XII Additional Implementation Issues The purpose of this section is to identify any implementation issues not already covered in the previous sections of the business case. First, provide a brief introduction to this section, then identify and explain three issue areas and how they will be handled in the implementation of the proposed system.
For each of the three, create a sub-heading and write a paragraph that:
· Identifies the issue
· Explains why it is an issue
· Describes how it should be handled during the implementation of the proposed system.
The issues identified could come from any aspect of the system; the following questions may give you some ideas, but issues do not have to be limited to these areas:
· What else should the organization consider?
· What things should the project team keep in mind?
· Are there any ethical or cultural considerations?
· What impact will there be to the employees if processes and/or systems are changed?
· What impact will there be on the workplace?
Approach to Developing this Section
Consider the system being proposed and the organization in the case study, and identify three issues that have not previously been discussed in the business case. Consider the questions above, as needed, to assist in the analysis. Section XI, XII, XIII: Risk Management & Risk Matrix, Security, Additional Implementation Issues
IFSM 495: Capstone Course
December 5, 2021
I. Background and Environmental Analysis
Trusty Carpets is a successful family-owned business that has been operating from a single location for the past 20 years. Currently, total carpet sales is in the ballpark of $1.2 million annually, with a net profit of $100,000. The business is poised for major growth through the recent acquisition of Metro Carpets, a business located on the other side of town that sees $3 million in sales annually with a profit of $360,000. Additionally, Trusty Carpets will be combining operations with their previously contracted carpet installer.
The original location has basic existing IT infrastructure to aid with sales and ordering, the new location does not. A technology solution is required to manage two separate locations and the installation operation as a single business. The targeted solution will also enable increased sales through an online presence that connects Trusty Carpets with home builders, and directly with consumers via in-home sales. The primary business objective is increased profit margins, while ensuring that Trusty Carpets is operating in an environmentally friendly manner.
B. Environmental Analysis
There is a rising number of residential and commercial construction activities in numerous countries globally indicating a boost in growth in the global rugs and carpet industry. This coupled with an increasing focus in aesthetically pleasing interior decor and a shift toward environmentally friendly carpets, is further driving market revenue growth. Currently, the global carpets and rugs market is projected to hit $164 billion by 2028. Other stats indicative of this growth include nylon material accounting for the largest revenue share of 32.5% in 2020, with North America owning major revenue share followed by the Asia Pacific market (Global Carpets and Rugs Market Size, 2020). COVID-19 has also been a stressor in this industry, stunting the construction of housing and building projects and in turn limiting the purchasing of carpet tile flooring and a subset of services. With re-openings, increased renovation and remodeling activities in the real estate realm, high consumer interest in interior decor, and revamping of commercial buildings (Carpet Tiles Market, 2021), there is an increased post-COVID need for the carpet tile services, which expose great business opportunities for Trusty Carpets.
Opportunity or Change to Business Vision, Strategy or Objectives
Expansion is a single driving factor for increase in profit margins, Trusty Carpet’s primary business goal. Acquiring Metro Carpets and merging with Mike’s installation company is an exponential step towards that objective. This new business direction presents several opportunities. First, obtaining Metro Carpets presents 50% non-utilized space which can be leveraged to store recyclable carpets before they are picked up, and installation equipment that are otherwise stored in trucks. Having space to store recyclable carpets also means scouting for individuals who would like to dispose of old carpets and offering to facilitate the process, all the while offering Trusty Carpets as replacements. In light of finding customers, the enterprise can leverage the digital space for marketing and e-commerce efforts. Otherwise, in-person outreach can include attending niched events including but not limited to real estate conventions and establishing partnerships with interior design showcases like those at IKEA, or local home improvement vendors to aid in promoting/selling Trusty carpets.
Expanding also indicates recruiting more employees and obtaining an adept information system that will handle data/information generated from billing, accounting, HR, business partnerships, supply chain logistics, e-commerce management, and marketing efforts. This system must ensure privacy and security of data, while maintaining downtimes, and offering mobility, speed, and efficiency. These will help optimize current business processes and technology.
Inefficient Business Processes or Technology
Currently, Trusty Carpets utilizes the local paper for its advertising and marketing efforts, which proves inefficient especially as the pandemic accelerated digital transformation by 3 to 7 years in just months (Boulton, 2021). Trusty Carpet’s accountant handles all paperwork as well as processes relating to finances, bill payments, invoice distribution, payment collection, and payroll. This can be overwhelming and lead to errors. Transferring the workload to the new information billing system will help, and the accountant can own managerial tasks like overseeing processes and performing quality control. Order forms will also need to be managed by the system, as well as all customer records and handwritten ledges generated by Metro Carpets. Carol handles the bookkeeping which is organized but paper-based; these records should be stored in the cloud for backup, additional security, and ease of access. Mike currently runs his installation business from home and stores equipment in trucks. Leveraging the additional space acquired, installation services can be moved onsite.
New Technology Trends
Carpets still continue to be trendy despite the rise in popularity for hardwood floors; and technology is being used to improve their beauty and durability. Manufacturing remains constant with the standard principle of fiber being woven or tufted into a roll of modular-backed finished product (Morris, 2021). Aesthetic ability in regard to color, texture and pattern are controlled to match a disposable mentality among consumers to keep the margin between carpet and hardwood floors thin. Design-capable tufting machines have allowed for more decorative and comfortable/”soft” modular carpets. Multiple-dye technologies help to achieve better blended coloration. Antimicrobial technologies help eliminate damaging microbial growth without compromising aesthetics and functionality (Ryan, 2020). Eco-friendly carpets are being manufactured by materials like recycling plastic bottles all to protect occupants and the environment (Morris, 2021).
Commercial or Operational Trends
Operational efficiency is an important aspect of ensuring commercial and industrial activities result in value and profitability. Operational efficiency and best business practices are essential in the carpet industry. Companies are absorbing and implementing operational efficiency as well as best practices which in turn provide them with a competitive advantage in the industry. Trusty Carpets should design its operations so that they are efficient, environmentally friendly, customer oriented, technologically advanced, and profitable.
New or Better Products & Technologies
There are other competitors in the carpeting industry, and Trusty Carpets is not a unique firm. Jerry will be required to maintain a competitive advantage, which will be accomplished through an investigation of the enterprise’s information technology infrastructure. A large number of small firms have made the transition away from paper bookkeeping, payments, billing, invoicing, and inventory management practices (Silva, Filho, & Fontoura, 2020). These companies have discovered that deploying an information technology system that automates these operations is considerably more effective, accurate, and saves money and resources. Additionally, businesses have discovered that advertising online, whether through a website or social media, reaches a greater number of potential customers than any other form of marketing.
The latest technological advances, such as social media, have made advertising considerably easier, cheaper, and more effective in terms of reaching a wider audience in a shorter amount of time. Many competitors are using social media, allowing them to easily reach a larger audience of young people who are looking to purchase the latest trends in carpet manufacturing. Trusty Carpets can leverage social media – Facebook, Twitter, Instagram, and other platforms – to quickly reach this technologically savvy segment of the population.
Changes to Statutory Legislative or Other Environmental Requirements
The environmental rules and policies may need to be revised. As a result, the government may alter policies in order to better safeguard the environment. These rules frequently lead to new regulations governing company activities. Existing laws and policies may also be revised or updated by the government.
Ignorance of the law is not an acceptable justification for breaking the law. It is Trusty Carpet’s obligation to keep up to date on environmental laws, rules, and regulations that apply to its particular industry and firm. Trusty Carpets should create a Compliance Management System (CMS) to ensure that they are in compliance. (Dittmers, 2018). A CMS is used to manage the risk associated with new legislation and changes in the marketplace. Incorporating requirements into business processes, conducting operations reviews to guarantee adherence to requirements, developing corrective action plans, and updating materials are all made possible through the use of a CMS.
II. Problem Analysis
A. Business Problem
Trusty Carpets’ has an immediate need to select and implement an IT infrastructure solution or system that enables the management of two separate brick-and-mortar locations and the installation operation as a single business. The existing IT solution only services one location and the new location on the other side of town operates with non-digitized legacy business processes. The recent acquisition of Metro Carpets and expansion of the business exacerbates a problem that already existed: Inefficient processes lead to poor profit margins, this being the chief business problem that a new solution will address, in addition to facilitating online sales, establishing home builder contacts, in-home sales and environmentally responsible carpet disposal. The business is currently negatively affected financially, which will be compounded operationally with the expansion and operation of two disparate locations that are not connected by and managed within a single system that must unify the ledger of both entities. DynaTech recommends an aggressive timeline of 4 months for system selection and implementation.
III. Proposed Solution
Trusty Carpets has several separate programs that handle finance, inventory, sales, marketing, payroll, and customer relations; fragmented data should be streamlined to ensure enterprise decision-making is data driven. A good ERP option is Oracle’s NetSuite. It is cost effective, easy to use, customizable, secure and offers support services.
Oracle’s NetSuite is a cloud-based business management platform that gives companies tools needed to nurture growth and efficiently run their businesses. Enterprise Resource Planning (ERP) tools offered include applications for finance, supply chain management, customer relationship management (CRM), human resources, ecommerce, inventory, order, procurement, payroll and more; all of which are needed in the merging of Trusty Carpets and Metro Carpets. With a centralized data source, information inputted across the system updates in real-time allowing authorized users to access the most accurate information on demand. NetSuite uses the SaaS model where a subscription fee is paid to access the platform, but system maintenance and management of the platform is owned by the vendor, Oracle. With an established LAN for Trusty carpets and a WAN to support the connectivity of the additional site at Metro Carpets, the enterprise is set to support the implementation of NetSuite. This acquisition will provide a unified view of the business bringing together disparate systems, bookkeeping tasks will be automated, the complexity of managing invoicing, billing and subscriptions will be simplified, inventory will be centralized, and Salesforce automation will help to manage leads(McCue, 2021). Capabilities with NetSuite are endless as required by Trusty Carpets.
IV. Expected Improvements
The modern economic landscape indicates a business need for Management Information Systems and solutions. These can be presented in the forms of infrastructure, platform, or software that can be built-in or outsourced to enable small businesses to operate like enterprise-scale businesses (Gratch, 2015). Since Trusty Carpets is a small start-up with an in-house IT infrastructure and an expansion underway, it would benefit greatly from an Enterprise Resource Planning (ERP) system which would be outsourced and hosted on the cloud. Therefore, it is important when acquiring ERP that only features needed by the carpet retailer like CRM, web hosting, ecommerce platform, etc. are obtained.
The proposed solution, NetSuite, can address ineffective business processes in finance management, operations, and customer relationship optimization all of which will lead to increases in profit. The software’s financial management solution will help manage bookkeeping tasks by automatically updating ledgers. Accounts receivable, payable, and invoices will be tracked efficiently – previous methods used that were manual and at risk of human error will be replaced. The solution will provide a single view of inventory, streamlining data relating to carpets and equipment’ stock. Order processing will be automated and fulfilled across channels, helping to manage the ordering lifecycle. With a 360-view of customers, the lead-to-cash process will be sped up as critical customer data like sales history and active support cases are consolidated. Forecasting tools provided by the solution will be used to predict future sales, and the customer experience will be personalized. These are in line with the strategy of the business since its main aim is to go digital and generate greater revenue. Lastly, value gained by the organization will aid with the cost of production of the carpets which will in-turn decrease, hence more profit.
V. Alternatives Analysis
The following alternative analysis information exposes four options that Trusty Carpets may adopt moving forward regarding IT infrastructure and related business processes. The status quo, proposed solution, different solution and process change are further detailed by description, benefits, cost elements, feasibility, risks and defining issues. These attributes are compared in a matrix and finally a justification is provided regarding which system is selected.
A. Status Quo
1. Description: Do nothing, continue existing basic IT workflow with google docs at the original store, and non-IT processes at the new store while advertising in the local paper.
2. Benefits: No new capital investment or monthly fees, however no problems from section II are addressed.
3. Cost Elements: No additional cost.
4. Feasibility: Not feasible while attempting to manage the entire business with one solution in addition to seeking increased profit margins.
5. Risks: Discontinuity between store finances, inventory, lost sales and the same (or worse) decreased profit margins.
6. Defining Issues: Does not allow for the management of separate locations and the installation business. Does not establish an online presence for marketing and business communications. Does not address carpet recycling requirements.
B. The Proposed Solution (NetSuite ERP)
1. Description: Oracle’s NetSuite is a cloud-based ERP offering applications for finance, supply chain management, CRM, human resources (HR), ecommerce, inventory, order, procurement, payroll and more.
2. Benefits: Centralized finances, inventory and asset management. A low cost, scalable solution that enables the creation of new efficient business processes in addition to online marketing.
3. Cost Elements:
a) ERP System Implementation $14,000
b) Monthly ERP subscription: $18,000
c) Monthly ISP subscription at the new location: $69
d) 5x Tablet PC’s for Metro Carpet Sales & Warehouse staff: $2,000
e) 2x Notebook PC’s: $1,000
f) 2x Smartphones: $600 + $30 monthly data plans
4. Feasibility: Extremely feasible, ERP adoption for small business is streamlined for ease. Costs are negligible, as an increase in just 1% profit margin represents tens of thousands of dollars in revenue gains for the newly combined business operation.
5. Risks: Internet access – required for cloud access, this can be mitigated with a redundant system like cellular hotspot use. Information Security – company data is protected to the highest level of Confidentiality and Integrity by Oracle’s industry leading security practices – however, there is always risk that data can be compromised in the cloud. Personnel adaptability – Metro Carpets employees are coming from a no-IT business process environment, are they up to the challenge in adopting a new solution?
6. Defining Issues: Centralizes data for management of the business as a whole, ubiquitous access, scales to meet the needs of Trusty Carpets, cost effective, introduces process efficiencies, vendor managed (no in-house development or maintenance).
C. A Different Solution (Metro Carpets IT Update)
1. Description: Connecting the new Metro Carpets location to the internet via ISP, establish a WiFi with a router and leverage existing google docs
2. Benefits: Improves upon existing legacy, manual processes being conducted at the Metro Carpets location, enables faster invoicing for sales and inventory purchase. Likely to have a small impact on the profit margins at the Metro Carpets location.
3. Cost Elements
a) $100 Monthly ISP subscription at the new location
b) 5x Tablets for Metro Carpet Sales & Warehouse staff: $2,000
c) Scanner/Fax/Printer (all-in-one) $1,500
4. Feasibility: Highly feasible, the existing infrastructure and processes at the main store were implemented by an existing employee, it’s essentially a replication of the footprint.
5. Risks: Organizational – Metro Carpets personnel unfamiliarity with technology, IT – Internet access is required for cloud access, this can be mitigated with a redundant system like cellular hotspot use. Financial – missed profits.
6. Defining Issues: This solution does not address management of the enterprise, will likely not increase profit margins and will not address poor marketing strategy.
D. A Process Change (Reconciliation)
1. Description: Reconciliation of sales, ordering and inventory at the close of each business day.
2. Benefits: Provides a consolidated picture of the enterprise ledger, albeit not in real time. May also contribute to better situational awareness of what inventory is on hand.
3. Cost Elements: None
4. Feasibility: Feasible, the only delineating factor is employee time spent delivering and consolidating records.
5. Risks: Time – human error is likely when combining records, resulting in lost time. Organizational – time spent on this process will encumber existing personnel. Financial – missed opportunities to increase profit margin.
6. Defining Issues: This solution does not address management of the enterprise, will likely not increase profit margins and will not address poor marketing strategy.
E. Comparison of Alternatives
The comparative analysis matrix plainly states the positive and negative aspects of each possible solution:
Trusty Carpets Alternatives Analysis Matrix
Name of Alternative
No added cost
No Organizational, Financial or IT improvement.
Organizational, Financial and IT improvement.
User hesitation, added cost, data security.
Metro Carpets IT Update
No Financial or Organizational improvement, added cost
No IT or Financial Improvement.
Selection of the NetSuite ERP is justified through the following primary reasons: It enables a holistic view of the business through integrated finance & asset management, a by-product of which is the ability to track carpet skews in warehouses, allocating space for recycled carpet. It is also the only solution that modernizes Trusty Carpet’s IT infrastructure, instantiating the online presence required to boost sales and customer relationships to realize enhanced profit margins. While this solution comes with some risk, the investment in equipment, an ERP subscription and training for personnel strategically align IT and business strategic objectives.
VI. Feasibility Analysis
Understanding organizational readiness to address the root causes of problems means understanding how to solve complex problems (Sebastian-Coleman, 2013). Trusty Carpet should therefore have processes and people in place to coordinate the efforts and communicate changes (Greeff & Ghoshal, 2004). Trusty Carpets is a small business looking to expand their IT infrastructure and streamline their current business processes. The proposed solution is to implement an ERP solution using Oracle’s NetSuite by benefiting its feasibility based on time, cost and staffing. As we’ve identified pain points in our previous sections, Trusty Carpet now has the ability to implement this solution and understand the benefits. Integrating an ERP system into the current business process will help address and support their growing business. A feasibility analysis will be conducted to evaluate Trusty Carpet’s potential for success and will be examined in the following areas: economic/financial, organizational/operational, and technical feasibility (Simplilearn, 2021).
A. Economical/Financial Feasibility
With the current business model, Trusty Carpets sells about 250,000 square feet of carpet a year (70% of it is mid-grade carpet and padding) for sales of about $1.2 million. With the recent changes and expansion, Metro Carpets generates about $3 million in annual sales at a 12% profit. The proposed agile business solution provides positive economic benefits to Trusty Carpets. The estimated project income and expenses to implement NetSuite’s ERP system is cost-effective, scales rapidly and prepares Trusty Carpets for long term growth (NetSuite.com, 2021).
Oracle’s NetSuite ERP solution provides flexibility with startup implementation costs. They offer subscription services where users can subscribe for an annual license fee (Netsuite.com, 2021). NetSuite quotes, “Your license is made up of three main components: core platform, optional modules and the number of users and there is also a one-time implementation fee for initial setup.” NetSuite’s ERP system is cloud based and modular so that you can purchase additional licenses and modules as Trusty Carpets grows their business. Lastly, by implementing NetSuite best practices, Trusty Carpets has the financial capability to accommodate growth and strategize to increase sales. With reduced operating expenses, assessed resource allocation and increased projected revenue, Trusty Carpets should start recovering costs of the implementation within 6-24 months.
B. Organizational/Operational Feasibility
NetSuite is an industry leader in cloud ERP and is trusted by start-ups and household-name enterprises across various industries. Its primary role is consolidating disparate data across functional areas in a business. Therefore, core functions in the finance, inventory, procurement, and accounting departments at Trusty and Metro carpets will be merged and managed using a common database. Centralizing the data sources will allow for real-time information updates. Access will be authorized to cross-functional teams including Ann in Sales, Mike in Installations, Ben in IT, and Carol in accounting. Using NetSuite, processes that support the expansion along with increased internet sales and environmental responsibility will be automated resulting in increased efficiency.
Trusty Carpets has a standard IT infrastructure in place consisting of LAN and internet access, enough to support the integration of NetSuite into current business processes. The solution can easily be accessed from a browser using any device with connectivity – salesmen using tablets to check carpet inventory can continue to do so; stored and shared Google order forms can continue to be utilized as needed. The significant shift in processes would be through transferring such data to the ERP portal so they are readily available in real time by authorized users.
Staff expansion would be necessary to maintain the merger with Metro Carpets, oversee system processes, analyze data reports and leverage reports to fuel business intelligence. The sales team will benefit from additional staff with monitoring inventory and coordinating installations. Unless this is outsourced, a team of marketers will be needed to own marketing efforts especially as it will transition digitally. The merger will indicate more paperwork for accounting and increased necessary manpower. And managing a WAN will mean employing and training more tech support specialists. NetSuite supports a single sign-on portal and offers drag-and-drop tools, all of which underpin usability and reduces friction with employee training.
C. Technical Feasibility
System capabilities are at the forefront of technical feasibility. Exploring whether the software is equipped with features needed to enable the business prior to procurement is critical. NetSuite’s cloud platform is dynamic in that it allows clients to tailor the system capabilities exactly to their needs and customers have the flexibility now and in the future as business challenges shift. The solution offers the following application and developer tools: Customization with drag and drop options plus the ability to create custom fields, records, and roles. Process automation allows the enterprise to automate approvals for purchase orders and sales discounts among others. Integration is enabled so that data flows smoothly from NetSuite to outside software applications. With internalization, an environment is created where teams can easily leverage the system despite language, local tax and accounting rules. With health dashboards, there is visibility into system performance so that business continuity is insured and users are kept productive.
Because of the lack of servers to set up and devices to configure, implementing NetSuite is quick and straightforward through its SuiteSuccess Implementation methodology. This is an approach that tailor’s implementation to the business based on its industry (and the solution serves various industries including but not limited to retail, manufacturing, and software.) Through the program, there is faster deployment of less than 100 days and rapid time-to-value which fuels increased employee adoption and success for businesses. There is also a team of readily available consultants to guide Trusty Carpets as it maneuvers through change management.
VII. Requirements Checklist
The following requirements specifications define expectations that the proposed system is expected to fulfill. Functional, Data, Technical and Security requirements are established to ensure the proposed system meets the needs of Trusty Carpet’s growing enterprise.
A. Functional Requirements
1. The system must enable the management of disparate business units as a whole.
2. The system must help to establish relationships with new home builders.
3. The system must support increased sales.
4. The system must enable in-home sales.
5. The system must track warehouse inventory for carpet recycling.
B. Data Requirements
1. The system must support a synchronized database.
2. The system must support sales invoice input.
3. The system must accommodate three tiers of carpet inventory (bottom grade, mid grade and top-of-the-line).
4. The system must manage customer account information.
5. The system must handle carpet measurement input.
C. Technical Requirements
1. The system must provide redundant access.
2. The system must ensure data back-ups.
3. The system must instantiate an Ecommerce presence for internet sales.
4. The system must establish a CRM portal.
5. The system must be accessible to remote users.
D. Security Requirements
1. The system must be protected by multi-factor authentication.
2. The system must require the use of strong passwords.
3. The system must employ communication encryption standards.
4. The system must protect Trusty Carpets client PII.
5. The system must protect Trusty Carpets financial information.
VIII. Context Diagram
The context diagram is a useful data model which aids in documenting functionalities of the information system as they relate to NetSuite System users. Defined by functional, data, technical and security requirements, the solution is able to receive inputs from departments, store data, process data, and generate outputs accordingly. Data flows smoothly through the system, adapting to changing business needs/requests, and generally empowering Trusty Carpets as it brings together disparate systems and expands its customer base. The context diagram is located in appendix A below.
IX. Project Management
A. The advancements in information technology have radically transformed the ways in which businesses operate. Firms that plan to expand their geographical operations, for instance, require integrated technology tools to improve their operational efficiency. Trusty Carpets is a family-owned enterprise that has been running a single retail outlet for two decades. However, it plans to …