2 page Case Study - Posted 3/27/2007
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Entertainment Retailer Expects $500,000 Sales Gain from Enterprise Monitoring
Virgin Megastores USA was used to applying innovative technology to enhance sales at its 13 stores. So it was natural for the company to be among the first to deploy Microsoft® System Center Operations Manager 2007. Virgin expects to cut helpdesk trouble tickets by 20 percent, save 35 percent on helpdesk costs, redeploy internal resources to avoid spending U.S.$100,000 on consultants—and boost company sales by $500,000.
Business Needs
At Virgin Megastores USA, it isn’t just the music and entertainment selections that are up to the minute—so is the technology that helps sell them.
While some other retailers are still using dial-up technology to connect stores to corporate headquarters, and pushing sales information back to headquarters daily or perhaps weekly, Virgin has persistent T1 connections between its 13 stores and its Los Angeles, California headquarters.
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We’ve always run IT lean and mean, so that won’t change with Operations Manager. We’ll just run IT better—and enable the company to make more money. |
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Robert Fort
Chief Information Officer, Virgin Megastores USA |
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“That shift to a real-time environment has changed the culture here,” says Robert Fort, Chief Information Officer at Virgin Megastores USA. “If there’s a hiccup on the network, we get calls from our users within minutes.”
That’s because Virgin uses real-time data not just to see store sales, but to influence them. For example, if store managers see that sales in a particular store are below expectations at 1 pm, they can go to the floor and motivate sales associates to boost sales to meet projections by the end of the day.
Virgin also uses technology for advantage in the highly competitive retail market. It’s in the process of rolling out kiosks throughout its stores that allow customers to preview virtually any digital product that Virgin offers before they buy it. “The kiosks are a clear differentiator for us,” says Fort. “It’s one more way we use innovation to stay ahead.”
Fort and his colleagues—there are just 12 IT personnel in all, and just two to support servers and networking—manage a technology infrastructure that includes 60 data center servers and 28 point of sale (POS) servers running the Windows Server® 2003 operating system, and 250 point of sale (POS) devices and 300 kiosks running Windows® Embedded for Point of Service software.
There’s been too much seat-of-the-pants management of the infrastructure, according to Fort, with IT working reactively to fix problems reported by users. The system has worked but, to support Virgin’s continued growth, Fort and his colleagues wanted it to work better.
Solution
Virgin is increasing the efficiency and performance of its infrastructure, and furthering its reputation for innovation, by becoming one of the first companies to deploy Microsoft® System Center Operations Manager 2007, the best-of-breed end-to-end service management solution for the Windows operating system. The company began evaluating a prerelease version of the solution in October 2006 and completed full production deployment in March 2007.
System Center Operations Manager is replacing a Linux-based Big Brother solution that monitored some key servers in the corporate data center. System Center Operations Manager, in contrast, is deployed to all Windows Server–based machines—including Microsoft SQL Server™ 2005 servers supporting the data warehouse, plus file and print servers, the POS servers, and servers for Microsoft Exchange Server 2007—as well as to the hundreds of POS devices and kiosks.
“With Operations Manager 2007, we’re gaining a level of monitoring we never had before,” says Fort. “We’re reaching out to more of the enterprise than we ever could do with our Linux software.”
To monitor non-Microsoft components of its infrastructure, such as the Cisco routers and switches with which Exchange Server is tightly integrated in a unified communications structure, Virgin is evaluating the use of Cisco management packs for System Center Operations Manager. The Microsoft- and third-party management packs provide best practice knowledge to discover, monitor, troubleshoot, report on, and resolve problems for specific technologies. Virgin is also deploying management packs to support the monitoring of the Windows Server 2003 Active Directory® service, Exchange Server, and SQL Server.
Benefits
Fort anticipates that the benefits of System Center Operations Manager will be “huge.” “We will definitely see more uptime throughout our environment,” he says. “We can be more proactive in identifying issues before they occur, before they affect either store personnel or our customers. And if we spend less time responding to ‘fires’ we can spend more time on proactive maintenance that keeps our environment running even more efficiently.”
One of the key areas where Fort expects to see the impact of System Center Operations Manager is at the helpdesk. For example, Fort describes the management pack for Exchange Server as so “unbelievably complete” that it will enable the helpdesk to spot when inboxes are close to full, so they can advise users to take action to keep their messages flowing. And until now, it’s been managers at each store who have spotted problems with the company’s innovative kiosks and called the helpdesk.
“Now, with Operations Manager, we can monitor those kiosks ourselves and route alerts to the helpdesk to take action before the problem is even evident in the store,” says Fort. “That means we don’t wait for the human element. We reduce downtime and we reduce the cost of maintenance at the same time.”
Fort expects trouble-ticket volume at the helpdesk to decline by 20 percent. That in turn will help Virgin to continue to add technology assets to the helpdesk portfolio without increasing staff—a savings of 35 percent in labor cost. Because IT staff will spend less time in reactive troubleshooting, they’ll have more time to address strategic initiatives, such as Virgin’s compliance with the Payment Card Industry Initiative to boost credit card security. By using personnel freed from network monitoring, Virgin will save U.S.$100,000 on consultants for the work.
But that’s the least of the benefit that Fort anticipates. Better monitoring and proactive maintenance will cut unplanned downtime by an estimated 75 percent. With Virgin ringing up 1,500 sales transactions per hour, System Center Operations Manager will enable the retailer to gross another $500,000 per year.
“We’ve always run IT lean and mean, so that won’t change with Operations Manager,” says Fort. “We’ll just run IT better—and enable the company to make more money.”
Keywords: Point of Service Devices; Retail Point-of-Sale
