Helped Askona drive business growth through an upgraded IT infrastructure

Client

"Askona" is a manufacturer and retailer of mattresses, furniture, and sleep products. The company invests in R&D, developing a smart approach to sleep product selection, up to analyzing genetic predisposition to better sleep on firmer mattresses or higher pillows. As a result, every second sleep product buyer chooses Askona, and the brand holds 48% of the market.

In 2020 alone, sales across all product groups increased by 10% in retail channels, by 7% in B2B channels, and by 62% through the online store. Production of sofas and beds grew by 55%. Eighty new assortment items were added, each with its own attributes and variants.

Task: redesign product-related processes so they support the company's growth

Askona is showing strong growth. However, many workflows were designed and implemented when Askona's assortment and production scale were an order of magnitude smaller, and the company operated a single plant (today there are three in CIS alone). At that time, a large number of manual operations was not a constraint.

As the business grew, both the business processes themselves and how they were represented in IT systems had to change.

At the current scale, process modernization became an urgent necessity. That is why in 2020 Ascona decided to automate shift scheduling, document processing in the EDI system, warehouse logistics, product information management, and more. The process changes will also be reflected in the updated IT landscape.

For example, Ascona planned to implement a PIM system for managing product information. To make the IT architecture flexible, easy to scale, and easy to update, the company decided to use a message broker.

The company came to kt.team with these requests, and that is how our collaboration began.

What did we do?

• We helped structure and enrich product cards so that they took less time to fill in, while the card content was sufficient for both internal business processes and sales through different channels.
• We automated product card validation across all stages of its lifecycle. The product card is used by production, sales, logistics, marketing, the order management system, product pricing, and service management teams.
• We helped reduce the approval time for non-standard orders and, as a result, the waiting time for the end customer.
• We helped build a flexible, easily updatable, and scalable architecture that will support Ascona's growth.
• We helped reduce Ascona's costs for supporting the IT landscape.

Understand the client's business

At first glance, implementing a PIM system seems like a local task at the business level: Ascona's IT architecture already includes dozens of IT systems.

But that is only the first impression. Ascona is a manufacturing and retail company, so all business processes related to the product lifecycle are central to it. As part of those processes, the PIM system also becomes one of the central elements in the company's IT architecture.

The implementation therefore began with a long analysis phase. The kt.team project managers and analysts examined:

This process took two months. Its result was a process map covering the "life cycle" and maintenance of the product card. We also identified processes that could be simplified and automated by enriching the product card with additional information.

• how the product lifecycle is built from idea to delivery;
• how information management is organized;
• what information is needed in each sales channel;
• what non-standard situations arise in online and offline sales;
• which slows down ordering and production processes from an information standpoint, and so on.

Result 1. Sales became more convenient and easier to understand for both the salesperson and the customer

Previously, Ascona's entire assortment consisted of material items. Salespeople in offline stores, and the company has more than 850 of them in CIS alone, sold not a bed as a whole, for example, but two separate material items, the bed frame and the bed base, because that was convenient for production. Production immediately received orders for the relevant material items, split by factory and delivery time. At the same time, the salesperson's work became more difficult, and the ordering process was uncomfortable for the customer as well.

Standard case:

A customer comes into the store and says, “I want bed X with a lift mechanism.” Previously, the salesperson had to mentally break the order down into the frame and the base with the lift mechanism, check which bases were compatible with the chosen frame, because there could be nuances, clarify the production lead time for each material item, and then piece the order back together. The customer had to wait until every aspect of the order could be clarified, and did not understand why they could not be offered a proper bed right away.

Now the salesperson works with a complete product. When taking an order, they can already see which combinations are available for Bed X and whether any of them include lift mechanisms. They can explain how these mechanisms differ. They can see specific production lead times not for each separate component, but for the bed as a whole.

Result 2. Despite changes in the sales business process, production receives the order as a set of material items

Combining material items into a product is convenient for sellers and buyers. But for production it is still important to know which material items are needed to fulfill the order and which parts they will consist of.

So we kept the business process view from the manufacturing perspective unchanged. The product or products included in the order are automatically broken down into material items. A material item has only the characteristics that matter for production: dimensions, material type, catalog color shade, and so on.

Result 3. The product card contains all the information needed by internal teams and sales channels

The same product looks different to different departments. For example, a standard pillow:

There are attributes that matter for procurement, marketing, specific sales channels, and so on.

For each of the 45 product categories in Askona's catalog, we created a list of attributes needed by the company's teams. As a result, we obtained detailed cards that contain all the information for external and internal users.

• for sales it looks like this: "pillow, pillow series, 50\*70, sateen cover, hollowfiber filling, machine washable, soft, medium height";
• for production: "fabric of SKU X sized 75\*110, trim X 2.5 m, 300 g hollowfiber, diamond quilting";
• for logistics: "SKU X, individual packaging in polyethylene, bulk packaging of 20 units in polyethylene, dimensions X; no special transport conditions required, stackable up to X layers"...

Result 4. Only products with complete and accurate information reach sales channels

The business process for creating and enriching a product card has several stages. For example, "Creating a new card," "Populating with data," "Available for sale," "Discontinued," and so on.

We set automatic validation parameters for each status. The system checks whether specific fields are filled in and how well their values comply with standards. For example, in the "Mattress height" field, you cannot enter "coconut coir," but you also cannot enter "0 mm" or leave the field blank.

Problem fields are highlighted and the card is sent back for revision. Only if all required fields are filled in correctly is the next status assigned to the card.

From now on, sofas without a specified seat depth, for example, will not make it into sales, and an in-store salesperson can easily answer the question: "Can this pillow be washed?"

Result 5. The catalogs present the full assortment, not just base products

Previously, the process of creating and filling out a product card was completely manual. Managers had to enter all parameters, sometimes hundreds of values, manually into the ERP system. For certain size variants of the same product, for example, a mattress 140 cm or 160 cm wide, they had to create separate cards and duplicate the data entry.

With a PIM system, the process of adding new products and their variants is automated. There is no longer a need to create dozens of cards for all product configurations: one master card is enough. Reference data sets are connected to the master card, where sizes, fabric types, and other configurable options are defined. Separate cards for each configuration are generated automatically and delivered to all sales channels.

• The ERP system was burdened with non-core tasks, while still unable to provide all the required functionality for product information management;
• a lot of time was spent adding new products to the system;
• human error caused mistakes and typos;
• products were entering the system late or not entering it at all. This made them harder to sell.

Result 6. The approval time for non-standard products was reduced from two weeks to a few minutes

Ascona has a fairly broad assortment: the main catalog alone includes 81 sofa models and 362 bed models, taking into account base sizes, fabrics, and fillings.

The actual production capabilities are much broader. In theory, a model can be made in dozens of fabrics and non-standard sizes, with different fillings in the backrests and different armrest options. But each material has limitations: for example, fabric cannot be used to make wide armrests, a sofa can only be extended up to a certain length, and the width of a bed headboard must be divisible by a certain number of centimeters...

Customized items account for a significant share of sales. How was the process for handling them organized?

A customer would come to a brick-and-mortar store and say, “I want this sofa, but in green burlap, 12 cm longer than the base model, and with a softer backrest.” The salesperson would write down the requirements, say goodbye to the customer, and send the request to production, because only manufacturing specialists could say whether such customization was possible.

As long as the assortment included only a few base models and total sofa sales stayed within 100-200 units per month, there were no problems, since production could set aside time to calculate 2-3 custom orders per month.

As of 2021, Askona produces 15,000 sofas per month, and production had to review up to 20 projects every day. The queue for technologists stretched to two weeks, and the technologists themselves were overloaded with a large amount of nonessential work!

All this time, the customer was waiting for an answer and did not always hear, "Yes, we will make the sofa of your dreams." Often, the limitations had to be explained and another fabric, another model, or another sofa length had to be offered. But over two weeks, the buyer had time to cool off, and a negative answer only made them less likely to buy.

We proposed an alternative solution: enter all possible options and constraints into reference data and connect the reference data to the product card.

Now the salesperson shows the customer only the fabrics in which the chosen model can be made, and checks all parameters directly on the POS terminal in the customer's presence. If the "ideal option" cannot be delivered with exact accuracy down to the shade and millimeter, the salesperson can offer alternatives to the customer on the spot.

A tangible result as of November 2021 was a reduction in the approval time for customized orders. There are grounds to expect that the number of successful non-standard orders will also increase in the future thanks to engaging the customer during the very first visit.

Result 7. Service sales are transparent for headquarters and convenient for salespeople

In addition to products, Ascona sells related services: furniture and sleep-product delivery, floor delivery, assembly, and more. These services were sold separately, using the price lists of the contractors providing them and separate contracts. It was difficult for headquarters to track service sales statistics and keep service pricing current at each offline store.

We proposed adding services to the PIM as a separate product category. The service type, such as city delivery, acts as the master model, which in turn can include several variants (delivery in Moscow, Saint Petersburg, Khabarovsk, and so on). Each variant has its own parameters and its own price.

We linked services to products and to one another so that a trigger would prompt the salesperson's POS terminal with a reminder of what can be upsold to the customer right now.

For example, a customer orders a bed with a base and a mattress. The salesperson immediately sees that doorstep delivery can be upsold for this set of products. Does the customer live in a multi-storey building? Then floor delivery can also be upsold. If the customer ordered delivery and the product is one that needs assembly, assembly can be upsold as well.

Products and services are grouped into a single order. The salesperson will know exactly what was sold to a specific customer.

Head office will receive transparent, easy-to-understand sales statistics for each service in every showroom, and the cost of each service will be transparent and easy to track.

Result 8. It is easy to find the needed photos, scans, and marketing materials in a centralized repository

Each item in Askona's assortment is surrounded by numerous digital assets: product photos from different angles, 3D renders, videos, certificates, awards, promotional materials, assembly and care instructions, and more. In addition, there are large sets of general marketing information (for example, seasonal promotions), production information, and information about Askona suppliers' certificates and licenses... These are millions of files.

Previously, digital assets were spread across different storage locations: some were in the company's systems, some on local computers or on the corporate network. Finding the right file could take a long time, and files were sometimes lost. Assets with a limited validity period had to be tracked manually or recorded in Excel files.

We used Pimcore's DAM capabilities. All digital assets were migrated into the system and organized. Each digital asset is linked to the relevant reference data and products. It is easy to find the needed file, and all required images are automatically pulled into the product card.

Assets with a limited validity period were marked accordingly: when the control date arrives, the responsible employee receives a notification that it is time to renew a certificate, update a photo on the website, or turn off an ad campaign (for example, if a contract with a celebrity has expired or a seasonal promotion has ended).

Flexible, updatable IT architecture

In 2020, Askona began a major modernization of its IT landscape. The company had already outgrown the scale at which a clear and easy-to-manage architecture could be built with point-to-point integrations. The number of systems and integrations had crossed the critical threshold, and the push for further IT development prompted a search for alternative architecture options.

That is why Ascona decided to implement an architecture with a message broker at the center.

Based on these requirements, the Kafka message broker was chosen. We deployed the broker and integrated the standard user interface. But that was only part of the process. In total, we held three lectures on deploying Kafka and spent more than 100 hours on broker setup and maintenance tasks.

As a result:

• a lightweight tool;
• easy to deploy;
• easy to administer, preferably with minimal IT involvement;
• scalable;
• with simple integration or replacement of specialized systems.
• integrating new systems requires many times less IT investment: you only need to build this system's integration with Kafka (work on the system's side);
• any system in the IT landscape can be replaced without disruption, and this will not affect the operation of other systems and integrations. The business can keep changing, scaling, and adding new sales channels;
• IT specialists are not needed to find, identify, and fix message transfer errors between systems. Managers can track all of this through the UI.