Puffin Parcel Group - Case Study Example

Puffin Parcel Group Introduction Change in organizational structure and processes are a common aspect in modern business management. Change makes it possible for an organization to take full advantage of existing business opportunities while also aligning its processes to the demands of the industry as a whole. This report focuses on changes in business processes of Puffin Parcel Group, which is operates collection and delivery of parcels to and from businesses in Manchester and is strategizing to take advantage of home collection and delivery while also taking advantage of online business opportunities. The report will highlights areas of change to be undertaken by the management and how new open source packages such as a CRM or ERP system can support these changes. Further, the report wills also discussion challenges Andre will experience during the process of implementing the new strategy for the business, while also suggesting some recommendations for how they may be addressed. Changes in business processes Andre’s vision for Puffin Parcel Group (PPG) will herald a number of changes on the previous business processes in order for the people and structure to be suited to the new business strategies. Given that PPG has over the past decade operated a reliable service to local businesses in Manchester, the processes must be transformed to accommodate the expansion to other platforms. Expansion to the home delivery and returns market increases the complexity of business processes in PPG. Whereas the employees were used to working in a system that only supported collection and delivery to and from local businesses, they will now incorporate home delivery and collection to the business processes. This might also translate into a need for PPG to absorb some of the drivers on casual contract into its network of permanent full time drivers. Having an online presence will have significant impact on PPG due to the impact of e-commerce on sales and marketing efforts. Liang (2010) notes the internet performs a number of significant functions, which improves efficiency in areas of operations such as information acquisition, organization, processing, storage and transfer. However, for the business to enjoy success brought about by these changes, the management should introduce changes targeting payment systems and logistic, which promotes innovations. This platforms means that although PPG does not open physical offices in other regions, its presence will expand to reach to national and also adds to potential exploitation of international customers. Among the areas that will change is time of business operation. Online business will make it necessary for PPG to adopt a 24/7 business operation to fully capitalize on existing markets. Introduction of 24/7 business operation ensure customer orders are responded to on a timely manner for increased customer satisfaction. Without such services, PPG might not take full advantage of the potential offered by the online platform. There are also significant time differences when the company deals with international businesses such as those operating from China. Therefore, PPG will need to invest in web professionals to coordinate online business (Entrepreneur, 2014). The adoption of home collection and delivery platform is an important part of the PPG expansion strategy. Working with MiniMartz will result in changes in business process in terms of point of collection and delivery. While the original process of collection and delivery involved the contact point being enterprises where customers are located, which implies the business engagement with that particular customer ends at that point. However, working with MiniMartz means PPG is adopting a‘station-to-station service’ approach instead of door-to-door delivery and collection systems. The station-to-station service form of business arrangement implies enhanced efficiency in delivery and collection especially when the customer is not available to take shipment at a period convenient to the delivering company (Zhang, Xu, Zhang and Jian, 2010). The new business arrangement implies PPG still has a contract with the customer even after delivery to MiniMartz corner stores. The new business model should therefore be able to respond to various incidences of customer needs for assistance after delivery of parcels to MiniMartz corner stores. According to Achrol and Kotler (2012), the post-information economy has made it necessary for businesses to adopt vertical integration processes that will respond to marketing functions and values-added, which are moving forward in the network and closer to the consumer. Adoption of vertical integration will ensure that even as the company expands to embrace new markets, it also remains closer to the customers for it to respond to their needs adequately. Introduction of home delivery and collection system and the online platform will also affect how PPG advertises services to current and potential customers. Focusing on local businesses made it easy for PPG to advertise services to this customer segment, as it was possible to implement Single Market Approach, which allowed the organization to channel resources towards business development based on available resources (Boone and Kurtz, 2013). However, home delivery and collection in addition to having online presence needs a change in advertisement processes. The organization will for instance have to adopt a Diversified Approach in creating customer awareness based on the different segments under focus (Boone and Kurtz, 2013). Businesses and homes might have different needs in terms of hours of operations and bulk of parcels to be delivered. While businesses might prefer morning to afternoon as the best time for collection and delivery, different homes might request after-work hours as people will be at home to receive the parcels. Additionally, the level of advertisement conducted on online platforms will also increase to ensure PPG increases its presence in existing information technology tools to attract more potential customers. Consequently, adoption of online and home collection and delivery implies that PPG will adopt new advertisement methods to reach different customer segments, which transform the process of advertisement for the business organization. Use of Open Source Packages to Manage Changes ERP (Enterprise Resource Planning) ERP will provide Andre with an important platform to plan the resources under control of PPG at different levels of the organization (Kurbel 2013). ERP is an organization-oriented Open Source package that will make it possible for Andre to keep track of existing and new departments. It will provide a tool for central management of organizational database. Given the expansion to accommodate increased business generated from engagement with the Chinese company and introduction of home collection and delivery platform, Andre will require software that will respond to the needs of increased organizational operations. Expansion of PPG will lead to expansion and creation of new departments to respond to areas such as inventory management, purchasing, vender integration, sales, accounting and payroll. This ability proved by ERP will ensure PPG enjoys increased productivity while also improving decision-making by the management (Hossain, Patrick and Rashid, 2002). Working with the Chinese Delivery Company and MiniMartz corner stores will translate in significant structural changes for PPG. ERP packages provide a flexible tool for new operations to be implemented into the organizational system. ERP is a configurable system, which allows the Andre to select and adopt portions that are essential for the organization. The tool also allows for future upgrading to accommodate new processes and structures in the organization (Hossain, Patrick and Rashid, 2002). The challenges existing when PPG collaborates with MiniMartz chain of corner shops and the Chinese Delivery Company is common for business organizations operating on a business-to-business (B2B) application. Adoption of ERP will solve challenges that results from the organizational requirement of integrated and automated the online enterprise to make processes quick and efficient. Such business engagement means MiniMartz chain of corner shops and the Chinese Delivery Company, which are the storefronts where customers of PPG access their parcels represent the front-office of Andre’s company. When ERP system is added into this process, there is a timely delivery due to quick information processing and feeding into master scheduling and distribution resource planning (Yen, Chou and Chang, 2002). ERP is important in ensuring customers track parcels throughout the process until delivery point. This prevents misplacement of parcels, which can results from increased customer base and segments targeted by PPG. Focusing on resources under control of PPG at different levels of the organizational operations enables increased efficiency as the company can incorporate tracking technology such as the radio frequency identification (RFID) and sensor networks (Lyytinen et al. 2004). Additionally the systems enables faster access to customer and organizational information by adopting a system where networks, applications, data and computing devices are all merged and the administrator or permitted persons can access at any time and place (Junglas and Watson, 2006). Andre will therefore benefit from implementing such programs that are supported by ERP, therefore making it possible to reduce lead-time, improve organizational productivity, increase customer satisfaction while at the same time reduce overall costs of production and increased revenue for the organization (Angeles, 2007). Customer Relationship Management (CRM) While ERP will enable Andre manage PPG resources effectively, CRM tool will increase the level of customer interaction as it improves the management and access to information about customer needs and history. Given the expansion will result in creation of new customer base, Andre will require internet software that will enable the PPG form a relationship with new customers. Expansion into new market segments implies that sales and customer services become essential for success of the organization. CRM will be important in enhancing customer experience based on the ability of the tool to improve the level of internal activities. Customer satisfaction will be achieved through implementation of a process that incorporates customer needs and organizational goals throughout the system of product delivery (Kumar and Reinartz, 2012). Andre will attract and create customer loyalty by adopting CRM in customer management relationship marketing. Customer satisfaction is essential especially for business entering new markets. CRM provides a platform for Andre to ensure his customers access quality services based on created history, which enables determination of customer preferences. According to Kumar and Reinartz (2012), “knowledge about customers and their preferences has implications for the entire organization”, therefore organizations must implement the program by sticking a balance between organizational objectives and customer interests (p35). However, it improves the relationship between the organization and its customers by treating each client uniquely based on the belief that customers are heterogeneous in their value and needs (Kumar and Reinartz, 2012). Challenges in Implementing the New Strategy Andre’s plan for expansion will require financing to ensure every aspect of the strategy is implemented successfully. The expansion of PPG operations mean the company will also need more asserts to maintain high quality and efficiency of services. Consequently, Andre should be ready to inject more funds into aspects such as purchasing more vehicles and hiring more drivers on permanent full time basis. Regardless of the open source system adopted during implementation of the expansion strategy, Andre has to incur extra cost in the process. Hiring experts to run the information technology system will also translate into increased recurrent expenditure for the company. However, the challenges of financing the expansion process can be offset by outsourcing some of the functions. Running and maintenance of the preferred open source system can be outsourced from outside providers of the services. There are a number of vendors with the necessary capabilities for maintaining updated systems, which ensures companies concentrate on provision of high quality services to customers while leaving the maintenance of ERP or CRM systems (Gupta, 2000; Park, Im and Kim, 2011). The company might not achieve the full potential of these applications when it concentrate in owning such systems since technology keep improving, demands for supporting solutions, which consume time, money and other valuable organizational resources. Outsourcing will also reduce costs due to recurrent expenditure spent on experts employed in the IT department. Integration of different processes conducted under PPG will also be a challenge for Andre. After introduction of new areas of operation, the company will have multiple areas of operation that would require effective management to ensure success. There is need for Andre to ensure maintenance efficiency in collection and delivery to local business section of the business while also making the new platforms such as increased online presence and home collection and delivery are functioning to their full potential. There is a need for Andre to ensure establishment synergic relationship between the preconceived operational and strategic planning with organizational financial planning to ensure smooth combination and conversion of organizational components into cohesive entities (Correll and Herbert, 2007). To achieve the necessary cohesion and synergies, Andre should invest in integrated business planning, which leads to the adoption of the necessary technological, process and application changes for linking organizational planning components, which will improve the level of alignment and financial results. Integrated business planning is a holistic approach to organizational processes, which will significantly, improves operations and leads to greater control of organizational information assets. Evaluation and resistance change is an area that will most likely provide a challenge to Andre. The changes that will be introduced will require employees who have skills and attitude to the drive the organization to new heights (Daft, 2007). Given the uncertainties that come with adoption of new ways, resistance to change might be one of the challenges for Andre. Although employees might not be vocal in their opposition to the changes, they might not offer their best towards achievement of organizational objectives. There are also a number of employees who might not meet the requirements of the new organizational structure and processes. Implementing the changes will mean the organization is highly reliant on information technology to drive most of its functions. Without employees with knowledge and skills to perform these services, the organization might not be able to deliver high quality services to its customers. However, there are various approaches that Andre can adopt to ensure employees respond to the changes to ensure only those who have the skills and will remain contracted to PPG. When conducted evaluation of existing employees and their capabilities, Andre should ensure adoption of a process that is transparent and effective enough to gauge employee skills. Among the measures taken to achieve this can include using both internal and external evaluators. This will ensure the evaluation process results in a more accurate report on performance of various roles especially when it involves using experienced external evaluators to integrate strategies addressing internal resistance while the internal evaluator relies on the good connection with the staff (Shell, 2002). Conclusion The foregoing report has features areas of change that will accompany Andre’s strategy to expand the operations of PPG. The expansion will herald a number of changes, which the business owner and employees must respond to. ERP and CRM systems have also been discussed as two of the open source systems that the PPG can adopt when taking advantage of the booming online business. While ERP provides an important platform for planning and managing of resources under control of PPG, CRM has been found to be important in increasing customer satisfaction through creation of customer relationship based on history of interactions. Further, challenges such as the need for increased finance, dealing with employee resistance and integration business operations have also been discussed. Solutions such as outsourcing, integrated business planning and use of external evaluators to identify suitable employees have been suggested as part of the solutions to problems that might exist during implementation of the change process. References Achrol, R. S. & Kotler, P., 2012. Frontiers of the marketing paradigm in the third millennium. Journal of the Academy of Marketing Science, 40 (1), 35-52. Angeles, R., 2007. An empirical study of the anticipated consumer response to RFID product item tagging. Industrial Management & Data Systems, 107(4), 461-483. 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Iclem 2010: Logistics for sustained economic development--infrastructure, information, integration. Reston, VA: ASCE Publications. Read More