More than 90 percent of retailers failed to increase productivity over the past few years and margins are projected to fall by a further 13 percent by 2030. Tesco won’t be one of them. The multinational grocery retailer decided that, in order to better serve its customers worldwide, it needed clearer visibility into its business processes.
“Every little helps” according to Tesco plc’s slogan. It means that, when working toward a goal, every contribution—no matter how small—can help you to get there.
Tesco knows about small steps; its founder Sir Jack Cohen started with a market stall in London in 1919 and opened his first store 10 years later. Since then Tesco has bought, built and opened thousands of new stores, today boasting 6,800 shops worldwide.
Since Tesco introduced self-service shopping in the 1940s, consumer appetite for digital and contactless ways of shopping has radically increased.
So, to be able to turn on a dime when market conditions changed, Tesco had no choice but to become more agile. Its competitors were changing their business models continually, and Tesco knew it needed to transform its processes in order to compete.
Jason Dietz, Head of Process Architecture and Capability for Tesco Global, said: “Our competition can change their business overnight. It was important that we have a clear decision-making process to become leaner and fitter—that was the mantra.”
In terms of technology, the supermarket giant was looking for more than a “little” help. Process visibility was an issue; Tesco was constantly finding gaps and holes in its processes and manual intervention was rife. Processes were documented through workshops and shared using Excel spreadsheets, PowerPoint and Sharepoint.
Without process visibility, Tesco could not be agile. It could not make its customer experience (CX) consistent, and its decision-making ability would remain hampered by a lack of transparency. The grocery giant could miss out on opportunities for the future—reflecting the changing nature of the retail world. Its more agile competition would win.
“We were constantly reworking our processes and there was not enough control or guidance,” said Dietz. Tesco’s process architecture team was formed as part of Tesco's Global Finance Transformation Program (GFTP) and Business Operating Model Review. Driven by the leadership team with the aim of driving Tesco to becoming a process led organization.
The team identified that Tesco needed to reinvent its service model architecture. With a single source of truth for process design and standard operating procedures, Tesco would be able to:
By implementing this single process design/SOP platform, Tesco would gain complete visibility and control of its processes worldwide, offering transparency across stores— reducing risk and costs.
For this project, Tesco partnered with Software AG, using ARIS to deliver an integrated view of its end-to-end processes, allowing Tesco to create a business operating model that would hypercharge its efficiency. In 2017, Tesco made its investment with five designers and 20 viewers. After the successful cloud deployment for GFTP, Tesco expanded its use into human resources and, in 2019, selected ARIS as the de facto enterprise management system for its global service model transformation, adding Risk & Compliance Management and task mining using Robotic Process Discovery with Software AG's partner Kryon.
ARIS was deployed extensively during the coming months, driven by the small process architecture team who finished the configuration in four months.
Today, Tesco has built an extremely impressive global process platform that is quickly evolving to give full end-to-end visibility and management of the enterprise. There are 160 active designers across the business, with 300 fully trained, and 1200 viewers embedded within the business operations.
Tesco is looking to expanding this to thousands of viewers with processes down to store operations level to ensure a consistent and efficient customer experience. These will be provided to customer-facing teams within store through use of a store portal. Beyond that, there are aspirations to expand into the Internet of Things to automatically capture actual process data.
As part of the service model project, Tesco's use of ARIS and supporting technology has enabled improved visibility across operations and shared service centers across the globe.
The robust foundation built by Tesco in ARIS provides the ability to dive into processes to see how the business is working. Tesco’s teams have the confidence to manage their processes properly.
This transformation has not gone unnoticed by the CEO and Board with the approach and benefits of the Tesco Service Model being shared as part of investor briefings. The scale of what has been achieved in building Tesco’s end-to-end business model in ARIS far exceeded expectations.
Software AG is proud to have partnered with Tesco achieve their goal with ARIS— “Every little helps.”
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