Proposal For ERP System And Business Process Reengineering At Radiance Dry Cleaners, Essay.

Introduction

Background information and purpose of this report

Scope, include sub-topics of report  

Possible roles of ERP system  

Current needs, problems and opportunities of organisation (RDC)

Brief overview on ERP System

Possible roles of ERP to address needs, problems and opportunities of organisation

ERP Systems Modules suitable for the organisation

Options of ERP Systems Architecture suitable for the organisation, e.g. benefits and limitations of cloud based ERPs in the context of this organisation

BPR and changes in business processes

Overview of BPR and methodology

Current “As is” business processes of the organisation

Proposed changes to the business processes

“To be” business processes of the organisation

Functional and information requirements of “To be” business processes

Reasons and benefits for organisational change

ERP implementation

Brief overview on ERP implementation methodology

Comparison on vanilla and chocolate implementation

Implementation option suitable for the organisation

Change and risk management

Importance and process of Change Management

Risks associated with BPR and ERP customisation

Critical success factors, e.g. organisational commitment and OPM3

Scope of this report

Background information and purpose of this report

This report is based on a family run business named “Radiance Dry Cleaners (RDC)” which is owned and operated by Peter Lee. The business provides cleaning and laundry services in Sydney through six stores at different locations. Presently, the transaction details are maintained manually through a register although it is working fine but there are some constraints as the manual system is laborious and consumes more time. There is significant growth in customers as they provide excellent customer service but it is noticed that the staff are unable to manage the data properly and provided high quality service. This report is focused on proposing some changes within their business process and implement an ERP (Enterprise Resource Planning) system so that they could easily manage the data and provide high quality service to their customers.

The focus of this report is research on ERP system for Radiance Dry Cleaners (RDC) but it is not limited as the concept of Business Process Reengineering (BPR) is also introduced in this report. This report presents the benefits of adopting ERP system for the business and the suitable option for implementing such system. Further, the discussions are carried out to propose some changes within business process of the organization. This report also presents the ideas for change and risk management required upon implementation of BPR and ERP in the organization.  

Current needs, problems and opportunities of organisation (RDC)

The major necessity that is being faced by the organization is a suitable system to manage their data so that those can be accessed for better decision making and providing high quality service to the customers. The organization also needs to make some changes to their current business process so that desired service quality could be offered to the customers. The organization also needs a system so that they can keep track of their customer and transaction details.

The major problem that the organization is facing with the growth of customers is management of data. The staffs are unable to manage the data properly due to which the customers are often not provided with high quality of service. During the rush times, record of customers visiting the stores are not recorded properly and even left null due to which sometimes error or communication gap occurs between the stores and customers. Due to inappropriate record of customers, the staffs are also unable to provide support to the business.

An information system will provide answer to all the problems of the organization. The system will help the organization to keep track of the essential information or data related to customer or transaction. Further, the organization will be able to generate reports from the system so that they can make better decision making and focus more on customer service. The organization will be able to integrate the six different stores under one platform with the help of an information system.

ERP system is a software application for business process management that is being used by organizations for managing their business and automation of their back office functions. This system helps to integrate the different functions of an organization into one so that the business processed could be carried out efficiently (Zach, Munkvold and Olsen 2014). ERP offers various advantages to businesses as it is scalable and it provides a centralized system for the entire business organization.

Possible roles of ERP to address needs, problems and opportunities of organisation

Possible roles of ERP system

The ERP will provide total access to the essential business processes by making the data available centrally throughout six stores of the business. There will be increased collaboration and streamlining of the tasks to be completed by the business. The system will help maintain inventory levels on a daily basis and execution of business activities efficiently. ERP will also provide a better insight into the business condition along with improved visibility (Rajnoha et al. 2014). The implementation of ERP in the organization will provide a single and unified reporting system for the business processes. The ERP system will also help the organization to generate various reports as well as analytics as and when required. The information of the clients will be centralized and streamlined with the help of ERP system. The staffs will be able to focus more on developing and maintaining health relationship with the customers rather than involved with maintaining records. The organization will be able to standardize their own processes and systems which will help to enhance productivity and efficiency.

From the case of Radiance Dry Cleaners (RDC), it is identified that various modules of ERP system is required by the organization as listed below:

Inventory module: This module will be used by the organization to keep track of the required items in stock. The module will help to ensure that there is no additional time required while delivering services to the customer.

Sales module: This module will include the sales related information and it could be used by the organization to keep track of service queries or handling inquiries, accepting service requests and even tracking pending service deliveries (Nwankpa 2015).

Purchase module: This module will take care of the procurement of required items and it consists of various functionalities that could be used by the organization to handle their business processes.

Finance & Accounting module: This module keeps track of the transaction and finance related information (Leyh and Sander 2015). The organization will be able to check their financial status or past reports for different financial years so that they can make future predictions.

Customer Relationship Management (CRM) module: This module relates to customer service and developing a healthy relationship with the customers. The organization will able to keep track of their customers as the records will be stored in this module.

For the organization, it is identified that Web based architecture will be suitable as it will allow the users access the ERP system remotely. Presently, there are six stores and they will be connected centrally with the help of web based architecture. In this type of architecture, the presentation layer is divided into two parts that is web services and web browser to support the mobility of the devices through the internet (Kilic, Zaim and Delen 2015). This means that the system will be accessible from anywhere and there will be increased collaboration between the different stores.

Overview of BPR and methodology

BPR (Business Process Reengineering) is considered as a new approach for business improvement so that dramatic improvement could be achieved in business performance. It is not a technology but it is a concept that could be utilized by organizations for improvements in the business process (Chang 2016). It should not be considered as downsizing, restructuring, reorganization or new technology. There has been attempts by many organizations so that they could achieve improved business processes although they have failed. This concept relates to making modification or changes in the existing business processes to achieve better business performance.

Brief overview on ERP System

The above reflects the existing business process of Radiance Dry Cleaners (RDC) and how they handle their clients. The diagram illustrates the organization considers the two type of customers differently and different procedure is being followed for different customers. The present business process is the complex and time consuming. There are also instances where the data of customer is not recorded properly during rush times. Hence, it is identified that there is a need for some improvements in their business process to achieve better business performance.

The changes that has been proposed for the business processes within the organization are listed as below:

• The data or information of the customers have to be recorded properly so that high quality of service could be provided to the customers.
• The processing of request for services have to be done at faster rate and quickly so that the wait time of customers is reduced.
• A new information system has to be implemented in the organization so that the business process could be handled efficiently.
• The customer type should be recorded automatically as soon as the customer contacts the store.

The above reflects the proposed changes in the business process of Radiance Dry Cleaners (RDC) and how they will able to achieve better business performance. The diagram illustrates that a new system will divide the type of customers automatically and centralized procedure will be followed for the customers. The proposed changes will help to easily manage the business process and record data efficiently. The record of customer information will be done immediately after they contact the stores. The customer record along with other information will help to keep track of the business processes and how it could be managed efficiently.

The functional and information requirements of “To be” business processes are listed as below:

• Enhanced business processes of the organization so that improvements could be done efficiently.
• Description of the data that will entered into the system for enhanced business processes.
• The customer information will be recorded to improve visibility and business performance.
• The financial or transaction related information will be stored and could be accessed when required so that proper decision making could be done for future prospects.
• The processing of services requested by the customers should be easily handled quickly and at faster rate.

Change is an essential aspect within any organization which is needed some or the other time so that improvement could be done in their business processes. Changes are required in the organization so that they could achieve better results and improvements in their business processes (Mavetera et al. 2015). In the organization, it is identified that there are some issues faced by the staffs while handling the business processes so there is requirement of some change. The organization change will help to achieve enhanced business process and the staffs will be able to focus more on customers rather than just involved with recording of data or information. The organizational change will help to gain more flexibility and agility in the business processes.

Brief overview on ERP implementation methodology

The implementation methodology for ERP is an essential factor as it is complicated process and it could lead to success or even failure of the system. It has been indicated by [] that there are two major initial decisions that have to be taken into consideration. The first one is the use of implementation methodology and second is the decision of whether to change the system or not (Ghanadbashi and Ramsin 2016). For successful implementation of an ERP system, it is important that the organizational culture is assessed along with the business environment and employee skills. The factors like culture of the organization, business environment or others are essential to determine the type of implementation that should be adopted by the organization.

The vanilla implementation refers to decision of implementing an ERP system along with modifying the business processes so that those are compatible with the system. It could also include modification of the ERP system so that it matches with the existing business processes. This decision is essential for any organization prior to implementation of an ERP system and vanilla is selected when decision is made for not modifying or customizing the system rather changing the business practices so that the system could be easily adopted (Ranjan, Jha and Pal 2016). The vanilla implementation uses core functionality of ERP system and provides best practices to execute business processes of the organization. Vanilla implementation requires aligning the business processes instead of modification of the ERP system.

ERP Systems Modules suitable for the organisation

In chocolate implementation, there is requirement for system modification and it could be suitable for the users as the system will be customized. The major drawback of this type of implementation is that there is increase in investment as implementation cost becomes higher and there is also increased chances of risk during implementation. In this type of implementation, thee basic design could be modified at any stage during the implementation so that business needs could be fulfilled. This type of implementation provides competitive edge over other companies in the market with the help of unique functionalities. However, there are also certain challenges as the customization may lead to complexity and risks of failure (Ram and Corkindale 2014). The fixing of issues may take longer than usual due to involvement of customized codes as the regular updates provided by the vendor may not work for the customized system.

For the Radiance Dry Cleaners (RDC), it is identified that Vanilla implementation will be suitable as the implementation will be quick and easier to use. The current business processes within the organization could be redefined and the inadequate functionalities or inefficient processes could be eliminated. The investment cost will be low as compared to customized solutions and as presently, there is no system used by the organization, a simple design will be easier to use. The basic functionalities could be easily operated by the staffs to achieve the desired business requirements of the organization. The vanilla implementation will help the organization to receive smoother upgrades whenever it is being provided by the vendors.

Importance and process of Change Management

Change management is defined as the approach that is required for managing changes due to integration of technology in the organization. This process also includes evaluation and assessment of impact that the technology integration will have on the people as well as overall organization. Change management is required within the organization to ensure success of the ERP system implementation.

The process for change management is mainly carried out in three phases that are illustrated as below:

Preparation for change: This phase includes development of a strategy and a team for processing change management in the organization (Wang 2017). It is similar to planning activities of any project that is required to ensure success.

Management of the change: This phase includes development of plans for change management and taking actions so that the plans could be implemented. It relates to design phase of a project and it will ensure that the ERP system implementation is successful.

Reinforcement of change: This phase includes review and analysis of feedback from users on the change implementation. After that, the gaps are analyzed to manage the resistance to changes and then corrective actions are put in place to ensure success of the ERP implementation (Bradford et al. 2015).

The vendors often make frequent changes and updates and this may create system vulnerabilities which are quite difficult to fix. Theses frequent updates cannot be easily accessed by the users. Frequent changes also expose the confidential information from the server.

Options of ERP Systems Architecture suitable for the organisation, e.g. benefits and limitations of cloud based ERPs in the context of this organization

Maintenance and upgradation are difficult to implement as it is difficult to upgrade the customized codes. Installation of patches and upgrades can also overwrite the customized code may cause break (Ijaz et al. 2014). In other words, new environments are required to test the customized codes after upgradation.

Cost increment: Testing and rewriting the codes increases the overall cost of the ERP software and the quality of the software will also not be maintained.

Business process reengineering can decrease the overall performance of the business organization and also the operation and business functionalities will get hampered (Vom Brocke et al. 2014). The process functionalities and business strategies will be interrupted due to frequent business updates.

There are various critical success factors associated with ERP implementation such as Organizational commitment, Excellent project management and Organizational change management. The success of the ERP implementation will be ensured by commitment from management of the organization such that the new system is accepted by the employees. The application of suitable project management methodologies will ensure success of the ERP implementation project (Shatat 2015). The success of the ERP implementation will be ensured through proper evaluation and assessment of the outcomes against requirements of the organization.

Conclusion

From the overall report, it has been identified that the organization will be benefitted with the implementation of ERP and BPR in their current business process. The business process of the organization could be improved so that desired quality of service could be offered to the customers. The organization will be able to make future projections based on the data that will be stored in the ERP system. The ERP implementation will require changes in the business process but it could be managed efficiently with the help of suitable change management procedures. Further, it has been identified that vanilla implementation is most suitable for the organization as it will help to easily operate the business processes through the system.

The ERP project in the organization have to be carried out following certain steps to ensure that the system is aligned with the business processes and the desired requirements are fulfilled. The problems within the organization have to be analyzed properly and the objectives for the ERP implementation have to be set according to the business goals and objectives. A team have to be developed to ensure successful implementation of the ERP system. The options for implementation of the ERP system have to be evaluated so that it is able to fulfill the desired requirements of the business. Presently, the organization has no system as they maintain the records manually therefore the migration of data is also an essential aspect that have to considered prior to implementation of the ERP system.

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