Microsoft Office 365Customer Solution Case Study

LG CNS Launches Korea’s First Cloud Office Service for Fashion Houses with Office 365

OverviewCountry or Region: KoreaIndustry: IT Services

Customer ProfileLG CNS is a global IT services company that provides consulting, systems integration, IT outsourcing, business integration and enterprise resource planning solutions.

Business SituationIn a keenly competitive environment, large fashion houses use IT to drive growth and increase market share. LG CNS wanted to level the playing field by providing smaller fashion firms with cloud-based enterprise systems and advanced communication and collaboration tools.

SolutionLG CNS developed an integrated online portal that delivers all the services needed to manage a fashion company, combining Microsoft Office 365 with a customized enterprise resource planning platform, and an enterprise portal solution called iKEP.

Benefits Reduced costs, increased sales Increased product value Better fashion industry work practices

"Companies don't have to miss out on any valuable ideas or information from clothing stores and fashion markets if they allow their employees to communicate and collaborate wherever they are, at any time.”

An official of the distribution/construction business development team at the LG CNS

Global IT services provider, LG CNS wanted to give small-and medium-sized fashion companies affordable access to advanced communication and business management technologies. Using a mix of Microsoft technologies, the firm created the Enterprise Total Service for Fashion Industry (ETS-F). Built on a customised enterprise resource planning system (ERP), the ETS-F includes Microsoft Office 365, which provides mobile access to email, calendaring, instant messaging, video conferencing, and document collaboration – all via the cloud – and an enterprise portal solution, iKEP, which manages back-office tasks, such as approvals and schedule management. By reducing IT investment costs and enabling fast, mobile collaboration, LG CNS believes ETS-F will raise fashion house sales by at least five percent. Spurred by interest from the fashion industry, LG CNS now plans to use ETS-F as a springboard to create other industry-specific cloud services.

SituationFashion is one of Korea's major industries, but investment in IT doesn’t always match the industry’s glamorous facade. According to the National IT Industry Promotion Agency's 2011 report, ‘Research on the use of E-business and IT Systems by Domestic Companies,’ the information index of the fashion-related industry hovers around the medium level.

With fashion trends moving ever faster, some larger fashion companies have adopted a fast-fashion strategy, to accelerate traditionally long production preparation periods. Today, these companies have emerged as major players and are expanding their market power, changing the industry landscape both at home and abroad.

Recognizing that the fashion industry was fast turning to IT as an enabler for this competitive differentiator, , LG CNS started planning a new service in mid-2011, directly aimed at small-and medium-sized fashion companies. The company’s objective was to help these smaller fashion firms become more profitable and compete against larger fashion houses.

As a first step, LG CNS used its experience with the nation’s leading fashion companies to identify the issues all fashion firms face when implementing key IT systems. In particular, LG CNS analyzed issues related to deploying and using groupware and enterprise solutions ,such enterprise resource planning (ERP), supply chain management (SCM), and customer relationship management (CRM) systems.

LG CNS noted that the IT environment in most smaller companies was not optimized for these enterprise systems, and that many companies lacked the expertise and funding to integrate enterprise systems.

LG CNS also wanted to help smaller companies adapt to changing trends in fashion marketing. Traditional approaches were giving way to digital media, with in-store tablets and POS activities being used to engage customers. Leading fashion houses were adapting to this trend by equipping staff with integrated communication and collaboration systems. Deploying and integrating these systems, however, frequently proved beyond the resources of smaller companies.

To change the game for small- and medium-sized fashion companies, LG CNS created a customized IT service for all fashion firms. The service would help companies manage all aspects of the fashion business, with enterprise systems enabling them to replicate the work processes of major fashion houses and adopt industry best practices.

The service was to include advanced communication and collaboration capabilities, so workers could engage with office systems wherever they were: a concept they called, ‘Smart Work’.

SolutionLG CNS named their proposed service, the Enterprise Total Solution for Fashion Industry (ETS-F). It would consist of three key service elements, and to provide easy access, LG CNS wanted to deploy it in the cloud.

The first element was an ERP system, customized for the fashion industry. It was designed to manage and automate business processes that had been honed by well-known fashion brands over a long period of time. The ETS-F ERP included product planning, purchasing, production, distribution, marketing, sales, POS, human

"Inspiration and speed are very important in fashion, and having to come to the office to view, input, or organize data can be a drag on productivity."

An official of the distribution/construction business development team at the LG CNS

resources, and accounting modules that were tailored to the fashion industry. The company turned to its Software-as-a-Service (SaaS) team to create a multi-tenant structure in order to provide the ERP in the cloud.

The second element was designed to bring the Smart Work model to life. LG CNS wanted to enable staff at smaller fashion companies to work efficiently wherever they were, with continuous access to all essential office applications, as well as excellent communication and collaboration tools. To do this, LG CNS chose to package the online Microsoft productivity suite, Office 365 with its own enterprise solution, iKEP.

LG CNS set the iKEP as a main frame for back-office tasks such as approval and scheduled management. Then they added video conferencing, messaging, and integrated document management functions by using components of Office 365, SharePoint Online and Lync Online. This meant employees working at the company HQ, distribution centers and stores could freely share ideas and information anytime, anywhere.

LG CNS then linked service accounts and Office 365 accounts using the Microsoft identity-management service, Active Directory. This allows ETS-F users to access the iKEP, SharePoint Online, and Lync Online accounts with a single sign-in.

The third element of the ETS-F was cloud infrastructure. To generate economies of scale and provide fashion stores with an affordable service, LG CNS decided to host the ETS-F service on its public cloud infrastructure, which included servers, storage, virtual desktops, networks, and security.

BenefitsReduced costs, increased sales When LG CNS released ETS-F, the fashion industry immediately showed a keen interest: "If a fashion company took on a system-development project as big as LG CNS ETS-F, it would have to invest at least five billion won," said an official of the distribution/construction business development team at the LG CNS service division. “With the ETS-F, companies do not have to bear the burden of the initial development costs. Also, the total cost is only 40% of direct operational costs based on the total cost of ownership over a five-year period."

Cost reduction is just one of the benefits . According to a simulation performed by LG CNS, the ETS-F offered improved on-time product supply, easier inventory management, and enhanced store and customer management. With such efficiencies, sales could increase by five percent.

Easily accessible Smart Work capabilitiesWith the ETS-F, LG CNS was able to bring Smart Work practices to smaller fashion companies, helping them compete with larger rivals.

"Inspiration and speed are very important in fashion, and having to come to the office to view, input, or organize data can be a drag on productivity," says the official. "Now, companies don't have to miss out on any valuable ideas or information from clothing stores and fashion markets if they allow their employees to communicate and collaborate wherever they are at any time."

Increased service value; increased salesLG CNS believes that by integrating communication and collaboration capabilities to the ERP system and the

"With the ETS-F, companies do not have to bear the burden of the initial development costs. Also, the total cost is only 40% of direct operational costs based on the total cost of ownership over a five-year period."

An official of the distribution/construction business development team at the LG CNS

enterprise portal, fashion houses can change the way they work, which will help them innovate. As a result, the integrated service will act as a catalyst for customer purchases.

The company also expects the service will help smaller fashion firms adapt to the ‘Bring Your Own Device’ (BYOD) trend. With ETS-F, users can access groupware, the ERP, video conferencing and messenger on their own mobile devices, regardless of whether they are using smartphones, tablets or laptops. As a result, companies can deploy ETS-F capabilities without having to purchase dedicated devices for staff.

Scope for expansion to other sectorsLG CNS plans to make 2013 the year of the ETS-F expansion. The company has already established a strategic roadmap to expand the service to other industries, using its successful experience with the ETS-F as a springboard.

“Currently, we are bringing best practice processes as adopted by the nation's large fashion brands to small and medium-sized companies,” says an LG CNS representative. “Our goal in 2013 is to introduce advanced processes to 30 fashion companies, and ultimately to offer our services to 100 companies," he added. "With the ETS-F as a starting point, we plan to expand industry-specific cloud services to other sectors, including food & beverage companies and pharmaceutical firms."

Microsoft Office 365Microsoft Office 365 brings together cloud versions of our most trusted communications and collaboration products—Microsoft SharePoint Online, Exchange Online, and Lync Online—with the latest version of our Office desktop suite and companion web applications for businesses of all sizes.

Office 365 helps save time and money, and it frees up valued resources. Simple to use and easy to administer, it is financially backed by a service level agreement guaranteeing 99 percent reliability. Office 365 features robust security, IT-level phone support, geo-redundancy, disaster recovery, and the business-class privacy controls and standards that you expect from a world-class service provider.

For more information about Microsoft Office 365, go to:www.office365.com

For More InformationFor more information about other Microsoft successes go to:www.microsoft.com/casestudies

For more information about LG CNS products and services, visit the website at:www.lgcns.com

This case study is for informational purposes only. MICROSOFT MAKES NO WARRANTIES, EXPRESS OR IMPLIED, IN THIS SUMMARY.

Document published January 2013

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