Business analysis fundamentals and applications

¶ … CanGo continues to expand, its traditional methods of logistics, storage and retrieval continue to be pushed beyond the limits of what they were originally designed for. The scenarios of the videos surrounding the planning, purchase and implementation of the AS/RS (Automated Storage and Retrieval) technology-based systems are only a partial solution to the company's challenges however. The following analysis provides insights into how CanGo's senior management teams needs to take a more strategic and thorough -- view of the challenges their company faces today and in the future with regard to growth.

The selection of the AS/AR system is not being made thoroughly enough, with a focus on the company's value chain, and due to this myopic focus, this investment will not scale and pay for itself over time. First, there is a lack of planning with regard to the overall distributed order management system and workflows the company relies on for all its revenue. Integrating distributed order management systems across all selling and service channels so logistics processes and systems have real-time visibility of customer demand is invaluable in ensuring a high level of supply chain performance (Liu, Deitz, 2011). This requirement, which needs to be one of the main priorities of CanGo in implementing the AS/AR system, is considered an adjunct issue -- not a central one. That's troubling because the level of system and process integration to ensure all inbound sales orders from any channel are accurately processed through the internal logistics and AS/AR system is going to be very complex and challenging given the number of products the company is selling today. Add in mass customization or the ability to build exactly what a customer is looking through using a build-to-order strategy that relies on front-end product configuratoirs, and the complexity goes up exponentially (Liu, Deitz, 2011). In short, the senior management team is vastly underestimating just how challenging it will be to make all sales channels synchronized and capable of supporting the large differences in order type, transaction size and timeframes for delivery. Just as troubling is the lack of focus on advanced technologies that would make bar coding look antiquated and archaic. The use of Radio Frequency Identification (RFID) for example could vastly improve the performance of the AS/AR system as studies have shown from early adopters of this technology (Davis, Samanlioglu, Jiang, Mota, Stanfield, 2011). Yet there is no mention of this technology in the case study or the discussions in videos. This is a significant shortfall from the standpoint of creating long-term value by adopting a more effective technology that can scale faster than bar coding for example. Second, there is no actual definition of how to create an effective lean manufacturing strategy for the long-term as well. The lack of planning for a sustainable lean manufacturing strategy will over time cause any company to not attain its full potential for cost reduction and time performance gains (Ferdows, Thurnheer, 2011).