Process Driven Retail with SAP

October 23rd 2007Jeff Wiggin, Ralph Haffenden, Tanya Coldiron

2Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Process Driven Retail- Agenda

Agenda

Factors for Success

“Running” a Process Driven Project

Process Driven Retail– Accenture Retail Process Model– SAP Retail Linkage

Chico’s – Who We Are?– SAP Retail Journey– Accenture Partnership

3Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Who we are?

Ø Chico’s FAS includes the following brands: • Chico's• White House|Black Market • Soma Intimates

Ø $1.64 B Specialty retailer of private branded, sophisticated, casual-to-dressy clothing, intimates, complementary accessories, and other non-clothing gift items.

Ø 960 women's specialty stores in 48 states, the District of Columbia, the U.S. Virgin Islands and Puerto Rico

Ø Headquarters are located in Ft Myers, Florida

4Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- SAP Retail Scope & Journey

Ø Enable strategy to pursue high growth in a multi-brand retail business.

Ø Support high-performance throughout the entire supply chain

Ø Implement a new application platform to standardize leading practice processes and provide one version of the “truth”

Ø Burning Platform: Legacy IT applications were highly customized,loosely integrated systems that were not build to support the multi-brand business strategy

Business Challenge

ü Financeü SAP for Retail Core ERP Merchandisingü Business Intelligence (BI)/ POSDMü Merchandise Assortment Planning (MAP)

SAP IS Retail Scope

5Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- SAP Retail Timeline

Ø March 2006• Chose SAP Retail for ERP Solution• Chose Accenture for Integration Partner

Ø soma Implementation• April 2006- Kicked off Design/Blueprint for pilot• Feb 2007- Rolled out entire footprint for soma “big bang”

Ø WH|BM & Chico’s Implementation• June 2007 - Kicked off Solution Education• Sept 2007- Began Design/Build phase• 2008-2009- Planned Rollout

Timeline

6Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Process Driven Retail with SAP

Ø Not a “system’s project” but a value led- ERP implementation based on core business processes and identified competitive advantages.

Ø Process Driven Retail

Ø Define “to be” processes based on retail process model and known competitive advantages

Ø Obtain awareness, accountability and alignment on the strategic processes with the leadership team

Ø Design/Configure solution based on defined process

Ø Test/Train with integrated scenarios based on processes already aligned to with the business

7Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Accenture Retail Process Model Overview

§ Retail Industry best practice knowledge in a reusable asset- “Retail on a page”

§ A common language, method and infrastructure for building out processes, solutions and services

§ Interactive Process Model Includes:§ Process Flows§ Capability Areas§ KPI’s & Definitions§ Scales of Mastery

What is it? What are the key benefits?

§ Accelerates project timelines and scope definition

§ Educates/Level sets project teams on retail processes & client’s competitive advantages

§ Provides an end to end view linking process with SAP solution and transactions

§ Drives design session(s) from a process perspective – project focus is the business not a system’s implementation

Ø Accenture’s Retail Process model helps to accelerate the process definition for the project using industry knowledge of best practices

8Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Retail Process Model

Ready to run demos

AP330 CRP ScriptAP322 Configuration DesignBP310 Business Process DesignPredefined Blueprint documents for standard retail scenarios

Step by step activities execution guides

Documentation and rationale for the customizing settings

Accenture Retail Solution Overview

(ARBS)

Complete process flows with retail related data examples prepared to facilitate demos

Pre Configured System Template

Pre-configured processes for the retail sectorPotential sandbox previous to DEV Client System

Foundation for defining business processes and identifying competitive advantages.

Chicos FAS- Accenture Retail Business Solution for SAP (ARBS)

Ø Accenture Retail Business Solution for SAP is built upon the Retail Process model and provides documentation and a pre-configured system with business processes, configuration guides, scripts and ready to run demos.

9Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Process Driven Approach- Project Impacts

Ø Using a Process Driven approach drives all areas of the project:

Ø Project Team Structureü Defined by Integrated Process: I..e Purchase to Payü Business & MIS representation on each team

Ø Design/Blueprint Sessionsü Process is reviewed with both system and non-system tasks to

drive an integrated solution.ü Roles & Requirements are driven through the design sessions

Ø Configuration & Buildü Projects in Solution Manager are built on Defined Processesü Transactions are defined based on known processes

Ø Integration Testing & Trainingü Integrated scenarios are basis for testing and trainingü Both system and manual steps are defined as well as interaction

to legacy systems.

10Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Leading Practices

• Accenture Retail Business Solution (ARBS) Documentation and Solution

INPUTS OUTPUTSProcess Workshop

With Key Participants

• Updates to Business Process Flows

– Activities– Integration Points– Roles by business area– Inputs– Outputs– KPIs & Process Metrics– Impact Assessments

• Detailed Requirements (Traceability Matrix)

• Organization Role & Headcount

• Identified Gaps/Alignment Points

• Action Items (logged and assigned)

Chicos FAS- Process-driven – Design Approach- Example

• Process/Brand Leads• Business Process Owners• MIS Team Members• Solution Architects• Change Management Team• Testing• BI and RICEF Team

• Accenture Retail Process Model

• As-Is Process and/or System Documentation

• Known competitive advantages

• Organization Impact Assessment

11Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Process-driven CRP Example (Purchasing finished goods)

Purchasing finished goods is the process of creating a standard purchase order for fully manufactured items, approving that order, tracking and receiving units into inventory

Key Alignment PointsProposed Solution• Standard SAP purchase orders are created and

updated as needed• POs are exported to PDF files (PO form) and

communicated to vendors via email• POs are manually signed for approval prior to

finalization• POs are updated and re-communicated to vendors

as style or order details change• Changes to the number of units on-order impact

OTB• Tickets are ordered 60 days in advance of the

delivery date via a file that is generated from the PO and sent to Avery Dennison

• No EDI

– Buy Meeting– Preliminary

Approval– Pricing &

Delivery

Process inputs

Create purchase order

Approve purchase order

Updatepurchase

order & order tickets

Communicate PO to

vendor

Receive units and close the

PO

On-hand inventory in DC

Process outputs

• Manual PO approval process• Closing open units on a PO automatically by

using a tolerance factor in the system• Styles finalized prior to creation of PO

Chicos FAS- Process-driven – Process Flow (Example)

12Confidential to Chico’s & Accenture • ©2007 Chico’s FAS, Inc. All Rights Reserved.

Chicos FAS- Factors for Success

• Focus on People, Process & Technology

• People– Don’t Underestimate the Human Element

• Leadership Alignment is Critical- CEO Sponsorship• Behavioral Change is Difficult and Must be Managed

– Train Early on Future state process, Follow With Systems Training Near “Go Live”– Communicate Clearly and Often

• Process– Don’t Try to Fit Technology to Current Ways of Doing Business– Business Disruption is a Given, Make it Worth it by Creating an Integrated,

Process Driven Solution

• Technology– IT Strategy Across Brands and Capabilities is Critical to Driving Value through MIS– IT Governance- Identify Business & IT Decision Owners to Make Quick Decisions