JB Hi-Fi taps Microsoft for warehouse management overhaul

JB Hi-Fi taps Microsoft for warehouse management overhaul

Once the integration in Sydney was wrapped up, the solution was then deployed in the company’s facilities in Melbourne and Brisbane.

Credit: JB Hi-Fi

The JB Hi-Fi Group has deployed Microsoft Dynamics 365 Supply Chain Management to transform its warehouse operations as part of a digital transformation effort aimed at keeping business going despite COVID-19 lockdown measures.

With the assistance of Microsoft Fast Track, the vendor’s implementation services and support offering, the electronics and home goods retailer deployed Dynamics 365 Supply Chain Management for warehouse management in its Sydney footprint in roughly four months. 

“It’s definitely an accelerated time frame for this type of project, but it is actually quite achievable with a modern tech stack – the fact that the core environment is cloud based, software as a service. You can integrate quickly to Azure,” JB Hi-Fi group technology director Simon Page said. 

Once the integration in Sydney was wrapped up, the solution was then deployed in the company’s facilities in Melbourne and Brisbane.

“We aimed to start with out of the box Dynamics 365 so as to get the basics right,” said Josh Bell, who was systems delivery lead on the project. “We have leveraged the OData API, custom web services and the business events platform. 

“From an integration perspective, we took the opportunity to re-platform our APIs as part of this. We were historically running brand-specific APIs on AWS [Amazon Web Services] and on-premise,” he added.

The team then took the opportunity to re-platform the APIs required for the supply chain by designing a group layer, multi-tenanted approach. 

“Essentially, we have JB Hi-Fi, and The Good Guys who run independent systems, however both integrate to the new group layer services that we have built,” Bell said. “The group services integrate to Dynamics 365 Supply Chain Management. Data egress is the reverse, Dynamics 365 Business Events are event driven and are sent to the group layer. 

“Our multi-tenanted API layer then sends the events to the relevant organisation. Our group layer APIs reside in Azure leveraging, Functions, Service Bus, CosmosDB and Logic Apps,” he said.

The move to Dynamics 365 Supply Chain Management came as JB Hi-Fi Group, like many organisations, went through rapid adjustment to focus on online and telephone sales as the pandemic struck, keeping employees working even when physical stores in Victoria were closed.

How the company managed its warehouse operations played a big part in its overall performance during the worst of the COVID-19 disruptions. 

“Earlier this year we were able to report strong financial results,” JB Hi-Fi Group CEO Richard Murray said. “Our ability to leverage our digital assets to support a shift in the way customers shopped, as well as how our people work, played a significant role in our continued success."

“For example, we were able to seamlessly keep delivering from both warehouses and stores – and that was good for customers who needed essential items and great for our team – even if it was quite a different way of working,” he said. 

Broadly, the company needed to warehouse its bulky goods for both its JB Hi-Fi and The Good Guys brands together, while smaller goods and appliances could be sent directly to stores. 

Specifically, it needed a new warehouse management system to boost the efficiency of its bulky goods management and ensure that it had complete data transparency across the organisations. 

In addition, the group needed its warehouse management system to be able to cope with the fact that both JB Hi-Fi and The Good Guys run their own point of sale systems and have unique stock codes. It also needed to integrate with other features such as the real time tracking in its freight system.

Now, the company claims that the new system has boosted predictability for customers and helped to ensure that their delivery arrives when they want it.

According to Bell, the modernisation of data warehouse management, the ability to handle real time data, as well as to add fields on the fly, has also proven particularly valuable as it ensures the organisation has the flexibility it needs to stay agile and responsive.

One of the next areas of focus for the transformation is to optimise product picking in order to boost operational efficiency and streamline logistics, for both the JB Hi-Fi and The Good Guys brands.

JB Hi-Fi in August posted solid growth in its FY20 results, with a notable rise in its online sales across the board.

Overall, the hardware and electrical retailer ended the financial year ending 30 June with a statutory net profit after tax (NPAT) of $302.3 million, up 21 per cent year-on-year.

Of note was a rise in online sales, which increased 48.8 per cent, to $597.5 million, for the financial year. 

This was driven largely by a surge in the coronavirus-affected fourth quarter, with an increase across the group of 134 per cent on the previous corresponding period.

“We are pleased to report strong sales and earnings for FY20 and importantly, we have provided our customers with the products they required as they spent more time working, learning and seeking entertainment at home, and kept our team members in jobs with an absolute focus on health and safety,” Murray said at the time.

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