Transcript stoneybootsbigcasefinal

STONEY BOOTS, INC
Delivered By: OU MIS Consulting Team 5
Group Members: Melissa Nevolis, Ryan Luggen, Tyler Wilson, Jay
Mazzarella
Delivered To: Dr. McGann and Tyler Doehr
1
3
Current State Analysis
4
Process Areas
Recommendation #1 – Enterprise Resource Planning (NetSuite)
TABLE OF CONTENTS
Executive Summary
5-6
8-15
Recommendation # 2 – User Training and Incentives
16-19
Recommendation #3- Ipad Application
20-22
Summary of Recommendations - Strategic Goals
23
To – Be Process Flows
24
Project Timeline
25
Project Financials
26
Conclusion
27
Appendix A – Epicor Supplemental Information
28-29
Appendix B – Application Diagrams
30-32
Work Cited
33-34
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EXECUTIVE SUMMARY
Executive Summary
Stoney Boots Inc. manufactures and sells custom boots to retailers across the globe. Their CEO, Sean McGann, realized the
company was not operating at full capacity and sought a IT consulting firm to develop the company into an industry leader. He
needed someone who could improve the following four areas:
• Internal Enterprise Process
• Customer Facing Process
• Customer Side Supply Chain Process
• Supplier Side Supply Chain Process
OU MIS Consulting researched the company and developed the following known issues list:
• Missing Centralized System – Each branch has separate systems that did not automatically communicate.
• Branch Communication Issues – Current system Lotus Notes failed during implementation
• Lack of technology – No current web or social media presence
• Documentation – Separate storage of paper invoices for individual branches
• Customer Service – Only has a call center that is open only during business hours
• Manual Error – Subject to data entry errors by employees
To address these problems OU MIS Consulting has recommended the following:
• Enterprise Resource Planning/CRM/Commerce System– The ERP system will centralize all of Stoney Boots’
current business operations. It will allow each branch to process orders simultaneously, thus confronting any
customer/supplier supply chain process problems. The CRM system allows for increased communication with the
customer at a more optimal level. The Commerce System is able to tie all ERP and CRM processes together so
that an integrated system is produced. Websites and other functional tools can be created with this package.
• Training Program – by offering a training program Stoney Boots will be able to implement the before mentioned
systems with the help of outside consultants. By encouraging employees to learn the system Stoney Boots will
retain current employees and give them incentive to learn the new one.
• Ipad Application – This will allow for the salesperson to use during sales calls and face to face interaction. It is
an internal application that can also be used externally by interaction with the customer.
OU MIS Consulting believes that with these recommendations Stoney Boots will be able to achieve increased revenues, be able
to cut costs, improve customer service and retention and develop into a leading IT manufacturer.
3
CURRENT STATE ANALYSIS
Sales & Distribution
Currently, the sales representatives have to check the inventory
before making a sale. Once they do make a sell, the sales
representative send the order via Email or phone to the Customer
Care Teams.
The Customer Care Team receives the order and enters it manually
into the Sales System database. Then, twice a day that database is
synched up with the Distribution System’s database.
Once the Distribution System synchronizes the order, the workers
pick, pack and ship the orders from the Durango distribution
center. At which point, the workers key the shipment information
and update the inventory level into the Distribution System.
At the end of the day, a program is ran to up date the Sales System
with the Distribution System. This allows the Sales representatives
to receive an accurate inventory report. The warehouse managers
at this time also run Raw Materials and WIPI (Work-In-ProgressInventory) to help identify where finished goods need to be
transferred and the stock level of raw materials at all plants . This
report is then sent to a manager who forms a production schedule
in excel.
By the end of the week, the information from Raw Materials and
WIPI are sent to a manager who sends a purchase order to the
vendors by email or fax.
Manual
Entry
Inefficiencies
& Errors
Separate
Databases
*A general outline of the AS-IS process can be see in Appemdix A
Customer Care & Accounting
Web & Communication
Each team member of the Customer Care handles a bank of
phones for customer complaints from 9AM-5PM. When they
are not on the phone, they do data entry or respond to hand
written complaints.
For Accounting, the payroll runs twice a week and the
AP/AR are entered into a Great Plains, which comes from a
week old invoices from other departments
Currently, the website is not working and is ran by a third
party provider.
All communication to other departments is hand written or
word processed and sent through the mailroom.
Communication by email is done through AOL.
Communications overseas is handled by telephone or fax and
backed by a written copy, which is sent by mail.
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Customer Facing Process
Stoney’s current internal process involves the combination of
several disjointed systems. The reason for the company’s
lack of continuity can be related to the mergers and
acquisitions that Stoney completed in order to expand
business. Unfortunately, the systems they inherited from
these expenditures has lead to data being moved inefficiently
across the company. Their manufacturing plants , including
those in Mexico and South Korea are relying on information
to be manually placed into a 20 year old “Sales System”.
With sales being the most important step to starting the
manufacturing process, the functional areas have to wait for
the processing of untimely data. Order fulfillment ‘s
“Distribution System” is only being updated twice daily and
doesn’t have the ability to automatically transfer data to the
finished goods manufacturing sector. Lastly, All of the
financial information being produced by these functional
areas are sorted out through manual entry into Stoney’s Great
Plains Accounting Package. Other departmental areas
functions are also being completed by hand or in wordprocessed documents. Stoney’s annual report states that the
company plans to maintain performance in the coming years.
With 2011 resulting in a 5.3% loss in income due to
operations, it is clear that the internal enterprise process
needs to be cleaned up. Getting all the functional areas
connected and receiving efficient data on a timely basis will
go a long way in bettering Stoney ‘s overall business and will
lead to satisfied shareholders.
Customers of Stoney Boots are sporting good stores, outdoor
specialty stores, mail order catalogs, retail uniform stores,
and independent retail stores. Some of the companies biggest
customers includes Cabela’s, Bass Bro Shops, and Dicks
Clothing and Sporting Goods. Stoney offers products that
fall under two categories. They are ToughGuy and SmartGuy
footwear. Wholesales customers can purchase either one of
both of Stoney’s brand boots in bulk. Stoney finds new
customers through print advertisement, tradeshows, and
product packaging. The company has 45 sales representatives
working throughout Canada and the United States. Stoney
looks to satisfy the customer needs through ideas they
receive from tradeshows, customers, and suppliers. Demand
for products and advertisement success is measured by
keeping track of calls they receive from different numbers
that are listed on each individual advertisement. Sales
forecasts for each product are calculated by employees
within Stoney’s company. Stoney’s rough sales forecasts can
lead to a shortage or surplus of inventory which directly
affects the carrying cost of inventory. Customers place orders
by speaking with sales representatives who then contact the
Durango distribution center about the order. In order to keep
growing their customer base, Stoney will need to improve
their current process and relationship with current and
potential customers
PROCESS AREA INFORMATION
Internal Enterprise Process
5
Supplier Side Supply Chain Process
The supply chain for customers starts with finding interest in
Stoney’s Brand’s products. This interest sparked by the
wholesaler is then pursued by a Stoney’s sales member who
is available to meet the customers needs. Once the customer
is given the breakdown of the product availability and the
pricing, they put in a sales order with the sales personnel.
This sales personnel then makes a phone call or emails the
main Stoney plant in Durango. From here customer care
places the order into the “Sales System”. Once this data is
entered, the customer is given their date of delivery that is
based on the reports run each day by warehouse managers
and information processed by the Distribution System. The
customer then must wait for the internal process to run its
course. Once Stoney’s accounting department receives the
customer’s invoice at the end of the week, they then notify
the customer of their account payable. The payment is then
made to the accounting department and processed through
the Great Plains accounting package. Customers procure
these items through shipment and any service or follow up is
handled by the Stoney representative responsible for the sale.
This supply chain process has many unclear steps and leaves
customers with a lot to be desired. In order to continually
satisfy their clientele, Stoney must make improvements in
providing customers with timely and detailed information.
Suppliers of raw materials to Stoney boots are easily
interchangeable , except for the waterproof material GORETEX. The process for suppliers begins with dropping off raw
materials to Stoney boots. These raw materials are kept track
of through the Raw Materials program that generates a report
for each manufacturing warehouse. Inventory is also tracked
through a program called WIPI that identifies finished goods.
Both of these reports are sent to a plant manager in Durango.
The Durango manager then manually enters the report
information into an Access database which allows the
manager to assess the next order of raw materials. A
manager then notifies the suppliers through email or fax on
what materials are needed . The distribution system and the
Access system in Durango also have safety stock levels that
trigger when stock needs to be replenished. Once suppliers
receive the information, the whole process starts over again.
The supplier process is completely controlled by Stoney
Boots. This is due to the fact that there are so many
companies producing the same quality of raw materials. The
competitive advantage that Stoney has its licensing
agreement with GORE-TEX. If the company doesn’t make
changes to this process by providing suppliers with more
detailed information on inventory, this licensing could be lost
along with their competitive advantage.
PROCESS AREA INFORMATION
Customer Side Supply Chain Process
6
AS-IS PROCESS FLOW
7
To combat Stoney Boots dis-jointed systems, OU MIS Consulting
plans to switch the company over to an enterprise resource
planning, ERP, system. As stated before, this system is designed to
combine each department of a company into a central system.
Currently Stoney Boots has multiple independent systems which
the ERP system will eventually discontinue. To start, ERP systems
have integrated sales invoices and capabilities that will
discontinue the Sales System. From there, the ERP system will
forward this invoice to order fulfillment, thus ending the need of
the current distribution system. The system will then
automatically info the other departments, as a result the raw
materials, WIPI, excel and access database systems will no longer
be needed. Up-to-date ERP come with financial application, giving
Stoney Boots the option to terminate the Great Plains system. The
ERP will also address customer care issues.
Collaboration
Discontinued Systems
Sales System
Distribution System
Raw Materials
WIPI
Great Plains
Customer Care
Expectations
Stoney
Boots
IT Staff
OVERVIEW OF ERP SOLUTIONS
Recommendation: Enterprise Resource Planning
Vendor
Two of the main areas of concern for implementing a new system
are cost and time. Companies want to be able to convert to a
system in a timely manner without incurring high costs. To
achieve this all three parts of the change need to work in
accordance. The three major sides of implementation are the
company, the vendor and the integrated IT staff. In this case,
Stoney Boots, whichever vendor we choose and the integrated IT
staff needs to effectively communicate to attain a successful
implementation. Stoney Boots must inform the vendor their
company requirements and expectations for the system. And
when the vendor explains their programs capabilities Stoney Boots
needs to understand to work with them. Neither part can expect
something out of the capabilities of the other. Once each part fully
understands their role, implementation will be smooth.
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One option OU MIS Consulting is considering is an Epicor ERP inhouse system. This all in one system offers companies many
additional features, including: Accounting, Business Intelligence,
Customer Relationship Management, Human Resources, Inventory
Management, Manufacturing, Supply Chain Management. Epicor’s
ERP system is a SOA architecture, meaning Stoney Boots can pick
and choose which aspects of the ERP system they wish to
implement into their company. This system will cover most of
Stoney Boot’s organizational needs, the accounting allows them to
keep balance sheets and report sales and income statements. The
business intelligence allows them to analyze and report business
data. Customer Relationship Management ensures high customer
satisfaction and retention. The Human Resource department
evaluates employee production. Inventory management can
control inventory levels and provide better inventory turnover
rates. The Supply Chain Management allows Stoney Boots to track
their shipments to distribution channels.
This implementation would happen in-house at the different
Stoney Boot’s locations. The integrated IT team would install the
ERP program on each computer and continually train users. Epicor
leases its ERP license for $5,000 to $500,000. Based on similar
company’s technology needs, we’ve estimated this license to cost
approximately $100,000. While the cost to implement a ERP
varies, we’ve predicted Stoney Boots to pay $400,000, based on
companies of similar size. (Kanaracus, Chris) Epicor’s policy states
that the estimated cost of implementing will not exceed 10% of
that estimate.
For full Epicor ERP system information, see Appendix C. (Epicor
ERP.com)
EPICOR – IN HOUSE SOLUTION
Epicor
Costs
$400,000
$100,000
• Implementation
and Training
• Licensing Fee
Timeline
8 Months
• 65%
10 Months
• 25%
12 Months
• 10%
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Cons
Epicor’s ERP offers all-in-one capabilities, with integration across
company branches. By purchasing the license to Epicor, Stoney
Boots is free to adapt the system as they wish. Stoney Boots is
free to integrate this system with other software as its sees
necessary. The purchase of the ERP system offers the company
the flexibility to customize the system as needed. Because of this
customization, companies are given more control of their system.
This allows a company to change the software to fit the business
process rather the change the business process to fit the software.
Accessibility access does not require internet connection, which
offers better access given your servers are working correctly.
With traditional in-house ERP systems, implementation can take a
significantly long time. Implementation takes longer because each
computer must have the software uploaded to it. Then the
employees must go through training before the system can fully
be implemented. Traditional ERP systems have high initial
investment costs. There is also the cost for training, which may be
from the vendors or internal super users. Epicor’s ERP will require
company maintainence costs which means staffing IT employees.
All this amounts a great deal of complexity, teaching each
employee how to use the system and then maintaining the
system. When the system malfunctions, it is up to Stoney Boots to
fix the problem.
EPIOCR PROS AND CONS
Pros
ERP Priorities
Based on research of the traditional ERP in-house systems versus
Software as a Service, OU MIS Consulting recommends that
Stoney Boots focus on a cloud computing service. Traditional ERP
systems take longer than SaaS ERP systems and with the goal of
100 million to 300 million revenue by 5 years, this system fits
better with the company’s goal. With earlier implementation,
Stoney Boots is intended to see increases sales. Traditional ERP
systems are built for 1,000+ users, where Stoney Boots only needs
60 users. The cloud system also helps cost by eliminating the need
for full time IT maintenance staff. Lastly, the online interface will
be more familiar to current employees and help for a smoother
transition. The next section will discuss Netsuite, our software as a
service ERP recommendation for Stoney Boots.
Pros
Cons
Flexibility
Training
Customization
Maintenance
Integration
IT Staffing
Accessibility
Complexity
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NetSuite Cloud Solution
2
Recommendation 3
RECOMMENDATION 1
Recommendation
NetSuite is considered the number one cloud based system that is used by more than 12,000 companies. It is a
Software-as-a-solution type package that is cheaper than most in house ERP systems due to the lack of hardware and
software costs. Gartner predicted that “At year-end 2016, more than 50 percent of Global 1000 companies will have
stored customer-sensitive data in the public cloud.” (C,2012). Cloud computing has been growing in the last decade but
with hesitance due to the potential insecurity of where information is being stored.
By integrating the Accounting/ ERP, CRM and SuiteCommerce packages
into one solution, Stoney Boots will be able to address many of it’s issues
with the current system. Each system is a different package and needs to be
added on to the ERP system. Many sub packages can be added on to the
main ERP package and can be fit to a companies exact needs. If an area is
not needed for a particular company, it can be removed or can be
manipulated to fit their needs. (NetSuite, 2012)
Almost anything can be added into NetSuite’s backbone. An example
of this is to integrate all users emails to the NetSuite site. This way
users do not have to open another window to constantly check their
emails. Instant notification will be sent to the customer when an email
is received just like any service. Any email service can be used
including Exchange. Any email software can be set up with a set of
email domains for each employee, then transferred over to the NetSuite
software. The use of the Lotus Notes license will not be needed due to
being able to have a free provider online. A company called Blue
Bridge demonstrates how their email operates through the use of
NetSuite. (Ryan, 2011)
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NetSuite SuiteCommerce
NetSuite CRM+
The NetSuite ERP package is the
basic underlying tool to run many
basic aspects of a corporation. It is a
Cloud based tool that offers features
such as financial management,
Supply chain and inventory
management, order and billing
management, Shipping and
fulfillment, financial analytics and
reporting, and many others.
This package is the platform that will connect
a companies ERP system with its CRM
system.
The use of adding this package is focused on
creating ease and comfort for the customers
throughout their purchase orders. A website
can be created through this package, which
would benefit Stoney Boot’s unavailable
website currently. The Portal sites are the best
way for employees and customers to stay in
constant contact. Information in the portal
website can be edited for each customer
depending on their needs. Customers will be
able to access previous orders and other
features.
This package, also known as Customer
Relationship Management, interties with
some of the capabilities of the NetSuite
SuiteCommerce package. It has
capabilities such as Sales Force
Automation, customer Service
Management, Partner Relationship
Management, Marketing Automation,
Analytics and Reporting off of the CRM,
and the use of mobile devices to run Net
Suite.
The Customer Service Management tool
is a vital element to this package. It
allows current support teams at the
company to continue with the company.
There are many mediums that can be
used to respond to tickets that are
submitted by customers such as phone,
email, and chat box options on the
website. It allows for the service
representatives to have a wealth of
information in front of them to answer all
and any question. (NetSuite, 2012)
Benefits:
1) Real Time Reporting
2) Strengthens Procurement
3) Elevates Productivity with anytime
access
4) Drives Decision Making with use
of Dashboards
5) Reduces IT Costs
Benefits:
1) Creation of Web Presence with website
2) Site Navigation/Search functionality for
customers easy browsing
3) Tablet and Mobile Use
4) Contact with customers with creation of
Portal sites
5) Use of Search Engine Optimization
6) International Commerce for continued
growth
7) Business Intelligent Tools
8) Order Management for Customers
10) Inventory Management
Benefits:
1) Streamlining quote-to-order processes
2) 360 degree view of your customers
3) Drives Collaboration with customers
4) Increases customer service productivity
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NETSUITE CLOUD SOLUTION COMPONENTS
NetSuite ERP
Expense(Yearly)
Netsuite ERP Package
- $99.00 for first user, $49.00 for
every extra/month = $2990/month
$35,880
NetSuite CRM+
- $129.00/month per user =
$7740/month
$92,880
NetSuite SuiteCommerce
- $250.00/month per user
=$15,000
$180,000
Possible Additional Costs(Many can be
added or deleted)
- Site Builder Software
- Advanced Inventory
- $500.00/month per user =
$30,000
$360,000
Consulting Cost
$1,169,745
TOTAL
$1,838,505
This represents the financial information for the NetSuite Recommendation. The three top costs are pertinent, as well as
the Consulting Costs to train users. Possible additional is variable due to the necessity of each additional component.
(CRM Exposed, 2009)
FINANCIALS FOR NETSUITE
Items
13
PROS AND CONS/RISKS
PROS
CONS(Risks)
- Low Ownership Costs
- Privacy
- System Upgrades and
Enhancements done by NetSuite
- Possible increase in downtime due to use of
internet access
- Accessible from any device that has
internet access
- Lack of adoption by users
- Fast deployment speed
- Lack of adoption by customers for portal
sites etc.
- No hardware needed on site
- Elimination of IT jobs for the ERP system
-Reduced IT Maintenance Costs
- Single Vendor Relationship due to
integration of all systems
- Increased Customer and Company
contact
- Reduced costs in such areas as
administrative costs (payroll,
administrative, general)
1)
2)
3)
4)
5)
Privacy – All Cloud computing systems have this potential risk due to the system being used through an internet medium.
Also, NetSuite houses all data centers and information for the company at their own buildings. Stoney Boots will not have in
house systems that will house all the critical data to run it’s operations. All information is dispersed to the user through the
use of the cloud.
Downtime Increase – The potential for downtime is higher than an in house ERP solution because it is run through the
internet. If internet connection is down or slow, quality work may not be able to be performed.
Lack of Adoption by Users – The users of the old system may be hesitant to learn and adopt a new way of doing business.
The system may be more technical for the users and it may be easier for them to continue with their old ways.
Lack of Adoption by Customers – Stoney Boots will be purchasing the CRM+ Suite which allows the customization of
portal sites between customers and employees. This allows for constant communication and understanding between both
parties. The risk is that some customers may be unwilling to accept this feature.
Elimination of IT jobs – Stoney Boots will no longer need to have an IT staff to maintain the functioning of the ERP system
due to NetSuite now taking on this responsibility. However, Stoney Boots has a small group of these individuals who did not
have experience in packaged software. The IT team will still be kept and moved to working on questions for employees who
may not fully understand what they are doing and working on the application and keeping it up to date.
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NetSuite CRM+
IMPLEMENTATION - NETSUITE
NetSuite ERP
NetSuite Suite
Commerce
• First area to be
implemented/
backbone
• Most time
consuming due to
amount of
information used
• Outreach to
customers
• Many aspects
implemented in
this stage
• Connects CRM
and ERP
• Linking 2 systems,
not as much time
needed
• 2 months
• 1 month
• 1 month
NetSuite implementation methodology is
called NetSuite One and is shown to the
left. This type of approach can be fit to
any size company and is used through a
phased approach. They are offered by the
NetSuite Professional Services.
(NetSuite,2012). The total time for
implementation is four months to
successfully integrate all aspects of the
NetSuite bundle for Stoney Boots. Due to
the package being a cloud based system,
this explains why the implementation is
so short.
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Training is essential when you are implementing any type of
ERP system. The users must become accepting, comfortable
and proficient with using the new system. This is why we
recommend using the Super User concept because it “has
been proven to increase staff buy-in and proficiency, plus
the sustainability of ERP learning” (ISC Technology, 2010).
Throughout the implementation of the new ERP system,
there will be a need a total of 15 super users assigned
accordingly to each department. On average, super users
spend “50-100% of their time until implementation” on hand
on ERP training, design and testing, which will take
approximately 4 months. Once they are fully trained, they
will be capable to train the end users as well with a ratio of
about 3:1
The use of super users over traditional training can help
achieve the strategic goals of cutting costs by reducing
training overhead costs. (EPI-USE Limited, 2009) In addition,
it allows a company to keep its competitive advantage by
maintaining and critiquing the understanding of the business
processes that may get altered by a third party. Lastly, the
time spent on training the super user stays within the
company and allows for a quick fix when an employee does
not fully understand the new system or it crashes.
Super User Character tics:
Organizational
skills
• Super users must have
organizational skills in order to
manage time of others in terms of
training
Communication
Skills
• A super user must be able to
effectively relay information to
employees
Problem-solving
skills
• A super user needs to quick
problem solving skills to help and
assist with any issues that might
arise when an end-user reaches
difficulties using the new ERP
system
Computer
literacy
• This characteristic is imperative to
speed up the learning curve for
encountering new system processes
Business
Knowledge
• A super user must be well informed
of the departments and/or
company’s business to help reform
and teach new business processes
ISC Technology, 2010 16
RECOMMENDATION 2
Training – Super Users
TRAINING
Implementation & Training
According to the Gartner Group research, if you don’t allocate at least 13% of the project’s costs to training then the project is
three times more likely to fail. However, another research from SAP and JD Edwards more recently showed their average client
spent 3.6% of its IT budget on training (Klee Associates, 2011). According to a study by the Indiana University South Bend, the
average 3 year cost of a consulting training is $1,169,745 that will train the Super Users. This will result in $97,478 per month
and with the project lasting approximately 4 months, that will be a total cost of $389,915. The Super Users can train an average
of 195 employees at the cost of $141,375 a year. This will result in the total cost of about $725 to train one person over a year
and will cost a total of $6,769 for 2.5 months to train 45 people. The estimated total cost of training will be $369,684
(Koenraad Adams , Eric Piazzoni, 2008).
The time associated with the super users teaching the end users can be seen below. The most critical business roles that
include sales, distribution and accounts receivable can take up to 8 weeks worth of training. The less essential roles such as HR
and marketing can be cut down to about a month. The least amount of time that would be needed is with teaching end users
the techniques of reporting. The most time an employee from Stoney Boots will be spending in training is a max of 10 weeks.
Learner Category
Training Process Components
Training Weeks
Critical Business Roles





Process tutorial
Navigation & terminology tutorial
Hands-on classroom process & navigation review
Hands-on job-based classroom with practice labs
Problem solving labs
6-8 weeks
Support Business Roles



Classroom navigation terminology & process overview
Hands-on job based classroom
Practice labs
4-5 weeks
Reporting
 Job aid relating old terms to new terms
 Hands-on report generation classroom or e-learning
2 weeks
ISC Technology, 2010
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INCENTIVES
Incentives & Strategic goals
Gain Sharing
For compliance of the entire Stoney Boot staff, we recommend
offering some type of incentive program in order to adapt to the
new ERP system and attain employees through the change over.
In a study by consulting firm Hay/Mcber 3,871 executives say
there are “six key factors that influence an organization’s working
environment”, which in turn effects performance. The six factors
consist of flexibility, responsibility, standards, commitment,
clarity, and aptness of rewards. (Daniel Goleman, 2000). Rewards
and incentives can help improve an employees performance and
can be measured by improving customer retention.
Gainshairing is used in order to improve and increase higher
involvement and performance within an organization. As
performance improves, employees share financially in the gain
brought about from their performance. “Gainsharing measures
are typically based on operational measures (productivity,
spending, quality, customer service) which are more controllable
by employees rather than organization-wide profits” (Masternak,
1999). Stoney Boots may have to cut profits for the first year, but
this is only to increase the time of competition training and also to
increase customer retention in the long run, if Stoney Boots
decides to keep the incentive plan. In addition most companies
that participate in the gainsharing program holds a reserve fund to
account for any periods that may bring about a deficit.
Gain Sharing
Advantages
• Rewards performance improvement
• Payouts are funded from savings generated by the
gain sharing plan
• Increases the feeling of ownership and accountability
Disadvantages
• Employees may question or challenge management
decisions regarding payment amount
• Increases the level of organizational stress due to
having a financial stake in the organization’s success
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INCENTIVES CONTINUED
-The success of the
company means
success for the
employees
-Some employees
only focus on the
goal of profitability,
sacrificing quality
-Allows employees
to align with
organizational goals
-Employees get paid
the same despite
differences in
performance
Disadvantages
Another alternative other than gainsharing is profit sharing.
This would cause the employees within Stone Boots be
compensated with a percentage of the company’s profits
(Masternak, 1999). This will create a work environment of
commitment and dedication to the company, which in turn
will cause better performance and in turn create a higher
customer retention.
Advantages
Profit Sharing
Stock Options
The other option Stoney Boots can offer as an incentive
program are stock options. There are two type of stock
options, incentive stock options (ISOs) or nonqualified stock
options (NSOs) (Masternak, 1999). We would recommend
the nonqualified option for Stoney Boots because it offers a
tax deduction of the spread between what the employee
pays and the actual value of the option should they choose
to buy. The other benefit of stock options is that depending
on how long the option last, it results in a lower employee
turnover rate so the employees can cash in their options.
The decrease in turnover will save Stone Boots in the
training of new employees.
Advantage
• Company
receives tax
deduction
• Executives and
shareholders
(employees)
hold the same
interest
Disadvantage
• Dilutes EPS
• May cause
manipulation
within the
stock price
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The use of mobile technology has increased in many companies due to the
functional capabilities for end users. However, applications are also being
developed for internal use by sales teams and other departments. Due to
Stoney Boot’s use of sales personnel to sell to new customers, creating an
application would be beneficial to all parties.
An example of such a company that did this was Goodyear Tire with the
creation of the Goodyear fleetHQ application. Customers can download the
application but there is also a feature for the sales employees of the company
to sell to potential companies to sell their tires. A customer is able to select
each type of tire that is available and see features and benefits. The same basic
ideas are available in their employee version with many other aspects not
The Apple Store and use of Apple
available to the user. (FleetHQ, 2011)
products are recommended
initially over the use of other
PROS
CONS
tablets and the Android Market.
The new Ipads are now built with
Retina displays that will result in
-Ease of locatable information for
- Cost could vary due to development
an enhanced experience for the
sales employees
- If the ERP system is down the dashboards
customer looking at the application
- Demonstrate components of the
and other information will not be available
shoes
when the sales employee is
- Access to previous sales orders
present.
and records on each current
customer
Due to the use of a Cloud ERP
- Ability to order for customer
system, the use of the current IT
directly from the application
department will be used for ERP
- Schedule follow up meetings
through use of the calendar
implementation super users as well
- See inventory Levels of each boot
as keeping the application working
and staying up to date on possible
IOS updates.
20
RECOMMENDATION 3
Ipad Sales Application
All components of the Application are described in Detail below.
CALENDAR
This section of the application can be used by the sales force
employees to get quick status updates on the sales for each
boot, information about the company as a whole, and other
information that would be needed in easy readable pie charts
and bar graphs. This function of the application is use for
internal uses and would not be needed by the customer. This
information will be drawn from the ERP system and will be
updated regularly so the sales employees who are out selling
will know current and imperative information.
This is a great feature for the use of the sales person. Due to
being on the road selling from customer to customer, using
this feature of the application will allow sales people to
access their email from their office on their Ipad. This will
keep the sales person up to date on where their next
appointments are and even be able to set up potential follow
up meetings if needed during the customer visit.
BOOTS AVAILABLE
BOOT MANUFACTURING
This function of the application will be used by sales
employees to see the current inventory levels of each boot
manufactured by Stoney Boots. When a salesman is meeting
with a potential new customer, for example, it is vital for the
salesman to know if these boots are in stock at the current
time. This feature can also let the salesman know when the
next shipment of boots is coming in so they can alert the
customer of this. Regardless if the item is in or out of stock,
the salesman can still sell the shoes to the customer right off
the Ipad. If the inventory is out of stock and the customer
agrees with the future shipping date once the inventory is in,
the shoes can still be sold.
This currently is not seen in the application prototype but can
be added in the actual production of the application. This
could be a 3D model of the shoe that could be moved and
rotated. Each component that is put into the shoe can be
shown so that the customer could see the durability and
quality of the boot without actually having it in front of them.
This is an easy way for the sales person to be able to show an
actual representation of the shoe in fine detail while the
selling is taking place.
COMPONENTS OF THE APPLICATION
DASHBOARD
*Please refer to Appendix B for
pictures of each component of
the application
CURRENT CUSTOMERS
This feature is useful when the salesman were to either sit down face to face with current customers or
if the current customer were to call them for reorders or other matters on the shoes. Each company has
their picture shown and can be clicked on. This will bring the salesman to a new page where they will
be able to access previous orders by the customers and other details necessary to sell the shoes.
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Expense (Yearly)
IPAD 2 WIFI & 3G ($529.00 each)
$13,225(One time fee)
Apple Development Fee
$99
Verizon/AT&T 3G Monthly Fee – 5MB
$50.00/month
$15,000
FINANCIALS FOR APPLICATION
Items
Developer Costs
TOTAL
- Development of Application
$50,000
- Design Costs
$10,000
$88,324
Shown above are the financials for the Ipad Application Recommendation. All costs were configured through Apple’s website.
The 25 Sales Force team was taken into consideration and the IPAD 2 is in accordance with this number. The Apple
Development Fee is a yearly fee that must be paid by all developers once per year. This gives the user the right to create
applications and distribute them either internally or externally. The Verizon or AT&T costs are current standard prices that must
be paid monthly per device. This will allow for users to move to locations that do not have WIFI and continue their work. It is at
the companies discretion to decide what provider would be suitable for the 3G coverage.
Developer costs are inevitable to create the functioning application. Due to the application being shown to current customers as
well as future customers, the application has to have a sleek design and interface. One component of the application is to show a
3D model of the components within in the shoe. The design must be crisp for customers to see the true components of the shoe
almost as if it was being held.
The application also will be updated regularly with information from the ERP system. As seen from other sources, database
based applications are costlier due to the coding and underlying system that is needed. It is necessary for the App to be of high
quality, which is why the above calculations have been configured in such a way.
These development fee calculations are variable and could increase with additions to the application upon the clients request.
(Thomas, 2012)
22
RECOMMENDATION
STRATEGIC GOALS
Disparate and outdated
legacy systems with
human error, excessive
paper trail and
unnecessary redundancy
NetsuiteERP
NetsuiteCRM+
NetSuite SuiteCommerce
- Alleviate human errors
and paper trail
- Cut Costs in inventory
and raw materials
- Increase Customer
Retention
- Grow in Revenues
Users not knowing the
new functions and
capabilities of NetSuite
User training through
Consultants from NetSuite
and Super Users from the
company
- Customer Retention
Increased
- Cost Savings
Increasing Customer
retention as well as trying
to find new customers
Sales Tablet Application
- IT Innovator
- Increase Customer
Retention
SUMMARY OF RECOMMENDATIONS
PROBLEM
23
TO BE PROCESS FLOW
24
PROJECT TIMELINE
Timeline
12
11
10
9
Months
8
7
6
5
4
3
2
1
0
NetSuite ERP
NetSuite CRM
NetSuite
Commerce
App
25
PROJECT FINANCIALS
26
CONCLUSION
Conclusion
Taking into consideration Stoney Boots’ strategic goals, Team 5 has provided 3 recommendations based on
the information given. Our recommendations will cutting cost, increasing customer retention, increase the IT
image through innovation, and finally increase revenue.
The first recommendation is an ERP system with the addition of an CRM and SuiteCommerce packages. This
will connect all of the different databases and interfaces together. The implementation of an ERP system will
help drive down the cost of inventory. An ERP system will also help increase revenue by getting products to
the clients on a timely manner and increase efficiency overall.
The second recommendation is the use of a training incentive program in hopes that employees strive for
complete understanding o f the new system. This will encourage employees to learn the new system and will
increase the time as to when any new systems can come online. In addition to, the training program will also
increase the retention rate of these employees by offering them a way to improve their skills.
The final recommendation is for Stoney Boots to create an IPad application for salesperson use during sales
calls and face to face interaction. It is a tool that can be used for the salesperson themselves through the use of
dashboards and calendars but also through the sale and knowledge of the boots.
In conclusion, Team 5 believes that the implementation of our recommendations will lead to the strategic
goals of cutting cost, increasing revenue, increase customer service and retention, and increase their IT image
for Stone Boots. On behalf of Team 5, we would like to extend our appreciation in allowing us to conduct
research and provide feedback regarding Stoney Boots’ business objectives. We hope our recommendations
will provide assistance to your company.
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APPENDIX A: EPICOR ERP
28
APPENDIX A: EPICOR’S ERP
29
APPENDIX B – APPLICATION PROTOTYPE
HOME SCREEN WITH APPLICATION TILE
WELCOME SCREEN AFTER LOGIN
30
APPENDIX B CONTINUED
Calendar
DASHBOARD
31
APPENDIX B CONTINUED
BOOTS AVAILABLE
CURRENT CUSTOMERS
32
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