The business idea of Oz supermarket is to reduce the exit queues by using and automated system of billing and checkout. In recent times, the focus on self-check-out has increased. This has been possible only with the increased use of Information Technology. Today, the retailers want to use integrated ERP (Employee Resource Planning System) so that all the functions from procurement to sales and support are integrated. According to Self Service World, 27,000 self-checkout terminals were shipped to businesses around the world in 2012. This growth is projected to steadily rise and 60,000 terminals will be shipped in 2018. ERP (Enterprise resource planning) systems are Information systems (IS) software that provides integrated suite of applications consisting of Inventory Management, Order management, customer relationship management, Account Payables, Purchasing, Account receivables, General ledgers. They integrate all the functions in business environment and thus provide integrated and collaborated way of doing things across departments (Nour, & Mouakket, 2013). Traditionally, different department works in silos, each having their own goal which results in huge inefficiencies, same data is entered twice and thus lot of efforts spent during reconciliation. The evolution of self-service checkout can be shown as:
The Oz supermarket business operation could be explained with the view of integrated supply chain. The customer is involved only during the purchase but the business operation starts much ahead in supply chain. It starts from the procurement of goods from various vendors, putting them in the shelf, determining the adequate level of inventory, putting the RFID tags and creating an automated system of re order quantity (Drnevich & Croson, 2013). The entire business operation of the supermarket is based on integrated supply chain. The three recommendations for Oz supermarket can be discussed as:
Traditionally, various departments in a business work in silos which results in huge inefficiencies. For instance, sales order team is entering sales order in their own systems. Account receivables team is also entering the sales order in their systems to calculate the account receivables. Although sales order and account receivables are closely interrelated, they have to deal separately (Powell, Riezbos, & Strandhagen, 2013). ERP systems are Information systems (IS) software that integrates various business processes. For instance, sales order entered by the order management team will be visible to account receivables team. ERP systems have designed cross functional processes that cuts across various departments and thus provides collaborated way of doing things. This helps the various departments to be on same page at a given point of time.
It is important to mention that there are various risks in the implementation of ERP projects. It is important that Oz Supermarket should have a workaround for these risks. ERP projects are quite complex and expensive as multiple parties and stakeholders are involved. There have been numerous cases documented that shows how disastrous the implementation project became for the organization. For example, Fox Meyer drug become bankrupt due to massive cost involved in their ERP implementation project (Nwankpa, 2015). Hershey suffered a huge loss due to ERP implementation. Nike has suffered gigantic loss of 100 million US dollar sales after the ERP implementation went live because people were not aware how to use new systems and thus it has to roll back to its legacy systems. It later implemented ERP with better preparation.
The downstream system of the supply chain would mean the customer interaction after the check-out process is complete. There must be a system in place to take customer feedback and use this feedback to make smart inferences about the existing business processes. Tangible benefits of customer feedback collection would include improvement in cash to cash cycle days, customer billing inquiries will be automated, improved customer order promising using Available to promise functionality, reduction in lead time, reduction in raw material and finished good inventory (Huang, & Handfield, 2015). Not only this, various business cycles like order to cash and procure to pay become more efficient and improved. Also, there will a huge time saving during period end reconciliation activities as system will help to do the reconciliation.
Other intangible benefits include reduction of manpower for Oz supermarket. As ERP systems, will automate the business processes, there is less requirement of manpower. Standardization is another benefit. For instance, organizations that have implemented ERP systems are suing similar processes and cycles at its different offices worldwide and thus processes will be more standardized. ERP systems bring collaboration between various departments and obviate the need to work in silos (Huang, & Handfield, 2015). All these also lead to increase in the visibility of information worldwide and ease the maintenance of information systems as same systems will be used worldwide.
It is important to mention that self-check-in and check-out at retail stores is being practiced by various large players across the globe. One of the area where Oz market can benchmark is inventory management. Generally, for retailers, inventory is not accurate and there is often mismatch in the quantity in system and quantity on hand. There has to be some mechanism in the system that could detect this where the problem is. Is company is not getting sufficient quantity from suppliers or it is not counting the material which it is receiving from supplier or is there any theft in the system (Dahl, 2016).
Conclusion
The above paper discusses the business process and operation of Oz supermarket. Based on the above discussion, it can be said that there is a scope for Oz to improve its operation for self-checkout. The benchmarking and the use of ERP are powerful tools that would enable the company to achieve success.
2. In this age of globalization, digitalization and cloud computing, organizations constantly have to reinvent them as well as update their IT systems so as to get the competitive advantage. This age requires collaborated integrated processes that help the supply chain to become agile and adaptable. Legacy systems do not support such kind of collaboration across business processes and thus organization which is using old/inefficient IT systems cannot compete in the market in the world where technology is changing so fast (Wagner & Beimborn, 2014).
The recommendations in Question is to implement ERP systems. It is important that proper steps should be taken to transform the legacy systems to ERP systems. It would be correct to say that an integrated ERP system would help the organization to improve customer service. In this age of globalization, digitalization and cloud computing, organizations constantly have to reinvent them as well as update their IT systems so as to get the competitive advantage. This age requires collaborated integrated processes that help the supply chain to become agile and adaptable. Legacy systems do not support such kind of collaboration across business processes and thus organization which is using old/inefficient IT systems cannot compete in the market in the world where technology is changing so fast. The key suggestions for Oz supermarket can be discussed as:
There are vendors in the market like SAP, Oracle, Microsoft dynamics that sells ERP solutions. Organization planning to implement ERP systems must studies product of different vendors and select that suits its requirements. Once the ERP licenses are procured, organization need to search implementation partner that help the organization to implement the ERP. There are numerous vendors like Deloitte, Accenture, IBM and also low cost Indian companies like Tata Consultancy Services (TCS). Once vendor selects the implementation partner, they can list down their requirements like what are their existing processes. Implementation partner can then configure the ERP systems in a way demanded by the organization (Aloini, Dulmin, Mininno, & Spagnesi, 2016). Organization can do testing and if satisfied with testing, they can go live i.e. start using new ERP system in a production environment. There are various big giants like General Electric, Apple, Sony, Nestle, Cadbury, Emerson electric that have implemented ERP systems and are now reaping the fruits of increased visibility of the business processes (Jinno, Abe, & Lizuka, 2017).
For Oz Supermarket the objective is take customer feedback into consideration and improve the customer service. This can be done only when the management and leaders of Oz prioritize the ERP modules that have to be implemented. ERP systems can be implemented in manufacturing, finance, healthcare, telecom and mostly all the industry sectors. They consist of various modules like below:
Organizations can implement all or various modules depending on the requirements. For instance, it is possible that any company is not using logistics directly and using services of 3rd party logistics, thus there is no need for them to use Transport management systems. Organizations can also implement ERP is a phase wise approach i.e. first they can implement finance modules; on top of it they can implement order management and like that. For Oz supermarket the first module to implement should be CRM (Customer Relationship Management) system.
Some of the potential disadvantages of ERP systems are as flows:
Conclusion
The above paper discusses the key suggestions for Oz Supermarket that would enable the company. With the above discussion, it can be said that CRM module of ERP system should be the top priority. The customer feedback should be looped into the system and this feedback should be worked upon by leaders of Oz Supermarket at regular time interval. Also, ERP project are primarily people driven project and top management support is very much required due to multiple parties and stakeholder. ERP systems are just an enabler and actual differentiation factor are the business processes that sets the organization apart from its competitors.
References
Aloini, D., Dulmin, R., Mininno, V., & Spagnesi, A. (2016). Benefits and Barriers of Social/Collaborative ERP Systems: A State of the Art and Research Agenda. In Strengthening Information and Control Systems (pp. 171-184). Springer International Publishing.
Dahl, J., 2016. The Impact of New Innovations in Information Technology on Operations and Supply Chain Management: A Comparative Business Case Analysis of Major Technologies and Applications.
Drnevich, P.L. and Croson, D.C., 2013. Information technology and business-level strategy: Toward an integrated theoretical perspective. Mis Quarterly, 37(2), pp.483-509.
Huang, Y. Y., & Handfield, R. B. (2015). Measuring the benefits of ERP on supply management maturity model: a “big data” method. International Journal of Operations & Production Management, 35(1), 2-25.
Jinno, H., Abe, H., & Iizuka, K. (2017). Consideration of ERP Effectiveness: From the Perspective of ERP Implementation Policy and Operational Effectiveness. Information, 8(1), 14.
Nour, M. A., & Mouakket, S. (2013). A classification framework of critical success factors for ERP systems implementation: A multi-stakeholder perspective. In Competition, Strategy, and Modern Enterprise Information Systems (pp. 98-113). IGI Global.
Nwankpa, J. K. (2015). ERP system usage and benefit: A model of antecedents and outcomes. Computers in Human Behavior, 45, 335-344.
Powell, D., Riezebos, J., & Strandhagen, J. O. (2013). Lean production and ERP systems in small-and medium-sized enterprises: ERP support for pull production. International Journal of Production Research, 51(2), 395-409.
Ranjan, S., Jha, V. K., & Pal, P. (2016). Application of emerging technologies in ERP implementation in Indian manufacturing enterprises: an exploratory analysis of strategic benefits. The International Journal of Advanced Manufacturing Technology, 1-12.
Rich, D., & Dibbern, J. (2013). A team-oriented investigation of ERP post-implementation integration projects: how cross-functional collaboration influences ERP benefits. In Innovation and Future of Enterprise Information Systems (pp. 115-127). Springer Berlin Heidelberg.
Wagner, H.T., Beimborn, D. and Weitzel, T., 2014. How social capital among information technology and business units drives operational alignment and IT business value. Journal of Management Information Systems, 31(1), pp.241-272.
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