Supplying Organic Food and Products in the Australian Community of Aroma Organics
Aroma Organics (AO) has been supplying the Australian community with affordable organic food and products since they first opened their doors in Melbourne in 2001. They have expanded several times since then and are now the leading certified organic retail chain in Australia. With 1,200 employees and fifty stores and franchises across the country, AO sells a wide range of organic products including produce, dairy products, oils, herbal items, beauty, and healthcare products. The retail chain generated a revenue of $76 million in the 2021-22 financial year. Kate, the proprietor and CEO, is proud of her business, which sells quality products and offers expert advice provided by her staff.
In the last two years, Kate has noticed a significant drop in overall sales due to new market entrants and increased competition. Major supermarkets have introduced more aisles exclusively for organic products, intensifying the competition. Additionally, staff have reported several issues, including a lack of communication, data mismanagement, delayed decision-making, information asymmetry, delayed invoice processing, inventory management problems, and supply chain issues between the warehouse and retail stores. Customers have complained about delays in fulfilling orders due to bottlenecks and poor customer service.
Each store stocks over 3,000 products, including perishable goods, making it challenging to identify the products in demand and maintain the required stock levels. Kate has been using a manual system to record stock levels. Until recently, she did not consider improving her information system due to a lack of knowledge about information systems. However, after attending a seminar about cloud-based Enterprise Resource Planning (ERP) systems, Kate realized the benefits that information technology can bring to her business.
In addition to in-store sales, AO supplies their products to vegan restaurants and cafes regularly. For business customers, they maintain a manual record of items and supply them daily. Any changes in orders require the restaurants to call the respective AO stores a day in advance to update the order. AO offers a 25% discount to business customers and a 10% discount for in-store purchases. Each store manages its own customer data on a spreadsheet, noting details such as first name, last name, address, contact numbers, customer type, and email address. They also offer free door delivery service for purchases over $200 within a 20km radius. Business customers` discounts are automatically calculated during invoice processing. In-store customers` details are verified on an Excel spreadsheet, and discounts are applied at checkout, which is time-consuming and complex, especially during peak business hours. Managing door deliveries is another issue due to various parameters such as purchase amount, distance, and types of items purchased. Kate also manages a Facebook page to promote special products and handle inquiries and complaints intermittently.
AO customers generally place orders over the phone or by visiting the store. In exceptional circumstances, orders are accepted via email or social media. Although AO has a reputation for maintaining high-quality and reliable brands, there have been recent issues with timely product transfers between the warehouse and different stores, as well as delivery to customers. Each order includes details such as customer information, order ID, order date, and the products required. There are increasing complaints about the time it takes to transfer products between warehouses and stores and deliver them to customers.
AO aims to record details of all perishable and non-perishable products by category, including product ID, product name, product description, expiry date, packaging date, supplier/brand name, category, certified authority, quantity in stock, and price. Currently, AO has warehouses in ten different locations where all their products are stocked. Kate believes there is no need to stock every product in every warehouse unless they are in high demand. She also wants to record warehouse details, such as warehouse IDs and shelf details, in the proposed system to help locate products in different warehouses. Kate plans to sell their products online via a mobile application, website, and social media to reach more customers and expand their business further.
Business customers may place orders several times a week or as needed. AO sends invoices to these customers once a month for all orders placed. Invoices, prepared and sent out on the first working day of each month, include details such as ID, date, and payable amount. Customers are expected to pay the invoice within 15 working days. Payments can be made by cash, credit card, or cheque. Once payment is received, a receipt is sent to the customer, identifying the invoice for which payment has been received, the date of payment, and the total amount paid. In-store customers who choose door delivery must pay upfront at checkout.
After attending an ERP tradeshow and realizing the benefits of ERP, Kate is keen to adopt an ERP system with the help of an ERP consultancy firm (you). She believes a computerized system will not only help record transactions easily but also help make better decisions by generating reports on customer orders, loyalty, purchase frequency, popular products, product shelf-time, customer demographics, and more. She anticipates better control over transactional data, improved business processes, and better decision-making about her business. Kate wants to know more about ERP implementation and is eager to hear about other benefits as well.
In this assessment, you will develop a management report recommending ERP systems for AO`s decision-makers to consider. You will study and determine the necessary coverage. The following areas are expected to be included, and you may show the initiative of making reasonable assumptions and incorporating other relevant topics as well:
General Introduction on ERP Systems:
Issues with Requirement Elicitation and Process Alignment:
Business Process Re-engineering (BPR):
Current and Proposed Business Processes:
Change Management and Organizational Project Management Maturity:
ERP Implementation Benefits and Feasibility:
While working on this assignment, study relevant unit materials as a start. Further research and studies on quality academic and industry sources are required. Develop an outline of your report with appropriate topics and sub-topics to discuss and build arguments throughout the report. ERP implementation requires organization-wide commitment, which may bring changes to the current organization structure. When persuading AO that ERP is required and recommending proceeding to the next stage by selecting an ERP system, your argument should link discussions in various sub-topics, including:
Remember, there are no fixed answers to the tasks in this assignment. Successful arguments can be made for different options. Your task is to present a concise, informative, and persuasive report. From your research and discussions, provide convincing support for your arguments and conclusions.
The readers of this report include both business decision-makers and technical advisers. Assume your readers are intelligent people who understand business arguments if sufficient information is provided, even if they do not have a technical background. You will be assessed on your ability to present your research and understanding of various topics and your achievement in informing and persuading the readers. It is essential to develop arguments with sound considerations and support. Use academic literature and industry sources to inform and support your report. There is no maximum number of references, but a minimum of ten quality sources is expected, with at least five from academic sources (peer-reviewed journal articles, conferences, or edited book chapter papers).
