resources in the perfect way to gain the competitive edge," says Mohammed Al Fahim, Group CEO, Al Fahim Group. "Our strategy and philosophy is 'change before you have to'. For us to sustain this we have to continually change.
"We need to service our customers up to their expectations. We need to utilise our resources in the best way at the right time. SAP allows us to do that - to be stable and reliable." Al Fahim adds that a major reason for choosing SAP rather than a competing ERP system was its proven stability and his confidence in their business partners to implement it successfully and provide quality support.
"It's a very disciplined system," he says. "We need to be aligned with our corporate goals. We are moving from being a family-run company to becoming corporate-run. Other systems leave you less flexibility."
Paris Gallery has also made investments in upgrading its communications systems. It recently conducted the roll out of Avaya IP telephony solutions across its showrooms in the UAE and beyond.
Each showroom is staffed by brand specialists working directly for international cosmetic companies, so it is essential that they are able to stay in constant contact with Paris Gallery head office, as well as the showrooms. "As one of the leading retail brands in the UAE, it is important that our employees are efficient and informed at all times, to assist customers and keep business flowing smoothly in every showroom. Rolling out Avaya across our showrooms offered us a streamlined approach to our voice, contact centre and unified communications,” says Al Fahim.
“Our business and engineering team can now collaborate and manage all moves, adds and changes across all showrooms with minimum on-site intervention."
The Avaya solution and the underlying infrastructure were implemented by local partner EMW and was ready to serve customers in just two days, with minimal impact on footfall and sales. With enhanced communications, between different parts of the business and employees, Al Fahim is now set for the future.