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Home Depot wins with IT.

Globe and Mail Update

You definitely need to be an educated consumer these days, but not for the reasons you might think.

Retail shopping is an experience that often leaves you all on your own. My recent summer search for a new barbecue reminded me that help is in short supply.

Certainly, there were plenty of outdoor cookers on display at the three brand-name stores I visited, but helpful service seemed nowhere to be found. For that reason I walked out of the first two stores and then grudgingly took it upon myself to hunt down a customer service representative in the third before making my purchase.

Ironically, prior to my weekend grill quest, I was witness to a hopeful vision articulated by Harry Taylor, senior vice-president of Home Depot Canada Inc., during a CIO Assembly event at Niagara-on-the-Lake last week.

Home Depot Canada uses information technology to dramatically improve customer service and responsiveness, and I thought of this notion amid my own frustration in seeking in-store help.

"Our aspiration is to take the time with the customer," Mr. Taylor told an audience of Canadian IT executives.

"Sell a complete project and teach the customer how to do it. Give the customer the know-how. They come into our stores, not knowing everything they need, but when they leave, they [should] have all the materials, tools and the knowledge and confidence to complete a project."

What a wonderful retail world this would be, and I give credit to Mr. Taylor for his good intentions. The application of IT by Home Depot Canada is all about creating time and specifically taking retail employees away from tasks that don't engage them directly with customers.

Mr. Taylor discussed his company's use of IT in terms of how it continually seeks ways that allow Home Depot Canada associates to connect directly with customers. It's a lesson every retailer should likewise apply. Given the frustration of getting retail help, strong customer service is surely a competitive differentiator and key to business success these days.

With Home Depot Canada, IT-enablement begins with staff training. Mr. Taylor explained there are 28,000 sales associates employed and most require some level of instruction on how to do their jobs.

There's substantial investment in Web-based training, which Mr. Taylor says significantly reduces the number of associate trainer hours needed and allows these educators to likewise spend more hours "on the floor" with customers.

Labour scheduling is another key area supported by an IT-enabled business. The aim here is to ensure the right customer service representatives are on hand at the right stores and in the right departments.

"We have 2,000 stores and we can't leave it up to every manager to schedule labour," Mr. Taylor said. "We want to create a consistent model."

So with the use of an enterprise resource planning (ERP) system, sales activities in each store are logged and measured for the purpose of understanding how business in each location is conducted.

Sales are forecast and transactions are continually logged by every store department on a day-by-day and hourly basis. This information gets fed into the ERP system and is used to determine for each retail location how many worker hours are needed and where: by type of worker and by department.

"There's a database that determines who is available," Mr. Taylor said. "We have consistency in our labour model across all stores, in terms of the labour that we use."

Home Depot Canada employees are efficiently armed with scan guns to track inventory in each store and are able to achieve more accurate inventory control, spending less time counting products and more time with customers.

The retailer uses portable wireless mobile ordering carts to scan products and then uses the data to update product information and reorder stock on the fly.

"It helps achieve greater productivity with inventory management," he said. "It's not a perfect system, but it's a whole lot better than the manual system we used to use."

What's in store for the future at Home Depot Canada are radio call boxes that customers will be able to use throughout the stores to get quick assistance. By simply pressing a radio call button, located within various departments, Home Depot Canada promises an associate will help you within 60 seconds.

The retailer is also experimenting with a self check-out system and, by the end of the year, it expects every store in Canada will have one. Mr. Taylor said self check out would reduce wait times and require fewer sales associates working on cash registers. Self check-out kiosks also would require a lot less space.

"We can take out two cash registers and put in four self check-out units," Mr. Taylor said. "We've reduced the wait time and the space required at the front end of the store, and created more selling space."

Home Depot Canada uses an auto-attendant telephony system that connects callers looking for help directly to an associate in the store.

And, of course, it has a website - the primary purpose of which is not to sell products, but rather to allow customers to investigate their choice of products online before they purchase.

"Most Canadians do online research before buying," Mr. Taylor said. "We'd be remiss if we didn't offer a service to help them.

"Many customers know what they want before they come to the store to buy. We're seeing a dramatic increase in traffic as we refine our site. We're viewing this as an enabler to improving customer service and the customer experience."

Mr. Taylor's take on IT is simple: Technology drives efficiency and improves customer service by automating menial retail tasks and giving more time to sales associates to spend with people looking to buy. He calls Home Depot Canada's IT effort only the beginning. For one retailer, the effort may prove to be the end of buyer frustration.

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