“I led Wal-Mart’s integration of Asda’s back office and financial operations – the largest change programme in UK retail history”
To re-engineer Asda’s finance function to allow complete integration with Wal-Mart’s information systems, whilst maintaining the most efficient and effective financial controls.
Wal-Mart acquired Asda in August 1999. All businesses within the Wal-Mart family rely on Wal-Mart’s standard corporate systems for their operation. Much of the Wal-Mart systems infrastructure has been developed over a number of years to support a rapidly growing US-based non-food retailer.
Asda on the other hand had developed its own processes around best-of-breed financial packaged solutions, configured more towards supporting a food retailer. On joining the Wal-Mart stable, it was clear very quickly that in order to leverage the huge benefits of being part of Wal-Mart, it would be necessary to convert Asda to using standard Wal-mart systems. However, there was significant concern that in some areas they may not be appropriate.
Iain Spence was selected by the Chief Financial Officer to lead the integration programme. The broad programme of activity was developed and implemented as follows:
- Month 1: High level analysis of Wal-Mart systems and gap analysis carried out to determine what Asda-specific functionality needed to be retained or developed.
- Month 2: Business buy-in – with such a fundamental change programme, managing the people aspects was critical, from board to accounts payable clerk. A communication programme was carried out involving every colleague in the business.
- Month 2-3: Team building – a project team was assembled consisting of finance line managers, Asda and Wal-Mart IT project managers and analysts.
- Month 3-4: Detailed analysis of systems and preparation of functional requirements for enhancements to Wal-Mart systems. Agreement with Wal-Mart development team.
- Month 4: Supplier conferences – with a wholseale conversion of Asda’s accounts payable systems only 3 months away, suppliers had a lot of fast work to do to make changes to EDI, product codes, account numbers, and invoice layouts.
- Month 5: Finalisation of chart of accounts and core configuration parameters.
- Month 5-7: Complete training programme for every colleague in the finance function covering both basics of Wal-Mart financial management and modules for each process and system required by the individual colleague.
- Month 5: General ledger goes live, ready to support the first store. MI and forecasting systems gain new reverse feeds to ensure single visibility of business performance at all times during the conversion process.
- Month 5: First store goes live with stock management, cash handling, EPOS, Management Information – a complete replacement of store systems. Accounts Payable system goes live to support the first store.
- Month 7-9: Next 20 stores go live with a corresponding build-up of activity on the general ledger and payables systems.
- Month 10: Expense and capital systems go live on new systems. Financial planning and forecasting and management reporting also convert to new chart of accounts, new time periods (weeks end on a different day, calendar months rather than 4 weekly months), new departmental trading structure.
- Month 11: Volume-based supplier income collection system goes live.
- Month 12-18: Complete conversion of all stores to new systems, with corresponding increase in activity on new financial central systems and declining activity on old Asda systems.
- Month 18: Closure of old Asda systems and data conversion and archiving.
Every core financial system was replaced within an 18 month period with:
- No business disruption – in fact Asda’s sales growth increased to a 10-year high during and after the conversion
- Meaningful and timely management reporting maintained at all times, even when both old and new systems were running in parallel
- Over 200 finance colleagues trained in general financial principles as well as in specific systems and processes
- Over 100,000 colleagues briefed on key changes to the business.
Allan Leighton, Chief Executive Officer, said “This is the biggest and most complex systems change programme in the history of UK retail”