Word limit: 3000 words (from Introduction to Recommendations and Conclusion)

Due date: Week 8 Friday (13 Jan 2023) 11:59 PM AEST

Return to students: Within a fortnight from the due date/submission date

CASE ORGANISATION: Aroma Organics (AO)

Aroma Organics (AO) has been supplying the Australian community with affordable organic food and products since first opened their doors in Melbourne in 2001. They have expanded a few times since then and are now the leading certified organic retail chain in Australia. With 1200 employees and fifty stores and franchises all over Australia, AO sells a wide range of organic products including, produce, dairy products, oils, herbal, beauty, and healthcare. The retail chain makes a revenue of $76 million in 2021-22 financial year. AO’s proprietor and CEO, Kate is proud of her business selling quality products and offering expert advice provided by her staff.

Kate has seen a big drop in overall sales in the last two years due to new entrants in the market and competitors. There was fierce competition from major supermarkets due to increased aisles exclusively for organic products in their stores. Besides, staff reported problems related to a lack of communication, data mismanagement, delayed decision making, information asymmetry, delayed invoice processing, issues with inventory management, and supply chain issues between warehouse and retail stores. There were customer complaints about delays in fulfilling orders due to bottlenecks and poor customer service.

As each store stocks more than 3,000 products including perishable goods, it has become a big challenge to identify the products in demand and the required stock levels for each product at her stores. Kate has been using a manual system to record stock levels. All this time, Kate did not think about improving her information system to support her business due to inadequate information systems knowledge.  She did not realize the benefits of information systems until she recently attended a seminar about cloud-based Enterprise Resource Planning (ERP) systems, which explained the benefits businesses can reap with information technology.

Besides in-store sales, AO supplies their products to vegan restaurants and cafes on regular basis.  For business customers they maintain a manual record of items and supply daily. If at all any changes in their order, the restaurants have to call respective AO stores a day before and get the order updated. AO offers discount to their customers – 25% for businesses and 10% for in-store purchases. Each store manages their own customer data on a spreadsheet. Regardless of the type, the customer’s first name, last name, address (Street no, street name, city, state, and postcode), contact numbers (phone, mobile), customer type, and email addresses are noted. They also offer free door delivery service for purchases over $200 and within 20km radius. Business customers’ discount will automatically be calculated during the invoice processing. In-store customers’ details are verified on Excel spreadsheet, and discount is applied at the time of check out, which is time-taking and complex especially during peak hours of business. Managing door delivery is another issue as there are many parameters to check such as purchase amount, distance and types of items purchased etc. Kate also manages a Facebook page to promote their products on special and to handle inquiries and complaints, which is intermittent.

AO customers generally place orders over the phone or visit the store.  In exceptional circumstances, orders via email or social media are allowed.  AO gained the reputation of maintaining high quality and reliable brands. Although AO is able to supply within a reasonable amount of time in the past, there are problems in achieving that in recent times. Every order includes details such as customer, order id, order date, and the products required. Furthermore, there are more and more complaints about the time for transferring products between warehouse and different stores and delivery to customers.

According to AO, they wish to record details of all the perishable and non-perishable products category-wise (product ID, product name, product description, date of expiry, date of packaging, Supplier/brand name, category, certified authority, quantity in stock, price). At the moment, AO has warehouses in ten different locations where all their products are stocked. Kate believes that there is no need to stock every product in every warehouse unless they are in high demand.  She also wishes to record warehouse details such as warehouse IDs and shelf details in the proposed system, as this information would help to locate products in different warehouses. Kate has a plan to sell their products online via a mobile application, website, and social media as well so that they can reach more customers and expand their business further.

Business customers may place orders several times in a week or as the need arises. AO sends an invoice to these customers once in every month for all the orders placed. Invoices are usually prepared and sent out on the first working day of every month and include details such as id, date, and payable amount. Customers are expected to pay the invoice within 15 working days. Customers can make the payment by cash, credit card, cheque, etc. Once the payment is received, the customer is sent a receipt. The receipt identifies the invoice for which payment has been received, the date of payment, and the total amount paid. In-store customers who choose door delivery, will have to pay upfront at the time of checkout.

After attending an ERP tradeshow and realising the benefits of ERP, Kate is keen to use the technology and adopt an ERP system with the help of an ERP consultancy firm (you). She believes that a computerized system will not only help her to record the transactions easily but also help her to make better decisions by generating reports to understand which restaurants and cafes place orders regularly, who are loyal customers, how often a customer buys items, the amount they spend on particular items, popular products, shelf-time of products, a list of customers living in different suburbs and other states, which customers did not place any orders in the last week/month/year, average monthly orders, etc. She anticipates that she will have control over the transactional data, improved business processes, and can make better decisions about her business. She wants to know more about ERP implementation and will be happy to hear from you on other benefits as well.

TASK DESCRIPTION

In this assessment, you will develop a management report recommending ERP systems for the decision makers in AO to consider. You will study and determine the necessary coverage. The following areas are expected to be included. You may show the initiative of making reasonable assumptions and incorporating other relevant topics as well.

• General introduction on ERP Systems with current examples from the industry. For example, an overview of ERP systems, their roles in organizations, their components and typical Modules of ERP systems, and their benefits to organizations
• Issues that may arise due to incomplete elicitation of requirements and misalignment between the business processes and organizational strategy
• General discussion on Business Process Re-engineering, including its steps, possible gains, and risks
• Discussion on current business processes and proposed changes to the business processes of the case organization, AO, with illustrations of the business processes
• General considerations on Change management and Organisational Project Management Maturity
• Apply to the case context of AO, discuss the general benefits, limitations, costs, and risks of implementing ERP systems, supported by an abridged feasibility analysis for AO.

Working on this assignment, you should study the relevant unit materials as a start. There are many areas that require further research and studies on quality academic and industry sources. You need to develop an outline of your report with appropriate topics and sub-topics to discuss and to build up arguments throughout the report. ERP implementation requires organisation-wide commitment, which may bring changes to current organisation structure. For example, when you persuade AO that ERP is required and recommend to proceed to the next stage by selecting an ERP system, your argument should link up discussion in various sub-topics including the following:

• The reason and benefits for organizational change
• Alignment of new business processes and ERP systems with the organization’s goals
• Benefits, limitations, costs, risks, and implementation feasibility of ERP system, in the context of this organization
• The importance of organizational commitment

Remember that there are no fixed answers to the tasks in this assignment. Successful arguments can be made for different options. Your task is to present a concise, informative, and persuasive piece of writing in report form. From your research and discussions in the report, you are expected to provide convincing support for your arguments and conclusions. 

The readers of this report include both business decision makers and technical advisers. You can assume your readers are intelligent people who understand business arguments if sufficient information is provided, even though they do not have a technical background. You will be assessed on your ability to present your research and understanding of various topics and your achievement to inform and persuade the readers, so it is essential that you develop arguments, with sound considerations and support. You should use academic literature and industry sources to inform and support your report. There is no maximum number on the number of references. As an indication of the expectation in achieving at pass level, a minimum of ten quality sources are required, at least five of which must be from academic sources (peer-reviewed journal articles, conferences, or edited book chapter papers).

Hints:

Your report should include the following:

• Title page (All member’s ID, full name, and each member’s contribution in preparing the report)
• Executive summary
• Table of contents (auto-generated)
• Introduction (aims and objectives of the report)
• Discussion (with suitable headings for various topics and sub-topics)
• Recommendations and Conclusion
• References

All students are expected to research quality sources, to learn independently improve understanding, and demonstrate in the report. Students working in a group should also demonstrate the skills in contributing to the group work, communicating, and collaborating with group members effectively, resolving issues, and developing the group in completing the group assignment. The marks will reflect the demonstrated level of achievements at fail, good, very good, or excellent level in each area.

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