I’ve had the pleasure of working with Dairy Farm for the last six years and am proud of the outcomes we’ve achieved together. And rather than me telling the story, I’d like to share the following interview with Paulman Lui, Finance Director of Dairy Farm North Asia Food, who talks about the challenges Dairy Farm faced during its recent transformation to SAP FICO.
Hello Paulman. Could you start by telling us a bit about Dairy Farm and your role in the company?
: Dairy Farm is a retailer covering 11 countries across the entire Asia-Pacific region. In 2015, our annual revenue was approximately $13 billion coming from roughly 6,500 outlets across the region. We operate supermarkets, hypermarkets, convenience stores, health and beauty stores and home furnishing outlets, as well as the restaurant business.
In the Hong Kong area, our main brands include Wellcome – a supermart chain, 7-Eleven – convenience stores, and Mannings – a health and beauty shop. We also operate Ikea in Hong Kong and own a 50% interest in Maxim’s in Hong Kong, China and Vietnam. In Singapore, our main brands include supermarkets Jasons Market Place, Cold Storage and Giant, as well as 7-eleven and health and beauty stores such as Guardian.
I am the finance director for Dairy Farm’s North Asia operation responsible for accounting services and property administration, as well as providing support to business units in for the Hong Kong and Macau region.
Could you tell us more about the SAP FICO implementation that Capgemini carried out for Dairy Farm?
Capgemini first started operating in Asia in 2003, when they purchased the joint venture set up between Ernst & Young and Dairy Farm in China to provide accounting services for the Hong Kong and Macau region.
About a year and a half ago, Dairy Farm wanted to transform its legacy Oracle system and migrate to the SAP FICO system across the region. China was chosen as the pilot site for the transformation, followed by rollout in Hong Kong and Macau. As Capgemini was already providing accounting services to Dairy Farm in Hong Kong and Macau, we engaged them to carry out the processes transformation. This involved many process changes and we collaborated very closely with Capgemini regarding the training and design of the transformation, as well as the data conversion and the subsequent rollout.
What were the main business challenges behind implementing SAP FICO?
Firstly, because Dairy Farm had been using Oracle since the mid 1990s, our staff had nothing in the way of SAP experience. Many of our existing processes at the time were designed around Oracle and other legacy systems, and the changes in processes needed for SAP implementation was extremely significant. This lack of knowledge and understanding of SAP was our main challenge.
Secondly, despite the fact that the China rollout was a pilot, it was also relatively simple. The Hong Kong operation is the most complicated operation in the entire region. We have the biggest business in Hong Kong, as well as the regional office and the head office, and all the different lines of business. So the complexity is three or four times that of China.
And finally, Dairy Farm had been working in an entrepreneurial culture – different businesses had different systems and processes, etc. The senior management at the time felt that there was a need to standardize the system and processes, to take advantage of the productivities and lay down the foundations of a system to enable us to grow in the future. This became our main objective.
The project was extremely successful, and we now have process alignment across the business. We can also carry out reporting and data mining in a much easier manner – with standardized data structures.
Why did you choose Capgemini to be your transformation partner?
Dairy Farm represents Capgemini’s main client in Asia – and because of our long history of working together, we knew Capgemini had deep and intimate knowledge of our business, system and processes.
Throughout the transformation period, Capgemini was an extremely supportive partner to us, not only in day-to-day operations, but also in terms of calling on them at very short notice for extra resources and people. We were also able to tap into Capgemini’s expertise and experience as a service provider in using the SAP system in accounting services.
What advice would you give to other companies looking to outsource this kind of implementation?
I believe that it is imperative to have a business partner that understands your business and has intimate knowledge of your processes. It’s also important to choose a partner that has knowledge of what you’re trying to achieve and the resources to achieve it, as you don’t know when an emergency might arise.
In fact, once or twice during the project, we had to ask Capgemini for additional FTEs to jump in and help us out at a couple of days notice – which they did, which meant we didn’t have to train up new people. This is very important for the success of the project.
In a nutshell, what has your overall experience of working with Capgemini been?
If I had to sum up Dairy Farm’s relationship with Capgemini, it’s all about trust – the trust in a partner that can back you up no matter what. And that’s the level of trust we have built up with Capgemini.