Lotte is a well-known confectionery manufacturer that produces a wide range of products under the slogan “Sweetheart of Your Mouth”. Having been using a virtual desktop environment (VDI) since 2011, the company decided to migrate its environment to VMware Cloud on AWS when it upgraded from Windows 7 to 10. Lotte has expanded its environment to provide a total of 2,500 virtual desktops and plans to create a digital transformation (DX) platform running on Amazon Web Services (AWS) for its core business systems as part of a cloud-centric approach.
“Managing desktops in VMware Cloud on AWS feels exactly the same to users as an on-premises environment, which has allowed us to easily transition to remote work. With our cloud-centric approach, we want to use AWS every time we build a new system.”
Hisaaki Ogata, Senior Manager, Strategic ICT Department, Lotte Co.
Continuous efforts to deliver new value and innovation
Lotte added chocolate and ice cream to its lineup in the 1960s and 1970s, and launched such favorites as Yukimi Daifuku ice cream and Koala March cookies in the 1980s. In 1997, the company introduced Xylitol gum, which promoted dental health. Lotte called this innovative approach “Lotte Innovation”, which is still in effect today.
In 2018, Lotte merged its confectionery and ice cream production, supply and reseller divisions to speed up decision-making and respond quickly to changing consumer needs.
«Now we distribute our products in supermarkets, markets and pharmacies. However, we do not believe that this model will be enough for continuous growth in the future, so we need to continue `Lotte-novation’ to expand our business,” says Hisaaki Ogata, Senior Manager of Strategic ICT Department. “We introduced DX to remove barriers between departments, encourage free and open communication and optimize our business while reflecting the intentions of our executives. True DX is more than just digitization or IT-based optimization: you must also participate in digitization – the improvement of business activities through digital technology. To achieve this, our strategic ICT department deploys and leverages new technologies based on our business plans, and promotes initiatives to increase the IT literacy of our employees and managers».
When Ogata took up his current position in 2016, the department was called the “Information Systems Division”. However, he changed the name to reflect the broader goals of maintaining both existing systems and merging business and information and communication technology (ICT), expanding digital infrastructure to support business growth.
Seamless migration of virtual desktops to AWS environment
Since 2011, Lotte has been strengthening IT management, business continuity and agility by building an on-premises VDI environment with VMware Horizon for approximately 2500 virtual desktops.
«A great benefit of VMware Horizon is that we can connect and use our desktops from anywhere without having to store applications and data on our client devices. This eliminates the hassle of setting up a groupware program to use another computer for remote access while on a business trip. It is also a reliable solution from a security perspective», — says Ogata.
With the company’s current cloud-centric approach, it aims to own as few IT assets as possible. When the companies merged in 2018, core systems and group software moved from on-premises to the cloud. With an upgrade to Windows 10 and a hardware warranty that expires in 2021, Lotte has implemented VMware Cloud on AWS, allowing customers to deploy and manage VMware environments on AWS.
«To run Windows 10 seamlessly, our desktops needed better performance, but we didn’t want to upgrade and grow our on-premises IT assets just for that. We chose to use VMware Cloud on AWS because it offers the flexibility and agility of a cloud with a proven track record, and it made the migration easy», — says Ogata.
The migration project started in October 2019 after final proposals from DXC Technology Japan, VMware and AWS Japan. Lotte began the transition to the new environment in March 2020. Four months later, the company migrated about 1000 computers to a 22-node VDI environment running on VMware Cloud on bare-metal AWS installations.
According to Ogata, «based on our utilization of existing hardware resources, we will initially run a hybrid environment and add another 20 nodes between spring and summer 2021 to move all 2500 machines to a single VDI environment.»
Stability equivalent to local environment with additional cost reduction
«Now we use our VMware Cloud on AWS VDI environment together with our on-premises environment; there are no differences between them», — Ogata says. «The user experience hasn’t changed much and everyone finds it easy to use. Connecting to other AWS resources is also simple. Despite the fact that we switched while the government state of emergency due to COVID-19 was in effect, the transition of our employees to remote work went smoothly».
Lotte is also moving its supply chain management systems, product information systems and information management tools used by sales representatives to AWS as part of its cloud-centric approach.
Ogata explains: «We make AWS our first choice whenever we build a new system. So far, we have not had any performance issues with systems built on AWS. We can optimize costs with reserved Amazon EC2 instances that receive discounts based on a set duration of use and turn instances on or off hourly.»
Expansion of digital transformation and inclusion of production lines
Further, Lotte plans to use a variety of AWS services for business development. “We want to deepen our understanding of the cloud and create a platform that allows us to immediately start proof-of-concept experiments without relying on external technology providers when we think of business ideas. We focus on IoT, machine learning and data analytics,” says Ogata.
Since bringing its sales and production departments under one roof, Lotte has been expanding its use of digital technology not only in product planning and sales, but also in manufacturing and distribution. The company is currently using AWS’ input support system to manage factory production performance and tracking.
«With the input support system, we use portable terminals on the production floor to scan finished products; this data is stored in AWS and connected to core systems for procedures such as shipping management,” says Ogata. “In the future, we will expand our focus beyond IT to include operational technologies for production lines. We envision smart factories that use IoT to automatically capture data to communicate with core systems and analyze. It’s exciting to think about how we can use AWS services in different situations».
About Lotte
Lotte, founded in 1948, is a manufacturer and supplier of confectionery, ice cream, healthy food, general merchandise, etc.
Advantages of AWS
- The existing VMware Horizon environment is preserved
- Operation and management of a VDI environment identical to the existing environment
- Optimize costs with Amazon EC2 Reserved Instances
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