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MALC: Case Study: Product Range
MALC: Case Study: Product Range
XYZ Ltd is a retail store chain with more than 200 stores in 40 cities across the
country. The company has seen a rapid growth in the past five years with a
dynamic team of board of directors. It has grown from 30 stores to 200 stores
during this period and major expansion plans continue. The team plans to
establish further 300 stores across the country along with expanding the
product range. It also plans to capitalize on the opportunities thrown open by
the internet. The short-term top priority goal is to launch a web-site to sell its
entire range of products on-line also.
Product Range
XYZ initially started its stores mainly focussing on sale of groceries. It slowly
expanded its product range to processed foods, bakery products, dairy
products, books, electronic goods, clothing and furniture. The stores layout
and structure have been carefully planned to accommodate product display
and convenient access to customers. A number of sales promotions are run to
attract customers during festivals, holidays, week-ends and company
anniversaries. The company also runs a loyalty programme to retain
customers. Security systems are in place to take care against theft, breakage,
fire, etc.
Corporate structure
The company has engaged a management consultancy firm a few years ago to
recommend an organization structure that would be relevant in the current
economic and industry environments and also meet the future requirements
of the organization. Based on the recommendations the company has
restructured its organization structure.
The CEO heads the company and is supported by a seven member board of
directors. The following departments have been created and they execute
relevant business processes and support services.
Sales and Billing Department takes care of managing the price lists and ensures
that the billing systems are functioning accurately. It is also responsible for
guiding the consumers by answering their queries and suggesting them
products that suit their requirements and budgets. This department also takes
care of advertising, store decoration and prominent display of current offers,
discounts and promotions.
The Logistics Department manages the movement of all products from the
warehouse to stores located in the cities. It also takes care of delivery of
products to customers’ location as per norms set by the sales department.
Human Resource Department takes care of all aspects of the people part of the
organization. Recruitment of employees, managing their performance
appraisal, payroll, trainings, promotions, disciplinary actions and terminations
are all managed as per laid down processes.
XYZ has plans to establish huge retail stores in all the prominent cities and
towns of the country. It plans to provide a new enjoyable experience to its
customers by making its retails stores not just a place to buy products but a
place to shop, dine and play. It also plans to launch its online sales website
within six months. An important aspect of this service is an assurance to
customers that delivery of goods ordered will be made within 6 working hours.
XYZ plans to provide all the products at competitive prices with an option to
refund all defective products with ‘no questions asked’ policy.
IT Organization structure
The CIO is the overall in-charge of the IT Department and there are five units
directly under his control. The infrastructure unit takes care of the main
network, sub-networks and servers. The applications unit takes care of all the
software applications and databases. The service management office takes
care of defining, implementing, reviewing and auditing all the IT processes. It
also takes care of resource allocation, preparation of business cases and
securing funds for IT projects and initiatives. The IT projects unit is responsible
for all IT projects that have been approved by senior management or board of
directors. The IT operations unit takes care of day-to-day management of IT
services in collaboration with infrastructure unit and applications unit.
IT infrastructure
The main data centre is in the Head Quarters location and the backup centre is
in another location. A cluster server approach has been adopted to ensure
high availability of services. The main network is from a well-known service
provider and the subnets are internally managed by the company. Each retail
store has a local server and a number of billing systems which are managed by
the local unit of operations team.
IT services
The ERP application is used by all the departments for their respective business
processes and operations. While the functional support is taken care by
respective departments, the underpinning technical support is handled by IT.
The services include application management, infrastructure management,
database management and Service Desk. Application development services are
handled by project teams constituted for specific business requirements.
IT service management
Service Strategy : The CIO and service management team have good visibility
of the organization’s business vision and long-term goals. They closely
collaborate and work with various departments to understand their strategies
and requirements.
However, the department heads feel that IT has suddenly become more
important in the organization. They feel that while at a strategic level there is
good information exchange between IT and business, at a tactical level the
links are missing.
Service level agreements are in place. However, issues and conflicts arise in
service review meeting regarding service level achievements reported.
Organization chart
CEO
IT Human
Procurement Sales & Billing Logistics Finance
(CIO) Resources