Interviews with management during the 'As Is' phase reveal the following: Culture. The Company's growth and singular focus on customer service has allowed a culture to develop in which consistently entering data into the QuickBooks system is not a priority. Also, up to this point, keeping inventory at minimally efficient levels has not been a priority due to the presence of adequate rack space. However, as the Company continues to grow, the company would certainly face obstacles if it were to continually increase its inventory. Process. The ERP system (QuickBooks) is not continually updated. Orders are not entered/tracked via QuickBooks. There is a lot of manual work and documentation required due to current procedures as well as costly delays waiting for documentation from vendors. People. Currently, the Company feels that it is short-staffed, even after recently hiring another full-time staff member to work exclusively with QuickBooks to ensure it is kept up to date. Technology. The Company believes it has a "hodge-podge" network of technologies including a custom built website / customer interface with online ordering capabilities and a disconnected QuickBooks financial management system. The Company has just invested in a license for five users to access the ERP simultaneously. The group has also been asked to consider whether the Company should purchase and implement the QuickBooks Point of Sale software which can be linked to QuickBooks or whether it should build a custom application. Asics Mizuno Externalities. The Company has experienced tremendous growth due to the uniqueness of items that are hard to find elsewhere and their specialization on the volleyball market. This has contributed to the typical inefficiencies that develop when certain processes in a business fall short of demand. In addition, the business experiences a strong seasonality factor during the winter months as high school volleyball player's demands are highest at this time thus increasing the difficulty of forecasting demand and appropriate inventories. One area that has experienced significant stockouts is shoes. The team gathers cost of sales and average inventory information to calculate inventory turnover by quarter (based on a calendar year) by brand of shoe. The following table is generated: Brand Nike Other (3 other brands) Q1 24 turns 18 turns 8 turns 5 turns Q2 15 turns 10 turns 6 turns 2 turns 8 turns 6 turns 7 turns 1 turn Q3 Q4 12 turns 11 turns 7 turns 2 turns Currently the company does not focus on performance measures, they are too small and too busy. The owner would like some management reports so stockouts don't' continue to disrupt business. Questions: 1) If you were to interview the owner of Spike, what interview questions would you ask? 2) What changes would you make to the process flow after seeing the current process flow? 3) What do you infer from the historic data? What other data might be useful to analyze? 4) What performance measures would you suggest for Spike? Why? Spike Volleyball is a small online retailer of Volleyball apparel and gear. They operate an Internet website that generates about $3 million US dollars in revenue annually. They employ about 15 people. They offer over 1,000 SKU's of unique inventory. The company is experiencing stockouts and loss of customers due to poor inventory management. The process improvement team draws the following process map for how Spike places orders with vendors and fulfills orders with customers. Order Placement Purchase Order (Word- Waiting on Invoice from supplier Order Fulfillment Delay (3days -4 Order Received (Web, store, Packing slip w/invoice Order fulfillment Folder for Shipment Shipping (2 days) Stock (1-2 days) Inventory Check Yes No Receipt Update Quick Books Export from website to UPS Phone call to customer Counted- Routing Slip Boxed for UPS Switch Check Backorder log Ye No Update website Wait for UPS pick-up (w/in Ibus.day) Entered into QB (0-5days) Get them to switch Partial ship/ backorder