strategıx

Leveraging JDA technology to support a Shelf Connected Supply Chain

Amy HigginsVP, Space Management & AnalyticsSears Holdings Corporation

1

• Introduction to Sears and Kmart• Our Shelf Connected Supply Chain Strategy• Implementation Roadmap• Benefits Realized• Lessons Learned

Agenda

• Sears Holdings Corporation is a leading integrated retailer in the USA Over $40B in revenue Over 3,900 full-line and specialty retail stores in the United States and Canada. The primary retail formats consist of Kmart and Sears Several proprietary brands including Kenmore, Diehard, and Craftsman

Introduction to Sears Holdings Corporation

Kmart• 1,261 stores account for approximately 37% of Sears Holdings revenue

Sears• 803 stores account for approximately 52% of Sears Holdings revenue

Floor & Space Planning

Our Shelf Connected Supply Chain Strategy• By leveraging data and analytics, we are able to take action on consumer demand

signals at several points in the retail process.• Within the space planning solutions specifically, we can respond as part of the

category review cycle or more rapidly through individual item review processes. • Several integration points of space, demand, and forecast data are necessary to

support this level of responsiveness.

Category & Item Review

Forecast & Replenishment

Store Receipt & Execution

Store/Item Consumer Demand Data

Store/Item Forecast Data

SHC Space Management Transformation• Several gaps existed between our current state and a shelf connected

supply chain Store floor plans were out of date, space analytics were not accurate. Store planogram assignments were not reliable and store execution

compliance was not measured. Space productivity analytics were not a regular input to the planning/category

review process Planogram/item space data provided to downstream processes was

fragmented and not consistently utilized Space Management data was not available in a database

• In 2007, Sears Holdings began a transformation of the Space Management area Leverage best in class technology solutions to improve return on space Deliver improvements to store inventory productivity Drive workflow efficiencies to support analytics

JDA Space PlanningJDA Intactix Knowledge

BaseMaster data integrationBusiness process re-

engineering

JDA Floor Planning integration

Item space productivityFloor plan category

space productivityBusiness process re-

engineering

• Technology Advancements From 2008-2010 we deployed several modules including JDA Space Planning, JDA Floor Planning, JDA Planogram

Generator and the JDA Intactix Knowledge Base. These applications allowed us to eliminate several manual activities, support store specific space plans, and made the overall space management processes more efficient.

These efficiency gains allowed us to pursue more advanced analytics to improve return on space and inventory.

• Closing the data gaps In 2009, we began incorporating store/item demand data to our processes allowing us to bring data driven decision

making capabilities to our business clients during category and item reviews. In 2010-2011, we completed the capture of space data for each store giving us visibility to the unique sales floor layout.

We now have the ability to make store specific decisions to fully optimize our space.

Our Space Management Roadmap

Foundational systemsBusiness process and

data efficienciesWorkflow enablers

Foundation

Integration

JDA Planogram Generator pilot

Store specific floor plan maintenance

Store/floor plan process integration

Certification Programs

Rules based mass planogram generation

Ability to execute customer segmentation

Elimination of manual handoffs

Item & category level productivity analysis

Business process & data efficiencies

Workflow enablersBene

fits

Initi

ative

s

Foundation/DataIntegration/Leveraging

JDA Planogram Generator expansion

Store space captureStore/planogram assignment

advancementsOptimization advancements

Store space data accuracyStandardized integration of

all space data elementsImprovements to

optimization methodsBusiness Process Efficiencies

Analyzing/Strategizing

Space Productivity Dashboards/On demand reporting

Integration of assortment plans and JDA Demand forecast data

Continual space optimization advancements

Store space productivity top-down/bottom-up

Integration of planning and execution throughout process.

Advanced reporting & analytics Workflow efficiencies Planogram Generator

advancements

2008 2009 2010 2011 2012+

Integration with category & item review

• Space Planning leverages key performance indicators to support analytics Store department and category productivity

optimized during store projects/remodels Store specific floor plans ensure optimal flow and

adjacency for each store/fixture configuration Item level KPIs support optimal shelf space

allocation

• Future plans Space aware assortment planning

Category & Item Review

Integration with demand & replenishment

• Space Planning data supports inventory management processes Store item authorization Store level item lifecycle management Store item minimum presentation quantities Store item shelf capacity Presentation in-stock reporting

• Future plans Store item forecast data will be leveraged to

support space optimization

Demand Forecast & Replenishment

Integration with store receipt & execution

• Space Planning data supports store item receipt, execution, and replenishment Planogram reset labor estimates Planogram and floor plan PDF available via web DC case label provides store location information Item location integrated to all store systems Item location on shelf labels supports In store automated shelf replenishment

notification

Store Receipt & Execution

Lessons Learned

• Business Process Depending on the organization, business process may be well established or

difficult to change. Allow time in the project to fully understand where business processes need to be redesigned

• Technology & Data The JDA Intactix suite is highly configurable. Take time to document future

state business processes in detail and determine those areas where a tailored interfaces & workflow are required.

Identify data gaps early and develop a plan to gather. Lack of required data to support business processes will impede progress.

• People Identifying the right talent and ensuring they are properly trained is critical to

success. Throughout our roadmap, education and certification was necessary for the

team. This is an ongoing area of development as we continue or journey.

Thank you!