Scaling down: How Joval Wine Group saved on IT costs during COVID-19

While most companies that move to the cloud do so for the ability to scale up as the business grows, Australia’s Joval Wine Group experienced the benefit of being able to scale down during the COVID-19 pandemic when orders slowed down.

The group was established in 1963 and is composed of grape growing and wine production, wholesale distribution and warehouses. As its five-year contract with a data centre was coming to an end, the company saw the opportunity to move to the cloud and reduce the infrastructure “burden”.

CTO Andrew Stoneham told Computerworld Australia that most of the technology spend and effort from the team was going into maintaining the legacy data centre environment and troubleshooting all the performance issues that came with it.

“When really we wanted to be focused on working with the business to actually enable the strategy. We knew if we could move to the cloud, we just got a much better outcome in terms of reducing that infrastructure burden and freeing up some funds to focus on the value add stuff,” Stoneham said.

Why Joval Wines picked Microsoft Azure

Stoneham said they looked into the three major public cloud providers and because Joval Wines already used several Microsoft software it made sense to go for Azure, as it enabled the company to take full advantage of the Microsoft cloud.

Joval Wine was already using Office 365 and Dynamics, and it was beginning to use Power BI. The latter was where Stoneham saw more benefits as once on the cloud the wine producer could access extra services around machine learning and artificial intelligence (AI) that supported their data analytics.

When the lockdown struck, Joval was ready to scale down as demand dropped significantly. Once pubs and restaurants were able to start opening for the public again, the business was ready to scale up again according to the demand.

“In our original business case, we were very focused on the flexibility to scale up the environment in line with the strong growth trajectory the business has been on,” he said. “In this situation we’ve been able to scale down and reduce that cost, knowing that as the industry recovers and volumes increase, we can turn things back up,” Stoneham said.

The challenges Joval faced in its cloud migration

Stoneham said that time was their biggest challenge as the existing data centre contract was coming to an end and to further extend or renew it was not an option due to the cost. “We didn’t have the luxury of some sort of multi-year, gradual approach to this. We really needed to get it right up front and execute quickly,” he said.

The other challenge is one faced by many businesses that move to the cloud: applications that are not cloud-ready. Because the business no longer wanted anything on-premises, they had to retire and replace a few applications with software-as-a-service (SaaS) products. Prior to this, Joval had some e-commerce hosted on Amazon Web Services, which was also moved to Azure.

How Joval Wine Group made the cloud work for the business

With everything running smoothly, Stoneham said Joval delivers a much better customer and employee experience. Plus the business applications and digital platforms run better on the cloud.

The biggest win to him is the fact that the team is not spending most of their time managing the infrastructure but can focus on what is next, such as the use of machine learning. It has also reduced infrastructure costs by 40 percent.

Stoneham said the business could only move everything to the cloud as a result of trust and collaboration between the technology group and the wider business, and that being able to retire those apps that were not fit for the cloud and getting it right made the difference and enabled them to remain agile, especially during COVID-19.

Understanding the usage and patterns of the applications allowed the technology team to be proactive and identify cost saving opportunities. Stoneham said that the typical thinking seems to be that you’re better off doing as many reserved instances of virtual machines as you can, because you get that 30 percent saving. However, he found that the business could save a lot by turning off machines when not in use—and that provided greater savings than leaving them on all the time.

Benefits of moving to the cloud, and what Joval is doing next

Joval was able to move away from static data about what happened in the past that was shared in either an Excel or PDF format. Now reports are available on the go and are also mobile-friendly, supporting the sales team when they need that data the most. This was improved further as Joval came in contact with BradPrint, which has developed data-analytics software focused specifically on improving wine sales.

One of the areas that Stoneham is working on with his team now is improving the working capital around managing the distribution of wine to 150 different wineries, and Joval is trialing the use of AI and machine learning to optmise that.

Wine is a product that, as Stoneham explained, every 12 months becomes a new product. He expects that machine learning can bring a lot of value and improve from a manual spreadsheet system to one that offers important and accurate information when needed. “The complexity of managing all that and having the right amount of wine in each state is really complex,” Stoneham said.

Looking ahead, the technology team is planning a few internet of things (IoT) initiatives. “That’s something that we haven’t done anything with to date. We can see a big opportunity in IoT, whether it’s warehouses, optimising transport, but also grape growing and wine production. We’ve got a serious backlog of opportunities there,” Stoneham told Computerworld Australia.