The Microsoft Retail Fuels Marketing Reference Architecture

Transcription

1 The Microsoft Retail Fuels Marketing Reference Architecture Business factors in the Retail Fuels Marketing segment of the oil industry value chain are driving the need for an information technology (IT) architecture that provides a highly secure, very reliable and interoperable environment that will create new ways to connect with customers, enable greater product and service innovation, and open up new revenue streams for oil companies and merchants. Oil companies and merchants are also looking for a framework to help guide the implementation of several new technologies including mobile commerce, hosted and managed point-of-sale (POS) systems, decoupled payment networks, and virtual retail management systems to reduce transactional costs, lower compliance costs, while concurrently increasing customer loyalty, brand recognition, and profitability. This paper describes the Microsoft s Reference Architecture (RA) for Retail Fuels Marketing (RFM). This RA incorporates Unified Communications and new technology adoption which will enable transformational user experiences for example, real time behavioral marketing and campaign effectiveness analytics. The Microsoft Reference Architecture for Retail Fuels Marketing is not prescriptive that is, it does not lay out specific implementation details of the architecture s actual structure and function. Rather, it describes a set of guiding principles to which it must adhere, and the general (logical) structure of the architecture to satisfy the domain requirements. The architecture also provides a framework for the industry to be transformed as it addresses four mega-trends; Mobility, Social Media/Collaboration, Cloud Computing and Big Data & Analytics. Figure 1 Mobility Social Cloud Big data This descriptive approach provides an agreed-upon set of principles for establishing key things like payment card industry (PCI) compliance, requirements for cloud-based hosted solutions, defines the needs around customer data security, and the requirements around the interoperability between forecourt control and point of sale; while also providing the flexibility SkyDrive Pro

2 for companies to innovate and establish competitive differences upon the base architecture. This agreed-upon reference architecture approach will encourage simplification and unification for all organizations in Retail Fuels Marketing. System integrators and solution providers will benefit from an established, coherent environment within which to build solutions for the industry and ensures Retail Operations can be confident that application solutions built upon this Architecture will run and integrate cleanly into their IT environments. 2

3 Created February 2013 by Adam Hems Updated April Microsoft Corporation. All rights reserved. This document is provided "as-is." Information and views expressed in this document, including URL and other Internet Web site references, may change without notice. You bear the risk of using it. This document does not provide you with any legal rights to any intellectual property in any Microsoft product. You may copy and use this document for your internal, reference purposes. 3

4 Contents Retail Fuels Marketing Businesses Demand More from an IT Architecture... 5 A Day in the Life of a Retail Fuels Marketing Organization... 5 Current State: Overview and Challenges... 6 Current Architectures... 7 Drivers for the Evolution of a More Efficient Architecture... 9 Enabling the Evolution Technology Trends...10 Scope, Approach and Guiding Principles Scope...11 Approach and Guiding Principles...12 Guiding Principles Role Based Productivity and Insights...13 Natural User Experience...13 Social Enterprise...14 Connected Business...14 Secure, Scalable, High-Performance Infrastructure...15 Microsoft Technology Supporting the Reference Architecture Reference Architecture Overview Users...18 Application Interoperability...19 Business Services...20 Data Services...22 Payment Card Industry (PCI)...24 Infrastructure...24 Getting There Summary

5 Retail Fuels Marketing Businesses Demand More from an IT Architecture The Retail Fuels Marketing reference architecture must support and respond to the functional activities of a retail marketing organization and provide the capabilities needed to effectively and efficiently run the convenience retail business. Retail Fuels Marketing is part of the Petroleum Industry s value chain within what is broadly described as the downstream segment of the oil business. Specifically, Retail Fuels Marketing is where the needs of the consumers, merchants, and oil companies intersect with the economics of refining gasoline and diesel fuels. The market is characterized by intense competition, razor thin margins on fuel, ever changing government and industry regulations, a shifting landscape of asset sales and business models across a fragmented market of retail operators (over 150,000 store locations in the U.S. alone) and consumer perceptions driven by the media s focus on the price at the pump. Finally, the IT needs are increasing dramatically within this vast, complex, datadriven business, with digital transaction volumes growing exponentially. A Day in the Life of a Retail Fuels Marketing Organization A typical Retail Fuels Marketing team in the U.S. is made up of regional fuel retail operations managers, pricing and trading experts and marketing business development brand managers. The team is located across the country and works together to develop a business plan to assess the economic potential for various marketing campaigns for increase fuel sales and profitability at their licensee branded convenience stores as well as to identify cost savings initiatives with less than a one year payback. The team s responsibility also includes technology infrastructure assessments to ensure payment and settlement systems are sustained securely and cost effectively. Most retail fuel locations are no longer owned by the major oil company s so the owner/operator licensee is most often responsible for managing the brand experience, interfacing with consumers, and collaborating with suppliers. The business team is goaled to address three key objectives: 1. Increase revenue and margins on fuel sales through improved brand loyalty 2. Enhance the portfolio of licensee locations and their retention ( stickiness ) 3. Optimize annual operating costs. The team holds strategy meetings to vet ideas through workshops and proof of concepts (POCs). However, the number of scenarios and the complexity of the analysis require that the work be an iterative, collaborative effort. Therefore the team also discusses options and exchanges ideas using and instant messaging, and shares necessary documents through their secure team portal, which makes it possible for them to prepare multiple options in parallel for management and select third party review. 5

6 Current State: Overview and Challenges The current state of the business drivers in the Retail Fuels Marketing industry business drivers include: Marketing Campaign Cost / Effectiveness. The current transactional business models preclude world class loyalty programs and cost effective digital couponing. The lack of data and real time integration also limits the use of behavioral marketing. In most organizations, the volume of information is increasing exponentially, which is an ideal scenario for a Marketer. However, the Retail Fuels Marketing business is seen as an exception, primarily as a result of the inability to capture consumer data and correlate it in a meaningful way due to a lack of data acquisition and integration. This data situation means that at best it s difficult and often just impossible to obtain or use data quickly and efficiently to get the information and answers needed for improved brand loyalty, to identify trends, influence behaviors in real time or close gaps in operational performance. Compliance and Transaction Costs. With constantly changing regulations and payment card compliance mandates, such as the Europay-MasterCard-Visa (EMV) upgrades based on chip and pin technology and forecourt Payment Card Industry (PCI) encryption upgrades, oil companies and merchants are trying to understand and manage the impacts on their business. Also, with credit card swipe fees at an all-time high, on average $0.12 / gallon of gasoline can add up to as much as 10% of total costs on microtransactions on in-store purchases 1 and so oil companies and merchants are looking for alternatives. Fraud and Payment Risk. In the United States, the retail fuels industry averages over 41 million transactions per day with an estimated cost of fraud at 1% on all transactions. So, oil companies and merchants alike are looking for new and better ways to protect consumers and payment risks associated with payment cards including physical theft of cards, white carding (credit/debit card data stolen the merchants database or double swiped illegally), skimming (covertly accessing the panel behind the pump and inserting an illegal electrical device that captures account information when unsuspecting consumers swipe debit/credit cards), and credit card fraud in general. IT Infrastructure, Upgrades, and Total Cost of Ownership. Both merchants and oil companies are looking for ways to reduce IT support and technology upgrade costs. With EMV upgrades on the horizon, it is estimated that merchants in the United States will be required to spend more than $5.4 billion to upgrade card readers in fuel dispensers and Point of Sale (POS) systems. For companies with more than 500 franchises, it will cost an estimated $20M to upgrade proprietary forecourt and legacy POS systems, which will only provide minor functional changes 2. 1 According to the National Association of Convenience Stores (NACS). 2 NACS reports an estimated $40,000 per location for upgrades and $225,000 per year for audit compliance. 6

7 So one of the key questions is, if merchants will be required to spend millions for upgrades, how can they leverage these investments to increase sales revenue, optimize operational efficiencies, and improve the margins on each transaction? Current Architectures The current state of IT infrastructure in most Retail Fuels Marketing businesses is that they are unable to adequately support and respond to analysis, operations, and business needs. Existing IT architectures in the Retail Fuels Marketing sector are often limited by siloed applications, poor integration, and barriers to collaboration. There is limited consumer data captured at the Point of Sale and a lack of integration encumbers use of technology like Complex Event Processing (CEP) to optimize decisions and execute Real Time Behavioral Marketing. Convenience Store Payment Switch or Tandem Payment Equipment: Point of Sale & Pen Entry Device Electronic Payment Server (EPS) Payment Networks: AmEx, Visa, MC, Fleet, Prepaid Cards, Proprietary Oil Company Cards Forecourt Forecourt Controller & D-box Forecourt payment equipment: Dispenser Card Readers, Pin Entry Devices, Encrypted Pin Pads, Receipt Printers Loyalty Networks and Programs Fuel Dispensers, Car Wash Equipment, and Price Sign Figure 2. The current state of IT architectures for the Retail Fuels Marketing sector. A few basic issues define the requirements of a Retail Fuels Marketing IT architecture. This evolution of requirements and the promise from a cloud-enabled, service-layered approach is a next generation approach that addresses the restrictive nature of processing data and workflow inherent in the existing legacy environments. 7

8 Current Issues include: Data Management. The industry s growing volume of data is a great problem to have but not when companies are unable to access the data cost effectively (e.g. they must purchase data from the credit card companies), or if they cannot cost effectively analyze the data that exists in disparate databases and/or lack the tools to identify trends and correlations in a timely fashion. Integration. When integration does exist, it is usually through point-to-point connections or intermediary database tables. These one-off connections add time and cost, and cannot easily be shared or reused by other applications. The industry has much to gain by moving from manual and batch processing to near real time settlement and reconciliation of data for financial, operational and marketing stakeholders. Unfortunately, many Forecourt Controllers and Point of Sale systems are closed or proprietary systems as they lack open Application Protocol Interfaces (APIs) and Software Developer Kits (SDKs) which are readily available in other industries. The need for open systems is common complaint shared by both Oil companies and Merchants with Retail Fuel operations and adds significant cost when trying to scale up operations by adding new locations. Coupled Networks. Networks are inherently designed to increase connections but in the Retail Fueling and Marketing industry the current state of network architecture has the payments network coupled to the Point of Sale network. This situation burdens companies who wish to provide marketing enhancements to their Point of Sale systems to gain competitive advantage as to do so requires changes to absorb the burden of payments compliance regulations required by credit card Companies (for PCI compliance). The need to decouple the payment network from the Point of Sale network is a common complaint shared by both Oil companies and Merchants with Retail Fuel operations. Performance Management. In the current state, Key Performance Indicators (KPIs), which are needed to understand and assess the current status and overall health of an organization, are often not readily available. The manual, time and labor-intensive processes needed to gather and analyze KPIs means that managers and employees waste valuable time waiting for answers while data is collected, analyzed, and translated into the insights needed to understand and run the business. This issue is common to all stakeholders in the Retail Fuel and Marketing value chain from oil companies to merchants to consumer packaged goods vendors (CPGs) and across most functions including marketing, operations and finance. As the industry has re-formed over the past decade, oil companies increasingly have divested their merchant operations, once-removing them from their end customers. Additionally, the oil companies have lost client data access by co-branding gas cards allowing the card issuer to coopt the consumer relationship. The resulting Retail Fuels Marketing world of franchisees, large merchants and small merchants has created the need for new forms of customer satisfaction metrics. For oil companies this means looking at not only traditional market segmentation KPI s in order to maintain or increase consumer loyalty but also for ways to gain alignment with their partner merchants (franchisees) and their need to ensure optimal contract renewals and to identify 8

9 synergies for joint cost savings and improved merchant satisfaction. For Merchants/Franchisees the competitive pressures necessitate new ways to identify and engage emerging consumer markets (e.g. millennials) to get them into the stores after fueling and to retain their loyalty. In this siloed environment, it is often difficult to locate information and ensure the timeliness and quality of that data. For example, three or four different systems may compile lists of available field data and so the organization may lack a single, comprehensive means to analyze and act upon the data. Drivers for the Evolution of a More Efficient Architecture Several business drivers are compelling Retail Fuels Marketing companies to seek a new and more efficient Retail Fuels Marketing IT architecture. Companies must have: The ability to deliver more with less. In today s business and operational environment, premium brand oil companies must deliver more information technology and marketing support for their merchants and distributors with fewer resources and severely timeconstrained work teams. For example, branded retail fuel merchants are typically small businesses so they depend on the major oil companies to provide large integrated payment networks, loyalty programs, and settlement platforms. However, the oil companies are constantly under pressure to deliver new platform capabilities, while reducing network management costs, to help their merchants and distributors compete in price sensitive markets. This situation is creating a mutually beneficial relationship on the near horizon between oil companies and their franchisees; where the new architecture allows the progressive oil companies to provide cost effective and superior security and reduced IT infrastructure costs with a decoupled payment network from the POS through a non-capex managed service offering. Integrated views. Merchants, oil companies, and consumer packaged goods (CPG) manufacturers all need integrated views that reveal relevant data, both structured and unstructured, to better manage marketing programs, fuel inventory management, and settlement. For example, today s retail fueling merchants/c-store operators, manage gas stations under multiple brands and distribution agreements, yet need to compare and contrast performance across all their locations, regardless of brand. At the same time, oil companies should only have access to fuel inventory management across their branded distributors. CPG manufacturers/suppliers also need integrated views of data across convenience store brands and regions, regardless of fuel brands. Easily accessible KPIs. Retail merchants, oil companies and CPG companies need up-todate Key Performance Indicators (KPIs) to fully understand the current status and success of marketing campaigns. For example, brand managers need to measure market effectiveness for promotions based on region, margin, and product availability, so real time data feeds and business intelligence is required to monitor KPI s and supply chains. Plug-and-play technology. The industry needs an architectural approach that allows Retail Fuels Marketing organizations to use more flexible and cost-efficient plug-and-play business logic. For example, if a technology supplier comes up with a new loyalty platform which is to be quickly executed through their hosted and managed POS system then 9

10 simple integration should be enabled by defined application program interfaces and web services, regardless of which forecourt controller, fuel dispenser, or payment network has been deployed at the merchant s locations This approach reduces the constraints on IT, gives companies access to best-of-breed solutions, and can reduce the time needed to deploy new solutions from years, to weeks, and months. Enabling the Evolution There is a strong wind of change coming in the industry and the future leaders will be those who implement IT investments they already need to make for compliance or infrastructure refreshment to leverage new technologies and architecture in order to leap-frog their competition. These leaders will use emerging industry standards and technologies to enable the more flexible, integrated IT architecture needed in Retail Fuels Marketing. Technology Trends There are four main technology trends driving across many Industries, all of which fully pertain to the Retail Fuel and Marketing Industry: Mobility. Most consumers and retailers in all Industries see the inherent advantages of mobile computing (e.g. smart phones such as devices running Windows Phone 8, tablets running Windows 8 and Windows RT, and technologies like telematics and geofencing) to transform the consumer experience for purchases of goods and services. Cloud Computing. This is computing capability delivered as a utility through Internet standards and protocols, commonly grouped into public cloud and private cloud types. Public clouds, as the name indicates, are available for anyone who wields a credit card like Windows Azure. Private clouds are meant for the exclusive use of a business or a consortium of businesses that collaborate. The cloud approach is ideal for complex Retail Fuel and Marketing operations, with its multi-vendor, multi-partner environment and huge volumes of data that require a combination of strict security and easy sharing with appropriate partners. Social Media and Collaboration. With current IT infrastructure, collaboration is also difficult because there is no convenient, shared location where multiple internal and external partners can access information stored on the corporate network. For example, it would be extremely valuable for both merchants and marketers to correlate consumer profiles with fuel purchases with in-store purchases. This correlation would require marketing data tied to the purchaser, payment event data of the actual fuel purchase, marketing data of an offer being accepted for in-store purchase and payment data of the in-store purchase. Facilitating this collaboration would lead to predictive analytics being available to the value chain participants. The industry also is now embracing social enablers to increase worker productivity, using social media technologies such as status updates and notifications from social networks like Twitter, Yammer and Facebook inclusive of real- 10

11 time messaging, blogs, photo sharing and wikis. As Marketing professionals use these technologies to manage their personal and professional connections, the Industry is adapting network-based capabilities to foster cross-discipline collaboration and to better understand and manage the Retail Fuels Marketing operations environment. Big Data/Analytics. The future of Retail Marketing will incorporate the concepts of data mining, business intelligence and real time event correlation to create predictive analytics from mashups. Mashups in the Retail Fueling and Marketing industry will take two forms - Consumer mashups, which will combine data from multiple public sources to facilitate behavioral marketing, and data mashups which will combine similar types of media and information from multiple sources into a single representation (e.g. new behavioral profiles, segmentations and categories). Scope, Approach and Guiding Principles This section will describe the overall approach to a Reference Architecture that Microsoft is taking for the Retail Fuels Marketing Industry. Scope The diagram in Figure 3 indicates where the Microsoft Reference Architecture for Retail Fuels Marketing is intended to lie in the typical sequence of defining a Reference Architecture for IT after a Reference Model has been defined and as input to a Reference Implementation. Reference Model Reference Architecture (RA) Reference Implementation (RI) Solution Architecture (SA) Solution Implementation (SI) Foundation for all other architectural elements Describes the Scope of the Domain Identifies entities within that Domain and their relationships Product Agnostic Defines rules (principles) and Structures (patterns) for Domain Describes general (logical) structure of architecture to satisfy domain requirements Guidance for the Reference Implementation Physical Instance of RA Foundational Architecture for Specific Solutions Might be a solution, probably needs adjustments May be multiple instances Specific Requirements applied to RI Physical Architecture that can be developed against Follows RA Rules to produce physical architecture Many possible instances Development & Deployment of an SA Applies Operation and management rules from the RA Figure 3 Scope The Reference Model in the sequence above is implied by the Retail Fuels Marketing Industry to which it pertains rather than being formally defined at this time. This document seeks to outline the components identified under the Reference Architecture label in Figure 3 (highlighted in red). Completion of the subsequent steps the RI, SA and finally the SI are left to any Microsoft Partners who choose to do so, following the guidance in this document using the Microsoft technologies indicated. 11

12 Approach and Guiding Principles As indicated in the previous section, the Microsoft Reference Architecture for Retail Fuels Marketing is not prescriptive that is, it does not lay out specifics of the architecture s structure and function. Rather, the Microsoft s Reference Architecture describes a set of guiding principles that govern it. This descriptive approach provides an agreed-upon set of principles for establishing consistent attributes of the subsequent iterations of a Solution build upon this RA the Reference Implementation (RI), the Solution Architecture (SA) and finally, Solution Implementation (SI); but also provides the flexibility for companies building upon this RA to innovate and establish competitive differences in their individual RI, SA and SI s. Guiding Principles Instead of being prescriptive, the RA describes a set of guiding pillars, or principles, that govern it. This descriptive approach provides an agreed-upon set of principles for establishing consistent performance, but also provides the flexibility for companies to innovate and establish competitive differences. Shown in Figure 4 are the twenty-seven Guiding Principles used to define qualities that Solutions built upon the Retail Fuels Marketing Reference Architecture should encompass. The top four Pillars are a grouping of more business-focused principles, and the platform across the bottom is primarily focused around infrastructure and IT, and underpins those on top. Each Guiding Principle is described in the following sections. MURA Guiding Principles Role Based Productivity & Insights Natural User Experience Social Enterprise Connected Business Real-Time Analytics Rich Interactive User Experience Collaboration & Knowledge Sharing Industry Standards Complex Event Processing People, Process & Information Integration Smart, Connected Devices Mobility Published Interfaces Information Models Self-Serve Business Intelligence User-Culture Localized Geolocalization Security Storage & Master Data Management Simplicity & Ease-of-use People & Expertise Search Workflow, Process & Information Integration Location Scalable Secure Manageability Integration Agnostic Secure, Scalable, High-Performance Infrastructure Domain Specific Infrastructure Global High Availability App & Data Marketplace Software as a Service Figure 4 - Guiding Principles of the Microsoft Retail Fuels Marketing Reference Architecture 12

13 Role Based Productivity and Insights This group of guiding principles supports the need of the business to get the maximum insight from the vast amount of data they have and to maximize the productivity of their workers. Real-Time Analytics. Rich statistical and analysis packages for data mining, discovery, and reporting for diverse information consumers. Complex Event Processing. Stream-processing engines that can detect and filter realtime events, either on-premise, or in the Cloud. People, Process & Information Integration. Business users use a variety of differing software tools and systems to do their jobs, often using related or even the same information or data. These tools or systems should be seamlessly integrated such that the business users are not required to continuously import and export data from one system to another in order to get their workflows completed. This extends to and includes workflows that include multiple users in their execution. Self-Serve Business Intelligence. To help them gain deeper insights into the increasing quantities of relevant data that is collected, users should be able to use tools to find, select, and explore their data themselves in different, flexible ways that make sense to them without, for example, having to define a report and request their IT to provide it for them. Storage & Master Data Management. Repositories to capture and enable analysis of operational and business data; located on-premise, in the cloud; or a hybrid mixture of both. Natural User Experience This group of guiding principles includes those features that enable participants to best experience the world and how technology fits into that experience, such as: Rich Interactive User Experience. This is a key quality of the user experience of applications for customers and retail employees as well as those of operations staff, control center personnel, and for mobile users using lightweight tablet and smart-phone devices. Smart, Connected Devices. This includes devices with integrated capabilities that are also connected to the network. Examples would include embedded devices running retail fuel pumps on gas station forecourts or line-of-business apps running on smart phones used to visualize business intelligence data, interact with payment devices on forecourts or enable collaboration with employees in corporate headquarters using Lync. User-Culture Localized. Oil & Gas is a very global Industry and therefore users around the world should be able to interact with their software tools and systems using their local culture s language, and their culture s date and number formats. Simplicity & Ease-of-use. As software tooling gets more feature-rich and runs on ever more powerful devices, it should at the same time continue to be simple and easy to use, as well as support input methods that make the most sense (like mouse and keyboard, touch, both, and/or Kinect). 13

14 Social Enterprise This group of guiding principles supports the needs of business users to maximize their productivity via the assistance of their colleagues and others in the Industry, including those people they do not yet know. Collaboration & Knowledge Sharing. This is collaboration using both thick and thin clients, across a variety of devices, and leveraging today s most advanced collaborative tools through corporate portals and public cloud services. Mobility. Workers on the forecourt or at Corporate HQ are increasing demanding the ability to work from a mobile location using the device appropriate to their needs; so solutions should support this capability and work across multiple devices. Geolocalization. This speaks to the need to know the location of the source of any given set of data, and also the location of workers in relation to other workers and/or assets that produce this data, on an ongoing and searchable basis. People & Expertise Search. Workers needing to collaborate don t always know what all of their fellow workers expertise is in, so this is the tooling that allows workers to quickly and easily find colleagues or business partners with specific skills for a workflow they are trying to execute upon and for which they have a need for particular skills in order to successfully complete it. Connected Business For the Retail Fuels Marketing Reference Architecture to successfully deliver cost-effective, integrative benefits, it must enable comprehensive interoperability both on-premise and in the cloud. For this, these features are of paramount importance: Industry Standards. These define a consistent, industry-wide interface to allow new component deployment. Published Interfaces. These are transparently publicized for open-industry use, even if a standard is not available, and that also satisfy important interoperability needs. All the elements of an interface are well defined so that applications can be independently developed to leverage the interface. Information Models. Consistent ontology (naming system) for referring to equipment and assets to enable exchange of information throughout the enterprise and the value chain. Secure. The definition of the security implementation including authentication, authorization, identity lifecycle management, certificates, claims and threat models to enable secure interoperable design and deployment. Workflow, Process & Information Integration. Connected, agile businesses desire Solutions that integrate the workflows of the business users and the systems they use, their process and procedures and the information those user create and manage as part of their work-day across all the upstream systems they interact with. 14

15 Secure, Scalable, High-Performance Infrastructure This group of guiding principles captures the needs of the underlying technical infrastructure, and includes: Scalable. Support for more users, larger models, increased transaction volumes, etc. can be accommodated through increasing hardware performance (scale-up) or the linear addition of hardware and network resources (scale-out), either on-premise, in the cloud, or a combination of both. Secure. Deployed components, functionality and associated information are protected from unauthorized access or malicious attacks. Utilization of security approaches that combine standards to reduce the likelihood of data being compromised based on the users identity can change the paradigm from adding more locks to making systems where there is nothing to steal. Real time multi-factor authentication of identity is proving to be an attractive security approach as an alternative to increasingly complex encryption and secure elements. Location Agnostic. Services are designed so that they can be deployed on-premise in a private data center, in the public cloud, on a smart phone, on a tablet or on a workstation. Users and software components have secure access to platforms and services wherever they are located. Manageability. Infrastructure components can be efficiently deployed, managed and monitored. Integration. Messaging and database technology for linking together workflow, processes, and data optimization. This includes services and components for communication of device and equipment data, between solutions deployed in the private data center and/or public cloud, typically via a Service Bus architecture. Domain Specific Infrastructure. Leveraging unified communications to manage compliant devices, from Forecourt systems and sensors and Back Office point of sale systems and then flowing that data into appropriate operational systems. Global High Availability. Solutions should be available around the world, all the time to meet the needs of this very global Industry. App & Data Marketplace. Marketplaces are now becoming a common method of deploying applications to both desktops and mobile devices, and a place from which to purchase data, from vendors. These may be public, or a Corporate-managed store. Software as a Service. Oil & Gas companies want to buy their software from their software suppliers as modern cloud-based solutions in order to reduce costs and increase flexibility. Microsoft Technology Supporting the Reference Architecture Today there is a large and wide-ranging selection of leading-edge technologies from Microsoft that oil and gas companies have access to. It s important to understand how industry solutions that apply the Guiding Principles, relate to the various Microsoft technologies that underpin them. 15

16 Infrastructure Security Common Data Tooling Integration Application Line of Business User Experience The Microsoft Retail Fuels Marketing Reference Architecture To illustrate this, a high-level diagram illustrating all the major Microsoft technology components available as of this version of this white paper can be seen illustrated in Figure 5. The technology is stacked in a typical Enterprise View, and the high-level components are colored to match the containing Guiding Principles that apply to them. Where several Guiding Principles apply, then several colors are used. In this fashion, the Retail Fuels Marketing Reference Architecture provides guidance on which Microsoft technologies would be the best choice to use when looking to solve the variety of industry problems outlined previously. Secure, Scalable, High-Performance Infrastructure Connected Business Social Enterprise Natural User Experience Role Based Productivity & Insights Figure 5 - Guiding Principles mapped to Microsoft Technology 16

17 Data Services Business Services Application Interoperability Users The Microsoft Retail Fuels Marketing Reference Architecture Reference Architecture Overview Figure 6 shows the Retail Fuels Marketing Reference Architecture, which reflects an integrated computing environment that encompasses domain applications, business productivity tools, and back office applications, both on-premise, and in the Cloud. Retail Fuels and Marketing Reference Architecture Portals Dashboards Mobile Applications Data Mining OLAP Social Community Web Applications Infrastructure Network Systems Security Account Management Reporting Mobile Wallet(s) Social Media Payment Networks Coupons & Loyalty Publish Redeem Settlement Campaigns Analysis Expert System Vendor Master Service Discovery Service Orchestration Workflow Interoperability Services Content Management ETL Data Access Components Customer Master POS & Back Office Service Interfaces Mobile & Digital Commerce Merchant Master Forecourt Controller & Signage Business Intelligence Fuel Inventory Mgmt. Site Mgmt. Services (Pwr., Ref., WiFi) Tokenization Service PCI Dispenser Card Reader PIN Entry Device Front End Process PA-DSS Store & Forward Payment Network Authentication and Authorization Identity Management Virtualization Provisioning System Operation Management Domain VPN Remote Access Network Boundaries, Firewall Figure 6 - The Retail Fuels Marketing Reference Architecture These Business Service Layers permit technology vendors, system integrators, and other Microsoft partners to realize the full benefits of this environment. To function as planned and to eliminate the need for additional integration work, the Reference Architecture provides inherent, seamless integration to connect all layers and applications. Built-in integration enables frictionless communication and information flow, up and down the layers, and provides the ultimate plugand-play efficiency needed. The next sections walk through some key aspects of the Reference Architecture shown in Figure 6 and discuss how they relate to the Guiding Principles described in the previous section and the interactions that take place between the various service layers shown. Scenarios serve as examples and show how a Solution can be delivered by leveraging the various components of this Reference Architecture. 17

18 Users The Microsoft Retail Fuels Marketing Reference Architecture Users Users interact with the System in a variety of ways, which is shown in Figure 7. Components in this section of the architecture would follow some of the Role Based Productivity & Insights Guiding Principles, like Real-Time Analytics, Complex Event Processing, People, Process & Information Integration and Self-Serve Business Intelligence; as well as those in the Natural User Experience Guiding Principles as well, such as Rich Interactive User Experience, Smart, Connected Devices, User-Culture Localized, and Simplicity & Ease-of-use. Also included would be those Guiding Principles in Social Enterprise, such as Collaboration & Knowledge Sharing and Mobility. Portals Dashboards Mobile Applications Data Mining OLAP Social Community Web Applications Account Management Reporting Mobile Wallet(s) Social Media Figure 7 - Integrated Portal Some of the components that Users interact with include: Portals hosted on premise in SharePoint or in the public cloud of Office365, which function as a common platform where managers access IT-based domain work processes of all kinds. It provides mechanisms that support blogs, wikis, and social networks like Yammer used to establish and maintain cross-domain collaborative systems. Rather than logging on to a specific system, users simply log on to the Integrated Portal to access work orders, KPIs, analytic, and other business related systems. Dashboards establish a single location where authorized employees find and use a wide range of data, including KPIs and business intelligence systems where they can leverage powerful self-serve analytic tools. Mobile Applications allow users to communicate via text, voice, instant message and social media, and access apps to be more productive whether setting up or modifying their personal profile information or using a specific app to conduct a transaction or do research. Social Community includes an organizations Yammer network, where employees can collaborate in order to maximize their efficiency and share information. They would also use messaging tools like Lync to instant-message (IM) one another and collaborate in realtime in pairs or larger groups using voice and video. Web Applications are used by stakeholders to move to track and identify opportunities for continuous improvements by providing rapid access to resources, trends and KPIs that are relevant to their role, discipline or geographic region. The new open architecture will allow for a bevy of new high productivity and cost saving applications provided in the form of managed services to franchisees and company owned operations. 18

19 Application Interoperability The Microsoft Retail Fuels Marketing Reference Architecture Account Management can be improved through Customer Relationship Management software (CRM) for better fleet management and franchisee and dealer networks. Reporting can be used to provide improved pricing updates and MSDS revisions via SharePoint. Mobile Wallet such as Wallet in Windows Phone 8 facilitates access to rewards and loyalty offers and information that might otherwise be unavailable, to be utilized at a point of interest by consumers, employee and organization members. This portal-based approach allows all disciplines and managers to focus on a more productive approach of management by exception where they get the information they need when they need it without the burden of reviewing irrelevant data or cumbersome processes to access information. As an example brand managers would like to have better validation of marketing campaign spend and consumer behavior that can only be proven with quality activity and transaction based reporting that delineates correlations (e.g. the consumer paid for gas, acknowledged the coupon on his phone and made the additional purchase.) Application Interoperability The Data Integration and Interoperability Services components shown in Figure 8 are in many ways the heart of a more effective IT architecture, providing a central mechanism for the movement of data between systems, equipment, and other elements in the IT infrastructure. Components in this section of the architecture follow primarily the Connected Business Guiding Principles, like Published Interfaces and Secure and Workflow, Process & Information Integration; but also many of those in the Secure, Scalable, High-Performance Infrastructure Guiding Principles as well, such as Secure and Integration. Service Discovery Service Orchestration Workflow Figure 8 - Application Interoperability Layer Interoperability Services Service Interfaces The Service Orchestration layer is a cloud-hosted Solution, running in Windows Azure that provides a decoupled set of service-oriented interfaces between the User service layer, and the Data Services that feed the various components of it. It is within this layer that Interoperability Services, built using Windows Communication Foundation (WCF) or hosted in BizTalk, expose Interfaces in order to provide a centralized repository for incoming data from point of sale and from fuel management, forecourt control, back office and financial systems. Using defined business rules, this component orchestrates the 19

20 Business Services The Microsoft Retail Fuels Marketing Reference Architecture movement of data between various systems over Windows Azure Service Bus that would include consumer data master, merchant/operational data master, settlement data master, loyalty data master and the economic evaluation applications used to model the expected Return on Investment (ROI) of opportunities. The Data Integration and Business Process Management components also serve to synchronize hierarchical and metadata across systems to ensure operational coordination and reporting accuracy. This capability addresses a number of common issues in dynamic Retail Fuel and Marketing operations. For example, when a new work process or loyalty campaign is initiated, the intelligence built into this component identifies the correct source of all data needed for that activity. The data is then collected and packaged into an XML file (or other standardized format) and forwarded to the application being used to handle the economic evaluation or other work process using Windows Azure Service Bus as the transport mechanism to ensure timely and ordered delivery. By establishing a common path for all relevant field data, the Data Integration and Business Process Management components also measurably reduce the time, cost, and complexity of deploying new applications. Business Services Figure 9 shows the various Business Services that are included in the Reference Architecture. Applied Guiding Principles in this section of the Architecture include many within Connected Business, like Secure and Workflow, Process & Information Integration, as well as some within Secure, Scalable, High-Performance Infrastructure like Secure and Domain Specific Infrastructure and Integration in particular. Payment Networks Coupons & Loyalty Publish Redeem Settlement Campaigns Analysis Expert System POS & Back Office Mobile & Digital Commerce Forecourt Controller & Signage Fuel Inventory Mgmt. Content Management Site Mgmt. Services (Pwr., Ref., WiFi) ETL Data Access Components Figure 9 - Business Services These Services include the following: Coupons. Merchants and Consumer Packaged Goods (CPG) firms have always been frustrated by the acceptance of coupons in the convenience stores. Success with coupons 20

21 has been inhibited by paper based coupons that can be easily duplicated, website accessible codes that unlawfully are shared and employee/merchant frustration on settlement times and coupon accounting rationalization. With the advent of mobile commerce these barriers to coupon acceptance are falling and new real-time digital couponing that is personalized to the consumer is on the horizon. Loyalty Programs are common to both oil companies and merchants. Mobile commerce is seen as key to providing new forms of interaction and relationships with consumers through branded mobile apps and unique and customized offers to increase company brand loyalty. The mobile win for the Retail Fuels Marketing industry is that mobility provides a cost effective and interactive way to recapture customer relationships with a branded app complementary to their branded cards and allows them to discontinue some co-branded cards deemed to have little value. Point of Sale (POS) encompasses those systems located at payment checkout locations where transactions occur in exchange for goods or services. The POS tracks items purchased, money/payments received and provides receipts to consumers. The devices can vary from older electronic cash registers to desktop computers and entry devices may now be smaller devices such as tablet devices and smartphones. Some hardware manufacturers are now embedding computing horsepower into compact printers, allowing operating Systems like Windows Embedded to run the POS within the printing device itself and host the UI via Internet Information Server. The displays in these cases can be compact portable tablets or phones running a web browser and accessing the POS on the Printing device over the network. By way of example of the POS functionality, consider a convenience store with fueling that provides customizations for fuel types or special food products or drink types. More advanced POS systems will also include advanced functionalities that provide integration to inventory management systems, Customer Relationship Management (CRM) systems, financials and warehousing, some or all of which may be built into the POS software. There is a clear direction that hosted and managed POS systems provide a lower total cost of ownership (TCO) but even more importantly are a means to drive faster updates and differentiation. Soon, Smartphone apps will begin to facilitate self-serve POS capabilities for consumers while maintaining data integrity with the hosted and managed POS systems. Dynamics AX provides a readily scalable, open, and hosted and managed POS architecture to deliver on this vision. Mobile Commerce is generally recognized as the delivery of electronic commerce capabilities directly into the consumer s hand, anywhere, via wireless technology. More specifically mobile commerce is considered to include mobile payments by consumers via smartphones and tablet devices, and use of mobile Point of Sale systems by merchants. In a broader context, mobile commerce also includes the network capabilities, security, devices, software, integration, support systems and workflows to make mobile commerce cost effective for consumers and merchants. Microsoft Windows Phone, Microsoft Wallet and Surface RT and Pro tablet devices provide attractive options to consumers and merchants alike as mobile commerce accelerates in Retail. Payment Networks may be coupled with the POS network, or decoupled. The industry is starting to utilize open Electronic Payment Server (EPS) Technology. An EPS is a 21

22 middleware payment software primarily used to provide payment functionality for Pay at the Pump terminals. EPS supports POS applications in the Retail Fuels Marketing industry using standard messaging interfaces (e.g. IFSF, PCATS, X9 and proprietary). EPS technology can be easily deployed on an existing POS lane or on the POS in store processor that typically resides in the back office of the gas station/convenience store site but can also be deployed outside of the POS on a Windows based appliance that is connected to the forecourt locally. EPS can be deployed to de-couple the POS from handling payments and reduce PCI scope. In the cloud, EPS takes the payment rules from the forecourt environment and further de-couples the Payments Network from the POS Network to provide a singular network end point that communicates with the forecourt to handle all payments. A properly designed and deployed EPS network when centrally managed and configured, makes managing the payment processing easy and cost effective and supports all forms of payments: Magnetic Stripe, Chip and PIN, Chip and Signature, RFID, NFC, and Cloud Based Mobile Solutions. Site Controllers on the forecourt are backplane devices that connect and send control signals to components like fuel dispensers/pumps, outdoor payment terminals, price signs, tanklevel controllers. The site controllers are integrated up to Point of Sale systems and/or Payment Systems. Windows Embedded provides a proven O/S to underpin these systems. Next generation site controllers have adopted open standards and APIs to facilitate decoupled forecourt and payment system networks and reduce the cost of integration to both legacy systems and desirable new technologies. Fuel Inventory Management is a service to enable the procurement, management, and selling of bulk fuel. The service facilitates demand forecasting, fulfillment, inventory management, sales and purchase order management, financial management, and environmental compliance to help maximize fuel margins, optimize inventory, determine best market price and reconcile deliveries, invoices, payments, and taxes. All of these systems form part of the Content Management System (CMS) to provide relevant information to all stakeholders. The CMS includes functionality for publishing, editing and modifying content via collaborative approval workflows that can also be managed and optimized from a central web-based interface like Microsoft SharePoint (on-premise) or Office 365 (a cloudbased Service that includes SharePoint Online). Data Services Figure 10 shows the primary sources of Data feeding the Business Services layer. Components in this section of the architecture follow primarily the Role Based Productivity & Insights Guiding Principles, like Storage & Master Data Management; but also some of those in the Secure, Scalable, High-Performance Infrastructure Guiding Principles as well, such as Secure, Scalable, Manageability, and Integration. 22

23 Data Services The Microsoft Retail Fuels Marketing Reference Architecture Vendor Master Customer Master Merchant Master Business Intelligence Tokenization Service Figure 10 - Data Services The Data Services include the following sources: Master Databases each stakeholder in the value chain desires their own view of the available data that is relevant to their business. To accomplish this end, newer architectures are incorporating multi-instance and multi-tenant design into their cloud based computing environment for master databases. Business Intelligence tools to help collect, maintain, and organize data to identify new opportunities and strategies to gain competitive market advantage and sustainability. Tokenization Service serves as a component of a payment security schema where a token takes the need for sensitive data out of the payment processing environment. Inherently, even if a token was obtained by unauthorized persons, it cannot be reused for purchases of goods and services. PCI Dispenser Card Reader PIN Entry Device Front End Process PA-DSS Store & Forward Payment Network Figure 11 - Payment System 23

24 Payment Card Industry (PCI) Figure 11 shows the Payment System of the Reference Architecture. Applied Guiding Principles in this section of the Architecture include some within Connected Business, like Secure and Industry Standards, Published Interfaces, as well as some within Secure, Scalable, High- Performance Infrastructure like Secure, Domain Specific Infrastructure and Integration. The Payment System includes the following components: Dispenser Card Reader for accepting various payment forms of payment at the pump (e.g. credit cards, debit cards, etc.) PIN Entry Device for consumers to enter personal identification data (e.g. zip code, pass code, etc.) in order to authenticate themselves with the System. Front End Process that complies with the global Payment Application - Data Security Standard (PA-DSS) as established by the Payment Card Industry Security Standards Council. Store and Forward component ensures that payment information is sent to an intermediate store where it is kept and sent at a later time to the final destination. This component should also verify the integrity of the data before forwarding to prevent any loss of data and to prevent a transaction from being aborted due to intermittent connectivity, especially in the remote areas or where environments may lose power or internet or satellite connectivity. This component should be underpinned by the Windows Azure Service Bus, a high-performance message transport system that provide these features. Payment Network which provides connectivity for recognition of payments, credits and debits to parties involved in the transaction and settlement between merchants, third party vendors and service providers. Infrastructure Figure 12 shows the Infrastructure for the Network, Systems and Security of the System. Guiding Principles that apply to this section of the Architecture include some within Connected Business, like Secure, as well as many within Secure, Scalable, High-Performance Infrastructure like Secure, Manageability, Scalable, Global High Availability, Domain Specific Infrastructure and Integration. Infrastructure Network Systems Security Domain VPN Remote Access Network Boundaries, Firewall Virtualization Provisioning System Operation Management Authentication and Authorization Identity Management Figure 12- Infrastructure 24

25 The Infrastructure includes the following components and technologies: Network includes the Domain, created and managed using Active Directory either on premise using Windows Server, or on the Cloud (Windows Azure Active Directory), and accessed by an encrypted VPN connection like DirectAccess over secured network boundaries. Systems includes systems virtualized using Hyper-V and provisioned upon Windows Server, and managed by System Center. Security is the Authentication and Authorization of users and remote Systems using Active Directory upon on-premise Windows Server or Windows Azure Active Directory in the Cloud, and Identity Manager. Getting There How can Retail Fuels Marketing businesses best realize the Microsoft s Reference Architecture described in this paper? Microsoft urges companies to consider the following factors when seeking to improve operational efficiency of their Retail Fuels and Marketing Business. Start small. Instead of trying to do everything at once, pick a domain process (such as mobile payments) and build the infrastructure, connectivity, and processes needed to accomplish that process within the integrated, service-oriented environment described here, and following the guidance offered by applicable Guiding Principles to aid in technology selection. Recognize that this high-level architecture is an objective and can at the very least serve as a guideline for service providers seeking to develop and deliver compatible applications for a more common architecture. Focus on business processes and work to incorporate robust data management into those processes. Use the vocabulary of your business when creating a solution. Build data models that use and present information in ways that retail merchants and marketers understand not based on the systems that generate that data. The Microsoft s Reference Architecture for Retail Fuels Marketing described here and the process of transitioning to this more efficient future state can be applied to address the real-world needs of Retail Fuel and Marketing operations. Figure 12 shows the desired end-state. (Compare this with Figure 2.) 25

26 Convenience Store Existing payment equipment: POS & PED Hosted POS (optional) Commerce Server Forecourt Controller/EPS Gateway Server Traditional payment methods: Amex, Visa, MC Alternative payment methods: Pre-paid, ACH, etc. (optional) Existing payment equipment Updated: DCR, PED, EPP Forecourt New Mobile Payment Method Loyalty Network Existing Equipment Figure 12 - Proposed future state of IT architectures for the Retail Fuels Marketing sector Summary Microsoft s Reference Architecture is an IT and business architecture that serves as a common, reliable environment for implementation and integration of the many technologies required by Retail Fuels and Martketing. Ultimately, this architecture will help to dramatically improve efficiency and cost-effectiveness for Retail Fuels Marketing analysis, operations, and business. The Microsoft s Reference Architecture for Retail Fuels Marketing provides a unifying language and a framework for improving productivity and integration in the Retail Fuels Marketing industry. For more information, visit 26