27 October, 2003
© Beep Knowledge System and case owners, 2002-2003
Digital SMEs Cases
Executive summary of the case:
Timing of case
Work on upgrading information and communication technologies and utilising
then into the practice was stared by Interdiskont company in year 2002.
Geographic setting
Interdiskont company is located in one location, but there mobile sales
tem is operational national wide.
Type and use of ICT
Following ICT is used by Interdiskont company. On filed sales office are
used notebooks, mobile telephones, IBM and DELL cash registers and POS
terminals. For connection to the company headquarters is used mobile network.
Main contributors
Main contributor is Interdiskont company itself.
Main beneficiaries
Beneficiaries are employed and Interdiskont company.
Background
The company Inter Diskont was established in May 1990 two Slovenian and
one foreign partner. The foreign partner did not co-operate in the sales
or the company organisation and is still not a part of decision making.
The foreign partner provided the start-up capital and acted as the first
supplier of the imported goods.
The company was founded with the money made on the flea market in Ljubljana
and in the first video store in Ravne na Koroškem. In the first few years
the sales were made on large organised trade fairs across Slovenia and
former Yugoslavia. Eventually, the sales diversified and the consumer
goods were also sold on smaller, occasional trade fairs, organised by
small communities. The company purchased suitable vehicles (lorries) for
the mobile sales force.
The company began managing its field sales in October 1994. The first
sale outside the retail store was organised in Kamnik and the sales force
has since visited 22 municipalities and is marketing their projects in
additional 36 municipalities in Slovenia (the number of included municipalities
in the years from 1995 to 1998 was 147) with the goal of adding at least
one municipality or town per year.
Objectives
Ever since October 1994 the company has been organising occasional sales
for consumers. Field sales essentially follow the same pattern as usual
retail stores, the only difference being that the sales are performed
for a limited time only, usually three to four days on an individual location.
In the beginning the company managed the field sales with minimal technological
equipment. However, with the increase in business operations the equipment
had to be replaced eventually, so the company started working with a local
computer company Infosys – Computer Engineering to find a solution and
surpass the limitations.
The company Interdiskont set one basic goal:
To upgrade information and communication technologies and utilising
them to achieve the following secondary goals:
- establishing a constant audio (and eventually
video) connection with the field sales force,
- enabling the field tem to have constant
access to all the needed business information,
- reducing the time needed for preparing the
provisions for the field sales (replenishing the stock daily to compensate
for the products sold),
- reducing the time needed for processing
sales information at the end of each business day,
- increasing the financial transparency of
field sales.
Resources (apart from ICT)
Financial resources for establishing an ICT infrastructure are provided
by the company itself. Following knowledge is required from employed:
- Head of the Office (University degree);
- Field Manager (High school or further education);
- Assistant Manager (High school);
- Salesmen (Vocational secondary school).
Activities
Activities had been diveded in two steps:
Preparation of a business plan and the activities accompanying the realisation
of the plan:
- choosing the hardware and software suppliers
;
- choosing the GSM service provider;
- choosing the Internet service provider.
Operational activities:
- establishing the appropriate IC infrastructure
for the sales force and the analysis of field sales,
- utilising the available telecommunication
resources to connection the company headquarters to the field sales
force,
- additional training for the field managers,
qualifying them to use ICT efficiently,
- enabling the users (employees) who will use the new technologies to acquire the basic ICT skills.
Outputs and results
Outputs / results that the company wishes to achieve and has set them
within primary or secondary goals:
- upgrading the IC technology and consequently,
- establishing a constant audio (and eventually
video) connection with the field teams,
- establishing a constant access to all the
information about the field team operations,
- reducing the time needed for preparing the
provisions for the field sales (replenishing the stock daily to compensate
for the products sold),
- reducing the time needed for processing
sales information at the end of each business day,
- increasing the financial transparency of field sales.
Lessons and conclusions
With increase of the sale in the field market Interdiskont was challenged
with problems how to transfer data to company headquarters. Every day
field time must be used to report daily sale information (amount of sale;
goods that have been sold; orders). Before implementing of solution developed
by Infosys company, field team workers had difficulties at the end of
the day to collect needed data. Too much time was necessary to calculate
daily sale, overview of stock and for report to company headquarters.
With inclusion of file server and mobile network for transferring data
these difficulties have reduce. Now company headquarters has daily overview
over seal team on the field. Increase of control of workers was achieved,
better and in time supply for mobile time is established. Efficiency of
field time is greater as result of use of modern ICT.
Staff needed to be trained in the use of tills, notebooks and software.
The company tried and tested the possible solutions and settled on the
one that worked in the field. The use of a floppy disc to transfer data
from the till to the printer proved to be an easier solution to impliment
and use than using cable connections and software. Once the floppy disc
is recorded the till can be paked away with the unsold stock and the seller
can transmit the daily data later when they have time and a quiet space.
Case description:
Background
The company Inter Diskont was established in May 1990 two Slovenian and one foreign partner.The company was founded with the money made on the flea market in Ljubljana and in the first video store in Ravne na Koroškem.
In the first few years the sales were made on large organised trade fairs across Slovenia and former Yugoslavia.
The company employed casual workers and students referred by the student organisation.
The foreign partner did not co-operate in the sales or the company organisation and is still not a part of decision making. The foreign partner provided the start-up capital and acted as the first supplier of the imported goods.
Eventually, the sales diversified and the consumer goods were also sold on smaller, occasional trade fairs, organised by small communities. The company purchased suitable vehicles (lorries) for the mobile sales force.
In the end of 1992 the company invested their own resources into building a pub in Ravne na Koroškem and in August 1995 they opened a retail store in a rented building. A year later they transferred the business offices and the warehouse to a new location in the immediate vicinity of the pub and the retail store.
The company began managing its field sales in October 1994. The first sale outside the retail store was organised in Kamnik and the sales force has since visited 22 municipalities and is marketing their projects in additional 36 municipalities in Slovenia (the number of included municipalities in the years from 1995 to 1998 was 147) with the goal of adding at least one municipality or town per year.
Since the company has been expanding their operations, the company realised they also had to increase the number of the employees. The company now employs ten people and two of them are field workers. In addition to the regular employees Inter Diskont also offers employment to students referred by the student organisation.
The company is divided into 3 sales units. Each unit employs a manager, responsible for the acquisition and sales as well as individual employee performance.
All the decision-making and organising is done within the management, while feedback and proposals come from the employees and the sales units themselves. The process is illustrated in the figure below:
In the ePractice Case Study the focus was placed on “field sales” and the organisation of the field business directed at using the ITC to solve the problems created by the mobility and distance of field workers from the company headquarters.
Objectives
Ever since October 1994 the company has been organising occasional sales for consumers. Field sales essentially follow the same pattern as usual retail stores, the only difference being that the sales are performed for a limited time only, usually three to four days on an individual location. In the beginning the company managed the field sales with minimal technological equipment. However, with the increase in business operations the equipment had to be replaced eventually, so the company started working with a local computer company Infosys – Computer Engineering to find a solution and surpass the limitations.The company Interdiskont set one basic goal:
To upgrade information and communication technologies and utilising them to achieve the following secondary goals:
- establishing a constant audio (and eventually video) connection with the field sales force,
- enabling the field tem to have constant access to all the needed business information,
- reducing the time needed for preparing the provisions for the field sales (replenishing the stock daily to compensate for the products sold),
- reducing the time needed for processing sales information at the end of each business day,
- increasing the financial transparency of field sales.
Resources
Financial resources
The financial resources for establishing an ICT infrastructure are provided
by the company itself and are considered to be confidential.
Human resources
The company Interdiskont, which has grown from a small company into
one of the fastest growing companies in the region, soon became aware
of the fact that the future development of the company and business
will require appropriate staffs, which have to be flexible and adaptable
as these qualities are highly important for efficient operations in
the field.
The company management designed the following employment scheme:
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Knowledge and skills
For a successful operation, the following knowledge is required:
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Equipment
To upgrade the operations of the retail store and field sales offices
the following equipment was used:
-
notebooks,
-
mobile telephones,
-
IBM and DELL cash registers,
-
POS terminals.
The equipment is used at the sales counter, usually located
in public buildings or public event spaces. The existing equipment was
complemented by a server, as a technical platform solution for the existing
problems.
Activities
Activities done by Interdiskoknt company to solving their problem can be divided in three steeps:1. Feasibility study about introducing new ICT.
2. Preparation of a business plan and the activities accompanying the realisation of the plan:
- choosing the hardware and software suppliers,
- choosing the GSM service provider,
- choosing the Internet service provider.
3. Operational activities:
- establishing the appropriate IC infrastructure for the sales force and the analysis of field sales,
- utilising the available telecommunication resources to connection the company headquarters to the field sales force,
- aditional training for the field managers, qualifying them to use ICT efficiently,
- enabling the users (employees) who will use the new technologies to acquire the basic ICT skills.
Output and Results
The functionality of processing field sales on the spot, which made the company establish a new ICT-supported business scheme was based on the following business operation diagram:
.gif)
This solution had certain limitations, which resulted in two basic problems:
1. The business operations difficulties:
- the problem of keeping track of field operations (guaranteeing constant
control over the sales and stock, which is very important in operations
lasting several days.
- the problem of timely replenishment.
2.The technological problem:
- the cash register had too many functions, ranging from selling to processing.
This required so many additional external devices that the cash register/computer
simply began operating too slowly and the risk of software or hardware
malfunction was too big.
Outputs / results that the company wishes to achieve and has set them
within primary or secondary goals:
- upgrading the IC technology
and consequently
- establishing a constant audio (and eventually video) connection with
the field teams,
- establishing a constant access to all the information about the field
team operations,
- reducing the time needed for preparing the provisions for the field
sales (replenishing the stock daily to compensate for the products sold),
- reducing the time needed for processing sales information at the end
of each business day,
- increasing the financial transparency of field sales.
The output / result diagram:
.gif)
To solve the existing problems, they turned to the company
Infosys - Computer Engineering, which analysed the situation and developed
the solution illustrated in the figure above.
Several cash registers can be connected to the server:
- removing possible sales bottlenecks at times of increased traffic.
A computer for sales processing can be connected to the server:
- on-line transaction processing,
- on-line stock control.
Connection server – GSM:
- always-on connection between the company headquarters and field employees
over the mobile network or the Internet.
Lessons and conclusions
With increase of the sale in the field market Interdiskont was challenged with problems how to transfer data to company headquarters. Every day field time must be used to report daily sale information (amount of sale; goods that have been sold; orders). Before implementing of solution developed by Infosys company, field team workers had difficulties at the end of the day to collect needed data. Too much time was necessary to calculate daily sale, overview of stock and for report to company headquarters. With inclusion of file server and mobile network for transferring data these difficulties have reduce. Now company headquarters has daily overview over seal team on the field. Increase of control of workers was achieved, better and in time supply for mobile time is established. Efficiency of field time is greater as result of use of modern ICT.Staff needed to be trained in the use of tills, notebooks and software.
The company tried and tested the possible solutions and settled on the one that worked in the field. The use of a floppy disc to transfer data from the till to the printer proved to be an easier solution to impliment and use than using cable connections and software. Once the floppy disc is recorded the till can be paked away with the unsold stock and the seller can transmit the daily data later when they have time and a quiet space.
Even a low technology operation such as selling at market stalls can benefit from properly set up ICT that is designed to be used in the field and at the skill level of the field team.
-
Lessons and conclusions - Key Factor: improved business processes
Interdiskont has with implementation of modern ICT to mobile times achieved that business process is now faster, better controlled and supplying with goods for mobile teams is in right time.
-
Lessons and conclusions - Key Factor: improved workplace environments
Mobile teams of Interdiskont can now executed their task in shorter time. Use of ICT has bring better management of field sale; worker on field sale can now in shorter time sent an every day cash report to the headquarter.
References and links
http://www.interdiskont.si/http://www.infosys.si/