final merged.doc 2003

8/11/2019 Final Merged.doc 2003

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Introduction

The Central Supermarket is a well known and self-service supermarket which is owned by Mr.

Baichoo Ramlokun. It deals with the buyin and sellin of perishable and non-perishable oods.

The business started to operate since !ctober "##$.

The location of the supermarket remains strateic as it lies in a true commercial place at the

center of Riviere du Rempart. %lso it is a place where there is a reat presence of residential

areas and as well attracts tourists from the coastal villaes like Roches &oires' (ost )afayette'

(oudre d*or and many others. Besides' it was the first supermarket set up in this location which

had no competitors apart from corner shops but with time there are various competitors that have

crop up.

The supermarket is now the larest one in Riviere +u Rempart and it is very modern with full

scannin facilities' air-conditionin and refrierated cabinets. In this era of information

technoloy' information has become valuable orani,ational asset ust like human resources and

inventories. Takin into consideration the importance and benefits of information systems and

technoloies IS/ IT0' Mr Baichoo started usin IS/IT a few years after it started business. The

hierarchy of the supermarket consists of the Top manaement' IT department' %ccounts

department' Trainin Manaer' the Marketin Manaer' Sales !fficers' Sales %ttendants'

Storekeepers and Security !fficers.

Information systems can be powerful tools for business. The key is havin current data converted

to useful information and havin that delivered to people who can act upon it before it*s too late.

If the information is delivered too slowly then it is only a lesson learned rather than profitable

opportunity.

1



Aims and objectives to be achieved

To reduce costs and achieve hiher benefits and profits

To shift from supply push to demand pull

To enhance the relationship between the orani,ation and its customers' suppliers and the

other players of the supermarket To minimise risks and errors in order to have a better stock control

To be more environmental concerned' that is oin for reen environment' by reducin

paper costs To improve the performance of the supermarket*s employees throuh more trainin

To do tanible and intanible way of doin business

To make sure the riht information is reached to the riht person at the riht time.

Each level of the Supermarket requires different type of information and information

systems.

At the Strategical level:

Information system used: Executive Support System ESS!

The 1SS is the desined specifically for the information needs of strateic manaers. It

provides these maners to drill down to detailed information.

Information required2 the chief e3ecutives receive information in summari,ed forms.

4or e3ample' they need to know the profit made durin a particular year in order to

decide whether they need to take more actions to increase profit ne3t year.

At the tactical level:

Information systems used: "anagement Information System "IS! and #ecision

Support Systems

The MIS is a software that supports manaement decision makin by providin

information in the form of reports and responses to 5ueries to manaers at the different

levels of the orani,ation.

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The +SS helps manaers by analy,in data from a database and providin the results of

analysis to the manaer

Information required: the manaer of a particular department needs information on the

total order cost for each department so that he can make arranements to pay suppliers.

At the operational level:

Information systems used: Transaction processin System T(S0

Information required: workers need to know the price of products to be able to put

them on the products or the shelves.

The T(S consists of keepin records' processin transactions and producin outputs.

External $orces affecting the Supermarket

Suppliers

Suppliers are an important link in the 6value delivery system.7 They provide the supermarket

with the necessary oods. Since the owner keeps ood relationships with its suppliers' they

offer discounts and credit facilities when there is bulk buyin. 8henever there is any

shortae of a particular product' the supplier supplyin that product is immediately contacted

and he will do his best that we received the products on time and in ood condition.

9owever' if an e3istin or a new supplier does not deliver products on time' the supermarket

can have inventory problem and this will tarnish its reputation. In order to avoid this

problem' the owner has adopted the approach of Supply Chain Manaement SCM0' that is'

focus also oes on helpin the supermarket to manae its relationship with its suppliers.

Moreover' by usin the :ust-In-Time inventory' there is a control on inventory and the risk of

oods bein damaed or e3pired is less. These two approaches are included in 8ave "'

reducin costs.

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Customers

4or the runnin and the success of Central Supermarket' Mr. Baichoo always tries to identify

the needs and wants of his customers. %s customers* tastes chane with time' in order to

keep track of the chanes and to address them in more efficient and effective way' Mr.

Baichoo uses environment monitorin process. This scientific process comprises of two

essential staes which are environment scannin and environment analysis. The outcome of

these two staes is detailed and interpreted information of the factors that can influence

customer behaviour both positively and neatively.

If for e3ample' there is a new product on the market which is non-fat. %s people are health

conscious nowadays' they*ll prefer to buy the non-fat product. If the Central Supermarket

does not provide them with this new product' they*ll o to another supermarket. 9ence' Mr.

Baichoo always tries to identify the wants of their customers and provides them with new

products available on the markets as consumers are always impulse to buy innovative

products. In addition' Customer Relationship Model CRM0 is also used by the business to

keep track of e3istin and new customers and to identify which products are fre5uently

bouht by customers. CRM is included in 8ave $

%ompetitors

Competitors are those who serve a taret market with products and services that are viewed by consumers as bein reasonable substitutes. Competition focuses on two tools which are

price and non-price factors. Competitors of the Central Supermarket are hypermarkets such

as :umbo' small shops and reional stores. 9ypermarkets are likely to meet the rowin

needs of more affluent consumers; meetin the risin affluence and education levels'

consumers* shoppin and eatin lifestyles. Reional supermarkets are similar businesses

such as Central Supermarket competin at same place.

%lso' Reional supermarkets are very competitive aainst price. Rival businesses can place

discounts' promotions' linkslaves for instance' 6buy product % and et product B for free7 in

order to attract customers towards them. %s a result' as customers seek to ma3imi,e utility or

well bein. Therefore' customers will be pulled towards substitutes at low prices. In this

situation' Central Supermarket should start to lower down prices on substitute products to

4



foresee hih level of customers. Besides' another reional competitor can erect where it will

be located near fast food' petrol stations which can attract customers.

Economical

It involves the study of economic factors such as inflation' employment' disposable income

and so on. Mr. Baichoo always takes these factors and the economic stae of the country into

consideration when determinin the price of products.

If Mauritius will face a recession in years to come' the purchasin power of consumers will

decrease' there may be hih unemployment. 9ence' people will spend more on necessities

rather than on lu3ury oods. %s the country will be facin such economic stae' Mr. Baichoo

should review his pricin policy of products as the disposable income of the consumers will

be low. If he increases the price of the necessities' the customers will prefer to purchase

somewhere else.

&echnological

%s technoloy chane' the supermarket has to adapt to this chane and the business stratey

also need to be reviewed. If it doesn*t keep pace with technoloical chane' then it will not

be able to cope with new challenes' difficulties and customers* demand. The IT department

always keeps track of new technoloies emerin on the market and tests whether they are

compatible with the current business structure. The business cannot move directly to new

technoloy' it needs to pass throuh research and testin. Besides' use of IT/ IS helps the

firm to communicate effectively with suppliers' customers and others. The owner sometimes

buys software which is less costly compared to in house development of the software. Thus'

The Supermarket is addicted to IT

'hysical()atural

(hysical and natural disasters can also affect the supermarket. 4or e3ample' if there is

cyclone for several days' most people will not take the risk to o out and shop. The

Supermarket also will not be able to open durin such bad weathers. Thus' it will not be

makin profit durin those days.

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%nother impact can be if the supermarket cauht fire' most oods' systems and important

data will be destroyed. 9owever' throuh the distributed system' the supermarket will no o

for complete loss.

'olitical(*egal

The political factor has a hue influence upon the reulation of the business' and the

spendin power of consumers and other business. The supermarket has to strictly abide

by all laws for e3ample' payin ta3' else it can be sued which can result in loss of

reputation. Customer complaints are taken seriously so as to avoid them to seek leal

redress and help from Consumer (rotection Institutions.

Internal factors

Employees and others

1mployees are valuable assets of the supermarket system. 8ithout them the supermarket can

face losses. 4or e3ample' the knowlede workers also known as the intellectual capitals provide

innovative ideas and advice the owner in which system it is best to invest. Staffs at low level

who et into direct communication with customers' they know better what customers demandsare. 4urthermore' continuous trainin must be provided to the employees at all levels in order

for them to adapt to technoloy and business chane. Besides' the supermarket operates in a real

time situation which involves real-time data warehouse system.

&he #ata +arehouse

!perational systems are able to enerate a lare amount of data to support the transactional

operations of the supermarket. The data enerated by these systems is fresh and valuable; as

well' it can be very diverse and heteroeneous' and can come from a wide variety of sources. In

order to solve the problem atherin' interatin' cleanin' and analy,in this heteroeneous

information0' a new software system was developed' that is' the data warehouse.

6



% collection of subect-oriented' interated' time-variant' and non-volatile data is what we can

call a data warehouse. This data is used to support the decision-makin process of the

orani,ation<s manaement team. The data warehouse is used to interate all of the

orani,ation<s historical data and has the ability to store snapshots of its transactions. %ll

information enerated from the operational data source is e3tracted' cleansed' transformed' and

loaded into the data warehouse. !nce in the data warehouse' the data can be subect to a wide

rane of analysis and e3ploration processes.

The Supermarket wants to e3pand the real time situation by investin in customer information

control systems CICSs0. The reasons to invest in this real-time system are that this system has

the ability to respond to user actions in a very short period of time' it has special features such as

instant interaction2 when users will re5uest information from the system and they will receive the

answer immediately. %lso' users will have the possibility to remain connected online0 so they

can start this interaction with the system anytime=which is called an online transaction

processin !)T(0 system. Throuh the use of this system' customers will be able to place

orders' buy products on their own and use the self and discovery services to be provided by the

supermarket.

+aves of innovation

In order to eliminate the issue of e3cessive inventory' leverain investment in Customer

Relationship Manaement CRM0 can be useful. CRM will help identify and taret their best

customers' enerate 5uality sales leads' and plan and implement marketin campains with clear

oals and obectives. %lso it will help form individuali,ed relationships with customers to

improve customer satisfaction0 and provide the hihest level of customer service to the most

profitable customers. In addition' it will provide employees with the information they need toknow their customers< wants and needs' and build relationships between the company and its

customers. Customer relationship manaement tools include software and browser-based

applications that collect and orani,e information about customers. 4or instance' as part of their

CRM stratey' Central Supermarket miht use a database of customer information to help

7



construct a customer satisfaction survey' or decide which new product their customers miht be

interested in.

Supply Chain Manaement SCM0 will improve the way Baichoo supermarket finds its products

to sell and deliver it to customers. The timely and accurate supply chain information is the ability

to order only as much of a product as there is a market for. This is the practice known as ust-in-

time inventory manaement' and will it allow the supermarket to reduce the amount of inventory

that it keeps. This can cut costs substantially' since the supermarket no loner needs to pay to

produce and store e3cess oods. SCM is efficient interation of suppliers' warehouses and stores'

in addition of orderin riht 5uantities it also facilitate to distributed to the riht location at the

riht time' so as to minimi,e total system cost while satisfyin service re5uirements.

Creation of the Supermarket website will help it to become more competitive in the market.

Staffs can make online order and they can also make online order and the customers also can

make online shoppin thus bypassin the cost of papers for purchasin order and sales order and

invoices. In addition it can market its products via the internet thus enhancin the services. The

customers can purchase the product online without comin on the spot and they will also be able

to add products in their shoppin carts. This facility will allow them to purchase their products

whenever they want. This will also reduce the cost of advertisement. %s a result of oin online'

Central supermarket can chane its approaches to stockin its various warehouses. 9ih volume

products or products for which the demand can be matched with supply' can be stocked locally in

the stores' while low volume products are stocked centrally for online purchasin.

Trainin the staff to handle problems on spot will save time and it will also be a way to enhance

service. The customer will not be at a loss when error will be made by the staff. 4or instance if a

product is counted twice then it can be solved in second. There is no need to depend on an e3pert

to solve the problem.

8



Strategic use of I&

>se of the Internet by businesses set off a revolution in the use of IT' so that utili,in the Internet

to conduct business became the strateic use of information technoloy.

Strateic roles of IT fall into one of three cateories2

68orkin inward7 improvin a firm*s internal processes and structure0'

68orkin outward7 improvin the firm*s products and relationships with customers0'

68orkin across7 improvin its processes and relationships with its business partners0.

+orking In,ards: -usinesstoEmployee

The aim of usin IT strateically inside enterprise is to improve business processes. The primary

electronic means to reach employees is throuh intranet.

Creatin an intranet will help faster access to information and updates will allow the employees

to make 5uicker decisions and take actions' thus improvin the overall productivity of the

supermarket. Intranet applications will facilitate accurate flow of tareted information across

verticals and hori,ontals' which could possibly reduce number of emails floatin around in an

orani,ation. Important policy documents' trainin materials' company knowlede documents

can be maintained on the intranet application and can be accessed from a sinle source when

re5uired. %nd also there is no need to maintain physical copies of information or other

documents and hence intranet applications prove to be cost effective solutions. The supermarket

also makes use of a corporate portal' that is' a ateway which allows only authori,ed employees

to have access to certain information.

9

http://www.karmatechnologies.co.uk/intranets.htm





In addition' more and more people are workin from their homes nowadays. Information

technoloy has become so sophisticated it allows people to choose to work from home.

Teleconferencin and video conferencin enable employees to beam in whenever needed. In

addition to that' information technoloy can allow a firm to reduce costs. Takin 1rnst ?@oun

for e3ample' the company has successfully reduced its office space by $ million s5uare feet by

allowin their employees to work from home.

Thus' the Supermarket intends make use of teleconferencin in order to reduce office costs. That

is' enablin some employees to work away from the supermarket.

+orking /ut,ard: -usinessto%ustomer

In most industries companies need sophisticated computer systems to compete. 8ith B$C' e-

business will eliminate the eoraphic boundaries and can et closer to its customers with

improved customer service and customi,ed response. They can provide $A hours a day and

days a week service. 8ith the customer service and personalised attention it can increase

customer loyalty. They can directly to the customers thus bypassin the retailers and distributors.

By makin leverain investment in CRM systems it can know much more about customers and

perhaps non-customers0.

+orking Across: -usinessto-usiness

Streamlinin process is a vital process for any type of orani,ation. Reformin process bein of

internal processes is very time consumin' remains the main challene for manaement to

reorani,e its process cross the business boundaries which often stop at the corporate walls.

8orkin across business takes many forms2 8orkin with Co-suppliers

8orkin with customers in close mutually dependent relationship

Buildin a virtual enterprise that miht evolve into an 1-market place.

10



Central supermarket stays in touch with its customers and suppliers via electronic mailin and

internet. Skype I( phone and MS& 8indows Messener are also bein used to communicate

amon them.

Skype is a software which works seamlessly with the internet connection. 8ith Skype Central

supermarket will be able to make calls over the internet to other employees on Skype as lon as

it is re5uired without worryin about time or distance. They can also make local' lon distance

and international calls to phones and mobiles. Skype is also used to chat and make video calls.

*evels of System Integration

The supermarket has a mi3ed relationship with various people involved in the supermarket.

In loose interation' one party provides another party with ad hoc access to its internal

information. The information may or may not be confidential' and it is accessed when it is

needed. Such limited interation re5uires little risk and cost. It is better to establish loose

interation with employees so that if ever they leave the ob they will not take alon with them

confidential data.

In close interation' two parties e3chane information in a formal manner. Some of that

information is probably confidential' and althouh the two parties* processes are distinct' they do

handle some tasks ointly. This level of interation leads to reater benefits' but risks do increase

because confidentialities are shared. Costs of interation are also hiher than in loose interation.

Close interation is maintained with customers.

In tiht interation' two parties share at least one business process' as partners' in a business area

that is important to both. %n orani,ation will probably have few tihtly interated relationships

due to their hih cost and risk. !n the other hand' an orani,ation could create many loosely

interated relationships because of their low cost and risk' but would find that the benefits from

these relationships are fairly minimal. Such interation should be kept with other businesses due

to competition.

11



IS 'lanning

(lannin is an essential activity in the business manaement. This activity involves determines

what should be done. 9owever due to turbulent business environment' plannin remains a

difficult task. %ccordin to Tari5 Siddi5ue' if you are failin to plan' you are plannin to fail.

(lannin in information system and technoloy involves determinin what systems will be

developed and what technoloy will be used in the future.

Systems plannin are very important and difficult. There are plannin techni5ues available to

help IS e3ecutives do better ob in plannin. If an orani,ation follows these techni5ues then it

can o for a success. The plannin techni5ues are2

Staes of rowth

Critical Success 4actors

Competitive 4orces Model

Dalue Chain %nalysis

Internet Dalue Matri3

)inkae %nalysis (lannin

Scenario (lannin

The supermarket makes use of some of the plannin techni5ues wherever it is applicable.

%ritical Success $actors %S$!

4or each e3ecutive' CS4s are the few key areas of ob where thins must o well for an

orani,ation to succeed. Most manaers identify factors that represent areas that need special

and continual attention to brin about hih performance. The manaer of the supermarket should

be concerned about these four critical success factors2

9ave the riht product mi3 available at each store

Eeep it on the shelves

(rovide effective advertisin to attract shoppers to the store

+evelop correct pricin

12



%ompetitive $orces "odel

%ccordin to (orter there are five areas of the e3ternal environment that affect the profitability of

the firm. Companies must compete with these F forces2

&hreat of )e, Entrants

8inners' Super > and other supermarket chains put up considerable barriers to entry. %nyone

startin up a new supermarket chain has barriers imposed on them' implicitly or e3plicitly' by the

13



e3istin supermarkets. The most common forms of entry barriers' e3cept intrinsic physical or

leal obstacles' are as follows2

1conomies of scale2 for e3ample' benefits associated with bulk purchasin;

Cost of entry2 for e3ample' investment into technoloy;

+istribution channels2 for e3ample' ease of access for competitors;

Cost advantaes not related to the si,e of the company2 for e3ample' contacts and

e3pertise;

overnment leislations2 for e3ample' introduction of new laws miht weaken

company*s competitive position;

+ifferentiation2 for e3ample' certain brand that cannot be copied The Champane0

-argaining 'o,er of buyers

Buyers always seek lower prices and barain for hih 5uality products. They act to force prices

down. If a product is too e3pensive in a supermarket then they will obviously o in another one

where they will et cheaper price. There are web based auction sites and shoppin bots ivin

buyers more shoppin options and more information about potential suppliers which increases

the barainin power of buyers.

-argaining 'o,er of Suppliers

Supplier power is an important part of the (orters five forces model. Supplier power is wielded

by suppliers demandin that retailers pay a certain price for their oods. If retailers don<t pay the

price' they don<t et the oods to sell. But lare supermarkets have an overwhelmin advantae

over the small shopkeeper=they can reduce the price they pay the supplier. 9owever' stron

suppliers can push prices of their oods hiher than the firm wants to pay and reduce the profit

marins.

14



-e the lo,est cost producer

The first stratey of cost leadership is one in which Central supermarket can strive to have thelowest costs in the industry and offer its products and services to a broad market at the lowest

prices. This stratey will be based on the Central supermarket<s ability to control their operatin

costs so well that they are able to price their products competitively and be able to enerate hih

profit marins' thus havin a sinificant competitive advantae.

#ifferentiation product or services

If the supermarket uses another stratey of differentiation' than it has to try to offer services and products with uni5ue features that customers value. The central supermarket will be able to

create brand loyalty for their offerins' and thus' price inelasticity on the part of buyers. Breadth

of product offerins' technoloy' special features' or customer service are popular approaches to

differentiation.

$ind a niche

The last stratey of focus can be either a cost leadership or differentiation stratey aimed towarda narrow' focused market. In accordance to this framework' while both overall cost leadership

and differentiation strateies are aimed at the broad market' firms may also choose to confine

their product to specific market areas or may choose to offer a smaller line of products to the

broad market' thus pursuin a stratey of focus or niche. Central supermarket sells its products to

middle class people.

#istributed System

16



% distributed system is a collection of multiple and platform independent computers which are

connected throuh a network to produce an interated computin facility. It also allows better

communication by havin the necessary software' hardware and communication e5uipments

situated at the different locations. In this situation' the user perceives the system as sinle-user

system thouh it is a multiple user system.

The owner has e3panded its business and remains close to its customers throuh the distributed

system. The supermarket is distributed at different locations namely in the 8est' 1ast and south.

Since the supermarket has more than FH employees' some employees work at the distributed

supermarket whichever is closest to them from their home. % copy of customer' supplier and

other relevant information is kept at each location to facilitate transactions and to be able to keep

contact with the centrali,ed Supermarket' that is' the supermarket head office. The supermarket

uses a distributed for the followin reasons2

To taret a lare roup of customers at different reions throuhout the country

Reduce air pollution and traffic conestion as not all customers will o to the centrali,ed

supermarket To et more contact into e3istin and new suppliers and customers

To ain competitive advantae in the market

If ever a disaster happens at any of the distributed system or centrali,ed' the supermarket

will still be runnin

#istributed #atabase

% distributed database is one where the database distributed at different sites. Information is

distributed at different locations where user can access the data at any of the locations. There are

two types of distributed database2

+ivide the database and distribute its portion throuhout the system without duplicatin

the data

Replicate the data at several locations

17



4or the supermarket system' a copy of the database will be kept at different locations. In this

way' the supermarket will be able to use a computer database to keep track of which products

sell best.

1easons for replication:

To have reliability and efficiency of fast read only 5ueries

By replicatin the database to multiple servers' we can ensure that the data is always

available even if there is some hardware' software or network problems. That is' if ever

one location is affected' other locations won*t be affected' we can still et the data at

other locations' the supermarket won*t o for total loss.

Better performance' reduced response times and faster access to data. >ser can access

the data close to him thus improvin the server response time.

4or security reasons' the supermarket makes use of a +isaster Recovery (lan' that is' in case a

disaster happens at any of the locations' every body workin in the supermarket knows what to

do' there is someone responsible for retrievin the data' another one for back up. 4or e3ample'

the supermarket system uses C!&ST%&T-SC%&SM 4%I)S%41 %RC9IT1CT>R1' a system

which ensures that all (!S data is captured' enablin all (!S lanes to remain fully operational in

the event of server or network failure and it also ensures that customers do not pay twice.

)et,orking

&elecommunication

18



Telecommunication refers to all types of data transmission' from voice to video. It is the

e3chane of information over sinificant distances by electronic means. % complete' sinle

telecommunication circuit consists of two stations' each e5uipped with a transmitter and a

receiver. The transmitter and receiver at any station may be combined into a sinle device called

a transceiver . The medium of sinal transmission can be electrical wire or cable also known as

copper0' optical fiber or electromanetic fields. The free-space transmission and reception of data

by means of electromanetic fields is called wireless.

The Supermarket depends on technoloy and telecommunication assets to communicate' learn'

sell' buy' and collaborate. It makes use of both telephone and computer networks. The

telephone networks consist of MyT which is the internet service provider IS(0' Skype' Do+

services.

8hen it became evident to the information systems manaer that the supermarket needed a better

way to communicate with the various players of the orani,ation worldwide' he implemented

videoconferencin' a rapidly maturin technoloy that has become more affordable since it

emered more than $H years ao. The videoconferencin system takes advantae of the

Interated Services +iital &etwork IS+&0' an enhanced phone line that can handle "$G'HHH

bits of data' voice' or video information per second--or any combination of the three.

2ideo %onferencing

It is a facility that links at least two computers toether with a diital video camera. It enables

meetin to be set up between a roups of people without havin them physically present round a

table. Since the supermarket makes use of Dideo Conferencin' this proves more useful for top

manaement to communicate to the other distributed supermarkets.

/vervie, of &echnologies used ,ithin the supermarket

19

http://www.webopedia.com/TERM/t/data.html

http://www.webopedia.com/TERM/t/video.html

http://searchnetworking.techtarget.com/sDefinition/0,,sid7_gci213670,00.html

http://searchtelecom.techtarget.com/sDefinition/0,,sid103_gci212716,00.html

http://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci212055,00.html

http://searchmobilecomputing.techtarget.com/sDefinition/0,,sid40_gci213380,00.html

http://www.webopedia.com/TERM/t/data.html

http://www.webopedia.com/TERM/t/video.html

http://searchnetworking.techtarget.com/sDefinition/0,,sid7_gci213670,00.html

http://searchtelecom.techtarget.com/sDefinition/0,,sid103_gci212716,00.html

http://searchcio-midmarket.techtarget.com/sDefinition/0,,sid183_gci212055,00.html

http://searchmobilecomputing.techtarget.com/sDefinition/0,,sid40_gci213380,00.html



1(!S J This 1lectronic (oint of Sales J It is comprised of a keyboard' a diital display' a

barcode reader' a printer' a credit/debit card reader and a till drawer.

>(C J >niversal (roduct Code J It is a barcode symboloy that is widely used for

trackin trade items in stores

S1C J Shelf 1de Computers J It is used for price chanes' creatin stock pictures

information on stock totals0 and for forecastin deliveries.

14T J 1lectronic 4unds Transfer J the computer-based systems used to perform financial

transactions electronically

1+I- 1lectronic +ata Interchane- is an automated process for e3chanin business

o information between the supermarket and other parties throuh the use of

computers and telecommunication links.

Barcode Reader- It is a laser scanner that reads the reflected laser liht from a series of

dark and liht coloured lines of varyin thickness.

:ust-In-Time Stock- It is a means to control the buyin' orderin and sellin of oods

Electronic 'oint of Sales E'/S!

)ocated at each checkout is an 1)1CTR!&IC (!I&T !4 S%)1 1(!S0. 1ach till also

has its own base to which all of the above is attached.

It is the base unit which is connected by cables to the branch computer in the

supermarket<s system office.

9elps to process the most popular products from the warehouse to the point of sales in

the shortest time

(rovides fast' accurate transactions and thus increases the business*s bottom line.

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9elps to manae stock and thus could prevent losses due to product e3piration or

damae.

3niversal 'roduct %ode 3'%!

8orks hand in hand 8ith the 1(!S

Identifies a product' its oriin and cost.

9elps manae stock efficiently

(rovides an easy way to update the cost of the products without the need to re-label each

of the individual products.

)eads to faster checkout times and thus leads to customer satisfaction.

Shelf Edge %omputers SE%!

%dministrative and stock control staffs have access to S1C and it fits flawlessly with

product >(Cs and 1(!S systems.

Manae the stock levels and keeps the business from purchasin to much stock and

runnin the risk of losses to spoilin.

1asy way to conduct inventory and provide customers with the freshest products.

Electronic $unds &ransfer E$&!

The process of usin payment cards credit cards' debit cards' etc0 to pay for products.

The cashier enters the customer credit card data into his system by swipin the card

throuh the manetic stripe reader' pluin it into a smart card reader or keyin in the

data manually. Speeds up the transfer of money and thus increases the overall sales fiures of the

business.

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(rovides a convenience to the customer

4ust In &ime Stock

The Kust-in-time* system takes advantae of a stock information system. %s products

pass throuh the electronic points of sales 1(!S0' the relevant data is sent to a database

containin information about stock levels. 8hen stock falls below a set level more

products are ordered.

Thus only a bare minimum of necessary stock is ordered and there is no need to maintain

a lare' fully stocked warehouse. This is a means of reducin cost in 8%D1 "

Employee 1esource &echnologies

Monitors employee*s hours and when they clocked in and out.

Improves employee efficiency and thus increases the bottom line of the business.

Eeeps a constant eye on employees* activities and in the event of a contradiction could

absolve the employer or the employee of any wron doin.

-arcode reader

The bar codes on products are read by the 1(!S tills at the checkouts. This is achieved

by usin a barcode reader which sends out infra-red laser beams via a set of mirrors'

enablin the bar code to be read at most anles.

8hen an item is passed over the barcode reader' the black and white parts of the code are

detected by the laser' as the black parts reflect very little liht whilst the white parts

reflect most of the liht. This is converted into electrical pulses which are sent alon the

cables to the branch computer. The branch computer then searches its stock file for the

product matchin the item number. 8hen this record is located the price and description of the product is e3tracted and sent

back to the 1(!S till at the checkout. It then shows this item and price on the diital

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display' prints them on a receipt and adds the price to the total. %t the same time' the

branch computer records that one of this item has been sold.

Electronic #ata Interchange

>sin 1+I eliminates the need of paper work' since the orderin is done by data bein

transferred between the supplier<s computer and supermarket*s computer' this is another

means of reducin cost in 8ave ".

% feature of 1+I is the ability to encrypt the information so that hackers are not able to

view the content even if they try to intercept a transmission.

%ontrol Systems

Computers are also used to control the free,ers and chillers throuhout the store.

In the warehouse' the lare free,ers have to be kept within a certain temperature rane.

This is achieved by havin temperature sensors inside each free,er which monitor the

conditions and switch the coolin motor on.

%omputer )et,orks used in the supermarket

)%& J )ocal %rea &etwork J It is an interconnection of computers restricted to a small

area like a home' buildin or office

*ocal Area )et,ork *A)!

The supermarket uses several computers which are located in a room known as the

system office and form the supermarkets own )ocal %rea &etwork. These computers are

used to control the stock and are connected to the checkouts. The computers are

multifunctional' and each can access the data' which ives the manaement a number of

access points.

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Si3 branch computers are linked to the 1(!S terminals at the checkout area they all

record information about items sold and provide backup for each other also' it is linked

via satellite links to a lare main computer.

Makes data transfer simpler and less intrusive due to the lack of wires.

+ide Area )et,ork +A)!

8ide %rea &etwork J It is an interconnection of computers spread over a wide

eoraphical area.

Since the supermarket system uses a distributed system' the Chief Information !fficer

CI!0 states that a 8ide %rea &etwork 8%&0 needs to be developed to serve the

followin purposes2

The information on the branch computers can thus be linked via satellite links to a lare

main computer housed at the supermarkets head office.

To allow streamlines communication between the main office and the different branches

of the supermarket and distributors' suppliers.

%ll branches of the supermarket will be linked in this way to the central main0 computer

and this is an e3ample of an e3tranet.

#ata &ransmission

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The supermarket makes use of parallel transmission to send data. The data is sent

simultaneously alon different wires' one bit per wire thus data transfer is fast. To allow

hih speed secure data transmission and internet connection' the T )ines are also used.

There are two ways of sendin data alon a network. These are2

(acket Switchin.

Circuit Switchin

In a packet switchin system' a messae is divided into a series of e5ual si,e packet. The

packets can travel alon different lines. It does not involve a route to be established before

individual packets are sent onto the network.

Circuit switchin means that the whole messae is kept toether so it does not need to be

reassembled at the destination. It re5uires a route to be established before transmission.

The supermarket makes use of packet switchin for data transmission instead of circuit switchin

as it is easier for a hacker to hack a circuit switchin system rather than a packet switchin

system.

4or an effective and reliable network' the network used in the supermarket consists of a switch'hubs' protocols' and socket.

S,itch: The switch allows many computers to use the same communication line at

different times

5ub: % hub is a device at the center of a network. It connects all the computers and

other devices in the network to the central file server. 8henever data is transmitted to the

server from a compute/workstation' it is sent via a hub.

1outer:The Chief Information officer alon with top manaement decided that to be able

to connect the )%& and 8%&' a router will be used. % router is a communication device

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that receives every packet of data bein received' reads the header of the packet and then

sends it alon the appropriate cable to its destination.

'rotocol: It is a set of rules which allows devices from different manufacturers to

communicate. 4or e3ample' there are rules on how data is oin to be transferred fromone place to another.

Socket: % socket is a proram that sends and receives data alon a network. It acts like a

port in that it is an identifiable entry and e3it point for other devices.

The supermarket also makes use of an open network. Throuh this type of network' products of

many manufacturers can be attached to it. Besides' the supermarket also makes use of the /SI

1eference "odel as it has the aim of usin a sinle' common and worldwide standard. The !SI

reference model recommends functions to be performed in each of the followin layer.

&he different layers of the /SI reference model used in the supermarket net,ork

Application layer: The supermarket makes use of 4T(' 9TT( (rotocols and has now

decided to use Session Initiation (rotocol SI(0 also in order to allow this layer to interact

with application whenever the user chooses to transfer files' read messaes or perform

other network activities.

The 4ile Transfer (rotocol 4T(0 provides the different rules when downloadin file from

the internet or uploadin a web pae on the internet.

The 9yperte3t Transfer (rotocol is a set of rules overnin the e3chane of different

types of files that made up displayin web paes

The SI( application-layer protocol allows for the creation and manaement of multimediacommunication sessions between devices.

'resentation *ayer: Takes data provided by application layer and converts it into

standard format that other layers can understand. 13ample' &etBI!S

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Session *ayer: This layer establishes connection to the server and arees upon the

protocol to be used. It transfers the data and closes the connection. 13ample is the SS)

&ransport *ayer: This layer splits the data into suitable packets' determines the actual

transmission type that is oin to be used and reassembled the packets. It also ensures

that there are no errors in the packet.

The TC( is used in the supermarket network.

The Transmission Control (rotocol TC(0 relates to the set of rules that overns the

transmission of data around the internet and is split into packets.

)et,ork *ayer: The &etwork )ayer defines the network addresses of devices that sends

and receives data. It also handles the routine of packets bein sent and received. The

internet protocol is used in this case.

#ata link layer: This layer identifies what network topoloy is bein used and can

identify transmission errors. The %synchronous Transfer Mode %TM0 is used to

transmit data' video and audio over the same network.

'hysical *ayer: This defines the physical characteristics of the network such as

connections' voltae levels and timin. Twisted pair and fibre- optic cable is used in this

layer.

+ireless )et,ork

>se of wireless technoloy will help Central supermarket to advance in many ways. It can cut

costs and increase fle3ibility. The employees can use laptops instead of personal computers so

that they can carry them anywhere. If there is any pendin work they can complete at home

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instead of stayin in the office till late or if they are travellin they can do their work. They don*t

have to be dependent on the particular computer.

Contemporary supply chain manaement SCM0 systems are a fertile area for mobile wireless

technoloy because of the need to provide simultaneous' accurate information about demand'

supply' production' and loistics as oods move amon supply chain partners. SCM software

vendors include capabilities for mobile support and wireless capture of data on movements of

oods and other events.

Central supermarket can invest on myS%( Supply Chain Manaement software. It offers a

number of mobile capabilities. Manufacturin employees can view work instructions on wireless

handheld devices anywhere on the factory floor. Supervisors can use wireless handhelds to call

up data from process control systems to monitor production-line behavior.

If Central supermarket needs to deliver oods' it can use myS%( SCM to create a delivery order

and tender it to a selected freiht forwarder. The forwarder can access this tenderin application

from a mobile device and accept' reect' or modify the planned order. If the forwarder reects the

tender or does not reply within an anticipated time frame' the supply chain manaement software

triers a te3t messae alert to the loistics manaer*s mobile phone to e3pedite the search for

another forwarder.

myS%( SCM also uses mobile technoloy for warehouse manaement tasks such as pickin'

packin' unpackin' freiht loadin and unloadin checks' and inventory 5ueries. Some of these

activities use radio fre5uency identification technoloy R4I+0 technoloy.

%ltierre Corp. provides a wireless )%& based on a system of R4 tas' )C+ displays' servers'

access points and wireless stations' which controls and updates prices for each item.

)ow-tech paper display tas used by Central supermarket to display prices and marketin

messaes can be replaced with electronic shelf. %ltierre e3ecutives say supermarkets and other

lare retail operations invest thousands of man hours in the inefficient process of manually

replacin paper tas on store shelves to reflect updated prices. They are constantly behind on

these updates' and fre5uently make mistakes.

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>sin %ltierre<s platform' a supermarket employee can update prices throuhout the store in a

matter of minutes with a few keystrokes. The system saves time and labour costs' reduces human

error and is LreenL' savin billions of sheets of paper each year. %ltierre has a shoppin cart in

the demo room overflowin with paper price tas' a compellin visual that attests to the amount

of paper that can be saved in a sinle supermarket.

%onclusion

To conclude' information system enables companies to react' respond' cater' store' retrieve'

disseminate' and control their new valuable asset that is information. In the years to come' a

ood information system within a company will be no loner an option; it will become a

compulsory in determinin success. To et the reatest benefits from an information system'

orani,ations must consider it an adaptable tool that enables their businesses to proress.

final merged.doc 2003

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