Coles Group's chief information officer Peter Mahler is quitting his job as the supermarket's head of IT, against the backdrop of new owner Wesfarmers' plans to undo his IT consolidation projects.
Wesfarmers, which acquired Coles Group for AU$20 billion six months ago, plans to break up Coles' IT operations -- a move which reverses much of the work Mahler has done over the past five years to consolidate its operations.
"Coles Group had a very centralised system ... We are working on an operationally autonomous business unit model and we are breaking down those centralised systems," a spokesperson for Wesfarmers said. Coles stable of businesses include brands such as Officeworks, Harris Technology, KMart, Vintage Cellars, Target and Pharmacy Direct.
Since 2002 -- the year Mahler joined Coles from Belgian telco Belgacom -- Coles began standardising its processes and platforms across the diverse brands, with eight key retail systems marked for integration. Previously, the brands had been operating as many as 14 different point of sale systems.
A significant problem for the company was that each division within Coles was run autonomously, which impacted the company's access to IT knowledge. Mahler was also responsible for significant cultural change at Coles. In 2003 Mahler began reining in Coles' IT reporting structure to ensure that each division's IT department reported to him rather than the managing directors of each brand.
However, complexity caused the integration between each division's IT systems to be delayed until a projected 2009.
Under Wesfarmers, the spokesperson said that the responsibility for IT will go back to the managing directors of each business unit. Wesfarmers plans to have not just the IT departments of Coles' divisions operating independently by mid-2008, but also plans to run the business itself independently.
"All the IT is done by the business divisions. That's the way we operate, whether it's Bunnings or our insurance or coal mines that we own -- they all have their own IT. And that's the business model we adopt, not just for IT but every aspect of the way we operate," the spokesperson said.
"Each of the businesses that have been created -- Kmart, Target and the supermarkets -- will be responsible for their own IT. There will be linkages back to each of these because of existing infrastructure between Kmart IT to Coles infrastructure, but the responsibility will reside with the business," the spokesperson added.