In-Depth

Bonhams Auctioneers

2006 ADT Magazine Innovators Award Nomination

I. Project Information

Company: Bonhams Auctioneers
Web site: www.bonhams.com
Project Designation: IT Integration

Brief explanation of the goals of the project

Seeking to gain an advantage in a highly competitive market, Bonhams required a new IT infrastructure that would support a sharp growth curve and reduce transactional costs associated with the auctions. Over five years, Bonhams completed five mergers & acquisitions resulting in an infrastructure that included several disparate legacy systems. To operate and serve clients effectively, Bonhams’ goal was to consolidate the systems into one unified infrastructure providing users with quick and reliable access to centralized data. Bonhams also needed a reliable and scalable solution for Web-based transactions and services.

Brief description of the business risks involved

The challenge was to design and implement a new IT infrastructure capable of scaling quickly enough to support over 300,000 transactions annually without disrupting existing business or increasing IT staffing levels. The business required a standardized platform with Web interfaces for on-line auctions.

Brief description of how the system helps users

Bonhams transformed the auction process from one that traditionally revolved around paper catalogues to an online database accessible to clients worldwide. The streamlined process enables Bonham to make a profit on all transactions. Bonhams' field staff and specialists have anytime, anywhere access to information. Because everything is done dynamically over the Web from one source, clients get exactly the same information as staff.


II. Organizational Objectives

What short-term and long-term benefits did the organization achieve from the project? Did the solution meet the projected goals for saving time and money? How were benefits measured? Was the system mission critical to the organization?

The unified IT infrastructure significantly improved Bonhams’ business agility and ability to support over 300,000 sales transactions annually with absolute reliability. The cost of processing each item is low enough that profit is made from lower cost transactions. The scalability of the database and applications profitably manages very high-value auctions worldwide, so this project was indeed mission critical for Bonhams’ bottom line.


Bonhams boasts a much lower cost of ownership than other systems in the market, giving them the ability to profitably sell more items than competitors.


Bonhams estimates the cost of developing and deploying the Progress solution was approximately one-fortieth the cost that a leading competitor incurred in deploying its enterprise resource planning applications from SAP. Progress also enabled the system to be deployed in hours rather than days that would have been required with alternative solutions.


Bonhams runs the database without the need of a full-time database administrator, and despite the growth of the business and the growth in the number of employees, the IT staff remains small.

Describe the business purpose of the new system.

Bonhams’ management strives for ongoing profitability, so they needed a flexible system that enabled continuous improvement across the business. Bonhams also required a system capable of capturing detailed information that allowed them to continuously monitor profitability and support diverse types of sales transactions. The system is accessible to all remote sales locations around the world providing access to information and processing it quickly and reliably.

Describe the features of the new system.

The auction system is accessed via Web browsers, enabling anyone anywhere in the world to make connections to auctions. Bonhams displays auction information on the Web and prints catalogs on each auction. Bonhams prints more pages than most magazine publishers, so capturing and presenting detailed information on large auctions presents a mammoth data collection task. Bonhams catalogers access the database to enter detailed descriptions of items, which are amassed for each sale and stored alongside digital photographs.


The database—which has over a terabyte of space for images alone—is a single source of information used by all systems. The auction application draws information from the database for presentation via the Web site, and the Macintosh-based desktop publishing systems also extracts information from the OpenEdge database to create the printed catalogs.


The system tracks every item from initial entry into the catalog through settlement. It also builds customer information and histories, allowing Bonhams to proactively market auction items to highly targeted prospective buyers, creating new levels of customer tracking to support target marketing activity according to the interests of our customers. The new system alerts customers requesting the service to the types of sales which match their interests and will automatically generate a letter, fax, or e-mail according to the preferences established by a customer.


The auction system is fully integrated with the OpenAccounts application, providing management with detailed information to track the profitability of auctions and even of individual sales.


Providing the same level of information access and transaction processing that is available at the head office to remote and even temporary locations is a major challenge, but the Web-based applications allow Bonhams to effectively share real-time information.

Explain the functions of the new system.

The main function of the system is to allow for online auctions. All auction information is stored in a central catalog application developed using WebSpeed.


Real-time information is available over the Web and can also be accessed by sales offices around the world.

Who were the internal sponsors of the project? Which officials or groups were opposed to developing the application? Why?

The technology director sponsored the IT project. He and his team had the full support of management particularly because the new infrastructure would directly impact the bottom line.

Were users of the system involved in the project during the planning and development phases? If so, how?

NA

What were the greatest challenges in completing this project? How were they overcome?

The challenges were in:

  • electing the infrastructure and the applications
  • integrating all the applications under one single infrastructures
  • insure reliable delivery of on-line transactions
  • and scaling the system all the way to handle 300,000 transactions a year with absolute reliability
Were the goals changed as the project progressed? If so, what were the changes and why were they made?

No, the project goals were clear and remained consistent.


III. Category

<>E-business Application Development

IV. Methodology/Process

Describe how productivity tools or techniques were used in the project.

Progress OpenEdge was used to build a database driven UI and workflow framework enabling the entire UI and most of the workflow to be modified in real time to suit changing business needs.


The framework was built using the "ballistic application development" that the Chief Architect had previously developed for another project. This approach enabled Bonhams to develop an entire ERP application from scratch in 30 man months. Bonhams grew fourfold and was able to make changes to its core business management tool in near real-time.

Were testing tools used during development? If so, when were they used? Was the testing cost-effective?

Other than application and test monitoring using text files, a wiki and spreadsheets for project and testing documentation, no formal testing tools were used. This was highly cost effective as no investment in testing tools was required. Due to the flexibility in architecture and the rate of change, automated tests were unlikely to be repeatable so the human element in testing was unavoidable.

Was a formal or informal software development life-cycle methodology employed? If yes, please describe it.

The team strived to slow down the software development cycle continuously since the project went live simply because the continuous pace of change had dramatically outstripped the ability to train end users. Presently, there is an informal life-cycle.

What formal or informal project management methodologies and/or tools were used to manage the project? If used, please describe how.

No official software quality program or metrics were used. The pressure to get it right sufficed.

Were software quality metrics used? If so, what were they, and did using them significantly help the project?

End users were and continue to be the biggest contributors for change requests. They helped to define procedures that were not obvious, and they were asked to test parts of the application with respect to UI and functionality.


V. Technology

What were the major technical challenges that had to be overcome to complete the project successfully? How did the team respond to those challenges?

Bonhams determined off-the-shelf auction management software and enterprise resource planning [ERP] systems would require customization and significant monetary investment to handle its operational size and global distribution.


Bonhams instead took the in-house development route based around best-of-breed financial and human resource packages, and the Progress OpenEdge environment.


Once its in-house solution was developed, Bonhams started searching for a new platform on which it could run. Bonhams Linux offered the required qualities of scalability and stability.

What software tools, including databases, operating systems and all development tools, were selected for the project? Why were they selected over competing tools? What process was used to select development tools and software platforms?

Bonhams based the new IT infrastructure on the Progress OpenEdge development platform and database. The OpenEdge database, which has over a terabyte of space for images alone, is a single source of information that is used for client services, accounting, human resources, the catalog, and Web transactions.


The infrastructure required a powerful and reliable database in order to leverage automation and improve operational results and business productivity.


The tight integration between the Progress development tools and the database was another important benefit. Bonhams determined that WebSpeed, which provides an integrated environment for developing and deploying Web-based applications, was all that was needed to develop the entire auction system.


Bonhams decided to move to Linux which Progress technology supports.


Bonhams selected CedarOpenAccounts' financial software as the standard for financial accounting. OpenAccounts is accessible via a standard Web browser and offers full support for multi-currency transactions. This is important because Bonhams needs to be able to handle the wide-ranging tax requirements of different countries and of the U. S. states in which it operates. Flexibility is particularly needed to meet the sometimes-difficult demands of tax authorities. OpenAccounts was written using Progress tools and runs on the OpenEdge database platform.

Describe the overall system architecture. Were elements of the technical infrastructure put in place to support the new system? Please describe.

Bonhams acquired ten x360 servers and eight x232 servers. Eight of the x360 servers are running Linux and two are running Microsoft Windows 2000. All of the x232 machines run Windows 2000 and function as file, print and exchange servers.


The core of Bonhams' auction management system runs on the x360 servers--three for Web serving, two for application and database functions, two for images, one for Web-delivered reports, one for disaster recovery and one for development.


The x232 machines operate as local servers in each of Bonhams' UK regional sales locations.

What characteristics of the tools and technologies used were most important in achieving the business purposes of the system?

The system required a powerful and reliable database and tight integration between the Progress development tools and the database.


VI. Project Team

What was the size of the development team?

During the course of the project, the team grew from the initial two to the current team of six.


The team also has access to two application trainers (who train users for other third party software and write all of the user documentation), a web and minor utility developer and two MIS managers.

Describe the software development experience of the team members.

Three of members of the team have considerable experience in software application having been involved with corporate and commercial application development for many years using many languages.


The team included a former Oracle DBA responsible for database integrity checking and for report generation using the Excel and CGI reporting tool.


One of the developers had eight years experience in real time and machine control system but was new to corporate application development.


The web and minor utility developer has five years experience developing web and java script applications.


The system analyst has five years of IT experience and was previously an administrator in another Bonhams' department.


Two trainers have four years of IT experience between them – one had a background in personnel and the other in customer accounts.


What was the composition and skill level of the team? Did development teams require training to work with the technology?

Only two members of the team have received formal training in Progress. That training consisted of three fundamental courses over three days.

How many person-months/days did the project take, and over what calendar time frame? Was a formal schedule created at the start of the project? Did the project stay on schedule?

The project launched with two developers in May 2001 and the release was originally scheduled for August 2002. Through a series of mergers and acquisitions, the business grew from 200 employees to 800 employees in Europe by November 2001. Another 200 employees were added in August 2002 in North America. This added the complexity of two additional legacy systems and business processes to the project.


The project initially went live in January 2003 after 58 man months of development, documentation and training development. It slipped by approximately five months - mostly due to the dramatic business changes. Work has continued at a rate of 6.75 man months per calendar month.

Did management and the user community consider the project a success?

Yes

If you had to do the project over again, would you do anything differently? If yes, please explain why.

Yes, process organization. During the development process, several different companies were merged into one. This involved diverse processes and attitudes. The development exercise was the core activity in bringing these processes and attitudes into line. As such development has been harder with more post release changes than should have been necessary.

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