How Kmart modernized using AWS and Micro Focus
A recent Forbes article commented, “COVID-19 will be remembered for many things and what’s becoming indisputable is how it is rapidly transforming business”. A probably less well-known impact is the additional complexity of the pandemic on large scale IT projects. For major change programs, IT teams would typically look to co-locate around appropriate machinery to ensure the final stages of the project go smoothly.
A recent financial services industry report says 72% of those surveyed “have grown more innovative in 2020,” with one banking COO remarking “We have never seen such transformation, such a drive for innovation, as we have witnessed in the last four or five months [to July 2020].”
Shopping around for change
The retail sector, if anything, has been more profoundly affected. Online grocery retailer Ocado has just overtaken heavyweight rival Tesco, a clear signal of market disruption. Elsewhere thousands of businesses globally have had to close their doors for good. Against this backdrop, the story of Kmart’s recent modernization program is all the more impressive.
Kmart’s challenge was to undergo a significant IT transformation to support its new business strategy. As explained to guests at the Micro Focus Realize event, CTO Michael Fagan talked about the technology strategy aimed to align with the company strategy, namely “modernizing … to improve customer experiences, and reducing costs so we can lower prices to customers”.
Part of that mission required freeing up budget by looking to save operating costs, and use that to invest in the future. With partner Infosys, they identified an opportunity to reduce TCO of their Merchandise environment by moving the systems in question into a new cloud-based technology environment. The projected savings from this move, reducing the TCO by 54%, would then fuel the next round of transformations. That saving needed to be realised quickly – by May 2020 – to support the broader change program initiatives.
Advised by Infosys, Kmart chose Micro Focus as the application modernization partner, and AWS as the destination platform. As a member of the AWS Partner Network, Micro Focus’ enterprise solution technology fully supports deployments to AWS.
The project started in March 2019 and sought to move the core merchandise system, which comprised 34 applications, including 19,000 components and around 4,000 JCL jobs, plus 1.4TB of data (Db2 & Files) and 946 user screens.
The new platform, which went live in May 2020, was a full AWS implementation, incorporating Amazon Elastic Compute Cloud (EC2) instances, Amazon Relational Database Service (RDS), and Elastic Load Balancing, as well as the Micro Focus Enterprise Server deployment engine. The new application delivery toolchain incorporated Jenkins, Microsoft’s Visual Studio, GitHub, Micro Focus Enterprise Suite and CTRL-M technologies.
As CTO Michael Fagan explained at the time, the project as a “move and improve” strategy that – while it achieved significant cost savings – met a number of further important incremental objectives:
– Agile – Increased agility with AWS Cloud Service
– Bringing Home – Increased security by bring order management system from Third Party Managed Infrastructure to Kmart managed AWS infrastructure
– Pay As Per Usage – Move to pay per use Infrastructure (AWS) providing significant cost savings
– Digital Transformation – Readiness for Digital Transformation and increased online presence
– Advance Reporting – Enhanced reporting capability with Micro Focus and LRS component
– Speed to Market – Enhanced development capability with tools for faster agile development
Vitally, the project cut-over achieved the golden rule of any change program – zero business impact. Which, remember, they achieved during a pandemic “lockdown” period, which meant the work took place remotely. “We had a real deadline, a real drop-dead date, so we couldn’t miss the deadline that we had, which was smack bang in the middle of COVID-19,” Fagan said. Furthermore, the projected cost savings are significant, “in the next 5 years it will save … $30-$40 million,” explained Fagan.
Kmart’s strategic investment in the AWS platform includes an enterprise wide training and certification program as they seek to maximise the partnership.
Things are changing at unprecedented pace. IDC predicts that 60 percent of global GDP will be digitized by 2022, a prediction made before the pandemic hit this year. The strategic mission was always about achieving DX ambitions. Now, the urgency has gone off the charts. Kmart’s example illustrates that the right blend of pragmatism, planning, technology and expertise can help turn a challenging period into genuine opportunity.
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