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SAP and its Technological Advantages

Discuss about the Logistics Analysis Paper for Applications and Products.

SAP represents Systems, Applications, and Products in Data Processing. In the current digital age, software like SAP are providing businesses with various technologies that they can use to growth, diversify, and simplify everyday operations. It is important for businesses to familiarize themselves with emerging technologies as a way of securing marketplace relevance, brand reputation, and consumer loyalty. SAP bridges the disconnect between companies and new business technology by providing integrated business solutions that are tailored to different departmental needs with an organization. There are five technological advantages of SAP that transcend conventional accounting/planning/control software these are: digital business; Internet of Things (IoT); machine learning; enterprise mobility; and SMEs growth accelerators. SAP introduced digital business technology with the aim of restructuring tradition business models through the introduction of intra-firm data sharing technology that limits the workload imposed on employees (Gruber, Buerkle, & Duncan, 2016).  

According, to SAP, Internet of Things is viewed as a means of connecting office computers with each other, and computers to people irrespective of the business or industry of operation.  Machine learning is viewed as form of Artificial Intelligence (AI) that allows SAP software to better the user interface by making the work easier through recollection and forecasting of behavior. This "thinking ability" allows the software to provide suggestions and guidelines that will match the user's expectations. SAP provides ingenious ways through which management can communicate with employees, consumers, and stakeholders through enterprise mobility technology that allows for sharing of vital information through secure channels and encrypted formats.  Lastly, SAP software provides strategy formulation and benchmarking technology that allows SMEs to growth in markets that dominated by large organizations and conglomerates (Gruber, Buerkle, & Duncan, 2016).  

According to a management research project conducted in 2018, less than 30% of all strategic plans developed by organizations are actually implemented. The implementation process is a vital part of strategic planning that is considerably difficult to perform successful. As such, SAP has lightened the load by ensuring that different departments are able to implement their strategies separately. By so doing, the organization is able to optimize resource utility by mitigating time wastage as management tries to coordinate all departments to towards the implementation of a single strategic plan of action. Moreover, separate implementation ensures that departments are able to create realistic time-frames within which the expected goals will be realized. Furthermore, SAP ensures the preservation of autonomy between the different departments by ensuring the strategic goals of one department are not overlooked (Elder, 2009).    

Digital Business

The separation also allows for the easy mobilization of stakeholders due to similarity of interests when dealing with individuals from the same department as opposed to formulating a single strategic plan to direct the entire organization. The relationship between management and employees is improved if the two groups are allowed to work together in departmental units.  Therefore, consensus and commitment are important factors in the implementation process. It is easier for workers to buy into a plan if it tailored to meet their specific workplace needs and not the general wants of all employees. The apportionment of resources toward the implementation process is better done with regard to departments since the needs of one department may exceed those of another. Hence, departmental manipulation of resources is more than likely to improve or better the implementation process. At the departmental level, management is able to clearly identify the number of individuals and amount of money required for their proposed strategic plan to be completed (Smith, et al., 2014).

On the other hand, there are several issues commonly associated with decentralized strategic implementation (where departments are allowed to implement their own strategies) that complicate the business performance of a given organization. For instance, this form of separation can result in the dilution of business objective and goals in favor of departmental milestone.  A department that is performing below expectation can set objectives that are easy to achieve instead of focusing of organizational targets and production requirements. In other situations, a department many have too few employees limiting the ability of the department to implement strategies without necessitating the help of senior management or other departmental heads. Timing also becomes an issue because departments will set different implementation time frames thereby eliminating any form of uniformity in the implementation process.  Moreover, considerable separation does limit communication between departments making the implementation process difficult for senior management to coordinate and direct towards the actualization of specific business strategy that will govern company success (Radomska, 2015).  

Implementation culture within the organization can be eroded by the separation created by SAP making the process more difficult instead of streamlining and bettering it. This erosion can be witness in the loss of focus, adherence to company vision, and commitment of stakeholders to process completion.  Nevertheless, the benefits of using SAP in this manner considerably outweigh the short-coming. SAP allows for the finalization of the strategic plan after successful collection from all concern parties. SAP will allow departments to properly budget the implementation of different goals based on financial assessment results and predictions. The software allows management to produce the different versions of the strategic plan to be implemented for each department. In addition, SAP generates "scorecards" that track and monitor the implementation process for the different departments. The separation of departments during the implementation process does not limit the roll out of the intended business strategy throughout the entire organization. In fact, SAP does in a way allow for the modeling of departmental annual plans around corporate plans. The express communication provided by SAP enables monthly strategic meeting that are focused towards the reporting and monitoring of the implementation process.  Lastly, SAP does provide for the collective review of the implementation process at department level making it possible for correction and adjustments to be made before the matter is finalized (CDRG, 2014).  

Internet of Things (IoT)

It is important to get the customer's personal information for the purpose of data collection. The personal information should relate to the customer's: name; phone number; email; address; job title; age; payment method; personal identification; and sex. The name of the customer is important to have because it will used to indicate on the necessary documents the name of person placing the card order. The phone number and email address are necessary for the sake of contacting the customer when the order has been processed and fulfilled. The customer's address is taken to aid with assessment of shipment costs and options available to the buyer. Getting the customer's job title and place of employment helps one to understand the financial capability of the person with regards to procuring the vehicle. Moreover, it provides information on the social class that is most likely to order a Volkswagen Tiguan SUV. Age and sex provide data on the age group and gender that is most likely to procure this specific make of the Volkswagen SUV. Payment method and personal identification will be used to illustrate the customers preferred mode of procurement and identification (O’Donnell, 2010).   

The customer can provide information relating to his current car model and preferred car model. For instance, a customer could have a higher preference for saloon cars but because of lack of knowledge on them, he/she decided to procure a car similar to one he/she current drives. This information helps with advising the customer on the optimal car choice that will fully meet their day to day needs.  If it is the customer's first time trying a Volkswagen car, it would be good for them to get insight on different models that would easily satisfy his/her transportation needs e.g. a family SUV or a cargo Lorry (Deloitte, 2014).

A good business needs to engage with its customers to ensure that their products are positively received in the market, and brand awareness is considerably good across the world. If the customer was indeed referred to buy the Volkswagen Tiguan SUV, it is important to know by whom or via which media for the purpose of assessing the efficacy of different marketing platforms and techniques. For instance, the person may have been referred to Volkswagen cars by a television advertisement. Lastly, it is good to gain insight from the customers on aspects of the ordering process that they liked, dislike and possible improvements that can be made to better the procedure (Mindy & Wood, 2008).

Machine Learning

It is important for the client to be provided with car details that related to engine number, and car specification as a precaution to ensure that the car is not replaced or ransacked during shipment. Moreover, the customer needs to know the order number for the purpose of tracking the SUV during shipment and clearing upon its arrival. In addition, shipment information should also be provided to the customer. It is important for the client to know the shipment date, method, and personnel. This knowledge will better the vehicle tracking process while it's on transit from the distribution center to the customer's preferred pick up place or residence (O’Donnell, 2010).

The gathered information will be used to fuel business improvements and restructuring. For instance, demographic data (age, sex, and race) will be used to develop marketing strategies that will allow Shanghai Volkswagen to appeal to car buyers of a given niche while providing opportunity to develop solutions to reach more buyer groups; for instance,  middle-aged women. Customer contact information is used to send promotional offers and payment invoices/receipts to buyer; in most situations, the contact information is used to make follow ups with customers with regard to previous inquiries on a given car model. Knowledge of customers' payment methods allows the organization to understand which money transaction avenue is the most popular with consumers. Referral information simply lets Shanghai Volkswagen understand which advertisement and brand awareness platforms are working properly; allowing for a significant proportion of marketing funds to be directed to those avenues (Mindy & Wood, 2008).  


The issues that would require solving before the ordering system is implemented are: customer communication avenues; order management system; and personnel training. The company needs to develop methods through which the organization will be able to reach and communicate with customer for them to place their order. Applicable avenues would have to a website page to handle orders, a toll free call center, and lastly a mobile device application that will allow customer to make orders using their smartphones. Shanghai Volkswagen then needs to develop an order management system/database that will provide secure access, retrieval, and storage of order data to authorized individuals. Lastly, a team of people need to be trained on how they with relate with customers, handle orders, and maintain the order management database (Elder, 2009).  

The online applicability of the ordering system allows for the omission of human errors on the company's part limiting any legal issues relating to wrongful order placement as a result of coercion, misdirection, or duress. Moreover, Shanghai Volkswagen will be able to minimize costs in future because a considerable portion of order placement will be handled by automated systems instead of sales personnel. In addition, the website ordering system is becoming a popular technique and is expected to be the most widely used avenue in future. As such, the company will guarantee its ability to adapt to customer preferences in future (Smith, et al., 2014).

Chongqing

Hefei

Zhengzhou

Wuhan

Shijiazhuang

Chongqing

1

Hefei

-0.14884

1

Zhengzhou

-0.33689

0.277353

1

Wuhan

0.052992

0.36021

0.179845

1

Shijiazhuang

-0.08942

0.374515

0.092477

0.235277

1

From the bar graph and correlation table above we can confirm that increment in demand in one region within a given week does also translate into increased demand in another region for the most part. The correlation between most of the warehouses is positive supporting the assumption made above. Therefore, making a centralized distribution center is not a good idea because it will have to process the demands of all five regions of china. Moreover, shipment duration will increase in some regions from 2 weeks to highs of up to 4-5 weeks.  The centralized warehouse will save costs on storage and staff but will create sizable expenses in the logistics department.

Cost

Chongqing

Hefei

Zhengzhou

Wuhan

Shijiazhuang

Total

Not centralized

ordering cost

¥2,641,800.00

¥2,719,500.00

¥3,146,850.00

¥3,202,350.00

¥3,058,050.00

¥14,768,550.00

holding inventory cost

¥595.00

¥612.50

¥708.75

¥721.25

¥688.75

¥3,326.25

shipment to warehouse

¥5,712.00

¥5,635.00

¥6,237.00

¥5,193.00

¥3,857.00

¥26,634.00

shipment to market

¥6,188.00

¥6,370.00

¥7,371.00

¥7,501.00

¥7,163.00

¥34,593.00

Total cost

¥2,654,295.00

¥2,732,117.50

¥3,161,166.75

¥3,215,765.25

¥3,069,758.75

¥14,833,103.25

Centralized

ordering cost

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

holding inventory cost

¥3,326.25

¥3,326.25

¥3,326.25

¥3,326.25

¥3,326.25

shipment to warehouse

¥31,932.00

¥30,601.50

¥29,271.00

¥23,949.00

¥18,627.00

shipment to market

¥14,789.00

¥14,769.00

¥12,323.00

¥16,221.00

¥18,154.00

Total cost

¥14,818,597.25

¥14,817,246.75

¥14,813,470.25

¥14,812,046.25

¥14,808,657.25

The best system to use would have to be the single central warehouse because it will have less cost compared to the current system which records cost of RMB14,833,103.25; therefore, the optimal centralized warehouse to use would have to be Shijiazhuang which has the least cost with RMB14,808,658.25.

Part c)

Based on the table below, I would still recommend the centralized system because it increases efficiency but it is still cheaper especially with regard to optimal choose central distribution warehouse Shijiazhuang which has the least cost with RMB14,827,284.25. This centralized system increases efficiency considerably by reducing the delivery duration by four days. 

Cost

Chongqing

Hefei

Zhengzhou

Wuhan

Shijiazhuang

Total

Not centralized

ordering cost

¥2,641,800.00

¥2,719,500.00

¥3,146,850.00

¥3,202,350.00

¥3,058,050.00

¥14,768,550.00

holding inventory cost

¥595.00

¥612.50

¥708.75

¥721.25

¥688.75

¥3,326.25

shipment to warehouse

¥8,568.00

¥11,270.00

¥12,474.00

¥10,386.00

¥7,714.00

¥50,412.00

shipment to market

¥6,188.00

¥6,370.00

¥7,371.00

¥7,501.00

¥7,163.00

¥34,593.00

Total cost

¥2,657,151.00

¥2,737,752.50

¥3,167,403.75

¥3,220,958.25

¥3,073,615.75

¥14,856,881.25

Centralized

ordering cost

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

¥14,768,550.00

holding inventory cost

¥3,326.25

¥3,326.25

¥3,326.25

¥3,326.25

¥3,326.25

shipment to warehouse

¥47,898.00

¥61,203.00

¥58,542.00

¥47,898.00

¥37,254.00

shipment to market

¥14,789.00

¥14,769.00

¥12,323.00

¥16,221.00

¥18,154.00

Total cost

¥14,834,563.25

¥14,847,848.25

¥14,842,741.25

¥14,835,995.25

¥14,827,284.25

References

CDRG. (2014). Implementation Barriers. Capacity Development , 1-6.

Deloitte. (2014). Driving through the consumer’s mind: Steps in the buying process. Deloitte , 1-24.

Elder, S. (2009). Basic concepts, roles and Implementation Process. International Labor Service , 1-43.

Gruber, S., Buerkle, J., & Duncan, J. (2016). SAP –Leading the Digital Transformation. SAP SE Investor Relations. , 1-32.

Mindy, F. J., & Wood, W. (2008). Purchase and Consumption Habits: Not Necessarily What You Intend. Journal of Consumer Psychology , 1-16.

O’Donnell, S. W. (2010). The Importance of Information. Top Line , 1-1.

Radomska, J. (2015). The Concept of Sustainable Strategy Implementation. MDPI , 1-10.

Smith, B., Hurth, J., Pletcher, L., Shaw, E., Whaley, K., Peters, M., et al. (2014). A Guide to the Implementation Process: Stages, Steps and Activities. ECTA Center , 1-15.

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[Accessed 24 May 2024].

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My Assignment Help. Logistics Analysis Essay For Applications And Products. [Internet]. My Assignment Help. 2019 [cited 24 May 2024]. Available from: https://myassignmenthelp.com/free-samples/logistics-analysis-paper-applications-and-products.

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