IKEA Sweden – Reimagining the customer experience with Microsoft Power Platform
Sameer Bhangar, Principal Program Manager, Wednesday, May 6, 2020
“Microsoft Dynamics 365 and Power Platform ensures that our customers feel seen. It makes it smoother for our co-workers to take the customer through the kitchen buying process. It has been an enabler to build long term business relationships based on quality and trust.” – Michel Tabakovic, IKEA Country Sales Manager
IKEA is a Swedish company that was established in 1943. The company designs and sells ready-to-assemble furniture, kitchen appliances and home products, among other goods and home services. Across the globe, IKEA has 211,000 employees, 433 stores, and operates in 50 e-commerce markets.
In this post we look at how IKEA Sweden partnered with Capgemini, a Microsoft Gold Partner, to build a Dynamics 365 and Power Platform solution for its sales staff to improve the kitchen buying experience for individual customers (B2C) and businesses (B2B). They wanted to provide their customers with a sense that “IKEA sees me” when working through the process of building a new kitchen. This project contributes to realizing the vision of having a holistic single view of the customer over the lifetime of their relationship with IKEA.
MEET MIKI
As the Country Sales Manager, Michel Tabakovic (Miki) leads the sales teams across IKEA Sweden. IKEA is evolving its business from being primarily perceived as a do-it-yourself furniture store to providing complete home solutions, such as large-scale kitchen remodel projects. Miki’s vision for technology is to “provide a single source for the customer view and enable IKEA to be a part of the customer’s long-term journey – for end customers and businesses.” He sees digital transformation being a key to improving the “human to human connection” – equipping the sales teams with customer stories and data points that will help them serve customers today and for years to come.
Miki’s motivation and drive to adopt Dynamics 365 and the Power Platform started when the IKEA Board and CEO asked questions about kitchen sales, such as – sales conversation rates, why were customers not buying kitchens with IKEA, who were the existing B2B customers, what was the potential size of the B2B market, and more. The team did not have answers to these questions because the data was not captured in a structured manner. Miki decided to take the lead from within the business to find a technology solution for these challenges. Initially, he did not receive much support from Corporate IT, but he continued to push on convincing multiple stakeholders and getting the necessary funding for the project. In his words – “I refused to take no for an answer but I was humble at the same time, understanding that the process was complex and the project needed to be scalable globally.”
Now, with the IKEA Sales Tool, Miki believes that IKEA kitchen and B2B sales teams will be able to make data driven decisions that benefit the customer through the entirety of the kitchen buying process. The data will enable capturing trends early before they become mainstream. For example – kitchen islands were an emerging trend before they became mainstream, customers have now started buying two ovens, what is the next trend? The system will allow the sales teams to learn and act on these quickly during the sales cycle. He considers this as just the beginning, the foundation of being part of the customer journey for many years to come. He continues to stress that the tool is ultimately for his sales team in the field to form stronger human connections with their customers.
BUSINESS CHALLENGE
The kitchen is the place where family and friends gather to cook, socialize, and eat together. Many might say it is the most important room in one’s home, as it is the center of the family’s day-to-day life. Considering its importance, it is natural to go about an organized approach, pay attention to details, and spend the necessary time when planning a new kitchen. While IKEA’s intention was to take the customer through an exceptional journey from initial idea to a ready kitchen, the reality in each local store was quite different.
The kitchen departments lacked a structured process for documenting and managing sales. IKEA heard from customers that the main reason they did not purchase kitchens at IKEA was because they felt the company did not provide good support through the buying process. Meanwhile the high demand for kitchen sales continued to grow in the market, with a growing awareness of the increased competition and greater customer expectations for the buying journey and final product. For all these reasons, IKEA needed to transition the way they sold kitchens for B2C and B2B customers.
BEFORE POWER PLATFORM – Business process, challenges and opportunities
Before the Dynamics 365 and Power Platform solution, the kitchen department used a homegrown spreadsheet-based solution to keep track of kitchen planning appointments, prospective customers, ongoing projects and the various elements that define the kitchen-buying journey.
Similarly, the B2B sales team also used Excel spreadsheets to track individual and aggregated kitchen sales. The homegrown “low tech” solutions created by individual sellers lacked a structured or unified approach.
Besides B2C and B2B sales, the Customer Support Center (CSC) process of making appointments was also manual. If a customer called the CSC to make an appointment, the agent would put the customer on hold and call the local store to schedule a kitchen consultation. The local store would then look at an excel spreadsheet to see what was available. Once the meeting was booked the notification back to the customer was done manually.
This process resulted in several challenges, such as:
- Extensive manual work required for a complex buying process, which could span up to four months
- Three hours a day spent on appointment scheduling and management
- Loss of sales due to lack of consistent communication process with customers
- Lack of mobility: B2B sales team did not have access to their systems when they were out in the field
- Lack of centralized data maintained to calculate & forecast revenue
- Lack of reporting capability to see a 360-degree view of sales
- Lack of data security based on roles, as all information was maintained in Excel sheets
POWER PLATFORM SOLUTION – IKEA SALES TOOL
The IKEA leadership team in Sweden and thought leaders from local IKEA stores worked with Capgemini and Microsoft to build a solution that enabled tracking of the sales process from the first meeting with the customer to the installation of the kitchen. It also serves as the foundation of IKEA being part of the customer’s home improvement journey for many years to come. The implementation is a collection of apps built with Microsoft Dynamics 365 and Power Platform, collectively referred to as the IKEA Sales Tool.
The development effort on the solution started in December 2018 with a directive from Miki to Capgemini to “build an app that required no more than ½ hour of training for the sales staff.” The app was piloted by one sales team in May 2019 and was rolled out across all stores in Sweden by June 2019. In total, more than a thousand employees and managers use the solution. Of these, ~250 employees use the full Dynamics 365 capabilities and ~750 use Power Apps. Five months after the go-live, up to 90% of the target employees were actively using the solution.
The IKEA Sales Tool consists of four apps:
- Kitchen App: This is a Power Apps model-driven app that leverages Dynamics 365 Field Service capabilities. It is used by in-store hosts to get an overview of customer bookings, manage resources (co-workers) and schedule drop-in customers to meet with sales specialists. Store managers and team managers use the app for reporting on key statistics.
- Co-Worker App: All IKEA employees are internally referred to as “co-workers.” In-store sales specialists use this Power Apps model-driven app to start and end in-store customer meetings, add meeting notes, update revenue details, and book revisits.
- B2B App: This is a Power Apps model-driven app that leverages Dynamics 365 Sales capabilities. It is used to manage the B2B sales pipeline and is the first attempt to create a single customer view for IKEA’s B2B customers, with data consolidated from multiple sources.
- Customer Support Center App: Customer Support Center agents use this Power Apps model-driven app to book, rebook or cancel appointments on behalf of customers.
Here’s more detail about what each Power App does, followed by a summary of the various technology components used to implement the solution.
KITCHEN APP
The studio host is the person who welcomes the customer into the kitchen area. They use the Kitchen App to check whether they are an existing customer, verify the scheduled appointment, and assign a “co-worker” to serve the customer. The app helps them plan the day and gain an overview of the bookings and resources available, so that they can successfully manage the drop-in customers.
The app also enables the sales management team to view analytics associated with the kitchen buying process, such as “booked appointments”, “cancelled appointments”, “business opportunities”. It is very important for IKEA to have these statistics because they want to change the way they do business and increase the number of scheduled customers versus drop-in customers.
The Kitchen App is a Power Apps model-driven app that leverages Dynamics 365 Field Service. The app provides a subset of the Dynamics 365 Field Service capabilities scoped to IKEA’s specific requirements. It uses the resource scheduling module for managing schedule boards, bookable resources, and more. Power Automate is used to simplify the user experience – each time a co-worker hits start or end on an appointment, a flow is triggered to automatically calculate and record the duration of the meeting and update the status. Azure Functions and Logic Apps are used to connect to IKEA’s SMS delivery system and send text message notifications to customers. Dynamics 365 workflows are used to send emails. The team plans to eventually migrate all workflows to use Power Automate.
Studio Host can view the appointments to assign to co-workers
Drill down of revisits in Kitchen App
CO-WORKER APP
After the customer is checked into the store by a studio host and assigned to a sales rep (“co-worker”), they begin to use the Co-Worker App, which is a Power Apps model-driven app that connects to data stored in Common Data Service. The co-worker uses the app to add meeting notes, update the kitchen project revenue, and book revisits with the customer. Revisits are a significant step in IKEA’s sales process. They drive increased revenue and form the start of building a long-term relationship with the customer.
The app also includes a calendar, implemented as a custom control in the model-driven app, which simplifies the customer journey for booking appointments. A web calendar is implemented on IKEA’s customer facing website and connects directly to the Common Data Service. Customers navigate to the appointment page and select the desired store. They describe their requirements and request an appointment. The web portal checks if it’s an existing customer and either fetches their profile or creates a new profile. A new opportunity is automatically booked and visible on the scheduling board. Customers can use this web page to directly view the status of their bookings, information about the co-worker that will handle their meeting, and more.
Whether the customer is booking an appointment for service planning through IKEA’s website or making an appointment for kitchen planning in the store, their appointments are all managed and updated via a common system and data store.
As a result of the Power Apps solution, this is the first time that a co-worker has been able to use a single tool to look for customer information and status in one place. They can also get a view into the sales progress made by each co-worker. They plan to continue expanding on this by adding goal management capabilities for co-workers.
In addition to using Power Apps, co-workers use two other tools in their day-to-day process to design kitchens and place orders. These are standalone custom tools – (a) a Design Tool to plan and design the custom kitchen and (b) an Order Management Tool (ISell) to generate a list of products based on the output from the Design Tool.
Azure Functions are used to fetch and publish data on a recurring cadence from the ISell system into Common Data Service, thereby making all the kitchen order information directly available within the Power Apps app.
Co-worker app used to manage customer meetings – Start and End buttons trigger flows to automatically update status and duration fields
Co-workers can use a calendar view to book revisits
B2B APP
The B2B sales force is responsible for selling IKEA products to small and large businesses to use in their office buildings. They use a Power Apps model-driven app that leverages the Dynamics 365 Sales capabilities to track the sales pipeline and provide insights into their B2B customers. The app also enables the sales team to keep ongoing communications and build better relationships with customers. Keeping with the theme of “less is more”, the app is a simplified version of the Dynamics 365 Sales capabilities, e.g. has a reduced set of sitemap and navigation options.
All B2B sales reps now use the new app to input new and existing customers’ information. This has allowed the team and IKEA management to have a view into who is taking care of the customer, active opportunities and general customer pipeline. They can also track sales activities such as revenue, estimated close dates, etc.
CUSTOMER SUPPORT CENTER (C2C) App
Customer support agents use this Power Apps model-driven app to book, rebook or cancel appointments on behalf of customers. The usage of the app has grown from six members to over twenty and new members continue be added on a regular cadence. Despite its small number of users, the app has transformed the way CSC deals with customers who call to make appointments. The agents can directly book appointments via the app and no longer need to put the customer on hold while they call the store to confirm the schedule.
During the call with the customer, support agents can also look them up to get their detailed history along with all their prior conversations with co-workers. This has been a far superior experience over trying to navigate multiple spreadsheets for this information. Since previously new sheets were created every three weeks, there was no historic view available.
This is an important goal for IKEA – to collect customer data so that they can build long term relationships and support the customer through their furniture buying journey in the present and the future.
CSC appointment booking tool
IMPACT AND BENEFITS
The IKEA Sales Tool has been in production for less than six months. While collecting more detailed impact metrics will require at least one sales cycle of 6+ months to complete, the following are early indicators of the benefits and impact of this solution:
- Provides a single automated system for sales team to see appointments, rebook appointments and manage the sales process from inception to kitchen installation
- Reduced time for manual resource planning, note collecting and collating data
- Centralized and consolidated customer profile allowing for better and long-term management of customer
- Increased sales due to a sales pipeline being captured and tracked for B2B customers
- Reduced training time with new sales reps, important because the B2B department is rapidly growing
- Centralized data maintained to calculate & forecast revenue with capability to see a 360-degree view of sales
- More advanced and refined statistics of sales, forecasting, employee performance, customer retention, etc.
- Expected positive return on the investment to implement the solution within a year
- Will enable prioritizing the right customers thereby increasing conversation rates. For example, during the busy month of December, co-workers can focus on customers that are at the end of their buying journey and follow up with newer customers during a slower period. This is something IKEA hasn’t been able to do before.
SOLUTION ARCHITECTURE
A summary of the Microsoft technologies used in the solution is as follows:
- Power Apps model-driven apps: Provide easy navigation and a simple user experience with secure access and relevant data visibility based on security roles.
- Power Automate: Flows are used to automatically update status fields and send text messages to the end customers for notification of scheduled meeting.
- Common Data Service: All data is stored in the Common Data Service with appropriate security roles for access. The IKEA Sweden web page integrates with data in Common Data Service using the CDS SDK.
- Dynamics 365 Field Service & Resource Scheduling: Leveraged to maintain stores, co-worker availability, scheduling & distributing appointments.
- Dynamics 365 Sales: Leveraged by the model-driven app to manage B2B customer accounts.
- Azure Logic Apps: Used to email customer meeting summary notes and quotations.
- Website Portal: Real-time integration of webpage hosted on website to MSCRM via CRM WEB API using OAuth 2.0 authentication.
- Translation Tool: Created for translation of custom fields and components which supports all languages provided by Microsoft.
- Azure Functions: To reduce performance latency, all heavy customizations and jobs are scheduled with the help of Azure Logic Apps and Azure Functions.
- Azure blob storage: Data exported to the cloud is converted into blob storage. This helps secure customer information as no person can access customer data directly, they must go through apps configured with dedicated security roles.
- Azure Key vault: All credentials, access key and security related data are stored in Azure Key vault on cloud.
Implemented Azure Function to create booking slots dynamically based on calendar configured for resource, which will consider holidays, working hours & business closures specific to stores, reducing manual work for all co-workers.
