The RETAIL NXT 2023 presented Tim EnglerThe CIO of the OBI Group provided an impressive insight into the technological transformation of one of Europe's largest DIY store operators. His presentation not only outlined the path from legacy systems to a modern ERP landscape, but also demonstrated how supply chain innovations enable fundamental efficiency gains.
Digitalization at its core: Why ERP is indispensable for retail
Engler began with a clear message: "ERP is the heart of every retailer." From procurement and warehouse management to sales – the foundation must be stable before technologies such as AI or omnichannel concepts can be successfully implemented.
His conclusion: Without a robust ERP architecture, there is no efficiency and no scalability.
The vision: Europe's number one for home and garden
OBI aims to become the leading provider of home and garden projects in Europe. At the heart of this vision is the transformation of the supply chain – from decentralized silos to a centrally controlled, cost-efficient infrastructure.
Key facts of supply chain transformation:
- Introduction of a new ERP and Warehouse Management System (WMS) based on Microsoft Dynamics.
- Building a central 100.000 square meters of warehouse space in Poland within just twelve months.
- Gradual migration of all warehouse locations by 2024.
Three success factors for change
Tim Engler explained the three key success factors that help OBI to overcome technological and organizational challenges:
- Fixed points and clear priorities
OBI defined fixed deadlines and milestones – such as the go-live of the new warehouse – as non-negotiable points. This forced the company to to make priorities and to avoid unnecessary complexity.
“Scope to Time” was our guiding principle: First the deadline, then the content.”
- Interaction of business and IT
Mixed teams of business and IT experts worked closely together to align technological decisions directly with business needs. Engler emphasized the importance of a common goals and communication:
"When things get tough, business and IT need to stand together."
- Focus on standards
OBI deliberately chose to use Proven Standardsto ensure the long-term scalability and efficiency of the systems. Instead of developing individual, customized solutions, business processes were standardized:
"99% of processes can be mapped with standard software – and we prefer to change our processes rather than the software."
From field to automated warehouse in 12 months
A highlight of the project was the construction of the new central warehouse in Swiebodzin, Poland. What was still an empty field in 2022 was transformed into a fully functional logistics center by January 2023 – including new ERP and WMS systems.
Efficiency gains:
- 50% higher logistics efficiency compared to old systems.
- Savings in the millions through centralized control and optimized warehousing.
Challenges and best practices
Tim Engler spoke openly about the difficulties of such large-scale projects and shared valuable lessons learned:
- Minimum Viable Product (MVP): OBI focused on core functions such as goods receipt and dispatch. Additional functions such as reporting were deliberately implemented in later phases.
- External partners: The success was also due to the collaboration with experienced implementation partners who brought extensive project experience.
- Agility in large-scale projects: Progress was made continuously and decisions were adjusted in four-week sprints without jeopardizing the release plan.
The future: What comes after the ERP transformation?
OBI is not resting on its laurels. In addition to further optimizing the supply chain, the following topics are a focus:
- E-commerce and marketplace integration
- Retail Media as an additional source of income
- Branch digitization with innovative technologies such as ESLs (Electronic Shelf Labels) and indoor navigation
Conclusion: A best practice for retail technology
OBI demonstrates what a successful transformation in retail can look like: With a clear vision, a pragmatic approach and a consistent focus on standards, the company has created a technological foundation that not only increases efficiency but also enables long-term growth.
Tim Engler's message is clear:
"Bring your teams together, focus on the goal and accept short-term pain to ensure long-term success."
OBI's presentation is a model for all retail companies that want to embark on the path to a digital future.