Pantaloon
Submitted to:
Prof. H.K. Mishra
Submitted by:
Amit Goel (29007)
Anand Prakash (29008)
Institute of Rural Management, Anand
2009
Contents
CASE SUMMARY
1. MISSION OF THE ORGANIZATION
2. MISSION OF THE MIS
3. ORGANIZATION STRUCTURE
4. VIEWS OF ARCHITECTURE
4.1 Architectural View
4.2 Structural View
4.3 Behavioural View
4.4 Execution view
5. ARCHITECTURAL APPROACH
6. FORM OF MIS
7. FAYOL’S MODEL
7.1 Planning:
7.2 Organizing
7.3 Staffing:
7.4 Directing:
7.5 Coordinate and Controls:
8. OMNIS MODEL
8.1 Why does the organization need information?
8.2 Who are the key stakeholders?
8.3 Identification of Information System
9. APPLYING MINTZBERG’S MODEL
9.1Organization Pyramid
9.2 Transaction processing System (TPS)
9.3 Management Reporting System (MRS)
9.4 Executive Support System (ESS)
9.5 Information system Event Cycle
10. DATA AND INFORMATION MANAGEMENT
10.1 Data Sources
10.2 Data Matrix
10.3 Cardinality Matrix
10.4 Process Details
10.5 Process Matrix:
10.6 E-R DIAGRAM
10.7 Information Matrix
10.7.1 For Sales Team- operational level
10.7.2 For Area Manager - Tactical level
10.7.3 For the CEO- Pantaloon- Strategic level
11. IMPLEMENTATION OF MIS PLAN
List of Figures
Figure 1: Organization Structure
Figure 2: Organizational Pyramid
CASE SUMMARY
Pantaloon group is a large Indian conglomerate with diversified business interest and and have been promoted by Kishore Biyani.. The company aimed at providing total satisfaction to the customers through wide variety of items, right pricing, pleasurable ambience, excellent service, best quality and convenient visual merchandising.
Its business has grown from one store in Kolkota in 1997 occupying an area of 8,000 Sq. ft. to 72 stores, apart from our 22 factory outlets located in multiple cities occupying an aggregate area of 21,07,608 Sq. ft. Pantaloon has been a pioneer in introducing the concept of mega retail stores in India called ‘Pantaloons’ for the entire family. In an extremely price-sensitive market like India, the Pantaloons chain of stores has been successful in maintaining the equilibrium between quality and price. Pantaloon outlets have been positioned as a complete family destination providing value-for-money goods.
Each region has a Regional hub. Under their control is several Distribution Collection Centers. The primary function of these DCC is to distribute the products across the PANTALOON retail stores.
They believe that their most valuable assets are their people, young in spirit, adventurous in action, with an average age of 27 years; they are skilled & qualified professionals.
Pantaloon has its marketing strategy to stay ahead in the competition like Pantaloon is the title sponsor of the event Femina Miss India 2007. Pantaloon is buying prime areas, instead of taking rentals as rentals are now fifty per cent higher compared to what it used to be. Pantaloon's own stores will also stock non-apparel related merchandise such as stationary, pens, gifts and toys for the film.
The company that has grown at a tremendous pace is now faced with the challenge of keeping the ball rolling, with competitors starting to get their act together. While Pantaloon has consistently managed to execute its expansion projects, forays into new categories will have to be equally successful for it to be able to deliver the kind of growth it has managed in the past. Given its ambitious expansion plans, Pantaloon is likely to sustain its first mover advantage. While new stores would drive revenue growth, sustaining customer attention once the novelty of a format wears off is a challenge.
Pantaloon operates in a competitive environment. The company has integrated backwards into garments manufacturing even as it expanded its retail presence at the front end, well before any other retail company attempted this. It was the first to introduce retail departmental store for the entire family through Pantaloon in 1997. Today Pantaloon is the fastest growing retail company in India.
In our assignment we have focused only on the retail chain of Pantaloons and not on the complete Pantaloon retail Pvt Ltd. which includes stores under the name of Pantaloons, Big Bazaar, Central, Food Bazaar etc.
1. MISSION OF THE ORGANIZATION
- We share the vision and belief that our customers and stakeholders shall be served only by creating and executing future scenarios in the consumption space leading to economic development.
- We will be the trendsetters in evolving delivery formats, creating retail realty, making consumption affordable for all customer segments – for classes and for masses.
- We shall infuse Indian brands with confidence and renewed ambition.
- We shall be efficient, cost- conscious and committed to quality in whatever we do.
2. MISSION OF THE MIS
To strengthen the current supply chain of Pantaloon by improving the distribution/ procurement strategy of the company and help retain its share in the competitive retail sector and there by increasing sales and profitability.
3. ORGANIZATION STRUCTURE
Pantaloons come under ‘Divisional Bureaucracy’ type of organizations. Decisions are taken centrally as well as locally at the regional level.
Figure 1: Organization Structure
Source: Company records
4. VIEWS OF ARCHITECTURE
4.1 Architectural View
The overall aim of Pantaloon is to increase its market share in the booming Indian retail industry. It is customer oriented company.
4.2 Structural View
It relates to functions and relations among them. Production, Procurement, finance and Marketing are very critical functions for the Pantaloon.
4.3 Behavioural View
Behavioral views include state of systems in place. Inventory holding costs of production units and outlets are parts of the “states” of the systems to be monitored. Pricing policies are market driven and are governed by “what-if” analyses for applying them across the organization.
4.4 Execution view
Explicitly nothing much is written about this aspect in the case.
5. ARCHITECTURAL APPROACH
The MIS will be used by the head of the organization as well as the staff at different Regional hubs for taking localized decisions as well as keeping in tune with the central decision-making body. So, establishing architecture will help in getting uniformity across users. The organization structure shows that a Clustered Architecture approach will be suitable for developing MIS.
It manages heterogeneous products and services and it has production units. Organization is divisionalised but many decisions are centralized.
6. FORM OF MIS
Pantaloon will have to opt for a Decision Support System which will help them in capturing the customer data and further combine this data with back office applications for the fulfilment of their objectives. This DSS will help them to take decisions pertaining to various aspects like pricing, supply chain management and would further help the organization to be customer centric. It deals with the unstructured problems; a model for decision making is required.
7. FAYOL’S MODEL
7.1 Planning:
The organization’s long term goal is to capture a major pie in the market share and earn good profits. For this purpose the organization has:
- A Procurement plan where it procures its finished goods (apparels) from various brand manufacturers.
- A outlet site selection plan (to open at convenient and profitable location)
- A marketing plan where (Collect apparels, footwear etc from companies and allocate store space etc., Advertising.)
- A finance plan on revenues and expenditure and how many stores to open, how many brands to keep. Reducing inventory levels.
7.2 Organizing
ORGANIZATION / MISLevel of organization / Functions / Actors / Level of MIS / Reports / Actors
STRATEGIC / Production, Finance, Procurement, Marketing / Board of Directors
Chairman, Managing Director / STRATEGIC / Daily revenue collection,
Daily production and inventory sold, daily outstanding reports, decisions to open new outlets / Board of Directors
Chairman, Managing Director
TACTICAL / Production, Finance, Procurement, Marketing / General Managers, Managers / TACTICAL / Sale and supply reports, Inventory status report
Daily product wise demand,
Outlet wise, reorder point, EOQ level, / General Managers, Managers
OPERATIONAL / Production, Finance, Procurement, Marketing / Supervisors
Production,
Marketing,
Distributors
Store in charge, floor staff
outlets, / OPERATIONAL / Product-type,
Daily Procurement, Expenses, Inventories stock, Finished goods, / Supervisors,
Production,
Marketing,
Distributors,
Store in charge, floor staff
outlets,
7.3 Staffing:
The staff includes area manager, store manager, category managers, sales team etc.
- Helping employees to realize their potential through innovative HR practices
- Performance improvement of employees by regular in-house and external training
7.4 Directing:
- New products/ designs to be introduced (Quantity-wise and variety-wise).
- Identification of proper stores location
- Continuous supply of inventories from suppliers (Preparation of procurement schedule)
- Inventory planning, monitoring, and tracking of work in process.
7.5 Coordinate and Controls:
- Inventory control to keep the cost at optimum level. Monitoring WIP
- Orders placed to the suppliers for inventories.
- Volumes of the orders from the customers that the company can handle
- Organized reports at all levels.
- Competitors
8. OMNIS MODEL
8.1 Why does the organization need information?
The organization needs information to coordinate its flow of materials smoothly and reduce transaction costs which may increase due to information asymmetry among various functional departments.
E.g. the marketing department needs to coordinate with the procurement department to handle the inventory and prevent stock-outs.
8.2 Who are the key stakeholders?
The key stakeholders are the company, employees, shareholders and customers.
8.3 Identification of Information System
Description / Processes / Relatedfunctions / Controls
Procurement Information system / -Procure from wholesalers
-Providing technical know-how / -Marketing
-Accounting / -Surplus management
-Demand
Finance and Accounting Information System / -Manage Accounts / -Planning & construction
-HR, Finance / -A/C standards
-Organization Policy
Marketing Information System / -Stock maintenance
-Merchandising
-Selling
-Customer service / -Distribution
-Accounting / -Forecast demands
-Customer complaints
-Competition
Production Information System / -Products
-Manage Demand
-Get raw material
-Manage production / -HR,
-Marketing,
-Distribution
-Finance / -Production has to be as per the specified quality
Human Resource Information System / -Recruitment of employees
-Training provided
-Promotion
-appraisal / -HR
-Finance / -Planning and Budget
-Organizational Policy
9. APPLYING MINTZBERG’S MODEL
9.1Organization Pyramid
Figure 2: Organizational Pyramid
Source: Based on Case Study
9.2 Transaction processing System (TPS)
It estimates number of transactions with indications on mode and medium in an organization and it provides a scope to identify areas of automation in the organization to optimizetransaction cost and time.
Transaction Description / Mode of Transaction / Processes / Goal/Purpose / RemarksDispatch of Products to stores / Batch/Offline / Collect demand notes from city stores / To collect demand notes in time / Can be automated for OLTP environment
Quality checking of products. / Offline / Quality control / Reject products not meeting quality standards / -
Sourced Buying from different companies. / Offline / Giving orders to various companies / To get timely delivery from companies / Can be automated online for OLTP enviroment
Inform regional centre about the level of inventory schedule / Offline/batchmode / Prepare daily schedule for city store / Different requirement of different products / Can be automated online for OLTP enviroment
Selling of products via website / Online / Receiving Order via Website / Promptly attend the order / -
9.3 Management Reporting System(MRS)
Place/Source / Report Description / Processed/ReportedStores / Area Manager
-Daily, Weekly, Monthly sales figure
-Daily, weekly, Monthly customers visit
-Daily Inventory of stores
-Items below 95% service stock
-Complaints of customer / Processed
Processed
Reported
Processed
Reported
DistributionCollectionCenter / DCC
-Requirements from stores
-Replenishment scheduling of stores
-Procurement Scheduling
-Inventory level item wise in warehouse
Sales Team
-Items and quantity to be procured
-Price to be paid / Reported
Processed
Processed
Processed
Reported
Processed
Regional Hub / Commercial
-Total profit and revenue from stores
-Total quantity handled by stores
-Investment required in stores
Marketing
-Demand projection for items in a stores
-Demand estimation at various location
-Average sales of stores and average procurement
Operations
-Average retail space acquired at each store
-Requirement for new stores
-Average inventory of stores
-Average replenishment time for stores
Merchandizing
-Total packaging cost / Processed
Processed
Processed
Regional Head / Distribution collection center performance
Stores performance report
Profitability of stores / Reported
9.4Executive Support System (ESS)
Various reports generated for the Strategic apex of the Pantaloon like CEO of the company. Indicative list of such reports are listed in the 10.7.3.
9.5 Information system Event Cycle
Pantaloon is very much quality conscious company and stocks products of branded companies only. It also has its own private labels which it either sources from third party manufacturer or through its own production unit. In both cases quality is never compromised. It also wants to increase the market share in organized Retailing. Due to sudden increase in the number of companies entering into the organized retailing Pantaloon is experiencing the high turnover due to poaching by other companies.
So we have prepared an event cycle based on Employee Turnover:
(High Employee Turnover)(Middle Management Layer
Experiences turnover)
Events in function updating in information base
Change in events Management & Control
(More Salary by competitors)(Employee Dissatisfaction)
10. DATA AND INFORMATION MANAGEMENT
10.1 Data Sources
S. No. / Data Source / Data AssociatedRegional hubs / Hub_Id, City_ Name, State_Name , Address
Stores / Store_ Id, Location_ Name, Size_ Area,
Store_ Format, No_of_Items, Hub_Id
Products / Product_Name , Variety, Stock_ of_ Product, Product_Price, Store_Id
Employees / Employee_ ID, Employee_ Name,
Employee_ Department, Employee_ Designation, Hub_ Id, DCC_ Id, Employee_ function
Direct consolidation centre (DCC) / DCC_Id, Location_ Name, Hub_Id
Company(Pantaloon) / Company_Id, Location_Name
Suppliers / Name, ID, product supplying, volume of trade.
Customer / Customer_Id, Customer_Name, Amount_Purhased, Quantity_Purchased, Products_Purchased
10.2 Data Matrix
S. No. / Data Description / Owner / Shared byC HR D O M P
Regional hubs / Pantaloon(C) / X / X / X / X / X
Stores / Operations(O) / X / X / X / X / X
Products / Marketing (M) / X / X / X / X
Employees / Human Resource(HR) / X / X / X / X
Direct consolidation centre (DCC) / Distribution(D) / X / X / X / X / X
Company(Pantaloon) / Pantaloon(C) / X / X / X / X / X / X
Suppliers / Procurement(P) / X / X
Customer / Operations(O) / X
10.3Cardinality Matrix
Sr. No / Data Description / Regional Hubs / Stores / Products / Employees / DCC / Company / Suppliers / Customers1. / Regional hubs / 1-m / 1-m / 1-m / 1-1 / 1-m / 1-m / 1-m
2. / Stores / m-1 / m-m / m-m / m-m / m-m / m-m / m-m
3. / Products / m-1 / m-m / m-m / m-m / m-m / m-m
4. / Employees / m-1 / m-m / m-m / m-m
5. / Direct consolidation centre (DCC) / m-1 / m-m / m-m / m-m / m-m
6. / Company(Pantaloon) / m-1 / 1-m / 1-m / 1-m / 1-m / 1-m / 1-m
7. / Suppliers / m-1 / m-m / m-m / m-m / m-1
8. / Customer / m-1 / m-m / m-m / m-m / m-1
10.4 Process Details
Process # / Process Description / Type of Process / Goal / ActivitiesChecking quality / Support / Better price realization / -Quality Assessment
Packaging and dispatch to retail stores / Support / Timely Delivery of Product to Stores / - Packaging
- Transporting it to stores
Payment to wholesalers / Support / Simultaneous good realization to wholesalers / - Cash purchase
- Accounting for input supply
-Deduction of Transport Cost
Acquisitions and adding new retails spaces / Management / To increase market presence and take on big players / Look for prime location and suitable acquisitions.
Sale and Marketing / Core / Maximizing revenues and profits. / Investment in marketing, new partners, maximizing customer satisfaction.
Procuring produce from wholesalers / Support / Meet the gap between Demand & Supply / -Procurement from wholesale market
-Communicating with DCC
Production / Support / As per demand / Receive demand from marketing/ produce in time
10.5 Process Matrix:
S NO. / Process description / Process owner / Pro #1 / Pro #2 / Pro #3 / Pro # 4 / Pro #5 / Pro #6 / Pro #7 / Pro #8Checking quality / Procurement / X
Packaging and dispatch to retail stores / Distribution / X / X / X / X
Payment to wholesalers / Finance / X / X / X
Acquisitions and adding new retails spaces / Marketing / X / X
Sale and Marketing / Sales / X / X / X / X
Procuring produce from wholesalers / Procurement / X / X / X
Production / Production / X / X / X
10.6 E-R DIAGRAM
10.7 Information Matrix
10.7.1 For Sales Team- operational level
Internal & Reported / Internal & ProcessedFrom DCC
-Items to be procured
-Quantity to be procured
-Quality parameters for produce / From DCC
-Demand item wise
-Monthly, weekly demand of items
External & Reported / External & Processed
From DCC
-Transportation scheduling for company
-Future requirement of Items
-Expected price for items / From DCC
-Price fluctuation in market
-Transport routes for procurement
10.7.2For Area Manager - Tactical level
Internal & Reported / Internal & ProcessedFrom Stores
-Total stock and sale value
-Total retail space occupied
From DCC
-Stocks available
-Replenishment schedule / From Stores
-Inventory item wise
-Daily/weekly sales value
-Item wise sales value
From DCC
-Stock available item wise
-Replenishment schedule item wise
-Time of replenishment
External & Reported / External & Processed
From stores
-Total customer flow
-Total discount offered to customers
-Shelf life of items
From customers
-Future requirement of items / From Stores
-Daily/Weekly customer flow
-Sales value per customer
10.7.3For the CEO- Pantaloon- Strategic level
Internal & Reported / Internal & Processed-Centers with maximum sales and profit
-Centers with maximum customer visits
-Centers with maximum customer complaints
-Stores with extra space requirement / -Measures to improve performance
-Finance availability for expansion
-Item wise demand- supply analysis
-Items with highest value realization
External & Reported / External & Processed
-Return on investment realized
-Sales of competitors vis-à-vis Pantaloon / -Increase in margins per item
-Increasing efficiency of supply chain
-Formulation of Competitor strategy
-Formulation of Expansion plans
11. IMPLEMENTATION OF MIS PLAN
We have developed the package in access around information matrix for Distribution Collection Center (DCC). In this we have created the database table around data-sources for Procurement Information system, and generated a report showing some of the information required by DCCs’.
We have created following four database tables:
- Employees: Employee Id being primary key.
- Regional_ Hub: Hub_ Id being primary key.
- Distribution_ Collection_ Center: DCC Id being primary key
- Suppliers: Supplier Id being primary key.
The tables are populated with some dummy data for testing purpose
The relationships between these tables are as per ER diagram we have made for the data sources.
The report generated:
DCC_Procured_Qty: