CASE STUDY

Information Systems Assignment 2011-2012

TASK 1 - SOLUTIONS TO INFORMATION PROBLEMS

Problems

Prior to implementing SAP ERP, the company managed operations using a patchwork of spreadsheets and nonintegrated applications. The company was relying on manual processes and small business apps for everything from inventory to accounting. Following problem are identified before implementation of SAP ERP.

Plus, none of the software was linked, so the company could not get an accurate read on its business.” “It was like running the company blindfolded.”

The finance department six months just to close the books, management never really knew where the business overall - or any particular store - stood financially.

Data was trapped in silos across four corporate offices, each of which had its own IT systems; and, by the time management received reports, the information contained in them was no longer timely, accurate, or actionable.

In addition, executives were unable to analyze enterprise-wide data to determine profitability and costs by store or understand the root causes of problems such as falling sales.

Equally important, inventory was always in question - a real problem, particularly for a retail business. The company did not have an effective stock-control or loss-prevention process in place, and its inventory was tracked manually, whenever stores had time to do it.

This meant stores placed new orders with vendors based on out-of-date inventory data - and often after they had already run out of stock.

Managers made merchandising and assortment decisions based on gut instinct - not on insights into sales trends or other data.

Solutions

To address these challenges, Magrabi Optical's management team decided to invest in an application for enterprise resource planning (ERP) - an integrated, comprehensive IT solution that could grow with the company.

To standardizing and automating processes and centralizing operational data for greater visibility and control, SAP ERP provides a merchandising and assortment planning engine useful for optimizing inventory at each store. “It also enables clustering and store profiling based on actuals so we could plan more effectively.

The company can use SAP ERP to set up vendor-managed inventories so that its suppliers could monitor inventory levels and proactively restock items.

Gaining these kinds of capabilities would help management run the company far more efficiently and profitably - and lay the foundation for significant, rapid growth.

To maximize business visibility and insight, Magrabi Optical also opted to deploy several SAP BusinessObjects™ solutions, including SAP BusinessObjects Dashboards software, SAP Crystal Reports® software, and SAP BusinessObjects Web Intelligence® software.

Evaluation of findings

The higher data volumes are, the less easy to understand they are. Simultaneously, the larger the organization is, the more meaningful each decision made by its employees becomes. However, answering to business questions never is easy. Once - in most of cases - it bases on data analysis which, if provided manually, could last even a month or two, the need for efficient system to support the business problems solving is highlighting (Benjamin and Levinson, 2007, 23-34). Business Intelligence systems - in a very few words - may help with such problems and - by the ...