Sobeys Distribution Department - Case Study Example

Sobeys Distribution department Executive summary E-commerce is a new aspect of business that was introduced through the different technological breakthroughs that has been witnessed within the field of information as well as communication technology- ICT. The advent of the internet brought with it myriad possibilities which include the fact that people could easily communicate in spite of the demographic challenges or even distance. In brief, it led to the overcoming of many physical barriers in terms of ease of communication. The following discourse focuses on Sobey in terms of the probable applicability of technology to improve its operations. Introduction E-commerce can be done in two ways. The first is a case in which a company produces goods and services that can be exchanged online. These include such goods as computer software and even books, commonly referred to as e-books. In such transactions, the buyer contacts a seller mainly through the seller’s website and places an order for the given product. After this, the buyer is directed on how to make the payment. This is done online too with the buyer offered a dialogue box in which he enters his credit or debit card number. The card must, in this case, be globally recognized. The transaction takes place in the major currencies which in most cases is the American dollar. After entering the card number, an amount that is the price of the product is deducted. Thereafter, the buyer is allowed to download the product. This is an entirely online process with the two parties requiring no physical contact (Stefan, Christ and Jochen, 2008). The other model involves the basics of the transaction being done online such as in marketing. In this case, the client and the buyer meet online and the buyer gets to the goods specifications in which he is interested. After this, the buyer makes the payment as would be the company policy and waits for the seller to deliver the goods. This takes place when the goods can not be physically exchanged. Sobeys, given its business nature, thus belongs to the second category. It would only carry out extensive marketing and some of the most basic transactions online. However, the remaining part of the transactions would require physical contact between the seller (Sobey) and the buyers. Primary Data Through interviews and observation of the firm operations, it became eminent that the store has a wide customer base and has in the past placed in place strategies that aim to increase its sales. Some of these include product promotions and some other value added services. Sobeys is a chain distribution department with presence in all the provinces of the country and has two hundred branches currently. It majors in the sale of grocery and other fundamental house wares. The use of ICT is appreciated in the firm as the company has a website and is at advance stage of launching on-line transactions with its clients. The use of social sites such as facebook and twitter is rife as the company runs several accounts and fun pages with which it keeps contact with some of its esteemed customer. They have used the on-line platform to carry out market researches and this has played a part in their determination of yet some newer locations of expansion. From the study on how the store uses technology, the following were determined: Key characters and the difficulties they currently face Among some of the key personalities of the firm is the president who also sums up as the chief executive officer of the firm. Currently, this position is held by William Bill Mc Ewan. Given the fact that firm has a presence throughout Canada, communication and information flow has proved to be a challenge to its operations. This is a challenge which is well understood by the organization’s CEO. For instance, there are several incidences and transactions always warrant his presence or authorization but due to the job’s nature, the president can not always oversee all these in person. Consequently, he normally delegates some of these duties to his deputies who head the branches. The difficulty that a business expansion presents calls for effective management. However, there can never be an effective management without an effective means of communication. This, thus, makes the integration of an e-commerce system into the firm’s operations very timely. This is also based on the fact that the firm aims to expand its operations further. E- Commerce brings with it several communication possibilities that would be of essence to the management at Sobeys. Company overview Sobeys is the second largest chain store in Canada and specializes in the retailing of mostly foodstuff together with household appliances. The firm is headquartered in Stellarton, Nova Scotia. Besides, it operates in all the ten provinces of Canada. With net revenue of $14.765 billion in the 2008/2009 fiscal year, the business commands a significant presence in Canada. Started in 1935 as a family business, the firm has managed to grow over time and currently stands as one of the strongest market players in the securities market in Toronto. The firm has one thousand three hundred supermarkets operating in the country under different locations but dealing in a single line of commodities which are mainly foodstuffs, beverages, and other household appliances. The firm has a committed marketing department that has in the past run several loyalty promotion programs. Among the most effective of these programs was the concept of loyalty card. The card program runs in partnership with Air Milles. It has mainly taken root in Atlantic Canada and Quebec. For every twenty dollar spent, the clients get to earn reward points that they later redeem at the very stores for a variety of gifts including Sobey’s shopping vouchers. This is a marketing strategy that has worked as Sobey currently has a customer loyalty rate of about eighty percent. Goal setting and mission statement Sobeys pride themselves in diversity and convenience that their stores provide their user. They bank on the quality of both their products and the services that they render their clients. These are the core values around which their goals and mission are embedded. Goal: to provide diversity and quality at the convenience of a single roof. Mission: to be the leading chain store in Canada Historical efforts to improve efficiency The firm has taken several steps and made countless attempts to improve the ease of management and their brand visibility as much as possible. They have appreciated every new technology that the information and communication technology has brought save for the cloud computing and these are steps that they have taken aiming to improve efficiency and returns. The firm started by officiating e-mails as valid communication papers that would be produced as evidence in courts of law. This was a major strep that improved efficiency as communication would be carried out despite where one would be. They did this at a time that other firms took e-mails as mainly social means of communication. The firm runs an integrated website; this site is largely used to market their products and services. They have further linked their website to the currently popular social networking sites such as face book and twitter. Results for each effort The inception of the use of e-mail as legal communication papers improved the speed at which decisions were made. In addition, they did cut on the costs of management as travel expenses and other related costs were eliminated from the firm’s books of account as expenditures. The use of the website and the social networking sites increased visibility thereby doing away with the need for extensive advertising. The type of platforms that the social networking sites create for advertising are more personal and the information carried in the adverts are received on very personal basis. This is a provision that the firm has exploited as it runs several face book accounts and fun pages. The posts of new branches and new products that they have or are planning to stock receive massive viewership with several follow up comments of inquiry. This led the firm to set up an online customer relations and publicity officer who runs the social networks. Financially, the little e-commerce provisions that the firm has made use of in the past has yielded positive results and would still be of essence if they continued using them. Next thing they target or introduce The assimilation of the cloud computing online system into the network system of the company would be of benefits to the company. Several costs that the firm incurs would be considered redundant and all the money allocated for them would be rechanneled to increase productivity. This system would ease legal procedures as it would be of relevance at any given juncture of operation. The fact that the firm uses e-mails as legal communication documents would see to their use as evidence in court cases; the e-mails that are easier to file and retrieve will be produced. E- Mails with the cyber filing space will be accessed easily and literally anywhere. The firm is seeking to begin employing the internet in retailing some of its product and services online. The firm stocks several recipes. These are written guidelines used to give information on how to prepare a meal. Their nature makes it possible to be sold online and this would do away with the complaints of the stock being depleted or missing in one region. The recipes will be stored at the central database and advertised on the website. Any client who will express interest in them will be directed on how to enter his or her credit card number from which an amount equivalent to the price of the product is deducted. A receipt for the transaction will be issued too. Process mapping The firm needs an efficient communication network that would bring into reality a number of their operational objectives. E commerce presents these in a number of ways. Besides, owing to the needs arising from the expansion that the firm has in the past prided itself in, it needs to install a centralized database with a controlled access so as to enhance management (Mary, Cathy, & Jane, 2006). The fact that the firm has one thousand three hundred supermarkets does not make this any easier. The branches are spread throughout the provinces in the country and this, therefore, rules out the possibility of providing the much needed infrastructure through a Local Area Network (LAN) or a Wide Area Network (WAN). Both would be effective but only if the firm’s outlets were situated close to one another. The only alternative that the firm is left with is to install an online network and this would best be provided by the cloud computing technology. This technology is set up by preliminarily installing a high speed local area network in the individual stores. The several LANs that, in this case, will be one thousand three hundred are then connected to a single router that enables all of them to access the internet where the central database is. The database exists in the cyber space and this technology presents many advantages than any other that the firm had tried in the past. In case of a damage or should a store catch fire, losses and damages would only be recorded on the destroyed workstation but the database that existed outside the physical equipment would be in one piece and of service to some other branches of the firm. The ease of access will allow the president go through the details of a branch located several of miles away while attending a conference in any part of the world. It cuts all travel expenses as meetings can be held online with voice and video conferencing possibilities that it comes with (Bernstein et al, 2009). The system comes additionally with enhanced security and to boost this further. The operating systems for the work stations will be customized to enhance security. Such operating systems such as shareware or freeware for computers and android systems for mobile devices are customized to individual preference thus enhance security. This would improve the integrity of the data stored in the databases. Security can further be enhanced through the use of passwords that the president and the rest of the management team will determine at what intervals they are changed (Jiaming, 2008). This program comes with all these yet at very cheap cost. Provided the respective supermarkets have installed and effectively functioning local area networks, all that the firm does is to contract a service provider who allocates the firm their cyber space which is limitless and can carry as many files regardless of their size as the firms would have. Business process diagram Store 1 Store 2 Conclusions To wrap up the lengthy discussion, the changes that technology is presenting the modern day entrepreneur are limitless with all aiming at bringing positive changes to the trade. It would, thus, be unwise for a business venture to keep doing business the old conventional way and keep making losses. The cloud computing system is a technology with the capability of bringing a complete overhaul to the management of the entire chain store. It would do away with unnecessary managers as it requires the least amount of human effort possible. This, however, is a feature that has made the system receive negative criticisms as it encourages labor redundancy. It makes it possible for one person to do all that would be done by entire front office staff. One would, therefore, decide to do away with them and carry out the file management individually. Questions How much will it cost the firm to install the new cloud computing system? What negative consequence does the system posses? How will its effectiveness be measured? The cost of installation for a firm this big will of course be much. Besides, it varies from region to region thus making it hard to speculate. But the benefits the system brings are worth the investment. The only negative effect is that a number of employees will be rendered redundant. And finally, its effectiveness will be measured on the type of interaction that it will offer. It comes in a user friendly interface that one can customize to own preference. This will make it easier for one to personally evaluate it (Kirchberg, Markus, & Bu Sung, 2011). References Bernstein, D, Ludvigson, E. et al. (2009). Blueprint for the Inter cloud – Protocols and Formats for Cloud Computing Interoperability. New York: McGrawHill print Ryan Jiaming, Y. (2008). Computer Supported Cooperative Work In Design. Melbourne: Springer. Kirchberg, Markus; Lee, Bu Sung. (2011). "From System-Centric Logging to Data-Centric Logging - Accountability, Trust and Security in Cloud Computing". Proceedings of the 1st Defense, Science and Research Conference 2011 – Symposium on Cyber Terrorism, IEEE Computer Society, 3-4 August 2011, Singapore. online Maria, M, Cruz, C and Joao, V . (2011). 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