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Business Redesign for Healthlite Yogurt Company

By: Gwendolyn A. Cuizon
March 7, 2006

Business Structure

Healthlite’s corporate headquarters is located in Danbury, Connecticut. All production takes place in processing plants that are located in New Jersey, Massachusetts, Tennessee, Illinois, Colorado, Washington, and California. Healthlite Yogurt Company has 20 sales regions, each with approximately 30 sales representatives. Healthlite has a 12 person in marketing division at corporate headquarters.

Products

Yogurt and related health products and new yogurt based products which would include frozen desserts and low-fat salad dressings.

Major Business Processes for Sales

The following are the way Healthlite conducts business in a day-to-day basis:

· Sales persons must write up hard-copy tickets to place orders through the mail or by fax.

· Each salesperson stores and retrieves data for assigned customer accounts using the minicomputer system in the regional office.

Higher client satisfaction due to value-added customer service is one positive result.

Decision-making can be improved because the information systems used are more efficient and can provide them accurate and updated data in real time.

Improvement in control of resources (materials, labor and products) and organizational planning.

Increased job satisfaction for employees’ particularly regional sales people whose jobs are now greatly facilitated with the aid of the new system.

Major Business Process Changes

The following major changes are required for the business redesigning plan.

Eliminate the need for hard-copy tickets to place orders.
Enter sales orders directly into enterprise-wide system instead of using around 20 workers at corporate headquarters to sort and to enter order tickets which could reached up to 500,000 order tickets per week. This also allows all systems users to have access to this data for analysis purposes.
Do without the need of using snail mail and fax machines for taking orders. The new business system allows orders to be placed directly through the web site.
No longer need to mail printed reports for individual salespeople and sales offices. Salespeople can access the system for needed information at anytime.
Sales representatives no longer need to write and mail monthly reports to regional headquarters. Sales information can be accessed from the system.
Managers can access up-to-date sales data in the new system anytime they need them. They no longer need to call subordinates and piece information together to update their reports.
Announcements, promotional campaigns and pricing discounts can be quickly disseminated though the enterprise-wide system. Thus, helps in improving communication processes between sales managers and sales representatives.
Customer Relationship Management tools are available to help with ordering. Customer history management, complaints, and real-time tracking service are also available for use.
Reduce the time involved to process orders since faxing and mailing will no longer be required in order to place orders. As a result, this would enable shipments to be delivered on time. Thus, promoting customer satisfaction.

Major New Technology Components of the Plan

Upon analysis of Healthlite’s needs to implement technology to support the new business processes, an enterprise system comes highly recommended. This is so because an enterprise can best meet the demands and requirements. An enterprise system could link enterprise-wide information processes in turn improving the overall business efficiency. When the entire company is able to use a single software system, all departments can share information readily and freely. Enterprise systems enable the company to avail of a wide-ranging information system technology platform. This technology platform provides a single data warehouse or a databank that can be accessed by different departments to input and to obtain enterprise-wide information. Also, the new system enables data storage in one data warehouse, which will prevent inaccuracy in extracted information. The data should be grouped according to processing sites, but can be accessed by all users. This data storage process will allow differentiation among processing sites at the same time allowing enterprise-wide search capability. It is easy to see then the enterprise system is essential element in propelling Healthlite’s success as it moves into the future.

An enterprise system into the Healthlite business will enable the managers to

support business processes that will make the company more efficient. The enterprise system will allow for centralized data collection and entry. This centralized entry system will reduce or eliminate paper passing throughout the company. This system will also enable employees to view reports on-line which no longer requires printing of documents or doing paperwork manually unless necessary. This additional feature will help managers and market analysts in accurate sales planning, decision-making, and marketing strategy development by providing them with the ability to collect more accurate information to assist them.

Healthlite must also improve the telecommunications infrastructure for the whole enterprise. E-mail capabilities will be needed throughout the company in order to eliminate the ineffective communication using snail mails and fax within the company. Email will enable speedy communication companywide. There is no need to do additional paper works by writing or typing requests. Also, the time and effort necessary to mail or fax the message will be greatly reduced through email. The message sent is received by the person addressed to in real time. If there are problems or requests required, the recipient on the email can quickly act on it. Intranet is another option the company could use. Intranet is a private computer network that can be accessed by authorized persons only. These will ensure that secret company information will not fall on the wrong hands. Adding Intranet and Internet service will definitely improve the company’s day-to-day operations.

Recommendations

To help facilitate the transition and to make better use of the technology or new system, the following recommendations are given:

· Healthlite should install an entire enterprise system and not limit itself to the customer relationship management component, or better known as CRM, of the system. In order to be effective, Healthlite could introduce the changes phase by phase.

· This approach in implementing the enterprise software will enable users to

adapt to the system well, starting with the order and sales process and

advancing to the most difficult part slowly.

· The systems development team must focus the development process of the new system on eliminating the existing business inefficiencies in manual reporting, hand order-tickets, and mail and fax order taking. Additionally, the development team needs to follow the systems development lifecycle to establish its new customer relationship management (CRM) system.

· All users must be ably represented. This means that representatives in each company division must be involved in developing the system. They should be allowed to make suggestions at the same time provide necessary information in formulating the system. And all users need to have adequate information on the upcoming changes introduced to the system.

· Healthlite should implement e-mail and Intranet use to improve its internal communications and productivity throughout the entire business. This could help do without the need for paperwork, snail mail and fax.

· The company should provide value-added customer service by including the customers during the design process of the business system. This is accomplished by soliciting feedback from customers in the form of questionnaires on a regular basis.

· Due to the low shelf life of the products they sell, Healthlite needs to ensure product freshness by improving the efficiency of its distribution of products and services to customers. With the new automated business system, orders are received and delivered immediately. The timely delivery of the products would ensure their freshness.

· Management needs to address the accounting discrepancies incurred annually. The accounting problem should be identified and resolved in the design phase to make sure that the new business system they come up with is free of these errors and accounting discrepancies will not occur in the future.

· Management also needs to ensure that the changes implemented in the business are done step by step especially that the company is in the midst of recent and rapid growth.

· Management needs to change its views regarding changes and adapt to the new business process accordingly. They should also lead the development process.

· Managers need to wait until the new business process has materialized and the benefits of the new system are realized before implementing the headcount reduction in order to ensure a smooth cutover.

Conclusions

Despite its current business process problems, Healthlite has managed to attain success in its operations. This means that Healthlite has a lot of room for improvement in the future. And this could be easily attained through redesigning business processes.

Currently, the organization uses little or almost non existing technology for their daily company activities. Due to the decentralization, many people are doing the same activities over and over again and doing paperworks manually which are time-consuming and could be transmitted electronically. The rapid growth of the company requires that Healthlite should quickly implement systems changes to improve its business processes and to get the product and services to the customer in a promptly and efficiently.

Healthlite’s management also posed some problems due to their very conservative views regarding technology. They need guidance in determining a proven system in

which they will be comfortable. The management’s support in the new business process is essential in implementing the changes effectively and leads the company into the future as well as to guarantee its competitive advantage.

The company needs to know the importance of using the systems development lifecycle. This process is vital in creating a new business system that will be useful for the company. Also, this phase is important to establish efficient procedures when developing programs that will best fit Healthlite’s needs. An enterprise system will be necessary to advance Healthlite into the future. At the present the company may only focus on redesigning the ordering, sales, and marketing processes. But later on, Healthlite management needs to realize that the CRM system is going to need to be scalable. Healthlite’s business growth despite the difficulties it encountered could mean that the company has a lot of growth potentials in the future. Healthlite therefore needs to accommodate future changes and bigger adjustments. And the new business process they are about to install must be able to handle these changes and need for additional data.

The company needs to identify and get rid of the sources of the accounting discrepancies annually between headquarters and the sales force. Management needs the accounting information to make decisions necessary for the company’s growth. The accounting report helps them to address potential problems and see possibilities for future expansion. The discrepancies in their accounting records due to the errors incurred are thus potentially making business decision on bad data. Before the implementation, management needs to address these problems to ensure that they will not arise in the future using the new system.

Management needs to take time in implementing the headcount reductions. A successful implementation requires that all employees will be there during its implementation phase. The installation and use of the new system requires the support of all employees. This will ensure a smooth cutover later. Once the learning phase of the new system has been overcome, management then can consider its headcount reduction.

Bibliography:

Pearson Education. (2004). Redesigning Business Processes for Healthlite Yogurt Company. Retrieved on December 12, 2005, from

http://wps.prenhall.com/ca_ph_laudon_MIS_1/0,6507,147471-,00.utf8.html

Aiken, P. (2004, October 24). Redesigning Business Processes for Healthlite Yogurt Company. Retrieved on December 12, 2005, from

http://aiken.isy.vcu.edu/classes/info360/software_exercises/P4_Redesigning_Business.pdf#search='Redesigning%20Business%20Processes%20for%20Healthlite%20Yogurt%20Company'

Ward, S. (2005). CRM (Customer Relationship Management). Retrieved on December 12, 2005, from http://sbinfocanada.about.com/cs/marketing/g/crm.htm

Vargas. M. (2005). CRM. Retrieved on December 12, 2005, from http://retailindustry.about.com/library/terms/c/bld_crm.htm

Maly, Jody. (2002, February). The Roadmap to Implementing Technology Solutions in the 21^st Century. Retrieved on December 12, 2005, from

http://www.identitech.com/industry/articles/Enterprise-Wide_2-25-02.pdf#search='define%20enterprisewide%20solutions'

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