[Event Report] Engineers Weaving Fast Retailing’s Digital Transformation: A Global Challenge (Part 3)

Amazon Web Services Japan G.K. hosted Fast Retailing Co., Ltd. on July 24, 2024 for its 4.5 hour lecture on the theme of “Engineers Weaving Fast Retailing’s Digital Transformation: A Global Challenge”. This blog post reports on the contents of the lecture, following up on the previous post.

The job titles are as of the day of event.

Panel Discussion: A History of Digital Transformation Forged with AWS

Shimpei Otani, Group Executive Officer (CTO & CSO), Digital Business Transformation Services, Fast Retailing Co., Ltd.

Shigeru Horikawa, Director (Infrastructure), Digital Business Transformation Services, Fast Retailing Co., Ltd.

Yasuhiro Kitaguchi, Director (SCM & Integration Engineering), Digital Business Transformation Services, Fast Retailing Co., Ltd.

Yuichi Murata, Director (Core Engineering), Digital Business Transformation Services, Fast Retailing Co., Ltd.

Kempei Igarashi, Senior Manager, Retail, Consumer Goods & Services Business Group, Amazon Web Services Japan G.K.

Career and Responsibilities of the Panelists

First, the panelists talked about their own careers.

Mr. Otani joined Fast Retailing in 2016 with a mission of internalizing engineering and embedding technology in the business. Currently he is the Chief Technology Officer and also in charge of security. Regarding the relationship with AWS, almost all Fast Retailing services run on AWS, leveraging it for over 12 years. He also shared the facts that he was actually an AWS Solutions Architect in his previous role and had visited Fast Retailing as a service provider during that time.

Since joining in 2012, Mr. Horikawa has experienced shifting from on-premises to cloud, with 12 years of experience working with AWS. Entering a company like Fast Retailing meant a major shift in his goals as an engineer, from system implementation to business results themselves.

Since joining in 2018, Mr. Kitaguchi has been responsible for developing common platforms and the data integration platform. Currently his focus is on logistics process reform and preparing digital tools. His AWS involvement began after joining Fast Retailing, consulting with AWS product teams when building new systems to determine optimal architectures.

Mr. Murata joined in 2017 and experienced the Ariake Project from launch. Starting with developing back-end systems for e-commerce, he went through roles in infrastructure and quality assurance before becoming department manager overseeing in-house development (his current role). E-commerce heavily utilizes AWS with ongoing support. He also introduced a new initiative leveraging Amazon Connect to reform call center operations.

Dawn Period – Fostering Culture

The discussion began with the theme “Dawn Period – Fostering Culture”.

Mr. Horikawa, with the longest tenure, looked back on episodes from when he joined. He learned AWS through seminars and vendor support. Before deciding to use AWS, he gained experience while receiving support from AWS Solutions Architects and others. Initially there were no architecture review processes, and failures like system outages due to lack of quality assurance occurred. Architecture reviews were born by learning from such failures.

Mr. Otani shared stories about the Ariake automated warehouse project, which unlike IT projects, had physical constraints like installing the warehouse hardware, giving him a taste of the pains unique to an apparel company. The project was still chaotic then without a clear picture, but consistently recruiting talented people has created an environment conducive to exchanging wisdom. Addressing critical issues collaboratively naturally fostered the current culture.

Mr. Horikawa also talked about negotiating with AWS over a 4TB database instance for an SAP implementation. At the time he believed it could only be done on-premises, but looking ahead to future growth, he negotiated with AWS and made it happen. This experience taught him that even seemingly impossible things could be achieved through proper negotiation.

As described above, Fast Retailing fostered their current culture by overcoming various failures and challenges with AWS from the dawn period of adoption. Unafraid to challenge and collaborate to solve issues formed the foundation of their culture. Closely cooperating with AWS to nurture this new culture was a major factor enabling Fast Retailing’s digital transformation.

Transition Period – Architectural Changes

The next theme was the transition period when the team at Fast Retailing implemented many architectural changes. Mr. Murata discussed shifting from the conventional monolithic EC package to a headless platform architecture, achieving microservices, immutable infrastructure adoption, multi-region deployment, leveraging open source and managed services, and standardizing technology. He reflected on the complexity of business logic and challenges with performance and scalability.

Mr. Kitaguchi explained how they initially started by just lifting and shifting their on-premise applications onto the cloud, and then gradually moved towards containerization and building CI/CD pipelines with global deployment in mind. Cost-conscious tool provision and close collaboration with business departments for cost awareness were also covered. Mr. Otani talked about standardization initiatives. The background of adopting Amazon Aurora and Amazon ElastiCache as a standard and establishing criteria for programming languages and frameworks was introduced. The struggles with proliferating tools seem to have driven the perception that some standardization is essential.

On the other hand, Mr. Otani also pointed out the importance of maintaining appropriate flexibility in technology selection. Excessive standardization causes loss of flexibility, so preserving suitable options for engineers is also important. These standardization efforts occurred during large-scale concurrent development. Architectural transformation was carried out in stages looking ahead to global expansion, achieving a break-down into platforms and microservices, achieving standardization, etc.

Expansion Period – Globalization

Regarding globalization challenges, Mr. Murata talked about local considerations. They operate multiple brands across roughly 30 markets, requiring a global platform while also addressing needs from each country. Proper prioritization and efficiency are important, but a “global-solution” does not necessarily fit all regions. Aspects like delivery methods and data privacy handling require localization. Mr. Otani added that technical issues cannot always be decided solely by engineers, sometimes requiring management judgment considering geopolitical risks.

Mr. Horikawa talked about network optimization changes. Initially all store communication concentrated to Tokyo, but now leveraging the AWS network fully, connecting each country directly to the nearest AWS Region improved speed and availability by utilizing the AWS backbone network.

Mr. Kitaguchi said based on the characteristics of location-based systems with high customization and requirements variation, they take an approach of building global core aspects like consistent inventory management and streamlining shipping/receiving workflows, then adding localized custom wrappers.

Cultural alignment is also important in multinational teams. Shared values represented in the mission statement foster decision-making and unity in diverse teams. Building an inclusive environment through mission sharing offers something to learn for any organization driving a cloud journey.

Security

Mr. Otani, also CSO, commented on security. Information systems today especially require enterprise-wide security uplift. Security encompasses many aspects beyond just technology, like executive awareness and physical measures.

In addition to IT security, operational measures are indispensable for protecting customer information. Fast Retailing aims not just to meet IT security standards, but exceed them. He emphasized holistically addressing security aligned to corporate mission and ingraining appropriate standards into organizational culture.

However, excessive security rigidness risks losing the creativity and added value that IT brings. Striking the right balance between security and IT flexibility is key, with an important security team role being to maintain that balance.

Summary

Closing comments by members are summarized as follows: Selecting cloud and platform products should consider not just current capabilities, but future evolution based on organizational culture. AWS was initially established to address the business challenges of Amazon, a company rooted in retail. AWS shares a customer-centric culture with Fast Retailing in many ways. Fast Retailing evaluated AWS as a company that continues to evolve in order to address customer needs. Reflecting on their 12-year collaboration, Fast Retailing aims to strengthen strategic partnership with AWS for global expansion.

Finally, they concluded the panel discussion with a heartfelt message inviting engineers from diverse backgrounds to join them and grow the team.

Original blog writers from AWS Japan:

Mariko Anan, SA, Retail

Yuto Miyoshi, SA, Retail