A & F belongs to apparel segment of Retail industry. The retail clothing industry is very dynamic constitute a larger area of industry with engaging people in production, developing and retailing and giving service to about 3 million of the population accounting about 4% of the gross domestic product. In present time, Retail clothing incorporates lot inspection work for dealing with suppliers but then they need to heed to upgrade their planned supply. The total Market size of Retail clothing industry is more than 45 billion outside and around 15 billion in USA alone. However, this market is characterized with moderate growth rate of 7 to 9% over the years. The product life cycle is very short due to changing fashion style. The competition is huge with few players as mentioned in the case dominating the Market.
The technology plays an important role in supply chain management so as to increase efficiency and effectiveness of the operation. It is of no doubt that in mature and the less growing industry, it is scale of operation that determines the profitability. This can be done by streamlining operation and decreasing other costs so as to improve the profitability. In this type of market one can find that the bulk of the market share is distributed between two to three major players. Hence, the industry profitability depends on the scale of operation. The learning curve effect also plays an important role in defining profit which means that productivity increases with increase in time. The ease of entry and exit is very difficult due to high economies of scale and learning effect.
Hence, Retail clothing Industry is highly competitive, regulated and with few major players sharing the major market share. It is highly oligopolistic with significant barrier to industry means the firm is dominant by few players like A & F, Gap etc.. It is characterized with low growth, stable revenue, high capital requirements, great operating margins, stable cash flow and high dividends. The Market in US is almost stagnant so opportunities lie in outside market i.e. developing nation.
Competitive Position
The competitive analysis is done by using Brand Equity and the Revenue and we found that Gap leads the competition followed by Victoria secret whereas A & F is giving tough competition to both. The higher Brand image is because of higher money spent by them in marketing and promotions.
Task 2.0:- Analysis of Technological Infrastructure
Today, an organisation witnesses huge competition and hence it becomes necessary to adapt, fast, calculated, strategic and efficient methods. To win in this race of competition Information Systems provides best platform. It comes with tools and components which help us in acquiring recovered information for decision making. E-commerce plays an important role in nearly every aspect of the organisations.
Almost every organisational unit have switched their traditional methods to the latest Information system methods. Despite having so many advantages the implementation process of IT faces hurdles; this may be due to non-alertness of various challenging issues disturbing the complete process. In this report we will analyze the e-business aspects of A & F and suggests some recommendations to improve it further. It is in the field of retail business where it is using its applications in project management, retailing, procurement etc.
A & F is in the field of Retail business with wide alliances with vendors and manufacturers. They too have few manufacturing units to produce in-house products. Gap and Victoria are the competitors in this field however A & F also evolved a lot in last few years in using technology to gain competitive advantage.
Use of E-commerce in Project Management
A&F uses extensively the aspect of e-commerce in the process of application of skills, knowledge, tools & techniques to project work for meeting up or exceed the need & expectations of stakeholders from a project is known as Project Management. Now we have at least an idea relating to E-commerce Project Management. The following knowledge areas are covered in the framework of E-commerce Project Management at A & F:
Scope Management,
Time Management,
Cost Management,
Quality Management,
Human Resource Management,
Communication Management,
Risk Management,
Procurement management.
Using appropriate tools & techniques, these knowledge management areas are bounded by Project Integration Management. Different tools is to be used by managers of such projects such as: Project Charter and Work Breakdown Structure for Scope Management; Gantt charts,
PERT charts,critical path analysis for Time Management;Cost estimates and Earned Value Analysis for Cost Management.
Use of E-commerce in Manufacturing
Use of accurate & fast Information System is crucial for organizations to stay in touch with the changes taking place in their operational and competitive environments. Implementation of E-manufacturing or E-service is necessary for Business-to-Business (B2B) E-commerce at A & F. Today, lots of Internet enabled supply chain management systems & enterprise resource planning (ERP) systems are available like MRP, SAP, BAAN, Oracle, PeopleSoft & IBM E-business.With web-based production of goods and services, communication & data collection constraints are reduced. Web can facilitate interaction with customers and suppliers, data analysis processes & data collection by using data warehouse, data mining & database management.
Use of E-commerce in Procurement
The Primary application of E-commerce at A & F is to carry out logistics & automated purchase between trading partners with well established relationships. Normally Intelligence & valuable information are not concentrated on EDI channel between participants; they are concentrated on the computer systems of participants. The end of negotiation stage can be signaled by purchase & delivery of a product. Delivery options or available payment options may effect product & merchant brokering in some cases.
Task 3:- Recommendations
Developing E-commerce platform for Retailing
Traditional forms of retailing are very much affected by the use of internet and E-commerce. It cause a complete dislocation of existing physical retailing and partially affected the ”real” retailing. Despite excessive promotion, lots of conflicting views & marked failures, E-commerce processes and procedures gives capacity for core reassessment of ‘How retailing operates & How retailers behave’.
Hence, A& F must develop and strengthen its e-commerce ability to gain competitive advantage. It helps it to manage the total company work so as to achieve efficient e-commerce IT system with following objectives:-
Increasing sales through Online methodology
Minimizes customers waiting time
Decreases paper work between the office and other entities
Increases quality of customer care
Optimizes billing and coding process so as to improve online performance
Implementation Plan
The whole e-commerce based IT system will be done in three phases which has been described as given below:-
a) Integration of all stores through ERP system for internal control of operation. This can be implemented by integrating the ERP system into the all 5 stores which integrates all aspects of organization i.e. from operation to billing to finance and all.
b) Development of customer’s interface e-commerce system Modules
c) Development and Final Testing
Proposed ERP Computer based system
The computer system which works best for this organization will include the ERP which actually stands for Enterprise Resource Planning. It is an IT system which helps to design the whole operation into the system for effective and efficient control. It integrates the whole organization by integrating all the departments i.e. project, marketing, Operations, Admin and Finance. This will ensure the smooth flow of information across the organization. It starts with the evolution of data object relationship. We will take ERP modules from JD Edward from Oracle. This is the first phase as it will ensure the smooth flow of information from online sales made by the customers to all other departments.
Benefits
It is one of the most useful resources of IT. It is having the following characteristics:-
It is a continuous system which updates and maintains the data in real time with support of the concerned department, help in supporting the online sales
The greatest advantage of the JDE is that it provides a common database for the entire organization which in turn will help the entire department to coordinate and plan in successful way.
It makes data flow across the entire department consistent and smooth which in turn ensure successful implementation of all the strategies.
Architectural requirement of Back-end system
JDE is basically integration of large no. of software and hard wares. Those are as follows:-
Database helps in daily transaction from operational activities. It is provided by Oracle and can be manage and access using SQL.
Portal Helps in Generating MIS using DBMS software
Business Analysis System like SAS
Helps in generating reports as per the need
Connectivity with Internet & Intranet like WEB 2.0 software
Helping in Documentation using DBMS from Oracle
Blogging and chatting using WEB 2.0
Proper flow of works
Daily & Regular updates using DBMS from oracle
Connectivity with Wikipedia using WEB 2.0
Improvement due to Computerized ERP system
With the help of proposed ERP system total time will be saved in second step and around half the time in rest of the step. It is because when computer details will be enter into the system the verification will be done automatically and also the information will be sent to all concerned department regarding old report and scanning. Hence, it will save time considerably for Offline as well as Online sales an provide a great support for the entire online system.
Important Modules of e-commerce websites
The important modules which are to be developed in this phase for A & F are given below:-
1. Customized Layout ‘ Brand Imagery
2. Products Management System
3. Featured or New Products section
4. Login & Registration
5. Shopping Cart
6. Payment Integration
7. Customized Tax Table
8. Order Management Tools
9. Promotion Tools
10. Social Integrations
11. User Forms
12. Report & Statistics
13. Third-party Integration
14. Content Management
15. Informative Pages
16. Content Management System
17. Customer Management System
18. Inventory management systems
19. Auto Responder Email Alerts Systems
20. Online Promotion
Development Methodology
The development will be done as per the process given in the flowchart for all the modules built above in the second phase.
Measurable Organizational Value (MOV)
The overall goals of their computer-based system for A & F office are to allow for a faster and smoother interaction of A & F and customers. The computer-based cataloging system will help organize and increase productivity of the stores i.e. Customers turnover. The use of technology will help limit the resources used, but technology itself will not provide value to the project.
We will integrate ERP that will allow A & F office to review customers’ database for specific information, customer information as well as an organized history of past Customers history so as to increase efficiency and effectiveness. This will help in improving the online sales for the A & F.
Desirable Areas of Impact
The idea for this project arose from such a tremendous waste of time and resources in A & F stores which in turn might lead to downfall of the stores. Hence, with the implementation of the new computer-based ERP system, it would be able to implement an efficient backend system supporting the second and third phase of e-commerce websites. Through this new computer-based e commerce based ERP system, we will help them to be both more strategic and financially effective in the future sales.
Rankings
Potential Area
Desired Impact
1
Operational
Increase Customers Turnover
??
??
Decrease wasted resources (time and fuel)
2
Financial
Decrease Money losses through time saving
??
??
Increase customer Revenue through increase in turnover
3
Strategic
Allocate time and energy more efficiently
??
??
Develop a new method of seeing customers
4
Customer
Customers would receive more accommodating service
??
??
Efficient and effective process
More online sales and customers loyalty
5
Social
Create a system that will help in (Education, Health, Safety, and Environment)
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