However, the accelerated development of the OneRetail platform and transition of the retail business online require even greater efficiency and flexibility in rolling out new IT solutions to the market. For us, these challenges mean that we need to evolve as a full-fledged technology retailer, one that uses IT best practices in customer service and all business processes.
The Group is currently carrying out an ambitious digital transformation program, while also restructuring its corporate culture, IT architecture and approaches to software development on the basis of three principles: integration of technologies into all business processes, decision-making based on data analytics and the technological development of all key functions.
Development of internal technological capabilities
Adaptation of support processes
Increased flexibility and reliability of the IT landscape
DEVELOPMENT OF THE ONERETAIL PLATFORM AND COMMON SPACE
FULFILLMENT AND LOGISTICS
CUTTING-EDGE PRODUCT RANGE AND MARKETPLACE
In 2020, we made the strategic decision that all software used to support the OneRetail platform and create a competitive advantage for our business would be developed in-house. This approach requires bolstering internal resources and capabilities in new developments. This year, we plan to double the number of IT specialists and increase the share of spending on in-house software development to more than 50%, compared with 23% in 2020. In the medium term, we plan to increase this figure to around 70%.
One significant change for us will be the transition from implementing individual IT projects to an approach based on product teams. These are being created at the level of the M.Video and Eldorado brands and key business functions, including the commercial unit, logistics, finance and IT. A product team consists of members of different business units and IT Department employees (business analysts, developers and data scientists, among others). Software products are developed in accordance with agile principles, with common goals and performance metrics set for all team members.
In 2021, as part of our digital transformation, we plan to transition our leadership in innovative change, including in IT products, to business functions. We will also further scale the product approach and create new product teams, including in the Eldorado brand, as well as in finance and HR.
The launch of the OneRetail model requires us to realign our corporate culture and shift towards technological thinking among all team members: sales consultants, business function and back-office employees, as well as all management. We are committed to ensuring that our in-store retail staff serves as the vehicle for our approach to integrating online and offline shopping experiences, and our central-office staff is effective in cross-teaming with an agile approach. In an effort to ensure the Group’s employees are developing digital capabilities and skills, we have created and are expanding the Digital Academy, a center of competency and new knowledge in technology.
One key focus of the Group’s digital transformation is to develop as a datadriven company and integrate data analysis into decision-making at all levels. We are committed to making machine learning an integral part of product teams and technology services, and ensuring that data tools are used widely throughout core business and back-office functions.
In an effort to enhance the flexibility and reliability of the Group’s IT landscape, we continue to reshape our IT architecture using a microservice approach, are developing a data platform and products based on machine learning and are implementing projects in information security and the transition to cloud infrastructure.
The Group is assembling a modern microservice platform built on hundreds of independent components (services). This approach involves supporting independent competing front-end products (mobile apps and websites) and common back-end systems used by both of the Group’s brands, including the logistics, finance, IT and HR modules. A microservices-based architecture helps to rapidly respond to the demands of the business by adapting current products, while ensuring that applications run quickly and smoothly as workloads grow.
In 2020, the Group transitioned to using cloud services as the basic infrastructure for digital products. In addition, as part of our goal of making our IT infrastructure more resilient, we plan to lease a new data processing center in 2021 and transfer to it IT systems that are critical to sales. These include the M.Video and Eldorado customer mobile apps and websites, as well as the consultant app and CRM systems. In doing so, the Group plans to fully eliminate any risks to continuous business operations.
Bolstering the IT function
In 2020, the Group continued to strengthen and develop the IT function based on the goals for digital business transformation. In August, Alexander Sokolovsky, former Managing Director at SberDevices (part of Sberbank’s ecosystem), was appointed CIO of M.Video–Eldorado. The CIO’s main objectives include formulating and implementing the IT strategy, supporting the Group’s digital transformation and developing IT architecture, mobile products and services based on data analysis.
Last year, the IT Department established six technology competency centers, which supply IT specialists for product teams in IT architecture development, software development, and data analysis and machine learning.