Having the ability to adapt to rapidly changing business environments is vital in any industry and for Virgin Entertainment Group, which sells compact discs and DVDs in 16 stores nationwide, adapting to the rising trend of online music downloading sites is critical for survival.
In addition to compact discs and DVDs, the North American subsidiary of the UK-based Virgin Group, plans to introduce a clothing line and consumer electronics at its Megastores to help offset a decline in worldwide CD sales. Those changes have Robert Fort, director of information technology at Virgin, reviewing the IT systems in place to support sales of the new products.
Fort has had his finger on the pulse of the IT market for some time. The company financials is run on a JD Edwards system so Fort has had to steer Virgin through the uncertainties that arose when Oracle acquired the software vendor and announced plans to integrate the technology into a new Fusion product line.
But the heart of the company has been sales at its retail locations, which is managed by a merchandizing system developed by Scottsdale, Ariz.-based JDA Software Group, Inc. Seeking greater flexibility, Virgin plans to add Triversity point of sale software, allowing stores to handle a more diverse product line.
Fort said his company had been considering Triversity before it was acquired by SAP last September. SAP plans to wrap Triversity's technology into the SAP for Retail suite. But don't look for Virgin to standardize its systems on SAP anytime soon, he said. Management has to finish realigning its business processes before even considering standardizing, he said.
"There's always been a lot of mix and matching going on in the retail industry," Fort said. "With all the consolidation going on right now, we'll watch how those players integrate their acquisitions."
The company is also experimenting by adding functionality into about 150 video information kiosks it uses in its New York City, Time's Square store. Currently customers can scan CDs at the kiosks and get product information as well as listen to various audio tracks.
The goal is to give customers more information at the kiosks, including the ability to buy CDs and other products, unavailable at the store, at one of its online partners. The Triversity software will allow Virgin to integrate sales at the kiosks without having to initiate a duplicate data warehouse, Fort said.
"There's a lot of metadata around it and this allows us to add features much more easily without duplicating our work and our systems," he said.
The Triversity software will integrate with the JDA merchandizing system, replacing Virgin's legacy IBM point of sale application that was installed in the mid-1980s. A rigid framework was set up for the system at that time, which allowed for efficient CD sales, but didn't support many other products, according to Alan Flaesgarten, Virgin's senior manager of applications and development.
"The old system ran like a champ. It was reliable, but it was incredibly expensive, inflexible and it's no longer supported by IBM," Flaesgarten said.
The company will roll out Triversity in March in its Southern California pilot store and aggressively through all its stores from the West Coast to the East Coast, he said. The new system will put controls in place, meaning that cashiers and store management will need to be trained on the new pricing module.
"The application is configurable so we don't have to custom code that, but any time you institute controls it challenges the business user to review the practices in the store," Flaesgarten said. "We'll take it one step at a time based on any issues we may encounter."