New systems added to Kmart, Pace operations

Discount Store News, July 20, 1992 by Arthur Markowitz

TROY, Mich. - Kmart, which won an award last month for its past technology efforts, is now starting to phase in more programs in its discount store and Pace Membership Warehouse operations.

Kmart said earlier this month that half of its 2,383 discount stores were now using Symbol Technologies' Spectrum One wireless spread spectrum data communication network and the technology would be rolled out to all Kmarts during the next five months.

The discounter next month is due to begin phasing in Triad Systems' automotive parts, prices and labor estimating database in its auto service centers, with the technology in all 991 centers by year-end.

Meanwhile, this month Pace will begin using J.D. Edwards' financial and job cost software to monitor its construction program that calls for 28 new clubs this year. The Paces being constructed in Orange Park, Fla., and adjacent to the LBJ Highway in Dallas will be the first clubs monitored using the technology obtained in the $100,000 deal.

Kmart won top honors in the annual Computerworld Smithsonian awards competition in June for the application technology used in its KIN II (Kmart Information Network) system. The discounter said the "critical suppliers" of the technology that form the bases for KIN II are Informix Software's database management software, Unisys' multi-processing Intel-based Unix computing platform and Symbol Technologies' LRT 3800 hand-held scanning and radio frequency terminals that communicate over a Token Ring network through Spectrum One's wireless technology.

KIN II is at the heart of Kmart's drive to use retail technology to become a more efficient retailer, providing better customer service while driving down costs. President and chairman Joseph Antonini, in fact, said technology is playing a "critical role in competitively positioning Kmart for success in the '90s. Indeed, after store modernization, technology is probably the second must important building block to improve profitability and market share."

The discounter picked the LRT 3800/Spectrum One system as the data collection and communication technology for KIN II "because of its real-time data collection capabilities and unique spread spectrum implementation," said David M. Carlson, senior vp of corporate information systems.

Kmart uses the LRT 3800/Spectrum One system for a series of advanced merchandising applications including scanning shelf bar code labels to determine merchandise availability and ordering goods when necessary.

Kmart and other retailers view spread spectrum technology as a platform for many different uses. Kmart is developing its own specific undisclosed programs for the Spectrum One network.

Carlson in the past has said that spread spectrum technology is the basis for the wireless store and that Kmart picked the technology that ties into this. Symbol Technology has developed a wireless electronic register, but Kmart, so far, isn't known to be testing this terminal.

Kmart, however, is the largest retailer to deploy the complete Triad systems for its service personnel since the vendor began offering a labor cost database feature in November of 1991. The labor estimating database incorporate Mitchell International's mechanical repair information, a leading source to estimate the time and skill level needed for a specific job.

The basis program, used by a number of auto specialty retailers, includes a database of the price for 1.9 million parts from 400 suppliers, which is updated monthly.

Kmart, using the complete Triad system, can offer customers a complete cost analysis for a job, breaking out the price of the parts and the cost and time for labor.

The J.D. Edwards' financial and job cost software allows Pace to monitor and control the cost of building clubs. The software, designed just for the IBM

AS/400 computer, tracks all aspects of a project, including the actual costs for land, equipment and materials against budgeted costs and measures progress of the construction against the estimated completion date.

The program issues reports on the project and alerts execs when costs don't match budgeted figures so they can act to resolve problems. To monitor construction, the program flags a project when 101% and 20% of the total cost is reached, and stops processing orders when costs reach the budgeted level. Managers then have to directly approve orders. Pace will use the software to develop a history for the cost of similar projects so the managers can fine tune future projections. Pace customized the basis off-the-shelf software so that project reports match the reports that the club had been using under its old manual system.

The company at presstime was monitoring projects using both its manual system and the computer program. This was being done to verify the computer program before its phase-in at the end of July.