Designing an ICT Strategy using the Balanced Scorecard
Complete Tasks A(1500 words) C and D(1000words)
ideally i would like a perspective take such as ‘internal busness’ and apply it to the case study to be able to produce a BSC (balanced score card)
if any issues please text me
Title: Designing an ICT Strategy using the Balanced Scorecard
Your assignment team, comprising four students, is a consultancy group who has already investigated the business of HealthyGlow Natural Health Products (HGNHP), producing a feasibility report. Some information about HGNHP, and the feasibility report, is contained in the attached case study.
The next decision you need to make concerns the appropriate strategic decisions extracted from the research your group has conducted in the weekly tutorials for the various requirements you have identified in and around the case study. It is these decisions and application of them in The Balanced Scorecard that are the subject of this assignment.
(A) As individuals within your team you must agree the assignment of an individual BSC perspective.
1. The objective of your individual research will be to produce a report on how your allocated “perspectives” may embrace the emerging technologies core to the module (as discussed on a weekly basis), including their strengths and weaknesses.
2. Your research must also identify two examples of the technologies in practice.
3. One example should be of “good practice” where it has been used appropriately and successfully and the other example should be of “useful but not successful practice” where it has been used inappropriately and or unsuccessfully. Your conclusion should highlight lessons to be learnt from your examples.
• The report in this section of the assignment should be at least 1500 words per person, and it should be clearly identified with the name of the author.
• All research will be appropriately referenced in accordance with the Harvard Referencing System.
(B) The complete team should now produce a report of at least 2000 words, developing a strategy for HealthyGlow, using the Balanced Scorecard.
(C) A first stage iteration for HealthyGlow.
(D) A personal module reflection to include and sum up your understanding of the whole module.
(E) Your development and progress (your learning journey).
The table below indicates the marking from the perspective of an individual student. The report submitted will Group and Individual contributions under (A-E)
(A) RESEARCH BY PAIR INTO SYSTEMS DEVELOPMENT METHODOLOGY
• Research of perspectives, alignment to emergent technologies and referencing 20
• Structure of report (word count = 1500) 5
(B) GROUP REPORT
• Consolidation of research strategy for HGNHP 25
• Structure of report (word count = 2000) 5
(C) BALANCED SCORECARD
• First stage iteration of consolidated BSC for HGNHP 10
(D) Individual Contribution – 1000 words reflecting on what designing a strategy means to you? 10
(E) Weekly development and progress (learning journey). 25
The team must meet during the tutorial session for each week of the assignment period. Notes and actions of team members may be taken and submitted to a ‘Minute file’ to your group on Moodle. These minutes could be a factor used in determining your developing and module journey and therefore form the allocation and distribution of marks between team members.
At the any team meeting the team should discuss responsibility and deadlines for different tasks, each of which must be allocated to an individual. This is not intended to prevent co-operation, but to ensure responsibility. Note that if the allocated team member does not satisfactorily produce a required product by the agreed time, the fact could be captured by Moodle.
Submission of Report
The final reports (submitted as ONE file) during week 12, via Moodle (designated area to follow). Each team member is strongly advised to keep a copy of the submitted document.
Criteria for marking
The following will be used as a guideline in marking the assignment, and is broadly consistent with the criteria used in Honours degree classification. This assignment contributes 100% of the coursework marks for the module.
(REALLY QUITE IN-ADEQUATE, ‘FAIL’) 30-39
(ADEQUATE BUT NO MORE) 40-59
(A GOOD AVERAGE PERFORM-ANCE) 60-79
(WELL ABOVE THE AVERAGE) 80+
Research of perspectives, alignment to emergent technologies and referencing No reference beyond lecture material. Little demonstration of understanding of the topic Some research of e.g. the course text only. Significant weak ness in understanding. Evidence of significant relevant research. Evidence of average understanding Thorough research of a range of relevant literature. Content showing clear understanding. Research extending to e.g. relevant, up to date journals. Exceptionally thorough research, depth of understanding
Structure of report Very weak. Almost total lack of any sensible structure Weak structure but some introductory and concluding section A generally well ordered report with relevant discussion and some clear conclusions Ordering showing clear understanding and development of argument Outstanding structure with exceptionally well developed discussion
Consolidation of research into strategy for HGNHP Little or no demonstration of understanding of relevance to HGNHP Weak understanding but some relevant discussion at least Evidence of average understanding. Relevant points made. Content showing clear understanding of application to HGNHP. Clear and sound conclusions Exceptionally thorough evaluation showing depth of understanding of relevance
Structure of group report Very weak. Almost total lack of any sensible structure Weak structure but some introductory and concluding section A generally well ordered report with relevant discussion and some clear conclusions Ordering showing clear understanding and development of argument Outstanding structure with exceptionally well developed discussion
(C) First stage iteration of consolidatedBSC for HGNHP Weak, probably with missing sections Most sections present and presented in acceptable if weak style Appropriate sections, well organised. Above average presentation, with fully integrated presentation of work of each pair Exceptional presentation standard in terms of English, style, ordering, subsections etc.
(D) Reflection Weak, probably with missing sections More descriptive than reflective Appropriate balance of description and reflection. A reflection that is wholesome and demonstrates a rounded coverage of reflection Exceptional in its precise and concise articulation of the significance of the whole module.
HealthyGlow Natural Health Products
The business now known as HealthyGlow was set up in the late 1950s by Thomas Comfrey and Charles Garlick. Comfrey and Garlick sold a range of herbal medicines and natural therapies over the counter to a small but faithful band of customers. Garlick was an expert in herbal matters and had an encyclopaedic knowledge of the subject while Comfrey, who came from a shopkeeping background, concentrated on setting up the retail operation.
Comfrey was acutely aware of the need to avoid holding large stocks of slow-moving or out-of-date products and he therefore set up a detailed stock-control system based upon card-indexed records. In the early days, the shop carried some three hundred stock lines and Comfrey’s box of neatly-written cards effectively tracked every stock movement, in and out.
When Thomas Comfrey died, he left his share in the business to Charles Garlick, who was fortunate to inherit a well-established retail operation which required little attention to keep it running. Garlick continued to add to his extensive knowledge of herbal therapies and began to build a reputation in this esoteric world by contributing the occasional article to newsletters and journals. As a result, he found that some readers began to order remedies by post and he even received enquiries from other retailers who wanted to buy goods for resale. The operation grew to become a sound (if unexciting) business which sustained Charles and his family in modest comfort.
Growth and change bring problems
In the mid-1980s, Charles was gratified to find that public awareness of the world of natural therapies was growing. He found that he was being asked to contribute articles on herbal treatments to mainstream magazines and was delighted when a publisher approached him to write a book which became a surprise best-seller. There followed more books and articles, plus regular bookings for radio and television interviews, all of which enhanced Garlick’s reputation as the guru of herbalism, so that still more orders flowed in to the company, now renamed HealthyGlow.
However, this was not entirely a good thing: Comfrey’s manual systems had served the business well in their time but were no longer able to cope with the vastly increased number of stock lines (around two thousand at the last count) and the sheer volume of orders received, both in the shop and through the mail, fax and telephone services. Garlick deplored the deterioration in customer service standards but he was unable to put things right; he had not played a part in setting up the original system and he knew very little about modern retailing, administrative systems or information technology.
Garlick was not entirely naive and he realised that he faced wonderful opportunities for growth – perhaps he should open more shops, maybe try and develop the mail-order business, possibly find ways to develop the existing wholesale trade with other retailers. He had talked informally about the possibilities with the bank manager, who had been quite enthusiastic but had made it quite clear that he needed to see a detailed business plan before the bank would even consider providing further financial support.
Frankly, Charles did not know how to even start on this process. He really only had a “feeling” that growth was feasible; he certainly was not in a position to make a strategic decision about the future development of his business because he lacked sound information about the strengths and weaknesses of HealthyGlow, nor did he fully understand the opportunities (and threats) which existed in the company’s markets. He certainly did not have any sort of business model which would enable him to perform “if…then” experiments in order to test a variety of business options. The bank manager had even talked about producing forecasts of the cash flow statement, profit and loss account, and balance sheet! Charles was perplexed, to say the least.
However, there were also other administrative difficulties piling up for him just now. Indeed, the business that had been his pride and joy had turned into a burden, just when he should have been contemplating retirement. Only last month he had had an unpleasant interview with the VAT Inspector regarding late submission of his VAT return and the final straw was a letter he had just received from the auditors in which they pointed out that the company’s accounting procedures needed to be overhauled as a matter of urgency. It seemed to Charles that there was no refuge from the gathering storm and he sought relief in the finest Korean red ginseng.
Charles seeks advice
Undoubtedly, this self-prescribed therapy lifted his spirits and the next day he took himself off to the Bowls Club (his only indulgence) where he played a few ends with Curly Woods, an old friend who held a number of directorships in the City. Curly quickly saw that HealthyGlow was a business anachronism, operationally and technologically set in the 1950s and nearly overwhelmed by the challenge of the late 1990s. With characteristic insight, he told Charles that he had to plan for new administrative systems in order to secure the very survival of the business, as well as to form a basis for growth along the lines that Charles had described. Curly recommended a consultancy known as Information Age and Charles resolved to contact them the next day.
Charles had a long talk with the consultant. He described his problems with customer service and administrative systems but also pointed out the growth opportunities which some of his competitors were already exploiting. He asked the consultant to undertake a feasibility study, to look at the issues and to report on ways in which information systems could support and develop HealthyGlow operations. It was agreed that a feasibility study could be produced in two weeks, and on this basis Charles would decide whether or not to invest in the design and implementation of computer-based application.
Information Age Consultants study the situation
Information Age consultants came and spent a week studying the business. They interviewed staff, observed the whole cycle of operations, and studied documents, reports and records which already existed. They found a great many circumstances which adversely affected the efficient running of the business and the quality of service offered. For example, the number of stock items carried had grown from just three hundred when the shop first opened to over two thousand, taking into account all the different pack sizes, etc. Also, the constant flow of customers into the shop made it difficult for staff to keep records of stock movements, particularly as the wide range of goods offered meant that many items had to be kept in the back room. Often the card index showed items to be in stock when in fact there was nothing on the shelves, and no doubt the converse was also true.
Furthermore, it was noted that newer members of staff in the shop were not very familiar with some of the products and often needed to consult Charles Garlick (or one of his reference books) for details of the recommended treatments and dosages associated with each item. As a result, service in the shop could be exasperatingly slow for the long-suffering customer. Nor was it much better for those who tried to shop by post, since the manual stock records were simply unable to cope with demand. Products were often out of stock, resulting in extended deliveries and yet more irate customers.
Another problem arose when customers wrote and asked for a repeat order without giving full details of their requirements. The company did not keep any organised records of sales by mail order, any more than they did of retail sales. Consequently, mail order letters were simply packed away in boxes after they had been fulfilled, more or less in date order and with a large rubber band around them to keep each month separate. Tracing any one order was a time-consuming process and inevitably the neat bundles soon degenerated into boxes full of loose paper.
Purchasing was similarly rather a shambles; Garlick’s original list of about fifteen British suppliers had grown to over one hundred, both at home and overseas, and only he really seemed to know which suppliers were best for any specific product, or where to go for an alternative source. For the most part, any and everybody seemed to place orders, usually by telephone, and sometimes they forgot to write down exactly what had been ordered. This frequently caused arguments among staff because individuals tended to order for their own department’s needs, yet everyone expected to be able to call off stock as soon as it came in.
Staff working under pressure were also often careless in administering goods inwards procedures (i.e. the checking of deliveries from suppliers). It had been known for urgently needed goods to be grabbed by shop staff as they came through the door and before they had been booked in; this created problems when the supplier’s invoice arrived because there was no record of the consignment having been received.
Nevertheless, consultants found that the underlying business trends were very healthy. In spite of the recession (and abysmally poor standards of customer service) demand in the retail shop was growing steadily, while the mail-order business was creating new sales records each month. Of course, Mr Garlick’s employees were aware of this situation: shop staff had been heard to say that they hoped Mr Garlick would open more shops and start to build a retail chain, whereas people working in the mail order department disagreed with this, because they saw lots of orders coming in from all over the country and they felt that they could mop up the extra demand that way. In another interesting development, one consultant had looked through the boxes containing last year’s orders and had noted that, while most orders were from individual consumers, a number came from other health food and herbalist businesses which wanted to resell some of the exotic products imported by Charles. These bulk orders tended to be of relatively high value but were usually placed on terms of 30 days credit; the book-keeping system (based on cash sales through the shop) was unable to monitor these transactions effectively and this was one reason for the auditors’ unfavourable report.
Charles himself had seen some of the practical problems and even recognised that the present low standards of customer service had to be addressed. However, he was not aware of the existence, let alone the scale, of his staffing problem. In truth, Charles had grown out of touch with his employees.
Most of the existing staff had originally joined him through their interest in alternative medicine in the days when most customers were regulars and often personal friends. They did not have experience of either mainstream retailing or serious mail-order fulfilment operations, nor had it occurred to Charles that they might need training to cope with changing circumstances. Staff throughout the business were feeling the pressure of work as demand grew and grew; they dealt every day with angry customers and were keenly aware that the standard of service was unacceptably low. They were therefore unhappy in their work and were rapidly losing the sense of mission that they had shared in the past.
Nor was this the only problem: Charles had told the chief clerk in the accounts department that he was going to seek a consultant’s advice about installing some computers,”…to sort out the problems in the company” but he did not think to mention it to anyone else. The office grapevine started to hum and the rumours spread like wildfire; virtually no-one in administration had experience of computing technology at any level, so the very idea struck fear into the hearts of everyone. How would they cope? Would they be able to keep their jobs, even?
At Information Age, they knew that they could specify a system which would restore efficiency and service levels and hopefully this would help to re-motivate staff; however, the lead consultant was keenly aware that all HealthyGlow staff would have to be kept fully informed about the project, would have to be reassured about the nature of the new systems and, above all, would need thorough training before “going live”. It was very clear to the consultant that there were problems which went further than a simple need for better accounting records (for VAT, audit and management accounting purposes) or for a computer-based stock book.
Perhaps the most interesting point arose when they began to consider the issue of competitive advantage: one of their consultants had turned up a marketing report which said that alternative healthcare was on the brink of a period of enormous growth and the business which took greatest advantage of this opportunity would be the one which could differentiate itself from the other players and command the profitable heights of the market.
The marketing report stressed that the natural therapy market was turning “legitimate” and was being perceived by consumers as a segment of the over-the-counter healthcare market. The consultant realised that Healthyglow’s corporate image already stressed a close relationship with traditional modes of health care. This might be developed by having staff wear white uniforms and by training selected personnel give treatment advice, backed up by training certificates displayed prominently on the wall. The contribution from information technology might be a proposal to print out details of the therapy and the recommended treatment, personally, for each patient, to be attached to the goods purchased.
While this would draw an immediate analogy with the professional pharmacist and thus confer a sense of legitimacy and confidence in the customer’s mind, the principal value of this proposal was to allow HealthyGlow to capture at point of sale the names and addresses of all retail customers, whose details would then be transferred to a marketing database which would be used to send details of new products, special offers, etc. to them in due course.
Consultants consider some solutions
Information Age staff now held a “brainstorming” meeting at which they discussed an outline proposal. Computerisation of the stock control card index clearly was a major issue but there also had to be a computerised sales order processing function to monitor stock movements accurately and to record changes in real time.
Planned growth in Healthyglow’s business meant that there would soon be a need for more stock, in more locations, stock which would turn over faster, thus requiring more deliveries from suppliers. Information Age staff thought that bar-code technology should be introduced from the outset in the warehouses and at point-of-sale in the shops to facilitate the movement of stock into, through, and out of, the proposed system. In addition, a purchasing module would be required to speed up the process of placing orders with suppliers, monitoring the progress of such orders, and keeping control over both deliveries and outstanding items.
The fast-growing mail-order operation also needed support to deliver much-needed improvements in customer service; on-line access to the order processing and stock reporting functions would make it easier for staff to provide a fast and accurate response to customer queries and requests. A marketing database would have to be set up to keep records of customer details, including the items they bought, and this should ideally capture details of all retail shop customers also, as well as anyone who wrote for leaflets and information.
The administrative issues also required urgent attention. It was clear that better control of cash flow was needed – history was full of examples of sound businesses which fell into bankruptcy because they were unable to finance the extra resources needed to sustain growth. The company needed better records of its customers, suppliers and of its business transactions; it also needed detailed accounting reports to support management decision-making and to provide detailed information for other people such as bankers, auditors, and especially the VAT Inspector. Information Age therefore decided to recommend a proprietary accounting package which would offer all these facilities and integrate with all the other functions. They would also recommend a payroll application which would enable HealthyGlow to handle wages and salaries for all employees quickly and efficiently, from one central location.
It was also clear that the bank would require regular reports of the company’s performance and it would, therefore, be essential to recommend a high-powered spreadsheet application which could be used to model the business development plan, to test alternative business scenarios and to produce regular revisions of the plan.
Among the database applications to be developed would be a “Suppliers” file, containing full details of domestic and overseas suppliers and the range of products available from them. A central marketing database would keep detailed records of all “Customers” (over-the-counter retail, direct mail retail and direct mail wholesale), complete with their trading histories.
The unique element, however, would be a “Product” database which included full details of recommended dosages and therapies for each product, from which would be abstracted the “treatment report” which would accompany each individual sale.
Information Age’s lead consultant looked at the minutes of the “brainstorming” meeting and at the pile of reports which represented the rest of their detailed research in to Healthyglow’s problem. All that remained was to write the report outlining the feasibility of a system to meet the observed requirement; if this was favourably received by the client, the result could be a lucrative contract to undertake the development and implementation of the whole system.
She sighed and turned to the word-processor…
(The following pages contain the text of the feasibility study which was submitted to Mr Garlick)
Report on the Feasibility of implementing Computer-based Information Systems in HealthyGlow Ltd.
1. Terms of Reference
This Report was commissioned by Mr Charles Garlick, Chairman and Chief Executive of HealthyGlow Natural Health Products Ltd. (HGNHP Ltd.) The Report will address the present and future information requirements of the Company: it will take note of a number of problems which are perceived to exist at the moment and will also take account of the opportunities for business growth which have been identified. (“Growth and Segmentation within the Natural Health Products Market” Market Analysis Ltd. September 1993).
The Report will make recommendations regarding the feasibility of introducing computer-based applications in place of current manual systems and will thus form the basis of forthcoming strategic investment decisions.
HNHP Ltd. was founded some forty years ago as a partnership under the name of Comfrey and Garlick. The original business was a small retail operation selling traditional therapies and natural health foods to an essentially local market. It now trades under the present name as a limited company and the Chairman, Mr Charles Garlick, is the sole surviving founding partner.
Turnover is currently in the region of £15m p.a. and the company has enjoyed substantial growth, particularly over the last 15 years. This is partly due to the growing perception in the eyes of the public that the use of natural remedies and health foods constitutes a perfectly rational regime, and partly to the reputation of Mr Garlick as an acknowledged expert in the field. His books, articles and broadcasts have done much to raise the profile of the company and the acceptability of natural health products in general.
In the first twenty years of its existence, the company employed no more than six people at any time; the payroll currently stands at over 60. The number of lines stocked has grown from around three hundred to over two thousand. Sales through the principal retail outlet have grown substantially, though this operation has been dwarfed by the burgeoning mail-order division, which has grown rapidly in recent years.
Whilst turnover has grown in proportion to this increase in demand, profitability has slumped and the number of service complaints has rocketed. The Chairman is also sensitive to a change in the prevailing culture of the company, when a staff previously noted for its commitment to the “cause” now displays a degree of dissatisfaction and cynicism in the face of service shortcomings.
A recent report on the prospects for the natural therapies market points to still faster growth in this sector and HGNHP Ltd. should be well-placed to take advantage of this development. However, it is well known that at least one major High Street retailing consortium is proposing to launch a chain of shops specialising in natural therapies. The press has also recently reported that the number of mail-order advertisers has tripled in the last eighteen months, though no large-scale national name has yet come upon the scene. The survival and the return to prosperity of HGNHP Ltd. will depend upon how successfully it can withstand the competition of a professional and well-funded retailing chain and capitalise upon the undoubted strength of its brand identity and the reputation of its founder.
3 Problems – administrative
(a) Order processing
This is particularly problematic in both the retail and direct marketing sectors, though worse in the latter. Turnaround times, error rates and out-of-stock situations are all considerably above the norm. The primary reason is the fallibility of the manual stock control system which underpins all order processing activity, though the situation is exacerbated by lack of product knowledge in many employees.
(b) Stock Control
The manual card-index system is a legacy of the original business and is inadequate to cope with current demand. It has virtually broken down and staff have little confidence in it. It is also unable to provide the basic stock movement statistics which are essential to management decision-making in the marketing, purchasing and financial functions.
There is insufficient expertise in the purchasing function and a general lack of direction which results in both shortages and overstocking, which is the worst of all possible worlds. The most reliable source of purchasing expertise is the Chairman and clearly this not the level at which day-to-day purchasing decisions should be taken.
(d) Mail order marketing and administration
The mail order operation is apparently one of the success stories of the recent past. However, it has grown in uncontrolled fashion from small beginnings and is now a major problem area in the company. Record keeping is minimal and this causes administrative delays, but the failure to record basic data about customers is also the waste of a valuable marketing resource. The cost of split deliveries and dealing with customer complaints appears to be very large and probably accounts for most of the profit generated by sales in this sector, although the accounting system is unable to provide detailed statistics on this important issue.
It should be noted that the existing mail order operation is no more than a “fulfilment” operation, which responds solely to orders received (mainly) through the mail; it is not a direct marketing business which actively seeks business in a clearly-defined marketplace.
(e) Accounting procedures
Accounting procedures also date back to the earliest days of the partnership and are still based upon manual ledgers. Documents such as invoices and purchase orders are typed or even hand-written. Errors and delays are commonplace. Critical reports have recently been received from both the company’s Auditors and the VAT Inspector, making corrective action now an urgent necessity.
(f) Cash flow control
Large amounts of cash flow into and out of the business and there is no formal procedure for controlling this. In earlier days, one of the partners could monitor cash flow almost in his head, paying suppliers and staff out of cash received over the shop counter. This is no longer possible and a more sophisticated system is essential to support business financial planning activity.
(g) Business planning
The scale of the business means that a closer level of co-operation with the company’s Bank is required, particularly in view of the need to finance the proposed developments in both the retail and mail order operations. Extensive business plans, including draft budgets for one to five years, will be required.
4. Problems – human
(a) Systems and procedures
There is a general failure to comply with current administrative procedures, principally due to a justified lack of confidence in the overloaded manual systems. Staff constantly express dissatisfaction with the systems already in place and they are starting to treat customer complaints with a worrying degree of complacency.
(b) Product knowledge
A lack of product knowledge is recognised by a number of staff, particularly those working in the retail operation. Customers often seek advice on therapies and regimes which they have read about and expect staff to be able to counsel them.
(c) Lack of computer literacy
Staff in general have little or no knowledge or experience of computer systems and would react negatively to any insensitive proposals to computerise even the present inadequate systems.
(a) Market growth
The increased demand for natural health products in general seems set to continue for the foreseeable future, according to latest industry reports. While the possible entry of a major retailer into the market poses a threat of competition, there is little doubt that such a move would increase the overall size of the market in terms of demand.
(b) Corporate Identity
The HealthyGlow name is well-known in the sector and is a strong brand presence in a highly diversified market. It is therefore a valuable asset, as is the Chairman’s professional reputation as the ‘guru’ of natural health regimes and therapies.
(c) Direct marketing
Considerable growth in the mail order sector has already been noted and HealthyGlow has a presence here which can rapidly be developed into a full direct marketing operation, provided that appropriate information systems are made available to support professional marketing and fulfilment activities.
(a) Stock Control, Sales administration and Purchasing
The extensive administrative problems should be addressed by the introduction of a suite of related applications centred upon stock control. It is essential to keep comprehensive records of current stock, in all sizes, including the price of the products, so that the value of these assets is always known with accuracy.
Stock movements should be recorded in real time and these movements should be analysed to provide management reports summarising demand patterns, cycles etc. Sales order processing should also be provided on-line, allowing sales staff to have access to the current actual stock position on the shelves. Stock levels in the database would adjust automatically as each customer order is entered into the system.
The retail operation will continue to meet demand from its shelf stock, with re-ordering from the warehouse being the responsibility of the shop manager. Shop stock orders would be treated by sales order processing staff in the same way as any other mail order from an individual or corporate customer.
Alternatively, the retail operation might embrace the latest technology and capture each transaction at point of sale. This is potentially an expensive course, though there are benefits, particularly if direct marketing is seen as a major plank of the company’s expansion.
Stock reports would show true current stock positions, thus enabling re-stocking purchase decisions to be made. Analysis of demand will allow purchasing patterns to be predicted and anticipated. Data on preferred suppliers and agreed prices would be captured by the system, thus allowing the process of procurement to proceed under strict management control. It will then be possible to budget for cash outflows related to stock purchase.
The company has no real marketing policy at present. It fulfils customer orders through retail and direct mail channels but does not have a co-ordinated policy to actively seek orders from either existing or prospective customers. There is a modest budget for advertising in the relevant journals (What Remedy?, Herbal Medicine World, Herbal Shopper, etc.) and Charles Garlick’s publications and broadcasts provide useful PR mileage.
This report does not focus on marketing issues, but does note that the mail order operations of HealthyGlow have shown substantial growth, as does direct marketing activity in the sector in general. In order to take advantage of this trend, the company must enter the proactive world of direct marketing rather than remaining in the reactive world of order fulfilment. A marketing information system should be developed if the company wishes remain a serious contender in this area.
(c) Accounting Procedures
The serious issues raised by the company’s Auditor and VAT Inspector mean that a full accounting system must be installed as a matter of urgency. There are currently a number of industry-standard packages available which would meet the company’s requirements. The package selected will offer full connectivity with other applications within the information system but it will also be necessary to ensure that it meets any accounting criteria laid down by the company’s professional advisers.
(d) Cashflow control and business planning
Powerful spreadsheet tools should be used to create a detailed model of the business. Managers may then evaluate alternative scenarios for the business, particularly where various levels of investment are possible – the so-called ‘what if?’ modelling.
The same spreadsheet tools should be used to create whole-company and departmental budgets and to monitor performance against these. It will, of course, be important to ensure that input from other parts of the system can be readily captured and incorporated into your models.
(e) Human Relations issues
Staff are an important resource and their feelings should be carefully considered as the company contemplates far-reaching technological change.
In the first place, staff must be informed and consulted about any proposed changes: the problems that everyone recognises must be acknowledged by the management and proposals to deal with them should be openly discussed. Staff disquiet regarding technological innovation must be recognised and dealt with in a consensus manner. The benefits of supporting their tasks with an appropriate level of technology must be emphasised.
Applications which are developed must be particularly user-friendly and easy to learn. Training must be planned well in advance and should be focused upon making the users comfortable with the technology, as well as upon developing expertise.
The issue of staff confidence in their ability to give advice to customers may be addressed through the database applications already proposed. On-line access to up-to-date stock and price data is essential. It will also be possible to capture technical detail about individual products and therapies and make this available on line to both counter staff and telephone sales personnel. It would even be possible to print information at point of sale or despatch, if required.
(a) The problems which have been identified are all based upon shortcomings in the outdated administrative systems which are still in use in HealthyGlow. Such shortcomings may readily be rectified by the introduction of computerised applications which are commonplace in the commercial world in general and we have outlined a plan for developing and implementing such systems.
(b) On the positive side, there are considerable opportunities for growth and we have proposed that a marketing information system should be developed to enable the company to take advantage of them. Of course, this presupposes that the problems already identified have been speedily dealt with.
(c) One difficulty is that there are frankly too many issues to deal with at once. It will be necessary to prioritise tasks in order to develop and implement each application properly.
(d) The human aspects of the problem are also fundamental to the success or otherwise of the whole project. There must be a clear policy for dealing with the human relations issues and a recognition that there will inevitably be a cost for the communication, training and management overheads.
Criteria for marking
The following will be used as a guideline in marking the assignment.
REALLY QUITE IN-ADEQUATE, ‘FAIL’ 40-50%
ADEQUATE BUT NO MORE 50-60%
A GOOD AVERAGE PERFORM-ANCE 60-70%
WELL ABOVE THE AVERAGE 70%+
RESEARCH OF METHOD-OLOGY & REFERENC-ING No reference beyond lecture material. Little demonstration of understanding of the topic Some research of e.g. the course text only. Significant weak ness in understanding. Evidence of significant relevant research. Evidence of average understanding Thorough research of a range of relevant literature. Content showing clear understanding. Research extending to e.g. relevant, up to date journals. Exceptionally thorough research, depth of understanding
STRUC-TURE OF REPORT Very weak. Almost total lack of any sensible structure Weak structure but some introductory and concluding section A generally well ordered report with relevant discussion and some clear conclusions Ordering showing clear understanding and development of argument Outstanding structure with exceptionally well developed discussion
CONTENT Little or no demonstration of understanding of relevance to HGNHP Weak understanding but some relevant discussion at least Evidence of average understanding. Relevant points made. Content showing clear understanding of application to HGNHP. Clear and sound conclusions Exceptionally thorough evaluation showing depth of understanding of relevance
STRUC-TURE OF REPORT Very weak. Almost total lack of any sensible structure Weak structure but some introductory and concluding section A generally well ordered report with relevant discussion and some clear conclusions Ordering showing clear understanding and development of argument Outstanding structure with exceptionally well developed discussion
(C) PRESENT-ATION Weak, probably with missing sections Most sections present and presented in acceptable if weak style Appropriate sections, well organised Above average presentation, with fully integrated presentation of work of each pair/ individual Exceptional presentation standard in terms of English, style, ordering, subsections etc.