Finding the most reliable, cost-effective tool to keep internal information flowing is an increasing challenge for the supermarket industry. In response, retailers and wholesalers are developing intranets to share corporate data in a secure, real-time atmosphere.
Intranets, which are protected corporate communications networks, use Internet sequences, such as transmission control protocol/Internet protocol (TCP/IP) to access Internet-based applications, including the World Wide Web.
Connected via password, staff members can use the intranet to search the Internet, but a company's internal information transferred through this gateway is guarded against unauthorized access.
Respondents to SN's third annual State of the Industry Report on Supermarket Technology predict that by the year 2000, almost 22% of on-line services will be used primarily for business communications.
Retailers and wholesalers told SN they currently rely on intranets to electronically link different regions, to enrich document presentations through the use of multimedia graphics and to enhance employee training programs.
"As a growing company, we continue to gain new customers and conduct business in multiple markets," said Emmett Yuchnewicz, web production manager for Randalls. "We decided to implement an intranet because staying in contact through one central location is very important."
According to industry observer Bob Smithers, wide-area networks empower intranets to connect people in different geographic areas in order to access information in a real-time and cost-effective manner.
The Independent Grocers Alliance, Chicago, operates a secure network enabling members across 23 countries to link into one central location and share company information, said Kim Barden, director of communications.
Currently, 800 IGA members are signed on to the secure Internet site. The wholesaler expects to see that number jump to 2,000 members by early 1998. Because IGA members operate numerous types of systems, IGA uses this "soft" version of an intranet, rather than one requiring all participants to use the same system.
"I have witnessed various retailers in the [United] States communicating with a retailer in Australia as if they were in the same room," said Jim Anderson, vice president of management information systems at IGA. "It is a great tool if you want to access company news, or even if you want to post questions to learn about colleagues' experiences on specific issues."
Even a small chain sees benefits from conducting chat sessions via an intranet rather than setting up formal meetings.
"It is nice not having to rely on meeting in one specific area -- which is straining on daily schedules -- to share information," said Patrick Arnold, webmaster for Dorothy Lane Market, a two-store operator in Dayton, Ohio. "Though I cannot quantify our results, the savings we have experienced have been in time. And if you go by the old motto, 'Time is money,' then I guess it is safe to say we are cutting costs as well," Arnold added.
"Mass communication via an intranet can be a large cost savings, especially when you can eliminate costs associated with traveling to off-site meetings," said Randalls' Yuchnewicz. "Meetings are instead conducted via computer, and attendees share documents and results in real time."
Besides connecting executives physically separated by miles and oceans, intranets also offer ways to enhance the documents being transferred electronically. Executives told SN they regard the use of graphics as equally important to the information provided in documents themselves.
"Visual options should not be underestimated," said Smithers, vice president and general manager of MossWarner Communications, Hartford, Conn. "People are sophisticated and want to be visually stimulated. It is the combination of designers and programmers that is responsible for an intranet's success."
Dorothy Lane is enhancing its internal financial statements through the use of multimedia graphics.
"We are able to make more of an impact when sharing financial reports through the use of graphics," said Arnold. "We are improving these documents by using pie charts and colors rather than just a report of raw numbers."
While graphics are a strong capability, IGA believes retailers should keep them in check.
"Graphics are an easy tool to use when incorporating imagery into reports and other documents," Anderson explained. "However, users should guard against using too many images -- you don't want overkill."
As computer-based training grows into a human resources staple, some retailers are reducing training costs by conducting automated training via intranets.
Dorothy Lane is completing a beta test of automated training through its intranet. "Through automated training we will see a 50% reduction in the time needed to train a new associate, and this number will rise," said Arnold. Previously, 10 to 12 employees were dedicated to training; now only two will be needed to augment the training process, he added.
The two-store chain is testing a multimedia presentation guiding new hires through an orientation module.
IGA is also looking into automated training through its secure Internet site. "We want to offer cost-effective training to our employees," said Anderson. "This solution would offer graphics on a repeated basis, via hard drive or CD-ROM, to present training applications." Anderson did not give a time frame for when IGA expects to launch automated training.
White-board conferencing, which allows users to work on a common document in real time, is a promising feature of intranet usage that still has technical hurdles to overcome.
"It is an excellent idea for people to review a document simultaneously and make corrections together in real time," said Randalls' Yuchnewicz. "Unfortunately, while testing it via the Internet, we always ran into a technical problem."
IGA also believes the feature has potential, but has no current plans to utilize it.
"Our overall opinion is favorable, but it will take research before jumping into using it on a regular basis," Anderson added. "It requires software expertise and it needs to be specified who gets control of the document during the meeting."
Dorothy Lane agrees. "It is an area with potential, though currently, I am unsure how it will fit in with our chain," said Arnold. "It is a neat feature, but right now we are trying to get other areas of our intranet positioned first, like our automated training."