Katz Group prescribes business intelligence for drug store chain

Drug-store operator the Katz Group turned to a Linux-based IBM product solution to capture business intelligence that it said has kept senior executives more apprised of sales across the company.

Katz Group for seven months has used the IBM Data Warehousing Balanced Configuration Unit for Linux (BCU), a data warehouse product combining software, server, and storage resources.

The company operates more than 1,800 drug stores in North America under brands such as Rexall and Pharma Plus, along with retail operations, and a national mail-order pharmacy business. Users only saw a portion of their sales business using its previous system, which was based on Informix running on a Sun box, Bill Rohal, director of development at Katz Group in Markham, Ont., said.

“We’re now delivering to sales executives daily sales to their BlackBerries,” said Rohal. “In the past, they were seeing sales once a week.”

Moreover, he said, using the BCU has reduced the sales processing time by 90 per cent.

Although bad motherboards causing minor hardware problems had to be replaced, he described IBM’s Linux product as a “solid performer.”

The drug-store operator wanted to upgrade its MicroStrategy platform because it had encountered problems as it added more users to the old system, Rohal said.

“We talked about for some period of time about getting rid of Informix because it’s a product that’s… mature.” IBM acquired Informix in 2001.

Rohal said Katz Group had also contemplated expanding its data warehouse to include non-pharmacy sales from its front-shop operation and Air Miles program.

“It was going to at least, at a minimum, double the size of our data warehouse. The Sun box wasn’t capable of supporting that.”

Katz Group considered two products — an IBM BCU and a Dell/Oracle solution – but the company would have to convert its database from Informix in either case.

Katz Group already had an extensive working relationship with IBM, but also chose the software vendor because the data warehouse conversion using the Dell/Oracle option would be done offshore.

“We were uncomfortable…trying to undertake something that major…with people halfway around the world,” said Rohal. “The communications that was necessary on an ongoing basis would have been very difficult…”

He said the project was not driven by cost alone, otherwise Katz Group would have selected Dell.

Richard Wozniak, program director for business intelligence strategy at IBM‘s office in Vancouver, Wash., said many clients see Linux as an opportunity to standardize on a single operating platform but still have the option to use hardware from other vendors.

Financial companies have tended to be at the forefront in adopting the solution, but some health and retail clients have also shown interest, said Wozniak.

“Customers are really spared having to do integration on their own time and at their own cost, and instead can buy the balanced configuration unit with the assurance it’s been pre-tested,” he said.

“Also, they have a clear path should they need to grow that installation. If they decide they need to go from one terabyte to two terabytes, the costs to do that are well-known at the start and are not something they’re going to have to go and negotiate after the fact.”

Wozniak said he could not provide an estimate of how much money BCU will save a company, but suspects it could cost as much as 50 per cent more to buy an equivalent system.

Comment: info@itbusiness.ca

Share on LinkedIn Share with Google+