CIO M.Video Sergey Sergeyev: About the main IT priorities of retail network of the Interview of TAdviser

Sergey Sergeyev:Channel separation of sales in a modern business environment is at least inefficient. Buyers want to have both on the website, and in traditional shop an identical set of services, and the companies which as much as possible pull together online and offline channels, receive noticeable synergy. And it is not the theory, but the proved business model any more. For example, you want to purchase the smartphone — at first visited several websites, compared models and the prices. Then decided to look in shop alive at "finalists", at once did not select, but in the evening nevertheless made the order and today you wait for the courier. It is purchase online or offline? What you the client for the retailer? M.Video of one of the first implemented integrated approach, and dynamics of our Internet sales and the general results speaks about unambiguous efficiency of such approach. More than seventy percent of our buyers begin a way to the purchase online, and it can quite come to the end in one of our shops. Though everything can be and exactly on the contrary, and anyway the buyer has the identical range, the prices and the choice of services. The same credit it is possible to issue online absolutely quietly. It is quite correct to believe that integration, mixing of sales channels today — already come true fact, and the buyer completely defines this trend. Retail only follows it, corresponding to the developing client experience best of all or worse.

Can seem to someone that, saturating a traditional format with electronic technologies (the digital signage tools, electronic booths, Wi-Fi-beacons, etc.), he kind of aims "be brought up" at electronic, proving to the buyer that it too allegedly corresponds to all current trends. And thus there can be a thought all about the same competition between online sales and traditional shops. In fact, if the retail company does everything competently, these Wednesdays — the Internet and shop — organically supplement each other. M.Video, for example, is able to keep track as online influences offline sale, of so-called ROPO effect (Research online, purchase offline) and uses this knowledge for development of sales. Our sellers in shops use gadgets with the special software which is completely integrated with all working systems. Such "mobile" sellers in a different way work with clients, and it positively affects sales.

Increasing, perhaps, "density" and a variety of use of electronic technologies in trading floors, we, of course, aim to use several advantages which internal presence of the buyer and a possibility of his communication with the consultant gives. All this just is also the aspiration to make client experience universal.

In terms of managerial technologies if we now also aim to separate something, then the speech can go only about tracking and the analysis of behavior of buyers (in online and offline nuances of behavior differ by determination). If we talk about marketing, attraction and customer retention, investments into development, then here we pursue common goals, respectively, believing that elements of the electronic and traditional directions of retail business are very closely integrated or already actually inseparable.

Sergey Sergeyev:Such concept really exists. I think, it is in many respects a terminology question though I did not use this term intentionally. First of all, because all traditionally meant by it and continue to mean a miscellaneous. I consider that to it anyway it is necessary belongs carefully because this term was widely adopted just when integration of electronic and traditional sales channels only became a pressing practical problem. And at that time these channels really existed separately. Now their consolidation, at least in terms of real-life templates of behavior of buyers, in fact — the come true fact. And the strategy of retail in such situation a bit different. M.Video, already gone through a consolidation stage online and offline in terms of the range, the prices, services, works on creation of completely seamless environment now — both on client side, and in a back office. We call this One Retail.

Sergey Sergeyev:Existence of electronic and classical channels, of course, is a necessary condition, but, I think, after all not sufficient. On the example of business development of M.Video it is accurately visible that even stable multi-channel retail business needs to adhere to the important principles penetrating activity of all company. I can give pricing policy as a characteristic example. It should be universal in space of all sales channels, and the prices respectively should be uniform. The technical policy of IT support of processes, in turn, should be formed of these principles, and having dealt with it (and, respectively, having understood what products and their functions we use as we integrate them that we develop, etc.), we can already objectively build an investment strategy. I can tell that we within two-three last years did essential investments both in technology, and in processes, and in personnel, and in formation of the strategic principles of a company performance. All this required considerable resources including our IT department. And it, certainly, while by the beginning of work both sales channels already existed and at the same time were rather developed.

Sergey Sergeyev:For a start I will tell, as we use products of foreign vendor, namely — the Ecommerce system from Oracle company so we precisely, as stated, in a subject. Here we, in fact, return to the sacral question of advantages and shortcomings of the boxed solution adjusted for industry features and set of tasks most relevant for today. Yes, I agree, implementation of such products gives noticeable effect in solution of the problem of integration of sales channels though at the same time it is always necessary to remember also investments which should be made at their implementation. And not only and even not so much in acquisition of licenses, how many in completion of software. The complexity of these products is at the same time both plus, and minus. In them the rich functionality and, apparently, quite clear and adequate logic is implemented. But, implementing them in practice, you on the example of not one function are convinced that they literally force business to implement certain rules and processes. You should or adopt these rules, or develop the, respectively seriously investing in development. It concerns the same pricing, logistics, purchases and a lot of things still. And integration of sales channels, or the same omnichannel (if suppliers got used to such term) here not an exception. It is possible to add to it, as in development foreign platforms for retail are though rather powerful, but not the most flexible tool, and implementation speed with their help of new services which are so often necessary to retail, not the highest. And, at last, applying the foreign platform, we because of internal dependences of a system are often forced to implement formally some functions which we actually do not use. As a result the effect of the used complex IT solution as a shrink-wrapped software product, of course, is far from hundred percent.

Therefore seriously it is necessary to be engaged in developments in the company much though in general for large business (including, by the way, and for foreign) it is quite customary practice.

Sergey Sergeyev:Serious priority for us is capability now to provide continuous and at the same time very intensive saturation with IT services of our business.

It is at the moment important to make ours the front - and back office solutions the most flexible, and the last also easily expanded. For this purpose we build a middleware-layer which will provide flexible information exchange between these levels. Here it should be noted especially that the number of front office solutions in modern retail business continuously increases. Mobile application, call center, the website, the trading system plus mobile application of the seller — already straight off five front solutions which should work by the uniform principles.

If to take growth of number of widely demanded IT services into account and also the fact that our federal company works at all territory of Russia the need for full-function middleware becomes even more notable. For example, before us there is a problem of reduction of delivery date of goods for X percent in the Far East. At the same time at least it is necessary to adapt a supply chain and IT services, necessary for its functioning. Within the multilayer architecture developed by us we should not finish several independent front office solutions. And such works, in fact, have permanent character. Having adequately configured middleware, the necessary functionality can be received everywhere at the same time. I will repeat that now it is the major for us a task, but, considering universal trends of automation of modern business, I think that not only for us.

Sergey Sergeyev:First of all, I want to note high quality of the Russian software of the corporate level, its prevalence in corporate environment and, as a result, existence of impressive experience of implementation of domestic goods. Specific examples here, I think, all are well-known. Therefore in most cases automation of traditional processes we are at least ready to consider the corresponding systems as a full-fledged alternative to the western development if, say, there is a question of the choice of a product.

Except a problem of IT support of traditional processes, in retail there is a high demand in the advanced developments dictated by the latest technology and market trends or emergence of these or those requirements from the state. I would note the last especially because exactly in recent years IT support of a number of the major state initiatives (for example, the Unified State Automated Information System, Mercury or 54-FZ, concerning the principles of processing of fiscal checks) was quite successfully performed by forces of domestic developers. Many of similar initiatives, as we know, have a direct bearing most on retail and in many projects of M.Video took part in quality of the test platform.

Next year there will be a biometric identification which also progresses from the state. And again domestic developments will be required. Here it is useful to remember already mentioned middleware. In case of wide use of biometrics for certain there will be a problem of use of this technology in the majority of front office solutions, and existence of an interface layer of business logic will allow to cope with a task optimum.

It is also not necessary to forget about the innovative developments. Yes, not everyone from them will receive practical application in retail business, and what will be received, perhaps, will not influence a key image its development. But the demand of IT-Innovations in retail stable, and here is anyway necessary development the ecosystem supported by the Russian startups.

Sergey Sergeyev:This concept traditionally contacts two trends. The first is a mass collecting of primary data, the second — creation on this basis of the algorithms of information processing focused on the solution of business challenges of the company. I think that data collection is the stage preceding full-scale digitalization rather. With great or smaller success it is done now by many. The recent project on standardization of cash vouchers and their centralized accounting in scales of retail business of the whole country showed that even such superlarge-scale projects can be implemented very qualitatively and generally for a limited time frame.

With data processing it is more difficult. Anyway now these data if are used, then generally traditional image, say, for formation of the same reporting. Full digital transformation means the automated execution of any business function with the minimum involvement of the person for me or in general without his participation. And it already essentially other direction of automation of business and, respectively, other accents in work of IT department.

In trade intellectual algorithms generally connect with decision making in interaction with buyers. At least partially to shift "responsibility" for these solutions to artificial intelligence, here indeed it is necessary still the huge volume of work. For example, it is quite possible to say that in the presence of necessary primary data and functions the expediency of opening of new shops in this or that point and their profitability can be estimated using machine intelligence too.

In our business there is also a number of the directions in which all cycle of customer interaction can be organized in the electronic environment. It is, for example, sale of electronic content. Here already now it is possible to use effectively technologies of full automation (or, perhaps, robotizations) process that allows to exclude intervention in process of personnel completely. And we on this way already go.

Sergey Sergeyev:Traditionally the IT infrastructure providing functioning of business systems was separated into computing powers, network devices and data storage devices. In the two first directions in general the backlog was made a little earlier, and now it is possible to use it. More problems can arise with the infrastructure connected with data storage. Also it is connected both with growth of information volume, and with big, than earlier, a variety of its formats.

Sergey Sergeyev:Yes, it would seem, accounting and reporting systems, planning of commodity and financial flows and some other are implemented everywhere for a long time. But it is necessary to understand: requirements to the reporting which took place even not ten and three years ago, very strongly differ from those that are shown to it now. It, in turn, forces business to continue to invest in the traditional systems, as well as to improve processes which this reporting covers.

Also in no small measure similar investments stimulate growth of variety of the systems of the class front-end in general and "mobilization" in particular.

And if to speak specifically on our business, I will note that the process of consolidation of M.Video and Eldorado which began recently, of course, cannot be successfully performed if we do not raise the questions of functioning of basic IT systems of both companies at all.

Sergey Sergeyev:We use three years the general principles of investment into IT. It means that the decision on what projects we finance, we accept together with functional managers of the directions and top managers of our company. It occurs within the committee on investments created by us and acting on the permanent basis. All this allows to observe that balance. But if we started talking about investments, I will note that, from the methodical point of view, we try to separate the approaches connected with investment into development of the traditional systems and financing of the projects directed to implementation of innovations and implementation of the principles of digital economy so far. In the latter case piloting, as a rule, is required.