What does it mean to work on the digital transformation of a famous fashion brand with 120 years of history? Why does digitalization mean not abandoning the company’s principles and traditions? What should a business pay attention to while outsourcing its software development? Fredrik Nelson, Chief Information Officer at Stenströms, one of the oldest and most trusted elite fashion brands in Europe and North America, gives his answers.
– Stenströms is a big company with a wide distribution network. You have physical stores and retailers who are working with you as partners. What part does your website play in the whole system?
– ECommerce is growing for us in general. We used to have only a website for pre-orders, then we added a B2B site where users could login and see the prices. At first, it wasn’t very successful because some of our retailers are traditional people and prefer old-fashioned calls. But now going online has become more popular and we are picking up the pace on the B2B site. We released a website for end clients two years ago and have seen growth here as well. Mostly, people look for things on the website and then go to stores.
– So your clients prefer to buy the company’s products in the stores?
– Yes. It’s very important for us to keep the retailers happy, to honor them that they are valuable for our business. That is part of our premium service when a client can come into a store, feel the fabrics to the touch, try our shirts on. We need our retailers to have a nice talk with them, take measurements for custom-made shirts and so on. We want to keep the personal touch that you actually get in stores.
Retailers were worried when we announced the launching of the B2C website, they thought all business will go online. But we are making advancements for them. For example, we have a clear statement – don’t do the Black Fridays or any sales online. Retailers are important!
– They also enable the production of custom-made shirts, don’t they?
– Yes, and we want to increase in the field of custom-made shirts. That is how we came up with the idea of a Made-to-Measure application. Currently, we can produce only a limited number of custom shirts per week. That is because retailers have to fill in a paper form and send the client’s measurements by fax. Managers in the office can not always read what was entered, some information can be missed, the fabric might be sold out, etc. It took a very long time to prepare the orders, the process is slowing us down. So we said we need to go digital.
– When you decided you are ready to go through the digital transformation, what were the expected benefits?
– First of all, we wanted to increase the number of shirts produced per week. All this paper flow was a big stopper because managers who prepare order information for fabric had to call back to the retailer for more information. A retailer then had to call back to the customer and ask to come into the store again for a new measurement or to choose new fabric because the previous one was sold out. We needed to get rid of all the empty missed checkboxes in our paper form, we needed to make sure the right business logic was implemented. For that, we also needed to make a lot of changes in our ERP system to get rid of manual work, from taking orders to the salary system for shirt makers.
– So basically it was digitalization for all business processes, not just for retailers?
– Yes, for all our systems. We expect our digitalization process to help us simplify ERP and salary counting, get rid of the papers, structure information flow in the factory as well. The main goal we have is to double the number of shirts that we can produce per week. Of course, it’s costly to do such a project, but we know that if we gain that double increase – we will solve lots of problems. We need digitalization to get a better stock balance so we can order kinds and quantities of fabrics more correctly.
– And you decided to work with an outsourcing company.
– In our IT department, it’s only me and one more person. I know a lot of programming but it would take a lot of time and it would be wrong if I was spending time on that. So we decided someone else has to do the software. I looked at some companies in Sweden. But local companies who we work with aren’t keen on this sort of knowledge, they are good professionals in dynamics, ERP systems, and other areas. We needed a company with good speed and willingness to listen. I wanted to have a proof of concept and see how we can move things forward.
– Did you know Forbytes from before?
– I used to work together with Forbytes’ CEO Don Lowe years ago. I know he is very structured and focused on quality. So when he said he wants to have a discovery stage, I agreed. Don said if the customer doesn’t want to go through discovery, he doesn’t want to go with the customer. I agree with him because we need to find out how to do things in the best way. If we haven’t done the prestudy, we don’t know what we are doing. I realized fairly quickly when we started the discovery phase that even inside the company we have different views on what we are actually doing. When you are doing prestudy, you ask yourself questions and are able to see bottlenecks that you haven’t seen before.
– Did our team help you in this process?
– Yes, they did a lot. At some point, there were even too many questions. Sometimes I almost got irritated about it. When you are inside the system you think everything is clear, but these questions make you think outside the box. What if you turn right instead of left? What would happen then? In the end, I really appreciate that process. We found out that we have more cases to think about, more areas that we might need to improve. So it is good that you as a supplier still dare to ask the right questions and not compromise when something in the system is not clear to you.
– Are you satisfied with the discovery stage?
– Very much. And I think it’s very important that you do it as we did. The development team came to Sweden and spent a week here last year. Sometimes you can’t discuss what is needed in the right way in Skype meetings, you might need to write something on a whiteboard, the team needs to feel what we are doing and be able to ask things back and forth.
– If we are talking about your general idea of digitalization, did it change during the discovery stage?
– I think it got more complicated. At first, we thought it’s very simple. 10-15 checkboxes in the order form, how hard can it be? Then we realized we need pages for standard and advanced shirt production. Standard means anyone in the factory can start production of this shirt, advanced means we need to create a unique pattern before automatic cutting. What does it mean that we need to go over to advanced? It can look easy on paper, but for development, it means different rules for different functions. So we needed to describe to the development team everything we do and why we can or can’t do certain operations.
So it was lots of things that we had to formalize for development and that made the app more complicated. I realized one thing: creating business rules that seem to be very easy on paper are actually damn hard making it digital, you just have to have rules to be able to create a system that will work properly. So the app grew. We couldn’t have done less to have a good result. If we hadn’t done it all, we couldn’t handle every aspect and wouldn’t be able to completely move the company to this system.
– What can you say about the development stage, was it comfortable for you to work with the team?
– Yes. The project was divided into work packages so you always knew what was going on. Demo also should be mandatory because it is always a good idea to test what has been created during the last work package. So we spent time looking at what we were getting. Something probably needs to be changed, something needs to be fixed. You see the result, you can start thinking of new things.
– Have you already discussed the tool with some of the retailers?
– No, we haven’t. We will test it in our 5 stores to understand how it will work internally. I’m pretty confident that the software itself works well and it’s clear for use. But a lot of things should be done at the backend. For example, we need to enter all kinds of fabrics, finalize integrations with ERP, and it all takes time from us.
– Are you going to advance this tool?
– Maybe. One thing we need to test is voice recognition. Maybe it could work like Google assistant so you could take the measurements and speak to the app, tell it the size and color, for example. I think that will be pretty cool and will make using the app quicker.
– Did you have some concerns about the outsourcing project? About possible difficulties in communication or project control?
– I had small concerns but I knew Don and a couple of the developers from his team. I understood we can get so much more with outsourcing than we would have in Sweden. I have colleagues who have development teams in India or somewhere else, and they feel outsource is a bit more problematic. I think it’s important to do it with a more or less similar culture where you don’t have to go through levels of hierarchy trying to solve one small thing. I mean you need simplicity in outsource. Make sure your development team understands you. If you don’t work close enough and can’t go to the next office and talk about any issue then you need to have ease of work.
– From your experience, what should you pay attention to while choosing the outsourcing company?
– References and understanding what the company has done before and with whom. It is good when you can meet the referer. And then there is like a two-step process: you need to understand the person and understand if you interpret what they say to the best or to the worst. Also, it is important to know the technology the company uses and to meet the team before starting the project with them.
– If someone asks you about Forbytes, would you recommend our company?
– Yes, I would, absolutely. Forbytes has the expertise, and you can be sure of what you will get as the end result.