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Digital Transformation Rejuvenates Spain’s ECI Department Store Group

By Li Bingfeng & Bai Rendong, Huawei

Founded in 1935, Madrid’s El Corte Inglés S.A. (ECI) is the largest shopping mall chain in Spain and the fourth largest department store group in the world with 86 stores in Spain and Portugal. ECI boasts a wide spectrum of quality goods, and provides additional services like home delivery, tailoring, and gift-wrapping.

Digital Transformation Becomes Imperative

ECI revolutionized the retail industry in the early 1970s by launching an unconditional refund service, which was soon copied by department stores worldwide. This refund policy embodies ECI’s philosophy for generating customer satisfaction, which has ushered in the golden age of Spain’s retail sector.

“For many tourists, ECI is another symbol of the country,” the Financial Times reported. “Like the unfinished Sagrada Familia in Barcelona or the Prado Museum in Madrid.”

However, the rise of the Internet and online shopping has empowered e-commerce to supplant brick-and-mortar establishments. This change in customer shopping habits is the cause of unprecedented challenges for traditional retailers.

Against this backdrop, ECI has to cope with data from hundreds of online and offline sales channels, inventory in 38 logistics centers, and a large number of members. Nearly a billion data entries have filled ECI’s sales data processing systems to capacity since the inception of ecommerce over the Internet. Omni-channel customer service systems play a paramount role amidst this new trend.

Forging Ahead on the Path to Innovation

The recent tide of digital transformation compels ECI to blaze a new path in order to survive and thrive. Facing a deluge of complicated data, a data analysis platform capable of extracting valuable business results and driving quick decision-making is vital for improving customer experience.

“We want to build an enterprise-grade high-performance data platform to develop business analysis applications, and support real-time analysis for online and historical data,” a spokesperson for Informática El Corte Inglés (IECISA) said. “The analysis results will help executives make timely and correct business decisions, such as better real-time inventory management and out-of-stock replenishment.”

This vision inspired a prototype of ECI’s High-Performance Analytical Platform (HAP).

ECI purchased four SAP HANA systems during the early stages of the platform’s construction. However, the scale-out architecture system involved multiple servers that complicated device O&M. A large amount of data interaction between HANA nodes greatly reduced performance and caused poor overall IT O&M. On top of that, the retail chain’s suppliers were reluctant to develop an innovative platform, which ECI needed to deploy big data analytics in its internal data warehouse. Therefore, ECI faced mounting pressure both internally and externally, and the platform’s construction came to a halt.

Building on Huawei’s Server Expertise

Said to be the ‘Forefather of all Mountains’ in Chinese mythology, the legendary Kunlun range is known as the home to gods and goddesses, where fabled plants and mythical creatures could be found.

Renowned for stability and reliability, Huawei’s x86-based KunLun Mission Critical Server platform features unparalleled efficiency to provide premium services for enterprise customers across industries, inside and outside China.

At the beginning of 2017, ECI’s executive team was invited to Huawei’s headquarters in Shenzhen.

With an understanding of ECI’s requirements for high performance and near-real-time analytics, Huawei worked with SAP, the world-renowned supplier of enterprise application software and solutions, to launch the single-node 8 TB KunLun HANA appliance scale-up solution, a bold idea based on Huawei’s experience with over 3,000 implementations.

Compared with ECI’s previous scale-out solution, Huawei’s solution improves performance by 30 percent. In addition, Huawei’s solution does not use external storage or switch devices, which simplifies deployment and management. Data table redistribution is not required after capacity expansion, and all the above advantages — coupled with the high performance and reliability of the KunLun servers — counteract any traditional scale-up solution reliability issues.

The proposed Huawei solution was soon approved by ECI. As the industry’s first single-node 8 TB scale-up case, the application had to pass SAP’s rigorous certification process before moving forward. In previous instances, the SAP certification process has taken nearly a year, but thanks to a relentless joint effort by ECI, SAP, and Huawei, the sign-off was completed within a single month.

Finally, ECI was making material progress with its digital platform construction.

Reinvigorating the Long Established Chain

The new digital platform has revitalized ECI. Today, based on sales conditions, stock shortage analysis and automatic replenishment take only minutes. Overall inventory turnover has increased by 20 percent, which saves a colossal amount in annual warehouse fees. The new platform eliminates service bottlenecks and allows for smooth upgrade and capacity expansion, which supports future service development, and achieves system-level availability 24 hours a day, seven days a week.

The new system outperforms the earlier platform by a factor of 1,000 times. ECI now fully taps into the value of data and no longer experiences performance bottlenecks. ECI drives accurate insights into service data in a quasi-real-time manner by analyzing its current inventory status, shortages, and production transfer purchase orders. The nearly 100-year-old retail chain is now on track toward a complete digital transformation.

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Issue 03

Intelligent IT World (10/2018)

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