It was pleasing to see the recent announcement at CeBIT by Harvey Norman's Chief Operating Officer, Mr John Slack-Smith, that Harvey Norman would be pushing ahead with a new enterprise solution. It was also somewhat predictable that they would receive some questions for not pursuing an on-line strategy as reported in MIS Australia. In my view they have got their priorities spot on.
It reminded me of the press criticism that SAP received for not following everyone else into the dot com bubble. Of course history now shows that SAP came out of the dot com bubble stronger and more dominant then ever, because they stuck to their strengths and avoided the hype.
Harvey Norman has grown solidly, has grown internationally and with acquisitions in recent years. The core of their business is in delivering great service, great range, cost effectively. To do this they need to manage their supply chain well. A new integrated system will help with that. Once they get their internal systems better able to perform, then they can leverage that into improved customer experiences, and that may ultimately mean providing online options. So they have definitely got their priorities right.
What I really like about this set of priorities by Harvey Norman is the recognition of risks in doing this scale of change. Some may feel that its easy to put up a web site and take online orders. Well perhaps if you are doing a few orders a week and operating from your spare room. But with 10,000s of transactions at stake, multiple suppliers and a well founded reputation at stake, then it takes a bit more than a web site. There is a lot of process and technology complexity to manage here.
So it is this risk that is clearly appreciated by the Harvey Norman executive in their decision. This is step one in any program of work of this nature; understanding the risk at all levels of the organisation. Then plan accordingly. Congratulations Harvey Norman and team, you are leading Australia in retailing expertise, and perhaps about to lead in managing process and technology change. Go Harvey Go!
Labels: Harvey Norman