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Business-critical insights with cloud-based analytics
Elkjøp modernizes business intelligence for growth
During the 58 years it has served the Nordic region, Elkjøp Nordic AS rose to the top of the retail electronics marketplace by responding quickly to the ever-changing needs of its customers.
“Our competitive prices and the range of our product offerings are two of the many reasons why we are the market leader,” says Monica Trøen Volden, Elkjøp’s Head of Insight and Analytics. “It is important for us to stay relevant to the customer in terms of products and services.”
Further broadening its customer base, Elkjøp expanded into the home appliance and kitchen refitting market, where it has also experienced significant growth during the last decade.
To help management make timely decisions based upon the best available customer information, Elkjøp was an early adopter of BI and analytics technology. The company has used on-premises versions of what later became IBM® Cognos® Analytics software since 1999. “We have a lot of data with a renewed focus on making sure that we use the data when we make business decisions and when we interact with customers,” says Trøen Volden. Toward this end, the Elkjøp strategy was to provide features and functionalities on the latest release to delight end users. This required a solution that was easy to upgrade.
In recent years, Elkjøp executives began augmenting the use of BI reports by increasing the use of dashboards to get a more immediate sense of business operations. However, this shift taxed the on-premises system. “Generally, the dashboards required more computing resources than reports,” says Sandeep Dhirad, Elkjøp’s BI Architect. “We needed to start looking at providing more resources to support dashboards for our users.” The company needed a solution that would allow it to easily scale its BI platform to accommodate current and future growth.
“Ever since we’ve had Cognos, we’ve had skilled people maintaining that solution on premises,” says Trøen Volden. “But we came to a point where we needed to renew our focus on supporting and collaborating with the business instead of focusing on the maintenance of technology.” As the business grew, the BI and analytics team needed a solution that would allow them to reallocate staff to support this strategy.
Diverse Users
Increased number of users-3000, from store employees to the C-suite
Real-time Dashboards
Business intelligence (BI) dashboards in real time for actionable insights
Instead of looking only at licensing cost, Elkjøp also considered the cost of software from the total cost of ownership perspective. Traditional on-premises software not only requires licensing but also infrastructure to deploy the software and personnel to maintain it. These considerations led Elkjøp to adopt a software-as-a-service (SaaS) cloud strategy where a subscription model covers the cost of licensing, infrastructure and personnel to support software reliability and availability.
When Elkjøp learned that the Cognos solution was available on the cloud, it saw migration as the next step on its modernization journey. This journey included adopting Cognos Analytics 11.0, streamlining content, introducing dashboards and supporting self-service.
“Since we began looking at cloud offerings, they have really evolved,” says Trøen Volden. “And the timing was right to move on it.” The Cognos Analytics on the cloud solution offered a SaaS platform with containers and a microservices architecture. It also connected with Elkjøp’s Snowflake cloud data platform as well as existing on-premises data sources to create a single version of the truth. In addition to Elkjøp’s other tools, Cognos Analytics software enabled the combination of different data sources in a hybrid cloud environment, with self-service and governance.
The Elkjøp modernization strategy began with adopting Cognos Analytics 11.0, streamlining content and introducing self-service that enabled the building of new dashboards in minutes. Users appreciated the modern user experience — especially the new sales dashboard that refreshed every five seconds with point-of-sale data.
When Elkjøp used the new sales dashboard for the first Black Friday sales event in fiscal year 2019-2020, sales results were the best ever. IBM was able to add more capacity to the Elkjøp cloud before Black Friday, and with no down time. When the peak period was over, IBM removed the additional capacity, also with no down time. Elkjøp paid only for the extra capacity it used. This kind of flexible scaling would not have been possible with an on-premises system, which would have required hardware acquisition and down time for integration.
When parts of the Nordic region closed down in early 2020 because of the COVID-19 pandemic, many consumers needed new appliances and electronics for remote work and home schooling. “Elkjøp increased its total sales revenue in the Nordic market by 9% in the 2019-2020 fiscal year and our sales have been at a high level since then,” says Trøen Volden.
“After COVID-19 hit, our management urgently needed access to real-time data. We rolled out the interactive dashboards so they could use it on their mobile phones,” says Dhirad. “Because Cognos is integrated into our cloud environment, this was easier to do than with our on-prem solution.”
Dhirad adds, “Our CEO is the third most frequent user of the cloud environment right now, and that definitely speaks highly of the system.”
“It’s also been very important for management to have their data warehouse app on a dashboard,” says Trøen Volden. “This was important before COVID-19 but it is even more important now for them to have a finger on the pulse of the business on their mobile phone.”
The increased visibility of the Cognos Analytics platform, with real-time availability on all devices and customized dashboards for more applications, enables more Elkjøp users than ever to derive better insights for growth and profitability.
When Elkjøp completes the migration of its Cognos Analytics platform to the cloud in 2021, its BI modernization project will have achieved its business objectives. By hosting the platform in the cloud, the company has gained significant flexibility. Elkjøp will be able to run automatically updated software without assigning internal resources to perform manual updates, and it will realize its strategy of accessing the latest features and AI capabilities without delay.
“By shifting to the cloud, we spend less time maintaining the Cognos tool and making sure it is working and spend much more time on partnering with the business,” says Trøen Volden. “It was a good decision to do the migration. We’re taking a giant step in terms of both moving from the on-prem to the cloud but also taking a giant step in terms of what will be available in the cloud.”
In addition to Cognos Analytics usage at the management and store levels of the business, the finance department uses the software to perform analytics, and supply chain managers use the data to plan and improve operations. Other business-critical functions also use the Cognos Analytics solution on a daily basis to support their work.
“Since I have been with the company, we’ve not had this type of penetration, all the way from top management to senior and junior analysts in different areas of the business,” says Trøen Volden. “It’s a pleasant place to be when you see so much usage.”
From a strategic perspective, Elkjøp management looks forward to deriving even more business value from the AI-infused platform. “This tool will enable us to dig into more data science-related analysis from commerce,” says Trøen Volden. “It will provide us with the opportunity to give more to the business, and I would like that.”
Elkjøp (link resides outside of ibm.com) is one of the Nordic region’s largest consumer electronics and appliance retailers, with more than 400 stores in Norway, Sweden, Denmark, Finland, Iceland, Greenland and the Faroe Islands. The company has 11,000 employees and reported revenues of NOK 41.5 billion for the 2019-2020 fiscal year. Elkjøp is part of Dixons Carphone PLC, one of Europe’s largest consumer electronics retailers.
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Produced in the United States of America, March 2021.
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