ILLUSTRATION BY JOEL KIMMEL
When a retailer owns more than 250 department stores—each with a unique look and feel—managing projects across business units can get complicated fast. That's why Bon-Ton brought in Kris Sham to establish a project management office (PMO) for the information services division.
Mr. Sham was previously director of project management at Saks Inc., where he managed multilocation projects and developed project management processes and standards for the department store company. Nowadays, he oversees project management processes and standards for 200 staffers and about 100 active projects at any given time, from new systems to handle the online shopping experience to enhancements that improve the company's product distribution.
How is technology changing the project landscape in retail?
The industry is going through very challenging times. It's reinventing itself in this new omni-channel world where customers can shop on any platform, from smartphones to computers to tablets. Once upon a time, people just came into a store. Now we still have traditional stores, but we also need to be able to compete online. For example, we could develop technology that recognizes shoppers when they walk into the store and then sends coupons to their phone. It's about providing value and a pleasant experience to customers, and at the same time achieving operational efficiency.
“Project managers in retail have to keep pace with new technologies while simultaneously working to improve customer experience and operational efficiency.”
Can you give an example of a project that addresses this shift?
We're working on a project to replace our current order management system. It handles everything that happens from the time a customer shops and places an order until that order is fulfilled.
Orders can come in from actual stores, computers, tablets, smartphones, kiosks—and they can be as small as towels or as large as furniture. Our current system was built for an older model of business, where people walked into stores or called on the phone. You can patch a system only so much before you just have to build a new one.
This is one of our larger projects, because it involves so many interfaces and back-end systems. We think it will take about one year, which is a long time. By the time you define all the requirements, the underlying business models and technologies can change. It's a lesson in defining requirements clearly, identifying risks ahead of time and coming up with a plan to mitigate them.
Bon-Ton operates stores across the United States. Does this affect the way you manage projects?
It's definitely a challenge to come up with systems that can localize the merchandise mix and customer experience, yet are flexible enough to allow us to standardize. Standardizations—like buying common merchandise for all our stores—would let us gain operational efficiency and provide cost savings.
But we can't treat every location the same. For example, we built a single merchandise planning and allocation system for all 272 stores, but merchants can go in and allocate a different merchandise mix to each location. On projects, we're in touch with store planners and managers across the country, and we always design our systems so they can take different inputs.
When you manage large projects such as these, how much do metrics matter?
Metrics plays a big role in our project management practices. We have to understand how we are managing our projects and resources, and demonstrate sustained improvement year over year. Our chief information officer and senior management lay out their vision of how they want to manage the business. I work with them to translate their vision to what metrics we need, and build a process that supports the collection of the appropriate data.
What project metrics do you measure to better manage business?
We analyze how our time is spent—particularly how much time we spend on forward-looking projects as opposed to projects that support and maintain the business. We also measure what percentage of our projects come in on time and within the approved budget, and then try to understand the reasons that cause project delays or extra costs, so we can eliminate those issues the next time around.
How has the organization adjusted as a result of using those metrics?
We implemented metrics one at a time, learned their shortcomings and fine-tuned to make them more meaningful. For example, we created a manager metric that analyzes how we use our staff. We look at the time spent on value-adding development projects and support projects, and then analyze the reasons why support consumes more time.
We look at what metrics we really need to manage our business, and also how to put processes and systems in place to collect the required data and analyze them. To do so, I constantly ask for feedback from both the project managers and the senior management. PM
PM NETWORK FEBRUARY 2014 WWW.PMI.ORG
FEBRUARY 2014 PM NETWORK