information systems Dollar General

We analyze the possibilities of the 4 types of information systems Dollar General can use.

  • Transaction Processing Systems (TPS)
  • Management Information Systems (MIS)
  • Decision Support Systems (DSS)
  • Executive Support Systems (ESS)

For this organization, we identified a sub category of Management Information Systems (MIS) called Supply Chain Management (SCM) application, a part of the ERP (Enterprise Resource Planning) Suite as the most critical application.

This was our team’s summary of why we chose this application: “Given the amount of products, product types, retail store locations and distribution centers, the management of logistics and inventory is paramount to delivering the best customer value.”

The objective of this thread is for us to explore the potential that our critical system is not feasible.

In order to define why this may not be feasible for our organization to development a SCM, it is important to understand what an SCM application does and some of the prime vendors of the suite.

As most of you may already be aware, The purpose of SCM Information Systems are to track:

  • Inventory Optimization
  • Transportation and Logistics
  • Planning
  • Distribution Management
  • E-Commerce

The Top 3 suppliers of SCM enterprise resource planning software packages (out of the box) are:

  • SAP
  • JDA
  • Oracle

Let me try to make some assumptions and put an hypothesis forward in this thread to potentially see why an SCM application may not be Operationally, Technically, Schedule wise and Economically not feasible for our chosen organization.

Some of the assumptions I make for this thread are:

  • The organization does not already have an existing SCM implementation.
  • The economic status of the organization is under pressure owing to cut throat competition in the low value retail market from giants such as Walmart, Target and 99 cents stores.
  • The organization currently has several technologies used for various IS systems and there is no centralization of technology development in the organization. As a result there is no standard way for these IS to communicate with each other.
  • The organization is looking for a Supply Chain Management system to optimize inventory management, transportation planning and logistics. Given this has been identified as a weak area by the board and has been identified as an area that needs to be improved in the next 6 months to have any possibility of performing better in the market in 2018.
  • In order to achieve the goals of the company, within the available budget and within expected timelines the company is willing to bug out of the shelf SCM software.

Feasibility is the measure of how beneficial or practical an information system will be to an organization.

With the above assumptions, the following is my feasibility analysis based on the four potential tests of feasibility and subsequent reasoning as to why development of SCM is not feasible.

Operational Feasibility:

Our study material defines this as “a measure of how well a solution will work or be accepted in an organization.”

Given the above assumptions for Dollar General, while an SCM solution is essential and required – the operational feasibility of developing the solution may be very minimal. As explained in the assumptions, the different teams have different dev tools, methodologies and there is no lack of standard. The important consideration in development of an SCM solution is the need for all the systems to perform efficient handshake. This is only possible if there is a general standard. If we chose to develop a system, it is going to be very difficult to forge a common standard as each unit will want to reduce the work it needs to do and will try to push its definition as the common standard. Therefore, a fresh developed solution may not be ready acceptable for the organization.

Alternate Point of View: Assuming that development of SCM will not be possible, I would like to note that purchase of an out of the Box SCM solution may solve this problem. All teams will be forced from top down to adopt to the solution from the market.

Technical Feasibility:

Technical Feasibility is defined as “a measure of the practicality of a technical solution and the availability of technical resources and expertise.”.

As mentioned in the assumptions, the current team has different standards and an SCM solution is not available. While there may be experts in individual areas, we do not believe that Dollar General has the required technical standards, or technical expertise with previous SCM implementation. An SCM implementation, requires highly skilled technology subject matter experts who also understand the business. Given that the organization does not seem to have the expertise, it appears that the technical feasibility of the solution is not favorable. As mentioned above, the fragmented technology landscape of the company is also a contributing factor.

Alternate Point of View: Assuming that development of SCM will not be technically possible, I would like to note that purchase of an out of the box SCM solution may solve this problem again. An out of the box solution will come with standard guides and implementation experts for hire from consulting firms.

Schedule Feasibility:

Schedule feasibility is “a measure of how reasonable the project timetable is”.

As mentioned in the assumptions, the organization is looking at getting the project done in 6 months are less, to enable the company to be competitive in the market place in 2018. As per my analysis, if Dollar general takes the route of custom software development for the SCM solution, it will take at least 18-24 months to complete the implementation. Therefore, the schedule proposed by the management makes the custom development of SCM solution not possible.

Alternate Point of View: Assuming that development of SCM will not be schedule wise possible, I would like to note that purchase of an out of the box SCM solution may solve this problem. if we choose the SCM in the cloud solution, it may be possible to get the system up and running in 6 months (with strong project management and issue resolution command in place).

Economic Feasibility:

Economic feasibility is defined as “a measure of the cost effectiveness of a project or solution”.

A custom software development will run into tens of millions of dollars. The return on this investment may take longer than desired by the management. Given the financial situation of the organization described in the assumptions, and given the delay in high RoI I do believe that there is a possibility that this project may not be economically viable.

Alternate Point of View: Assuming that development of SCM will not be economically possible, I would like to note that purchase of an out of the box SCM solution may solve this problem. if we choose the SCM in the cloud solution, we can negotiate the price and terms of the solution to fit the budget.

Based on the feasibility analysis, in fact, thinking about it, I would definitely recommend Dollar General to choose an out of the box cloud based Supply Chain Management solution that a custom in-house developed solution.

 

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