As the largest bakery chain in the UK, with more than 1,700 shops, Greggs is a staple of the British high street. Starting as a single bakery in Newcastle upon Tyne in 1951, it has grown to a nationwide business with a turnover of £894 million.
But in search of further growth, Greggs is keen to shake off its humble bakery heritage as part of a mission to gain market share in the fast-moving food-on-the-go industry. Doing so has required a vast business transformation.
Unlike most food-on-the-go retailers, Greggs has traditionally been a vertically integrated business, with its own manufacturing facilities as well as its own shops. In 2013, its executive team embarked on a technology-enabled change programme that moved Greggs away from its origins as a centralised bakery business, harmonised processes and provided the foundations for growth.
‘We were stretched at the seams,’ says Tony Taylor, IT and business change director at Greggs. ‘You get to the point where your current infrastructure can’t support you anymore. You know that you’re going to have to make some form of a change. The programme has all been about changing the look of the 1,700 shops. We had a variety of different formats, looks and feels but very much a bakery heritage and decided to go with this food-on-the-go journey.’
To become a decentralised business, Greggs selected SAP’s business suite on HANA as the ERP basis of its programme to transform, simplify and standardise its operations. Systems integrator Keytree was engaged to oversee and implement multiple deployments over the past three years.
This has included a complete finance systems implementation, new procurement capabilities, the implementation of a customer interaction centre, cloud-based HR application SuccessFactors, source-to-contract requirements using Ariba solutions and, more recently, SAP’s forecast and replenishment solution.
In 2015, Greggs commenced the implementation of the latest release of SAP IS-Retail technology to improve stock forecasting and replenishment, including a completely redesigned shop user interface.
The latest phase of the transformation programme has involved extensive engagement of both shop and regional management teams at Greggs. The project has aimed to help maximise the efficiency and profitability of the Greggs shop network in order to reduce wastage and improve product availability.
More than 1,500 shops have converted to the new technology, with training delivered to more than 16,000 staff through the SuccessFactors learning management system.
‘We have made huge progress as we transform and centralise the business,’ says Roger Whiteside, Greggs’ chief executive. ‘We are investing over £25 million in processes and systems that will enable us to compete more effectively in the fast-moving food-on-the-go market. We have already seen substantial change throughout our estate as we simplify operations to deliver great-tasting food and a great retail experience.’
Rising to the challenge
Taylor attributes Whiteside’s championing of the transformation, along with others in the operating board, as a key factor in its success and a huge enabler in gaining acceptance for the programme across the organisation.
Such buy-in from the top of the business says to everyone that the executive team is paying attention. ‘If somebody wants to make a change that’s not standard, they have to tell people why because it will go to that operating board as something that will potentially impact us in the future,’ says Taylor.
With regard to the change management aspect in the shops themselves, Taylor says Greggs has taken ‘a fundamentally different approach’ to other transformation programmes in the retail industry.
‘Lots of programmes struggle because you tackle the big things and you can’t see the tangible benefits early, so people become sceptical. Through procurement, we were actually able to start to bring some tangible benefits.’
To get to thousands of people in an easy way, Taylor knew his team needed e-learning solutions that weren’t about ‘going to a location and getting killed by a PowerPoint presentation’ or just getting an email saying this is what’s happening.
Through SuccessFactors, the programme team could engage, measure and deliver training to people when they wanted it. The 17,000 employees in shops were able to complete training on computers in their back office at a time that suited their individual shop.
Taylor’s team also attempted to illuminate the visibility of the transformation programme wherever they could, including through the CEO’s speech at the annual conference, briefing sessions or through dedicated ‘change champions’.
‘We built momentum on both training and communication, telling people this is what’s coming and this is what it’s all about,’ says Taylor. ‘When the CEO stands up at our annual conference and talks about the programme, directors mention it in their weekly or bi-weekly briefing notes and it’s mentioned in our annual report, people get used to it and get comfortable with it.’
James Holmes, programme manager for SAP transformation at Greggs, adds, ‘This project has always been ambitious, with so many outlets to be brought onto the system, at a rate of around 100 shops every week. Hitting the 1,500-shop landmark is a real achievement for us.
‘Despite the scope and size of this transformation, we have already seen encouraging results across the programme, and this gives us great confidence to continue working with Keytree on the deployment of the next phase of the programme, looking at production and warehousing in our supply chain.’
The main modular aspect of the transformation programme will be completed next year, although it will take a little longer to physically role out the changes.
That’s certainly not the end of Greggs’ transformation to a food-on-the-go retailer, however. This programme, which has grown Greggs’ IT team from 50 to 70 staff, provides the foundation blocks for the company’s continued evolution.
‘Across the country, we need to be able to create the opportunities to grow further,’ says Taylor. ‘We are looking at other opportunities. We opened our first drive-thru in June, and we are piloting click-and-deliver across the country. So we’re exploring a number of other initiatives to put our customers first and to be flexible, but it’s got to be relevant to Greggs as a food-on-the-go operator, not just because the competition are doing it.
‘So the transformation programme has been a foundation that will allow us to explore a number of different growth opportunities. But bedding it in is the most important thing first – rushing off to chase new technologies is not what the desire is here.’
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