WEB SERVICES AS AN INFORMATION ENABLER IN THE

RETAIL INDUSTRY

Sudeep Mallick

E-commerce Research Lab, E&R, INFY (NASDAQ), Electronics City, Hosur Road, Bangalore - 560 100, India

Anuj Sharma

Domain Competency Group, INFY(NASDAQ), Electronics City, Hosur Road, Bangalore - 560 100, India

Keywords: Web services, retail, business intelligence, RFID, POS.

Abstract: Retail organizations works on thin m

argins and hence it is very imperative that they utilize information

technology to achieve optimization on time and space in the entire retail supply chain in order to remain

competitive. Web services is an emerging technology holding tremendous promise as a platform neutral,

easy to implement mechanism to achieve information and business process integration in the extended

enterprise. In this paper, we review how Web services in consonance with other technologies can prove to

be an effective business enabler for the retail business when adopted in a phased manner.

1 INTRODUCTION

The retail industry works on thin margins (Banks,

2003) and competitive advantage lies in being able to

achieve supply of goods at the best possible price

and at the right moment without any interruption up

in the retail supply chain and in being able to deliver

the goods to the end customer ensuring highest

customer satisfaction down the supply chain (Kent &

Mentzer, 2003). Needless to say, this would depend

upon the organization’s ability to mobilize and

disseminate the right information at the right moment

to the decision makers and to those who would

implement those decisions.

In the next section, we look into the basics of the

retail b

usiness and the retail supply chain. In section

3, we analyze the capabilities of Web services

technology and its symbiosis with other emerging

technology in serving as an effective information

enabling mechanism. In section 4, we finally propose

a road map approach to applying the Web services

technology to the information enabling needs of the

retail business, keeping in mind the current maturity

level of this promising new technology.

2 THE RETAIL BUSINESS

A typical retail organization has the business

objective of procuring goods from suppliers and

reselling them to end customers or consumers

(Mason & Burns, 1993). The chief value add

functions provided by the retail organization are in

terms providing a buffer or cushioning effect

between the supply and demand, stimulating the

demand and arranging for adequate supplies to

meet the renewed demand and customer service.

Internet has also given birth to the online retail

model – the online market place like the

Amazon.com, eBay.com, etc.

3 WEB SERVICES AS AN

INFORMATION ENABLER

The term Web services has come to denote a

universally accepted XML standards based

mechanism for exposing business functionality

over the internet (Ogbuji, 2002) and is based on a

service oriented architecture (SOA). Hence, it can

be exploited both for simple information exchange

and execution of full-fledged multi-step business

transactions and workflows. Interoperability and

190

Mallick S. and Sharma A. (2005).

WEB SERVICES AS AN INFORMATION ENABLER IN THE RETAIL INDUSTRY.

In Proceedings of the First International Conference on Web Information Systems and Technologies, pages 190-193

DOI: 10.5220/0001226901900193

 SciTePress

universally acceptability of the Web services

standards are important issues to ensure effective use

of this technology (Kotok, 2004). This has not been

achieved yet for all the layers (reliability, security,

workflow and transactions, etc.) of the Web services

stack except for the foundational core standards for

service exposure, service usage and service message

exchange format – SOAP, WSDL and UDDI

(Mallick et al. 2004). This means it would not be

incorrect to say that Web services standards in their

current maturity may have limited applicability in the

role of a true business process integrator.

However, due to its tremendous potential as an

information exchange mechanism, it can enhance the

potential of other data collection, data processing and

information dissemination mechanisms and

applications. Being available in two modes –

synchronous (based on the RPC model) (Adams,

2002) and asynchronous it can be utilized in either

real-time mode or otherwise. Business intelligence

(BI) Web services (Business Intelligence Web

services, 2003) could be embedded in operational

applications like ERP, SCM, CRM (Mello, 2002),

etc. Real time data from RFID (Violino, 2003) and

POS systems could be made available for business

activity monitoring (BAM) using synchronous Web

services based information integration. Web services

could be used for information dissemination over

mobile, hand-held devices, etc. (XInternet

technologies). Finally, information items from

diverse applications running on diverse platforms

could be integrated into an Enterprise level

dashboard using the Web services standards for

enterprise portlets – WSRP (OASIS, 2004).

4 ROAD MAP FOR THE

ADOPTION OF WEB SERVICES

IN THE RETAIL BUSINESS

In this section we propose a road map approach to

application of Web services in the retail organization

and the retail supply chain. In stage 1 (Figure 1) we

propose that the retail organization use Web services

for simple information exchange among enterprise

applications in a limited way requiring minimal

security infrastructure and perhaps behind the

firewalls of the organization. This would require use

of the core SOAP and WSDL standards. In stage 2

the organization having gained experience with this

new technology could move ahead for information

exchange across the firewalls and over the internet.

This could include data exchange across the supply

chain with the trading partners of information not

requiring stringent security aspects like that for

financial transactions. In this stage, the information

could be collected from XInternet technologies

like RFID and POS systems and made available to

the plethora of mobile and hand-held devices over

the internet / intranet on a selective basis. But

before they could do so some form of agreement

on the data standards among the supply chain

partners would need to be worked out. In stage 2,

the retail organization having a well developed

common information model (CIM) in place and

also having gained some experience with tackling

security aspects across the firewalls, the

organization could move ahead towards a scenario

where data having stringent security requirements

like customer profile, financial information, etc.

could be exchanged over the internet. This would

be stage 3. By this stage, the retail organization

would have gained experience with simple, single-

step and secure information exchange across

applications and devices within and across the

firewalls using Web services, paving the way for

more complex scenarios. In stage 4, the Web

services standards for transactions and workflow

and reliable message exchange could be utilized

for accomplishing complex, security critical, multi-

step business transactions and workflow within

and across the firewall (Little et al., 2003).

Stage 1

Stores / Delivery channel

• Stores applications – diverse POS systems

(Tarpley, 2001) could be integrated.

• Shelf management – RFID data on product

uptake and customer purchase behavior inside

the store can be shared online with the stores

managers on their mobile devices.

Retailer back office

• Data from operational applications could be

made available to line managers through

mobile devices, enterprise portals, etc.

• Inputs on historical data from data warehouses

as well as RFID data could be integrated into

Enterprise dashboards/portals for analysis and

planning.

Stage 2

Stores / Delivery channel

• Real time POS and RFID data on sales, could

be sent back to retail office line managers,

field sales agents on their mobile devices,

terminals.

• Latest information on new product release and

price catalogs could be made available to field

WEB SERVICES AS AN INFORMATION ENABLER IN THE RETAIL INDUSTRY

191

Figure 1: Suggested stages for adoption of Web services in the retail business.

• sales personnel, store managers on their mobile

devices.

Retailer back office

• Line managers could execute lightweight

queries on BI applications from their mobile and

hand-held devices.

• Inventory level information from DCs and

warehouses could be accessed real-time (using

RFID technology) for merchandise planning.

Supplier

• Can update their product catalog, product

availability information maintained at the

retailer’s vendor portal at real-time.

• CPFR (Ashcroft, 2005) on a selective basis –

POS and RFID data from the stores, DCs could

be made available to the supplier – for certain

critical, fast moving products or LOBs.

Stage 3

Stores / Delivery channel

• Customer could update their profile and view

targeted sales information on their mobile

devices and over the internet.

• Stores could be sent advance shipping notes

(ASN) by the retailer to enable proactive

planning.

Retailer

• Retail head office could receive data on stores

performance (top sellers), price deviations by

stores by receiving updates on sales and product

price from diverse stores applications. This

information could be fed into the merchandise

planning systems for BPM and for making

stores supply, commission, discount related

decisions.

• Multi-channel delivery – coordination of

product delivery and dissemination of

promotion related information across multiple

delivery channels could be achieved by

accessing real time information about

customer behavior, DC and stores inventory

and channel performance.

Supplier

• CPFR on a wider scale – real time sales and

inventory information could be accessed on

critical products like the fast moving items,

new product releases to fine tune their

replenishment and supply activities.

Stage 4

Stores / Delivery channel

• Mobile checkout could be enabled for the

customer at the stores, kiosks.

• Stores personnel management applications

(time & attendance, salary, commission, etc.)

on diverse platforms could be integrated with

the HR and Financial applications of the

retailer head office.

Retailer

• Real time events such as falling inventory

levels at the stores, kiosks, DCs could be

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viewed by the managers for merchandise

planning. Integrating this real time information

from the stores, kiosks and DCs with the

merchandise planning system using Web

services could enable automated triggers for

undertaking replenishment activities paving the

way for BPM.

• Auto PO acknowledgement when retailer places

an order, notification of the beginning of the

fulfillment process, notification of the pick,

ASN (advance ship notice) from the supplier,

notification to the supplier about rejection of

goods delivered due to faulty documents could

be enabled using RFID and Web services based

workflow.

Supplier

• Automated replenishment, order placement,

fulfillment and settlement could be achieved by

Web services based integration of the vendors’

and retailer’s merchandise management system,

financial management system.

• Changes in the vendors’ policies, contractual

agreements, compliance issues could be worked

out in a workflow by integrating the B2B

systems of the retailer and the vendor.

5 CONCLUSION

In this paper we analyzed that adoption of Web

services in the retail industry. Web services in

consonance with other enabling technologies like BI,

mobile and hand held devices, enterprise portals and

operation applications can serve as an application,

data and business process integrator. However, due

to lack of maturity of standards in the entire Web

services protocol stack it could be used with certain

limitations. It is recommended in this paper that Web

services be adopted first as an information integrator

in the retail supply chain.

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