Introduction

ShopRite is a leading retailer in Africa, operating in 15 countries across the continent. In Ghana ShopRite operates as a chain of supermarkets with locations primarily in the Greater Accra region. As a full-service supermarket, ShopRite sells a wide variety of products, including groceries, household items, electronics such as blenders, microwaves, TVs, fridges and washing machines, clothing and footwear for men, women, and children. ShopRite also offers online shopping and delivery services for many of its products and the sales process for ShopRite can be broken down into several stages, including sourcing products, merchandising, marketing, and checkout.

Problems with ShopRites sales process

Many of ShopRites sales orders have some sort of problem, such as incorrect pricing, excessive calls to the customer for information, order-processing delays, missed delivery dates, and so on. These problems occur because ShopRite has three separate information systems: the sales order system, the warehouse system, and the accounting system. Information from each system is shared either electronically through periodic file transfers (sales order system to accounting system) or manually by paper printout (credit status from the Accounting Department to salesclerks). The high number of manual transactions creates many opportunities for data entry errors. Further, not all the information stored in the three systems is available in real time, resulting in incorrect prices and credit information.

Sales Quotations and Orders

Giving a customer a price quotation and then taking the customers order should be a straightforward process, but at ShopRite it is not. For a new customer, the sales process begins with a sales call, which might be over the telephone or in person. At the end of the sales call, the salesperson prepares a handwritten quotation on a form that generates two copies. The original quotation goes to the customer, and the middle copy is first faxed and then mailed to the sales office; the salesperson keeps the bottom copy for his or her records. On the quotation form is a toll-free number that the customer can call to place an order. Several problems can occur with this process, including the following:

The salesperson might make an error in the sales quotation. For example, a salesperson in the Direct Sales Division might offer both a quantity discount and a discretionary discount. If the salesperson is not careful, the two discounts combined might be so deep that the company makes little or no profit on the order.

Salespeople fax a copy of their sales quotations to the sales office, but sometimes a customer calls to place an order before the fax is transmitted. In such cases, the salesclerk has no knowledge of the terms of the sale (which are outlined on the quotation) and must ask the customer to repeat the information. On the other hand, even if the quotation has been faxed, the data might not have been entered into the customer database, so the customer might still need to repeat the order information. This situation can also lead to a duplicate order.

The fax received by the sales office is a copy of a handwritten form and might not be legible.

When customers place an order, they usually inquire about the delivery date. To get a shipping date, the salesclerk must contact the warehouse supervisor and ask whether the customers order can be immediately shipped from inventory, or whether shipping will be delayed until a future production run is delivered to the warehouse. However, because the warehouse supervisor is generally too busy to get an updated inventory count, total all the orders waiting to be filled, and find out how many other orders are in process in the sales office, she can only estimate the shipping date. Once the salesclerk has the warehouse supervisors estimated shipping date, she determines the shipping method and how long delivery will take. Next, the clerk checks the customers credit status. For new customers, the clerk fills out a paper credit- check form that includes basic customer data and the amount of the order. The form goes to Accounting, where accountants perform the credit check and then return the credit-check form showing the customers credit limit. If the order is from an existing customer, the clerk checks a paper report from Accounting that shows the customers current balance, credit limit, and available balance. However, because the report is generated weekly, it might not reflect a customers most recent payments or orders. If a customers available credit is less than the amount of the current order, assuming there are no other orders outstanding, the clerk calls the customer to determine what action the customer wants to take (reduce the amount of the order, prepay, or dispute the amount of credit granted). Once the order details have been finalized, the salesclerk enters the order into the order-entry system. The computer program performs four important tasks. First, it stores the customers order data, which are used later to analyse sales performance at the division level. Second, it prints out a packing list and shipping labels for the warehouse to use to pick, pack, and ship the customers order. Third, it produces a data file of all current transactions for the Accounting Department to use for preparing invoices (this file is also used for financial, tax, and managerial accounting). And fourth, the data file is copied to a USB key each evening for uploading into the companys PC-based accounting system.

Accounting and Invoicing

Invoicing the customer is problematic as well. First, the data from the current order-entry system is only loaded into the accounting system at the end of each day, so the Accounting Department does not have information on new sales orders until the following day. In addition, clerks must manually make adjustments in both the order-entry system and the accounting system for partial shipments and for any other changes that have occurred during the order-fulfilment process. Many times, these corrections are not made in both systems, causing discrepancies that must be corrected at the end of the month, at which point it is more difficult for the parties involved to remember what happened. Delayed order corrections also sometimes result in late or inaccurate invoices. If the completed invoice is waiting to be mailed when the warehouse notifies Accounting of a partial shipment, then a new invoice must be prepared. In any case, an invoice is eventually sent to the customer, separate from the shipment.

Questions

1. Assume you have been hired as the new Chief Technology Officer to clean up some of ShopRites problems as outlined above. Describe all the problems you observe about the way the companys sales force currently takes and fills an order. Now convince top management of the need to improve the existing system and put an ERP system in place. (Note: Your analysis must address the issues raised in the case study as well as in other literature demonstrating knowledge, comprehension, analysis and synthesis) [25 marks]

Based on your description above, create a strategy for an enterprise-wide system implementation based on appropriate theory and relevant use cases for ShopRite. [20 marks]

If ShopRite installs an ERP system, how could they reorganize and configure their sales processes to be more efficient? Be specific about how you would rearrange divisions or consolidate them. [15 marks]

Note: Use academic journal articles to support your discussions and justifications, and these must be appropriately referenced. A minimum of 10 journal articles should be used for this assignment.