Enterprise Resource Planning For Leading Furniture Retailers

Enterprise Resource Planning Software

Discuss about the Enterprise Resource Planning for Leading Furniture Retailers.

Contemporary Living is one of the leading furniture retailers in the country that operates  80 stores throughout the nation. The company has been very successful in all its operational activities but is planning to shift their main focus towards the development of a stronger operational and marketing plan. The basic objectives behind the change in strategy are to reduce the operational costs, improve the relationships with suppliers and customers, increase the level of customer satisfaction by increasing stock availability and to develop consistent prices of the products throughout all the stores in the country. As a result, the company has decided to acquire an ERP software, also known as enterprise resource planning software, to achieve the strategic objectives. For the whole acquisition and implementation process, the company has appointed a leader who would be assisted by a team of five members from within the organisation.

ERP or Enterprise Resource Planning is a business suite or business process management software that allows the management to integrate multiple business modules into a single software and perform multiple operations using the same software (Beal, 2016).

ERP business suites are designed for large business organisations that find it difficult to manage their work operations using multiple softwares as usage of multiple softwares increases the operating costs and makes it difficult for the management to track the business operations. An ERP business suite can manage the following business activities:

• Distribution process management
• Supply chain management
• Financial management
• Human resource management
• Customer Relation management
• Inventory and stock management
• Accounting
• Product planning
• Marketing management
• Sales management

Enterprise Resource Planning business suites can have the following advantages for a business organisation:

• Increased efficiency à An ERP business suite eliminates repetitive processes and makes it easier to keep a track of all the related process in an organisation. It increases the level of automation, which eliminates the need to enter information manually. An ERP business module also streamlines the processes and ultimately increases the overall efficiency of the organisation.

• Integration à An ERP business module is able to provide an integrated system of all the work operations of an organisation rather than maintaining separate databases for every work operation. This helps in increasing the consistency, avoiding mistakes and eliminating repetitive processes.

• Security à Enterprise Resource Planning business suites are famous because of their unmatched security measures. They are highly secure and provide excellent data backup and recovery options to save the organisation from human or natural threats (Software, 2014).

• High flexibility à one of the greatest benefits of having an ERP business module is that it is highly flexible. Vendors offering ERP business suites are able to provide multiple platforms for the software and can also make changes in them in accordance to the operational requirements of the company (SelectHub, 2015). Therefore, business organisations are able to acquire tailored versions of ERP business suites that are developed according to their business needs.

• Competitive edge à ERP business suites are highly beneficial as they increase the efficiency and productivity while they help in reducing the operational costs. They are powerful enough to make a company highly competitive in the market it operates in (Solutiondots.com, 2016).  

Therefore, it is clear that ERP software is what Contemporary Living requires to accomplish its strategies and achieve its objectives.

The management at Contemporary Living has decided that the manager would be assisted by a team of five members, which would be selected by the manager from within the organisation. It is important that the team should consist of hard working and respectable members who have complete knowledge about the interests of the stakeholders and the change that is being planned to be implemented in the organisation. The criteria for the selection of the team members are given below:

• One member of the team would be a person who would have an experience of more than ten years with the company so that his or her knowledge about the operations of the company can be put to a good use.
• The second and third members of the team would be two people who would be a frontline leader in the human resources and would have complete knowledge about the workforce of the organisation. These persons should be well respected by the employees and should be able to lead the change when needed.
• The fourth member of the team would be a person who would be the head of the entire infrastructure or the information technology in the company. This person would be able to coordinate the resources that would be required for the acquisition of the ERP business suite.
• The fifth member of the team would be a senior level executive of the company who would have knowledge and control of the entire stores and would be in direct touch with the important stakeholders of the business. This person would direct the plans and the process according to the interests of the stakeholders and would establish a medium of communication between the management and the stakeholders.

One of the most important steps in the whole shift of focus and strategic change is the acquisition of an ERP business suite. In the present day IT scenario, millions of companies are offering their own ERP business suites and are making it tough for the business organisations to select one. Each company has something or the other to offer which makes their business suites stand different from the others. In such a case, Contemporary Living can make use of the flexibility offered by ERP business suites and can get its own business suite developed from a reputed company. The company can obviously make a choice between an open source ERP business suite and a branded ERP business suite but it is crucial that the company choses a branded ERP business suite as the company has a large scale business and it cannot afford to test ERP business suites using open source softwares. A branded or professionally developed ERP software would provide more stability, security and operational advantages to the company. Furthermore, managing 80 stores across the nation using an open source software, which would provide no security guarantees, is obviously not possible. Therefore, the first step to acquire an ERP business module would be to get in touch with professional developers that would be able to tailor a software according to the business requirements of Contemporary living. The main features or the operations that the ERP business module would be required to handle for Contemporary living are:

• Inventory management à to keep a record of the furniture in stock and the stock lying in any of the 80 stores.
• Customer relation management à to manage the data and information of the customer so that the company can build better relations with them
• Financial management à to help the finance department in managing the finances of the company
• Human resource management à to help the human resource department in managing the workforce
• Pricing management à to manage the prices of the products and make them consistent throughout the country, in all the stores.
• Sales management à to manage the sales and help in sales planning, sales forecasting, etc.
• Accounts management à to help the accounts department of the company in managing the accounts, such as bills receivable, bills payable, expenses, etc.

Selection of Team

The acquisition of the ERP business suite should be strictly according to the budget of the organisation. Some of the important factors that the team should consider before selecting an ERP business suite are:

• Price of software
• Infrastructure costs
• Total cost of ownership
• Technical fit
• Ease of use, etc. (Kimberling, 2008)

As the company has large scale operations and is planning to establish coordination amongst all the stores, it is advisable that the company should go for an ERP business module along with a cloud storage feature. A system of cloud storage would make it easier for the company to create, store, access and manage data and information. A cloud system with centralized storage server would enhance the ability of the managers or senior level executives to maintain a greater coordination between the stores. The cloud storage system will allow them to access data or information related to any store from anywhere. It would also enable the employees to access pricing or inventory related data of every store if they would have authorization to do so. In this way, the company would be able to make the prices of its products consistent throughout the country. Furthermore, with the inventory of all the stores being available at each and every store, the employees will be able to keep a better track of the stock and would be able to provide better services to the customers in case they need a product which might not be available or might be out of stock in their city.

Another important consideration that the company would have to keep in mind would be regarding the mobile application of the ERP business suite (Schiff, 2016). Some companies allow their employees to bring their own mobile devices and use it for office work. If contemporary living is one such company then it would also have to introduce a mobile application of the ERP business suite which would be tailored to meet the security requirements of the company.

The implementation of ERP business suite is not an easy task and can take a lot of time for proper implementation. The implementation of ERP will require a lot of changes to be introduced in the organisation, which would only be possible if the implementation team is patient and follows the right approach towards the implementation.

In the beginning, a time of one month would be allotted to the team in which they would be required to acquire the best fit ERP business suite and the related infrastructure in all the outlets. The time period of one month would also include setting up of networks and infrastructure that would facilitate sharing of information between the outlets and the centralized storage server. After the end of one month, the ERP business suite would be tested by the developers in presence of the senior level executives to demonstrate the operations that the software would be able to accomplish for the organisation. The demonstrations would be done on real life operations so that the working of the ERP software can be better assured. After the ERP software has been properly tested, the software and the infrastructure would be introduced to the employees and a period of one week would be allotted to the training and development of employees where they would be introduced to the new infrastructure and the software. The training sessions would be held on the job itself and would be conducted by the professionals who would be developing the ERP software to ensure better results. The training sessions would take place after the work hours and would last for 2 hours while the employees would be provided with refreshments and breaks to compensate for the extra time that they would be putting in to gain knowledge about the ERP business suite. The employees would also be taught about the security measures that they would be able to use to protect unauthorized access of data or information. After the completion of the employee training and development program, the employees would be allowed to use the new software according to the business needs of the company. It will also be made sure that the developers would provide all types of technical or other assistance to the company in case the employees are not comfortable or are not able to use the software properly (Pcbennett.com, 2016). The developers would also be responsible for any types of errors or crashes that occur in the ERP business suite in the future and would provide assistance whenever required.

Selection of ERP Business Suite

The present day business organisations are competing in a global environment that is highly complex and is experiencing real time changes. Business organisations and operations are changing at such a fast rate that it becomes difficult to cope up with them. In such a scenario, implementation of ERP is also a dubious task and would experience a lot of resistance from the stakeholders. Therefore, is will be important to properly introduce the change so that the resistance can be minimised.

The following steps would be ensured to minimise the resistance to change and implement the ERP business suite in the organisation:

• Communication à one of the biggest reason for resistance to change is the lack of communication between the management and the stakeholders. The stakeholders generally have a fear of the unknown and if the change program is not properly communicated to them, they offer a great deal of resistance. To minimise such resistances, it has already been decided that the members of the team would be some of the most respected people in the organisation, who would be the leaders of their field and would have a great connection with the stakeholders. It will be the responsibility of these people to communicate the change program right from the beginning so that the stakeholders are well informed about the changes, the objectives behind the changes and the benefits that will occur after the changes are successfully implemented.

• Participation à Another important strategy to minimise the resistance to change process would be participation of the stakeholder. One of the biggest mistakes that few company commit while introducing changes is when they miss out the involvement of stakeholders in the change program. The stakeholders are important people connected to the business of the company and they need to know about the changes that are being brought in it. It is also important for the company to know the viewpoints of the stakeholders about the change programs because they are the ones who would get affected by the change. To minimise the resistance, the company would try to involve the stakeholders in the change program right from the beginning. The members in the team would be given the duty to communicate with the stakeholders and gather their feedback regarding the change programs so that they also feel equally responsible towards the change process. Once the stakeholders are involved in the change program, the chances of resistance are highly reduced.

• Software design à a great deal of resistance can be experienced if the software is not according to the requirements of the user. If the software contains complex functions, foreign languages, etc. To minimise such resistances, the management would have to ensure that the software is user friendly and is developed according to the cultural values of the employees that are going to use it in the near future. Further, the training and development programs organised by the developers would provide more help in bringing down the resistance to change (Corner, 2016).

The process of ERP implementation not just stops at making the software available in all the stores. Even after the complete acquisition of the software, it is important to evaluate the success or the after effects of the implementation as the company would want to know the return on investment that it has made in the software.

To evaluate the success of the ERP implementation, the team will effectively gather feedback from the employees, the customers and the senior level executives. The success would be based upon factors, such as improvement in customer services, inventory management, management of time, decrease in operational costs, increase in sales, etc. The company would also judge the success of the software by checking the difference in management of data and information before and after the acquisition of the ERP software and the level to which the employees will be satisfied with the new changes. Further, measuring the sales, repeated sales, sales conversion rates, customer retention rates and public image would provide a brief knowledge about the changes that have been achieved in terms of customer services and satisfaction.

The feedback would be adopted as a continuous strategy that would help in measuring the success and effectiveness of ERP implementation as the feedback gained from the stakeholders would be true and would be helpful in judging the effect that the software would have on the work operations, performance or the efficiency of the company.

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