PROCESS RE-ENGINEERING OF

GURUNANAK TRADING CO.

A Presentation By group AC2

Objectives and motivation of study

A consumer durables distribution company
To identify the key performance indicators (KPIs)
To suggest improvements in the existing problem areas
To gain an insight about the key business processes forms are the crux of
any business like:
Customer relation management,
Procurement of supplies
Enterprise resource planning

Steps involved

Analysing the
As-Is (Current)
Business
Process

Identifying the
scope of
Improvement
in the Process

Finding a
Solution to the
Identified
Problems

Illustration of
the To-Be
Business
Process

Indicating the
scope of
improvement
through the
KPIs identified

As-is process

As is Process- Supplier side

Initiated
from either
side

Supplier
evaluation
& Contract

Supplier
account
created

Order
arrivesprocureme
nt
departmen
t requests
delivery
from the
supplier

Firm
enquires
suppliers
about
goods
availability

Responses
are
evaluated
and
negotiation
takes place

Order
placed to
selected
supplier
and
advance
payment is
made

Order
arrivesInspected
and
defected
items
returned

Goods
received
and
entered
into book
of account

Evaluation of suppliers
Parameters used:

Gross Margin
Employer brand name in the market
Sales
Prospects of the company
General perception of people about the
company

As is Process Customer side

Either a
customer
contacts the firm
or a supplier
comes up with
the customers.

Customers
account created

Pre placement of
order- software
checks payment
due details
against the
customer
account

If Credit limit is
within limitsgoods are
delivered

If Credit limit is
exceededinvoice not
created

Areas of improvement
Issue 1:
Entry into
the Stock
Register

Entering the
number of
cases/pieces for a
large order

Time consuming

NEED
An automated
Helps better and faster
tool to capture
the stock accountability of goods
entries into
accounts

Areas of improvement
Issue 2: Evaluation
of Stock Issue

Just before the

request for
procurement

Checking the
stock limit each
time is time
consuming

NEED
A software to
Helps
calculate
thisspeedup the procurement
process
and notify
about the
stock limit


Areas of improvement
Issue 3: Post-Dated
Cheque Option
Non accountability for
cheque Payment due to
human error
Customer account reflects
outstanding amount
Difficulty in placing next
order

NEED
Tracking
Cleartodecision making in
software
taking next order.
keep a
check on
accounts

Areas of improvement

Calculating gross profit

for each purchase and
cumulative is a
Issue 4:
manual
and
time
Calculation of
consuming process
Gross profit

NEED
Customers see their
A tool to
gross profit for each
calculate gross
invoice
profit of each
purchaseand
Accountability of per
for the shop as
a whole month profit earning

To-Be Process

To-be process: POS Software Swim-Lane

Diagram

Recommendation: A Point of Sale Software

Feature
s

Cash/credit/Multi
payment
Easy and fast billing
Re order management
SMS/Email/Excel/CSV
Barcode

Recommendation: To be process
Refinement of process at two places
Request for
Procurement
Process
Entry into stock
Register

Customer credit checks

Customer post-dated Cheques
Entry into Stock Register
Evaluation of Stock

Key performance indicators

Stock
evaluation:

Small gross margin

Prevention of stock
Interest costs
incurred due to
increase/shortage
of stock

Stock entry:
Time consuming
Importing data
automatically
would save time

Delivery-time

Solutions

ISSUE 1 Stock
Register Entry:
Time consuming

SOLUTION:

Functions of Point Of Sales (POS)

software
Import the excel file provided by
the supplier to capture all the
stock entries related to items
directly into the accounts.

Solutions

ISSUE 2:
Evaluation of
Stock:

SOLUTION:

Functions of a POS
Maintain Brand, Group &
Category Wise Inventory
Provide Item Wise Gross Profit
Stock Valuation on Multiple
Methods
Sales & Purchase Order
Processing
Stock Verification

Solutions

ISSUE 3: PostDated
Cheque &
Credit Limit
Issue

SOLUTION:
Post-Dated
Cheque

Functions of a POS:
Captures the cheque details
The status of payment is
changed to Post-dated
Cheque
Updates the customer record
and clears the outstanding
amount against credit.
Status of the payment is
updated post check clearance

Solutions

ISSUE
3:Credit
Limit

Functions of POS
Software:
Records every
transaction and
maintain separate
records of each
customer
Notification alert
generated for
customers
exceeding credit
limit

Primary Credit
Limits:
Provision for
password
generated
bills if this
limit is
crossed

Final Credit
Limit: Not
allowed to cross
limits further

Provision for
Temporary
Limits:
Management
can give
authority to the
party for bill
generation in
case of
emergency

Solutions

ISSUE 4:
Calculating
Gross profit

SOLUTION

Functions of a POS
Specifies item wise Gross Profits
Easily accessible
Can be aggregated item wise,
brand wise, date wise etc.

Additional Benefits
Billing Features (ex: Discount, Indication for Loss, Negative Stock Billing
Facility)

Purchase Features (ex: Display Last 4 Deals, Supplier Wise Various

Outstanding Reports etc..)

Document Printing (ex: Accounts Vouchers & Check Printing, Receipt/

Payment Advice)

Barcode system of tracking goods

Single User & Multi Use and 100% Data Security & Accuracy

To-be process

Questions
GROUP AC2| SECTION 5| TAPMI BATCH 2014-16