TacDoh Looks To Slim Down Its NSM
TacDoh Corp. is 5-year-old food-services company that provides deep-fried snacks 'round the clock via an expanding network of 300 retail walk-in and drive-up outlets supported by three warehouse distribution centers in Atlanta, Chicago and Newark, N.J. TacDoh's business model places a premium on returning customers. To this end, the company strives to provide convenient access to a consistent product via initiatives such as:
• Internet ordering: An e-commerce site provides personalized "MyTacDoh" capabilities. Registered customers can define "The Usual" with a single mouse click; the product is ready at a specified time and billed directly to the user's credit card.
• SitAnywhereTacDoh: To attract professional customers, TacDoh offers registered users 802.11 wireless hotspot access at each outlet. Customers can surf the Web or download e-mail, with convenient direct billing available at all outlets. This has had a positive bottom-line impact: Half of each location's registered customers use the wireless facilities daily and spend, on average, 15 percent more per transaction, boosting TacDoh's annual revenue to $3.5 million and adding nearly $4 million to its gross sales last year.
• Share the Fat: Believing happy employees make for happy customers, TacDoh shares profits with its associates through this unique program. STF recognizes outstanding performance and tracks bonus pay based on sales and service achievements. Considered an industry differentiator, this in-house-developed application is as important to the company's ongoing success as its point-of-sale, inventory tracking and general accounting programs.
However, TacDoh's IT group has hard choices to make: The STF application development effort requires increased programming work, but the IT budget is frozen at last year's levels. Even though the infrastructure is of prime importance in supporting the company's distributed retail chain, customer outreach program and employee incentives, network management is considered an expense. TacDoh is exploring ways to manage this cost without interrupting store operations or customer-base enlargement.
Each of TacDoh's 300 retail outlets is linked to one of the company's regional distribution centers, which act as warehouse and communications hubs. The Chicago center is the original location, housing the corporate offices and data center. Chicago supports 150 retail stores, while Newark and Atlanta have 100 and 50 locations, respectively (see network diagram, page 55).
In our RFI we defined the following goals and asked vendors to indicate how these goals will be supported, violation thresholds, and audit and reimbursement procedures (the RFI and complete vendor responses are available here.)
• Reduce and stabilize network management costs by outsourcing configuration, monitoring, reporting, planning and maintenance of all network infrastructure at each warehouse, store and the corporate offices.
• Keep existing helpdesk and operations support, but at reduced levels to support PoS, accounting and STF applications. Staff reductions based on removal of network and branch systems are planned.
• Maintain 99.9 percent availability service levels at the stores; availability at regional warehouse facilities must be 99.99 percent.
• Keep all transactions to less than 5 seconds, with network transit time under 2 seconds.
• Maintain 24/7 network availability to support online transactions and customers' wireless transactions to the regional warehouses.
• Accomplish autodial backup within 5 minutes of dedicated circuit outage. Dial backup also must be dropped within 5 minutes of the dedicated circuit restore.
• Provide reports by store, warehouse and corporate user.
• Provide sales-tracking integration. Response times are fed to an in-house application, which tracks POS activity and "SureWeKnowU" access. This is currently an XML data feed with server CPU and memory usage, and network latency and utilization.
• Report SLA threshold violations and near violations. Ideally, this will provide for a configurable list, management of which can be delegated and distributed.
• Allow for circuit billing. WAN payments will be done by TacDoh corporate accounting, but provisioning and WAN billing audits are to be outsourced. Network CIR (committed information rate), burst and utilization must be correlated to billing reports from WAN providers. These reports should be audited for accuracy and flagged where billing reimbursement is required. (New stores come online regularly, usually with three month's notice.)
• Provide on-site support. Network staffers now take general responsibility for on-site network troubleshooting and repair. TacDoh wants responses to indicate the cost of such visits if they were outsourced.
Currently, network management is supported through Adtran N-Form, CiscoWorks 2000, HP OpenView Network Node Manager and Concord Communication eHealth. Primarily tools of the networking department, these applications are also used by helpdesk, operations and systems personnel. Savings realized by decommissioning these apps will help offset the outsourcing cost, but retraining must be considered. Vendors should indicate which network-management tools will be provided and whether retraining will be required.
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