Impact of Information Systems on Retail Sector Essay Sample
IT has impacted retail sector to a great extent. Increasing competition in
the sector has made it compulsory for the companies to do the merchandise available to client as
* What they want
* Where they want
* When they want
* At most competitory monetary values
Information Systems helped companies to accomplish this end by
* Streamline operation
* Study of purchase wonts
* Connecting decentralized concern units
* Inventory control
* Supply concatenation direction
* New concern theoretical accounts – on-line system
* Inventions in the field
Companies like Wallmart. Tesco to a great extent rely on MIS systems to analyze purchase wonts of the consumer. Wallmart moved a measure in front by integrating an advanced supply concatenation system where the seller is notified the same clip when a merchandise is sold from the shelf. This makes certain that no merchandise will of all time acquire out of stock.
Information Systems
Information systems ( IS ) is the survey of complementary webs of hardware and package that people and organisations use to roll up. filter. procedure. create. and distribute informations ; which is further used at assorted degrees in an organisation for determination devising. This gives rise to another definition of Information systems that states – An information system is any combination of information engineering and people’s activities that support operations. direction and determination devising
Information Systems
Information systems are used at all degree in an organisation. Generation of sale grosss to determination devising by senior direction. all has been made effectual and efficient with the usage of information systems. Different degree in an organisation have different maps so one information system can non function the intent of all. Therefore there are different types of information systems depending upon the application ;
Senior Directors
Middle Directors
Executives
Workers
Transaction Processing System ( TPS )
A Transaction Processing System ( TPS ) is a type of information system that collects. shops. modifies and retrieves the informations minutess of an endeavor. Transaction made by a system must measure up ACID trial in order to measure up for TPS ;
A – Atomicity
Atomicity means that a dealing is either completed in full or non at all. For illustration. if financess are transferred from one history to another. this lone counts as a bone fide dealing if both the backdown and sedimentation take topographic point. If one history is debited and the other is non credited. it does non measure up as a dealing. TPS systems guarantee that minutess take topographic point in their entireness. C – Consistency
TPS systems exist within a set of operating regulations ( or unity restraints ) . If an unity restraint provinces that all minutess in a database must hold a positive value. any dealing with a negative value would be refused. I – Isolation
Minutess must look to take topographic point in isolation. For illustration. when a fund transportation is made between two histories the debiting of one and the crediting of another must look to take topographic point at the same time. The financess can non be credited to an history before they are debited from another. D – Durability
Once minutess are completed they can non be undone. To guarantee that this is the instance even if the TPS suffers failure. a log will be created to document all completed minutess.
TPS in TESCO –
A POS ( Point of Sale ) system is one of the best illustration of TPS system used by retail companies ( TESCO. Wal-Mart etc. ) Scanned Barcodes
Display Monetary values
Gross saless Bill
Payment
Inventory
Histories
Database
Process Payment
Update Inventory
Search Database
Each merchandise is bar-coded. which contains the information sing the merchandise. This barcode is scanned by barcode reader
Management Information System ( MIS )
A direction information system ( MIS ) provides information that is needed to pull off organisations expeditiously and efficaciously. Management information systems involve three primary resources: people. engineering. and information or determination devising. Management information systems are distinguishable from other information systems in that they are used to analyse operational activities in the organisation. MIS procedure informations from TPS based on predefined study formats which is so used by directors. MIS supports the determination devising of directors to great extent for illustration in retail sector the handiness of the client informations and feedback can assist the company to aline their concern processes harmonizing to the demands of the clients. The effectual direction of client informations can assist the company to execute direct selling and publicity activities. TESCO usage this system in Replenishment. Pricing Analysis i. e. Markdowns and Gross saless Management. Tesco uses one format Called RTI ( existent clip nexus ) with BizTalk and SQL server to supply direction squad of its caput office a individual position of supermarket gross revenues informations from all its more than 12000 shops. It provides directors a position of single shop public presentation. a strong base for other existent clip applications including stock list direction and lab our monitoring. Tesco has besides used the procedure of informations excavation by analysing the information straight through the Electronic Point of Sale ( EPOS ) .
Decision Support System ( DSS )
A determination support system ( DSS ) is a computer-based information system that supports concern or organisational decision-making activities. DSSs serve the direction. operations. and be aftering degrees of an organisation and aid to do determinations. which may be quickly altering and non easy specified in progress. Typical information that a determination support application might garner and present includes: * stock lists of information assets ( including bequest and relational informations beginnings. regular hexahedrons. information warehouses. and informations marketplaces ) . * comparative gross revenues figures between one period and the following. * Projected gross figures based on merchandise gross revenues premises. TESCO – With the aid of SAP Business Objects Polestar provided as portion of SAP Business Objects Edge BI. TESCO guided informations pilotage application that helps TESCO to easy research information and rapidly reply of import concern inquiry via simple hunt on day-to-day. hebdomadal. monthly and annual footing. Furthermore. it helps to analyse the salary tendency on regular footing. Furthermore. with the aid of SAP TESCO is able to analyse recruitment success rate. applicant statistics and dropout grounds. Furthermore. supply to TESCO accurate informations from the HRMS application and supply the tools to do better. more strategic determinations.
Executive Support System ( ESS )
An executive information system ( EIS ) is intended to ease and back up the information and decision-making demands of senior executives by supplying easy entree to both internal and external information relevant to run intoing the strategic ends of the organisation. It is normally considered as a specialised signifier of determination support system ( DSS ) . The accent of EIS is on graphical shows and easy-to-use user interfaces. They offer strong coverage and drill-down capablenesss. In general. EIS are enterprise-wide DSS that aid top-level executives analyze. comparison. and highlight tendencies in of import variables so that they can supervise public presentation and place chances and jobs. EIS and informations warehousing engineerings are meeting in the market place.
TESCO – For minute to minute Oracle Credit-to-Cash Software solution enables TESCO troughs to drive working capital efficiency with incorporate concern procedures that lower DSO ( Daily Gross saless Outstanding ) . increase client satisfaction. and keep financial subject.
Assorted Divisions
As discussed already IT has changed the manner retail industry works. Invention in IT gives companies a competitory advantage over the other participants. IT has helped simplifying assorted maps of retail sectors. it has changed retail sector in following ways: a. IT and Retail alliance
b. Online Store – New Business Model
IT and Retail alliance
The IT industry has permeated through the retail sector and has become an built-in portion of it. The retail industry has been turning at a steady gait showing more and more strategic & amp ; concern chances every twenty-four hours. These chances play a critical function in pulling clients and retaining the client base to remain in front in competition. When IT gets in action in retail sector with solutions such as bar-coding. stock list direction. BI solutions to electronic POS systems. the premier focal point is to achieve & amp ; pull more clients while maintaining the costs low. These values come into image by taking advantages of new gross revenues channels. selling & A ; publicities. etc. Invalidating the mistakes and improved efficiency are the two cardinal factors by the consequence of which retail organisations benefit by automatizing the concern procedures. Not merely this. better and informed determination devising capablenesss has improved with existent clip information available to retail companies.
Inventory Management
Inventory direction: Inventory direction describes the method which is used to maintain a path of stocks in retail concern. We can specify it as a plan that allows the direction of gross revenues. payments and purchases. By deploying retail package or an stock list direction system can assist your concern in placing what you have. what are your demands and when you need therefore assisting you run a efficient concern. Integrated with BI. stock list direction system has the capableness to maintain a path of the points that are in demand and the points which are non. This helps in doing a better determination devising as it identifies the hottest and coldest points. It besides helps in distinguishing between slow traveling points and points that are purchased often which helps in grouping them. pricing the slow moving points and other issues.
Standard ERP/CRM: The basic demands of a retail merchant who deploys ERP solution can be classified into two. First. to hold an endeavor broad platform and 2nd. to hold a dealing direction system. So in order to carry through these demands many of the ERP sellers focus on developing retail ERP solutions that can assist in consolidating all the maps. The retail merchants want that the full solution should integrate POS. supply concatenation. stock list coverage. charge direction. etc. Now with the usage of ERP system in topographic point. it focuses more on retail centric constituents that fulfills the demands of a retail merchant or a retail organisation. With such a broad scope of sections in retail sector that differs in nature & A ; range of operations. retail ERP bundle has the capableness to run into the demands of such sections. Not merely this. undertakings such as path of stock list. stock. gross revenues. MIS studies. etc are besides handled with this. CRM solutions help in edifice dealingss with the clients by tracking their involvements. their demands and their purchasing forms.
Polonium terminuss: POS or the point of sale terminuss can be described as hard currency registry replacings. They are the systems that have the ability to track. record customers’ information every bit good as procedure and verify recognition card minutess. For concerns such as out-of-door gross revenues booths etc. little options like radio POS faculties. recognition card readers. etc are handy as they help them to enter and treat recognition card minutess.
Supply concatenation direction: Retailers are puting their Information technologies based supply concatenation direction system which will assist them cut cost. Radio frequence designation ( RFID ) tickets are germinating as a major engineering to track goods and assets within the retail supply concatenation. There are already a figure of planetary retail merchants utilizing RFID-enabled tickets on palettes. cartons and even single points. RFID tickets can transport more information than a saloon codification and can be scanned without line of sight by a high-velocity reader from a distance of several metres.
Harmonizing to retail advisers Kurt Salmon Associates. successful retail concerns of the hereafter will be those that play an built-in function in developing a winning supply concatenation with spouses up and downstream. instead than concentrating strictly on tactics that deliver single success. Kurt Salmon Associates estimates that the collaborative partnership attack could cut supply concatenation costs by 10 per centum while bettering the quality of the terminal merchandise. There is a existent desire for these webs to surpass one another ; this will be a cardinal thrust in presenting cost-efficient ironss in the hereafter.
Case Study – Walmart Retail Chain
Wal-Mart is the world’s largest and most profitable retail merchant. For the financial twelvemonth stoping January 31. 2011. Wal-Mart reported a net income of $ 15. 4 billion on $ 422 billion of gross with a 24. 7 % gross net income border. The Wal-Mart civilization is built on obtaining the most current information about what clients want. acquiring the best thoughts from employees about how to run the shops good. and sharing some of the net incomes with employees.
Point of Sale ; a computerized system that identifies each point sold. finds its monetary value in a computerized database. creates an accurate gross revenues reception for the client. and shops this individual gross revenues information for usage in analysing gross revenues and reordering stock list. Aside from managing information expeditiously. effectual usage of this information helps Wal-Mart avoid overstocking by larning what ware is selling easy. Wal-Mart’s stock list and distribution system is a universe leader.
Wal-Mart usage telecommunications to associate straight from its shops to its cardinal computing machine system and from that system to its supplier’s computing machines. This allows automatic reordering and better coordination. Knowing precisely what is selling good and organizing closely with providers licenses Wal-Mart to bind up less money in stock list than many of their rivals. At its computerized warehouses. many goods arrive and leave without of all time sitting on a shelf. Merely 10 % of the floor infinite in Wal-Mart shops is used as an stock list country. compared to the 25 % norm for the industry.
With better coordination. the providers can hold more consistent fabrication tallies. lower their costs. and go through some of the nest eggs on to Wal-Mart and finally the consumer.
Walmart and P & A ; G – The Company entered into coaction with P & A ; G for keeping stock list in its shops and built a reordering system which linked all computing machines between P & A ; G and its shops and other distribution centres. The computing machine system at Walmart identifies an point which was low in stock and sent a signal to P & A ; G. The system so sent a re-supply order to the nearest P & A ; G mill through a orbiter communicating system. P & A ; G so delivered the point to Walmart distribution centre or straight to the concerned shop.
The employee in the shops have “Magic Wands” . a manus held computing machine which was linked to in shop terminuss through a wireless frequence web. These helped them to maintain path of the stock list in shops and backup ware in distribution centre
New Business Model – Online Stores
Along with back uping efficient operation of retail organisations. IT and IS have resulted in the development of a wholly new concern theoretical account i. e. on-line retail or E-retail.
Online shopping or online retailing is a signifier of electronic commercialism whereby consumers straight buy goods or services from a marketer over the Internet without an intermediary service. An online store. eshop. e-store. Internet store. webshop. webstore. on-line shop. or practical shop evokes the physical analogy of purchasing merchandises or services at a bricks-and-mortar retail merchant or shopping Centre.
The largest online retailing corporations are EBay and Amazon. com. both are US-based.
Consumers find a merchandise of involvement by sing the web site of the retail merchant straight or by seeking among alternate sellers utilizing a shopping hunt engine. Once a peculiar merchandise has been found on the web site of the marketer. most on-line retail merchants use shopping cart package to let the consumer to roll up multiple points and to set measures. like make fulling a physical shopping cart or basket in a conventional shop. A “checkout” procedure follows ( go oning the physical-store analogy ) in which payment and bringing information is collected. if necessary. Some shops allow consumers to subscribe up for a lasting online history so that some or all of this information merely needs to be entered one time. The consumer frequently receives an e-mail verification once the dealing is complete. Advantages ;
1. Price & A ; Selection
2. Information and reappraisal
3. Convenience
Indian online retail sector is still in its budding stage. For the intent of treatment we will be utilizing illustrations from Indian online retail sector to understand elaborate operation of the system. We will utilize the following informations to understand why more and more consumers are taking on-line retail alternatively of store/mall channel. Survey – Turning tendencies in Indian Online retail
Did it of all time go on to you that you saw a merchandise someplace and you wanted to buy it the same clip.
1. Application transforms Smart phones into recognition card machine ( Source – squareup. com )
Squareup is an iPhone/iPad and Android mobile recognition card payment service that uses a little and cheap physical reader which transfers card swipe informations to the app. This is so farther used to treat payment.
2. Store free shopping via text ( Source – subports. com )
Subports is a retail shopping platform through which clients use text messages to buy points. Merchants tag their merchandises and administer a short codification. such that consumers who have their payment information tied up with subports can direct an SMS to buy that point.
3. In-App purchases for augmented world content ( Source – layar. com )
Layar is an augmented world application for Android and iPhone. It takes the image being captured by the camera and combines it with information from GPS. magnetic compass and tilt detectors to find the exact orientation of the phone. It uses this information to cover points of involvement on top of the image coming from the camera.
4. Social shopping ( Source – Aaramshop. com )
In India. Aaramshop is leting consumers to utilize Facebook to shop for family points. The site. which spouses with 100s of local vicinity stores and provides them a free online presence. so uses these little stores to present the goods. The consumer is saved the fuss of going to a shop and the local stores generate new concern by linking with clients in their locality.
5. Mobile shopping ( Source – tesco. com )
In 2011. Tesco installed practical shows on the walls of metro Stationss in Seoul. South Korea to let time-strapped consumers the chance to utilize their smartphones to choose points from a “virtual food market aisle. ” Those points were so delivered to their place by the clip they arrived back place from work in the eventide. Harmonizing to this picture. Tesco increased on-line gross revenues by 130 per centum.
Tablet enabled service
1. I-pod touch provides individualized shopping experience ( Source – miele. com )
When shoppers visit contraption maker Miele’s shop they are asked to register basic information and in return and in return are given an i-pod touch which leads them to a tailored usher to the shop.
2. Floor staff equipped with manus held devices ( homedepot. com )
Home terminal distributed tablets to its floor staff. The handheld devices help staff with carrying shelves. turn uping stock list. pass oning in-stores and other locations.
Mentions
1. hypertext transfer protocol: //mohanchandran. files. wordpress. com/2008/01/wal-mart. pdf 2. hypertext transfer protocol: //www. prenhall. com/divisions/bp/app/alter/student/useful/ch1walmart. html 3. hypertext transfer protocol: //rossdawsonblog. com/weblog/archives/2011/04/future-of-retail-10-powerful-trends-and-1-meta-trend. html 4. hypertext transfer protocol: //www. scribd. com/doc/79844828/PDF-Information-Management-System-in-Tesco 5. hypertext transfer protocol: //www. docstoc. com/docs/1024659/Transaction-Processing-System 6. hypertext transfer protocol: //jumpthecurve. net/retail-marketing/the-future-of-retail-isnt-so-foreign
