Impact of IT for improving operational and competitive advantage
The assignment will explore the available IT applications to the ShoeIT Company and how this application can be integrated with the business process of the company. The paper will particularly look for the advantages these application or the technology might prove helpful for the company to excel in the business while having an edge over the competitors in the market. The ShoeIT is a renowned shoe company having headquarters in the US along with 20 branch offices. It specializes in manufacturing and selling shoes and shoe related accessories. The company has stores all over the world and operates through bricks and mortar stores. The stores houses shoes for both men and women. The company also sells shoes an e-commerce and m-commerce stores for providing wider range of option to the customers. However in order to improve the business and compete in the market more efficiently proper strategies are need for streamline operation , improved decision making and effective communication with the customer. These three sections are important for successful business irrespective of the market position and requirement (Legner, Urbach & Nolte , 2016). The fact that how technology can address these sections and rather provide scope for improvement will be reviewed in details. The applications that will be particularly considered in this regard is Supply Chain Management Systems, Workflow and Business Process Management Systems, Business Intelligence and data mining.
The impact of technology is now prevalent in various sectors including business. It does not matter in which field the business is operating, there is always scope for improving various aspect of the business with the application of information technology which is no exception for ShoeIT. The company can leverage IT for improving the operational advantage as well as the competitive advantages.
However the process of improving the operational advantages is not so easy at all. It requires perfect choice of technology and strategy, otherwise the benefit of it cannot be realised fully in the business. The choice is significant here as not all the technology is equally efficient and it depends on the type of application it is being considered.
In order to improve the operational advantage, the first thing that should be considered by the ShoeIT Company is to streamline the operation and for that the company can consider the improved POS system. As the company is having both online and offline stores around the world, there should be proper way to keep track of the day to day transaction. Now it is not possible to keep track of the transaction on a daily basis only with manual approach (Lyberopoulos et al. ,2016). There should be some way to automate the process for better efficiency and less error in the process. However in order to improve operational advantage it is not only important to collect transactional related data, it is also important to data related to sales and inventory and integrate all of this in one place for further reference.
Section 1: supply chain management
Here the company can consider POS system that not only provide the option to track and store transaction related data in real time, but also provide easy mean to integrate data collected through sales and inventory. Thus POS system makes it easy for the company to offers an improved and seamless sales experience for both the offices functioning through both the front and backend system. As both the offices get access to the data in real time it is possible to maintain the service or sales operation streamlined. Hence the IT driven approach has a clear benefit for the company to improve the operational advantage.
In order to improve the competitive advantage it is not only important to collect data efficiently, proper technique is also required for analysing the data and drive information from that (Tai, Huang & Chuang ,2016). Intelligent information need to be interpreted from the pattern in the collected data so that proper decision is made. In order to manage the completion, it is important to understand the customer needs and preference from the data related to the sales. However these data are often unstructured in nature and huge in volume and frequency. Hence intelligent data analytics tools are required for that. The company can consider SAS advance analytics tool. It is a statistical data analytic tool that is capable of analysing huge volume of data both structured and unstructured and derive information from the pattern of the data. The study of data pattern is extremely important for deriving information from the data and make decision based on that.
Hence it is clearly seen that technology, if chosen properly is helpful for improving business process through streamline operation and intelligence business decision. Both of these aspects are equally important for improving operational advantage as well as competitive advantage (Winter et al , 2018). Hence the ShoeIT Company should incorporate technology for improving the business process through IT solution.
What it means:
It deals with the supply of goods and products. It manages each of the stages right from the time the products are dispatched from the warehouse and shipped to the stores where the products are available for the customer to purchase if the offline stores are considered. In the case of the online shopping through the e-commerce store and the m-commerce store, it deals with the shipment of the goods from the store house of the sellers to the customer (Ehrenhard et al. 2017). In both the mode of shopping the supply chain management is concerned with the shipment of product from the warehouse to the supplier and from the supplier to the customer. The steps involved might be different depending on the mode of the shopping.
Planning Phase
A structured and effective method for controlling steps and process of good supply to the concerned parties. While observing the nature of the business, it is easy to observe that as ShoeIT is concerned in supplying goods to the brick and mortar stores across the world, it is not possible to compromise with the supply. Nay delay in the supply means company has to deal with cost expenditure as well as hamper in overall sale which eventually means loss in revenue. A proper and effective supply chain management will help to minimize this risks and bring more efficiency in the supply chain.
However in order to improve and realise effective results from the system ShoeIT will have to be efficient in both the planning and forecasting phase which has been described below
In order to deal with the supply chain management without any issue ShoeIT have to be good in the planning phase. The components of the planning phase is described below:
Having a proper estimation about the flow in the supply will help to identify how the actual supply chain will look like. It is extremely important for effective supply chain management and it should be done through proper communication with the suppliers. The communication should involve the issue of lead and peak time shortage. The lead time shortage should be minimized for better result in the supply chain management. However it is not possible without proper planning and communication with the suppliers
In order to improve the shopping experience of the customer the service should be available to the customer 24*7 through ecommerce platform as well as the through the brick and mortar store, the production cost should be minimized while retaining the profit from sale. Hence ShoeIT should have proper planning for the production which in turn will help to improve the supply as well supply chain management.
ShoeIT should have proper planning for the demand as this will help to have proper stock for the shoe. If the production is more or less than what is the demand, both ways supply is going to be hampered. If the production is less than the demand, there will be delay in the supply and if production exceeds demand, it will be stored in the warehouse of the company. Hence there will be no use of the existing supply chain management as it is meant to maintain balance between the demand and the supply.
Forecasting Phase
The effectiveness of the supply chain management not only depends on the effective planning, it should have proper forecasting strategy as well. Now the forecasting can be done in the following way:
Here the data is collected with the help of the POS and then the data is processed with the help of the software such as SAS. The data after it is processed in the software provides information such as sales status, demand and sales volume which is essential for effective planning for the supply chain management
It is another effective way to make sales related forecasting which have a direct effect on the planning done for the production and demand. Here the data is collected from different department to have better accuracy and reliability in the data. In order to do the collaborative data collection there are several software available. Salesforce collaborative software is a popular choice in this regard and ShoeIT can consider it.
As ShoeIT operates in both online and offline mode, it is extremely important for them to have supply available in all the stores without which they will lose their customer and will not be able to perform well in the competitive market. Hence effective supply chain management is important for the ShoeIT Company to increase sales while meeting the demand of the customer.
What it means:
It is the collection software and hardware that helps to extract meaningful data from the raw data that is collected from different sources. It is not possible to extract meaningful data information from the raw data with human intelligence as the data is not properly structured and it is vast both in terms of size and volume. Hence computer empowered intelligence is required for analysing this huge amount of data in raw format (Cleary, Horsfall & Hayter 2014). The insight that is extracted from this data helps the organization in make business related decision for better productivity and sales for increase in revenue.
The business intelligence system can implemented with three steps :
Step 1) raw data needs to be extracted from database that is spread across multiple heterogeneous system. The data for ShoeIT include various resources such as customer relationship management, supply chain management and the enterprise resources planning
Step 2) the data then goes through data cleansing. After the data is cleaned it is then transformed for storing it to the data warehouse
Step 3) the data is then analysed for collecting information as per the need with the help of business intelligence software
Section 2: Workflow and Business Process Management Systems
Business intelligence help to create KPI or the key performance indicator which is derived after analysing the historical fact rather than assumption and experience. Hence the results as well as decisions are fact based and hence more reliable than the traditional data analysis.
The business intelligence could prove to be beneficial for the ShoeIT Company if it is used wisely. With the help of this tool it is possible to information such as what kind of shoes are most preferred in the local market, what are the most preferred price range among the people and more importantly it is possible to shopping style and trend among the customer. All this information is essential for the ShoeIT to excel in the local market and perform better than the competitors. Apart from the offline store the ShoeIT Company can also excel in the online platform as well through the e-commerce and the m-commerce site. In order to do this the company will look for information such as what type of offers user really want, how many customer prefers quality over price , what are marketing strategy followed by other competitors , what are offers customers prefers most and what type of service customer wants from the ecommerce site. Now all this information might seem overwhelming and impossible to collect and analyse. However detailed answer to all of this will help the ShoeIT Company to create online marketing strategy that will serve the customer better than other competitors. The business intelligence will offers details to these question with answer that will help the ShoeIT to take intelligence decision based on proper and accurate facts which is important for successful and effective decision making.
What it means:
It is the collection of the tools, technique and practises for serving the customer of the business.
How CRM works:
The CRM consists of the following components:
marketing automation platform,
sales tracking software or module
contact management
The market automation platform or suit helps to create various platform and emails that is created based on customer preference, shopping habits and choice for product (Brace , 2018). Now all of these process is fully automated which saves time for the organization and also makes the process effective. the sales tracking software helps to create sales template and send it to the potential customers for improving the sales.
Although customer are important for business and organization and effective customer service is important for growth of business, it is important to realise some customer are more significant to the business growth and some are not so important. Now this might not sound important but it has the potential to influence the way business makes profit and improve market presence. Now there are various factors that decides which customer are more important to the business than others. The criteria include history of the customer with the company such as how many times customer has purchased from the company , what are products that the customer purchase often ,what are the preferred budget of that customer. Now collection and analyse of this data are important to serve the existing customer and retain them with the organization for longer time. Now this information can also be used to attract new customer. Hence it is effective tool for the ShoeIt to manage the relationship of the customer with the customer effectively based on the facts and data.
Implementing Workflow and Business Process Management Systems for ShoeIT
Data mining can be defined as a process that is used by companies to convert raw data to data that is useful. This is done by utilizing various software that look for patterns in huge batches of information. Data mining can help companies in order to know more about their customers which would help them to develop better strategies (Berghaus & Back , 2014).
Why is this important:
Guaranteed shoe is present in retail market of shoes; as a result, there should be a set of data that should be analysed in order to understand newly introduced patterns in sales, inventory, restocking and many more. The Guaranteed Shoe would need to utilize data mining for extracting new patterns of data in sales as well as business operations. There are various types of patterns that can be discovered by Guaranteed Shoe are as follows
- Novel/ Significant: Guaranteed shoe can look for a pattern which is based on relationship. An example of this is that few customers that would buy certain belts would also buy certain shoes.
- Understandable/ Useful: Guaranteed shoe can find a certain pattern which would be profitable for the business. An example of this is that customers will prefer to look for products in another store if it is unavailable or out of stock in a particular store. They would not like to wait for the products to get restocked.
- Casual: Guaranteed shoe can look for patterns that are some random relationships or variations in their data. This would be imperative for the members of IT team in order to mitigate the variations.
- Size: Guaranteed shoe can deal with the huge amount of sales data for all the stores it has. This would require a way to change the size of data warehouse.
In the given module there are various types of data mining are discussed. These types are as follows
- Market Basket Analysis: Guaranteed shoe can utilize data mining in order to look for data items which are grouped and put in the basket of market. After the data is grouped, data mining analysis can define why they are grouped in that manner.
- Classification: Guaranteed shoe can use data mining to look for a pattern on the basis of classification of data in their system.
- Clustering: Guaranteed shoe can use data mining order to find the group of data patterns which have similarities among them.
Conclusion:
With the technology becoming more advanced and affordable, there is so many choices available for the companies to choose. Now this instead of being advantage for the companies might create confusion that what to choose from and what does not need considerations. However this might be easy if the vision of the company is crisp and clear about the scope and the requirement. While analysing the need of ShoeIT for choosing the technology it is seen that the company needs to improve the customer communication. Without serving customer properly no company can expect long term success no matter how big and popular the company is. Now the primary requirement to serve the customer properly and have a competitive edge over others is to know requirements of the customer properly and make that available in the right time and in the right place. The data mining, while help to understand the requirement of the customer by examining and interpreting the data related to shopping preference, supply chain management will ensure that the products are reaching to the customer at the right time. While these two technologies are important for improving customer engagement and customer service, the other two technology Workflow and Business Process Management Systems, Business Intelligence is important for improving the work flow in the business and make the business process more streamlined for efficiency in the production.
References:
Berghaus, S. & Back, A. (2014). Analysis of data mining and its Impact on business decision.
Brace, I. (2018). CRM design: How to plan, structure and collect project data. Kogan Page Publishers.
Cleary, M., Horsfall, J. & Hayter, M. (2014). Data collection and validation in business intelligence: does size matter?. Journal of advanced nursing, 70(3), pp.473-475.
Ehrenhard, M., Wijnhoven, F., van den Broek, T. & Stagno, M.Z. (2017). Unlocking how manager create business value with the business data: Development of an App-enabled Business Innovation Cycle. Technological forecasting and social change, 115, pp.26-36.
Legner, C., Urbach, N. & Nolte, C. (2016). Stakeholder communication for service and maintenance processes: Using ex post evaluation by end-users as input for iterative design. Information & Management, 53(6), pp.817-831.
Lyberopoulos, G., Theodoropoulou, H., Filis, K. & Mesogiti, I. (2016). Benefits of POS: Existing Solutions, MNO Requirements and Business Model. In project management and control 2015 (pp. 137-146). Springer, Cham.
Tai, Y.T., Huang, C.H. & Chuang, S.C. (2016). The construction of a successful business with intelligent data Kybernetes, 45(1), pp.141-157.
Winter, J., Battisti, S., Burström, T. & Luukkainen, S. (2018). Exploring the success factors of effective customer management. International Journal of Innovation and Technology Management, 15(03), p.1850026.
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