Bsa 375 - Fundamentals of Business Systems Development

BSA/ 375 - Fundamentals of Business Systems Development

Richard Guirguis

January 15, 2008

Abstract

Kudler Fine Foods is launching a new project to create and implement a “frequent shopper…loyalty points program…to provide customers with points which can be redeemed for high end gift items, airline first-class upgrades, or other specialty foods.” The objective of the new program is to facilitate “tracking purchase behavior[s] at the individual customer level …[to] help Kudler refine its processes and offerings to best satisfy their valued customers.” In addition, Kudler is seeking to “[improve] its operations and [increase] the loyalty and profitability of its consumers” (Kudler Fine Foods, 2007). A comprehensive business systems development plan will ensure that this project is implemented in an efficient, timely, and cost-effective manner.

Business Systems Analysis for Kudler Fine Foods

Kudler Fine Foods is launching a new project to create and implement a “frequent shopper…loyalty points program.” This new program is intended to improve Kudler’s ability to track individual customer purchasing “behavior” and help Kudler provide those customers with the products and services that they desire the most. In the process, Kudler hopes to increase its revenue while simultaneously satisfying its customers (Kudler Fine Foods, 2007).

Scope and Goals

The scope of the frequent shopper program will include a number of specific business and technical functions. One of the business components of this project will include the establishment of “a partnership with a loyalty points program.” Another component will be the creation of a detailed marketing plan to inform customers about the program and solicit customer participation. Finally, Kudler plans to improve communication and planning between the sales/marketing department and its purchasing department to streamline the supply-chain process to be more in-line with consumer demand.

The technical components of the scope will include, but not be limited to, a number of business system needs. Since Kudler intends to partner with an outside partner for its “loyalty points program,” it will need to establish interfaces between its internal sales and inventory control systems with the computer systems owned and operated by the loyalty rewards partner. In addition, there may be a need to modify the existing system’s database schema, screen layouts, and business logic to accommodate the increased communication demands of this new business function.

As stated earlier, the goals of this effort include increasing sales, improving customer satisfaction, and to reduce costs by improving Kudler’s ability to track customer purchasing trends for better supply-chain management. These constitute the primary three goals outlined by Kudler as part of this new frequent shopper program. Kudler created a revenue improvement forecast table to quantify the projected amount of increased revenue and the associated timeframes (outlined in Figure 1 below).

Figure 1 --- Frequent Shopper Program Projected Revenue Lift (Kudler Fine Foods, 2007):

Frequent Shopper Program

Projected Revenue Lift

Q1 Employee-wide training session

Frequent shopper program rollout .25%

Q2 Assessment and refinement of program

Frequent shopper promotion, increased customer satisfaction .50%

Q3 Frequent shopper promotion, increased customer satisfaction 1.75%

Q4 Frequent shopper promotion, increased customer satisfaction 2.25%

Total 4.75%

The frequent shopper program shows great promise in being able to assist Kudler with achieving each and every one of the aforementioned goals through implementation of those functions that are identified as “in-scope” for this project. This requirements document will not only serve to define those elements that are explicitly and implicitly included in the project scope as well as the individuals who must participate.

Supporting Measures for Success

The following items will be evaluated on a quarterly basis to determine the success of this project.

1. New customers signing up on the website вЂ" Kudlers target is 10 customers per month

2. Repeat customers вЂ" Kudlers will track establish customers and purchases.

3. Increase/decrease in revenue вЂ" An increase/decrease of no more than 15% per month.

4. Comparison of the cost of redeemed items vs. wholesale cost.

5. Points rewarded to customers вЂ" Overall points awarded to customers and customer level, new, 6 months, 12 months, over 12 months.

6. Points redeemed вЂ" Overall points redeemed by customers and customer level using the following categories: new, 6 months, 12 months, over 12 months.

Summary of Project Feasibility

Purpose of Project

As noted earlier, the purpose of this Kudler project is to implement a customer tracking system. The proposed system will be used to monitor, track, and compute individual customer sales. The individual customer sales totals will be tracked and accumulated to convert to loyalty rewards points. The rewards points will afford the customer the opportunity to redeem loyalty points for products and/or high end gifts from Kudler or rewards venders (Kudler Fine Foods, 2007).

Kudler Background

Kudler Fine Foods is a local specialty food store with three (3) locations in San Diego. The company was founded by Kathy Kudler who had a vision to provide the finest ingredients and accessories necessary to complete a recipe in a one stop shopping