Barmy is a new sports equipment manufacturer that sells to retail outlets. Coordination of all activities will take place at their head office in Toronto and all manufacturing and storage related activities will take place at their manufacturing facility located outside of Toronto. Barmy will place a great deal of emphasis on their manufacturing activities ensuring that supplies arrive on time, customers receive exceptional quality products and deliveries are made on a timely basis.
At the same time Barmy must ensure that customers enjoy their shopping experience from the time they place their orders until they receive the final goods. Customers should be able to place their orders online, track product shipment at all times and be provided with up-to-date information. Barmy’s information system should encompass all of these features and all other specified requirements. By excelling in their manufacturing process and offering outstanding customer service, Barmy will build a strong customer base focusing on customer loyalty.
An Overview of System
Barmy plans on expanding in the next five years but they are also beginning their operations at a time when the economy is not very stable. The company fears it may not survive its first year. With these ideas in mind the ideal system should not only fulfill all requirements but must also be cost efficient and should be implemented rapidly as they wish the company to be up and running quite soon. Most importantly, if the company is a success, the information system must be readily and easily upgraded to sustain required needs. In addition, all information must be shared between all departments as this will ensure efficiency and a sufficient data storage component will be required to maintain all this data.
1. Manufacturing Facility
* Inventory Maintenance: The manufacturing facility will need to maintain raw materials, work-in process, and finished goods inventory. To maintain an efficient manufacturing process, management should be able to coordinate inventory levels with various suppliers. This information will be used to project expected time of completion of finished goods as well as to avoid any bottlenecks and shortages of materials. Inventory of products in process must also be maintained as this also aids in maintaining the manufacturing process at optimal levels. Inventory of finished goods must be identified by a bar code; the system must be able to identify the bar code of the product at all times to determine its status and location.
This information must be readily accessible by all pertinent staff in real time. Warehouse management should also be alerted if particular inventory is on hand for a very long time either because it is not a good seller or because the customer no longer wants the product. In addition, all returns must be inspected and recorded.
Quality control management must be able to compute figures as to why the product was returned and to avoid such returns in the future. Products returned in good condition must be allocated back into inventory; those that are damaged must be evaluated and either sold at a discount or should be scrapped. Inventory must be updated instantaneously as the product leaves the manufacturing facility or as it is returned. Most importantly, the system must be upgradeable should the company decide to expand.
* Delivery Coordination and Scheduling: As products become due for shipment, the head office should arrange delivery and confirm information with customers through email. Barmy is leasing its delivery trucks from a company that offers the best tracking system as well as price; Barmy’s system should be compatible with the tracking systems of the delivery company and should allow both management and customers to track the product during shipment. If the shipment is delayed management should be informed to take further action. Since customers will be advised as soon as their merchandise is ready for delivery this will reduce finished goods from storage and maintain low inventory levels.
* Supply and Demand for Merchandise: The manufacturing manager must be able to view sales reports generated at the head office and daily sales orders. In addition management must be aware of increases in demand for certain products, product returns, and new promotions. Most importantly direct communication and real time information obtained from the sales department will allow maintaining inventory at minimum levels. Sales reports will advise of which products to produce in excess and which to discontinue manufacturing. Based on sales reports, management can implement JIT for certain products which are constantly in demand as another effort to reduce inventory on hand.
2. Head Office
* Customers: Customer service department should be able to have information at their fingertips and possess excellent product knowledge easily accessible through the company’s website. They should also be able to receive and disperse orders, view up-to-date product information to assist customers with new products and must be connected to the manufacturing department to determine product availability. Customers must also be able to make orders online if they have previously made a purchase therefore, the website must be user friendly and display all pertinent information. Internet orders should display inventory on hand in real time, if inventory is not available, an expected time of arrival can be provided.
To secure their information, customers should be able to create their own accounts including a user name and password. Furthermore, to facilitate customer convenience, Barmy’s website must be periodically updated to display up to date information. Customers should be able to address their complaints online or be able to call a customer service centre, where their complaints will be directly addressed. The customer service department should be immediately alerted if customers contact Barmy via e-mail to promptly respond to their questions or concerns.
Management must be able to monitor and overlook employees dealing directly with customers to verify customer service efficiency. This can be done by tracking and recording all customer complaints and identifying specific problem areas. As the company is planning to expand its system, it must be upgradeable and to have extra data storage capacity.
* Sales: Sales department should be able to compute various reports such as revenue for individual products; to identify more successful product lines. This information must be updated and be in real time as it will be used by other departments. To increase the customer base, sales representatives need to travel to meet various customers and supply them with updated product information. The website will be updated with information such as new products, product availability, prices etc. enabling the sales staff to access this information at all times.
* Marketing: A market analyst will be employed to provide changing customer trends and innovations to help Barmy stay competitive in the sports equipment industry. The market report will be used by various departments by planning, forecasting demand and customer trends.
* Other: All departments must be integrated to allow information flow to align its operations with its strategic objectives and sustain its existence through the sluggish economic conditions.
The main data required for Barmy are as follows:
* Customer data: As a manufacturing company, Barmy sells its products to sports outlets that resell to the end consumer. The data will include customer contact information in order to communicate effectively about their product purchases and their needs. This data will be used for delivering their products, forecasting their demands and ensuring exceptional customer service.
The marketing, manufacturing, accounting department and particularly the head office in downtown Toronto need updated data to coordinate their activities. The data includes customer purchasing patterns to forecast their demand, payment information for the accounting department and customer suggestions to better serve them. The marketing and sales department would require data to manage their promotional activities and sales efforts, and match the supply to demand.
* Company Staff: While the sales staff is traveling, they need detailed product, sales and upgrade information that can be accessed easily. They must be able to access the company’s information from anywhere, through the company’s internal website using a login ID and a password.
Data regarding product returns needs to be tracked and the reason and complaints need to be looked into to avoid future returns and to identify possible defects in the manufacturing or design process. The data will be collected through an online questionnaire to obtain customer suggestions and complaints to assess the quality of customer service.
Data regarding manufacturing needs to be maintained to identify returned items to their batch of production. The sales data is needed for procurement schedules to align it with the sales forecasts. Raw materials data and suppliers’ terms are required to sustain smooth working conditions and to schedule production with suppliers.
Management needs data in determining profitable sales lines, products in demand and emerging trends which can also be used by the sales and manufacturing departments, in assessing their prevailing strategies. The human resource department requires sales staff records to reward employees and track their success, salaries and benefits. In addition, the accounting department needs data about sales, Accounts receivable and payables to prepare financial statements, and in assessing the profitability of certain product lines.
* Delivery and Distribution: Barmy will lease trucks to deliver its goods, and therefore needs updated data regarding the best quotes as well as their tracking system. Customers track their product delivery online and need to be contacted for any schedule changes.
* Inventory: As Barmy wants to keep inventory levels at a minimum, it needs information regarding sales forecasts, customer orders and the quantities and prices being offered by suppliers. This data will allow it to reduce storage costs and avoid costly rush orders and enable an efficient use of its resources.
Managers and Associated Sales Staff: On a managerial level, managers must be able to monitor the performance of the sales staff according to their sales data. The system must be able to analyze the sales data such that it accounts for all the information regarding the quantities sold by each salesperson. Mangers also have to communicate with other departments through a network to ensure that all departments are aligned with the company’s objectives and strategies so that there is goal congruency.
Sales staff also need to access information when they are traveling, so they will need authentication to enable them to access the company’s data. Each staff member is assigned a password corresponding to their payroll number, to ensure information security. This feature prevents past employees from accessing confidential information; therefore, the system will automatically deny access to an invalid payroll number. The website has to be user-friendly and straightforward to ease in the information gathering process.
The human resource staff will be responsible for the employees’ payroll and benefits. With current economic conditions, recruitment will be put on hold. The HR staff will also work on employee development, through training programs and continuous feedback on each employee’s performance. They will set up guidelines and procedures for managers to evaluate their employees.
The manufacturing department should be integrated with the purchasing department to efficiently receive orders and schedule production cycles. The warehouse needs to be connected to the manufacturing department to manage inventory and plan supply orders.