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business process re-engineering

Case 7-19. Martin Shoes, Inc. (Planning a Database Using REA and E-R Methodology)

Martin Shoes, Inc. manufactures and distributes orthopedic footwear. To sell its products, the marketing department requires sales personnel to call on the shoe retailers within their assigned geographic territories. Each salesperson has a laptop computer, which he or she uses to record sales orders during the day and to send these sales orders to Martin's network nightly for updating the company's sales order file.

Each day, warehouse personnel review the current sales orders in its file, and where possible, pick the goods and ready them for shipment. (Martin ships goods via common carrier, and shipping terms are generally FOB from the shipping point.)
When the shipping department completes a shipment, it also notifies the billing department, which then prepares an invoice for the customer. Payment terms vary by customer, but most are "net 30."When the billing department receives a payment, the billing clerk credits the customer's account and records the cash received.

Describe how the principles of business process re-engineering should be applied in this case.

Solution Preview

Let us first see major principles of business process engineering, which can be summarized as follows:

1. Organize around outcomes, not tasks.
2. Identify all the processes in an organization and prioritize them in order of redesign urgency.
3. Integrate information processing work into the real work that produces the information.
4. Treat geographically dispersed resources as though they were centralized.
5. Link parallel activities in the workflow instead of just integrating their results.
6. Put the decision point where the work is performed, and build control into the process.
7. Capture information once and at the source.

Now us see how some of these principles can be applied to Martin shoes in order to improve its operations.

First of all, Martin shoes should implement a system wherein sales people can update the customer's orders on a real time basis. Rather than updating all the order which were gathered during the day at once in the night, company should implement a ...

Solution Summary

Describe how the principles of business process re-engineering should be applied in this case.

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