General Business ConsultantsBackground: Line of Business: General Business Consultants provides customized marketing programs to customers. This Project: The scope of the Budgeting Tool project includes: - Specifying a detailed description of a marketing program. - Providing the customer with a price quote for the marketing program. - Estimating the company's cost of producing the marketing program. Company Organization: Recently, the company has been aligned by major product line, by sales region, and by business unit. Within each alignment, each of the specification, price quoting, and cost estimating processes has varied from centralizing functions to assembling a team for each new customer. Each reorganization can drastically change the total number of users on the system, but the overall system functionality remains unchanged. This organizational structure is likely to change before the project is completed. Current Business Process and Environment: Specifications: The sales organization communicates with customers to assess their needs. These needs are entered into the Work Order system. The marketing programs are then described in detail within the Work Order system. The system provides output to those who produce price quotes, cost estimates, and customer presentations. The output is provided in paper form. Price Quotes: Details of marketing programs are printed from the Work Order system and used as a basic for formulating price quotes. Price quotes are started within spreadsheet that are designed by the person who is doing the price quote. The price quote spreadsheets are printed , manually entered into the Price Quote system on a mainframe computer, and refined based on current market conditions. Cost Estimates: Details and price quotes of marketing programs are printed and used to formulate cost estimates. Cost estimates are organized in three categories labor, materials, and outside vendor purchases. Cost estimates within each category are created in detail. Cost estimating is done in spreadsheet applications with auto-calculation turned off. The person doing the cost estimating designs these spreadsheets. Cost estimates are then summarized by category printed and manually entered into the Actual Tracking system. Actual Costs: Detailed cost estimates from cost estimating spreadsheets are summarized by category, printed, and manually entered into the Actuals Tracking system. The Actuals Tracking system has the ability to store and track at a detailed level both cost estimates and price quotes, but currently it is used only for cost estimates. Labor, materials, and outside vendor costs incurred to produce a marketing program are entered into the Actuals Tracking system at the summary level. Customer Presentations: Marketing program details and price quotes are printed, typed up, organized, and consolidated by clerical staff to produce a customer presentation. The accounting staff reviews the first presentation and cost estimate for financial feasibility before the presentation goes to the customer. Through a series of customer presentations, the sales staff and the customer negotiate a complete marketing program. The complete program includes detailed specifications, price quotes, and scheduled delivery. Negotiants: During later stages of negotiations with a prospective customer, the sales organization often requests and expects to receive price quotes during a single phone conversation. These are commonly referred to as phone quotes. Many times a team works day and night when in final negotiations with the customer. Employee Base Affected: The geographic spread of company employees involved in this business process includes three regions. The Northern region is based in the Eastern time zone. The Midwest region is based in the Central time zone. The Western region is based in the Pacific time zone. Each region has flex time for its employees, allowing normal start times no earlier than 6:00 a.m. and end times no later than 8:00 p.m. Business Problem: VP Sales: Our slow response to a customer's Request for Proposal(RFP) causes us to lose opportunities. Our competitors are taking market share through faster responses to prospective customers. Many times competitors respond to customers and complete a business contract before we finish the first presentation. Consolidation and formatting of information from different systems takes time. The format varies depending on which individual assembles the presentation, and does not always yield a consistent look to a pre-existing customer. Customers expect consistency and lose confidence when the presentations vary. When we get to negotiations, we cannot get accurate phone quotes fast enough. We have the right products and know how to produce them, but we are having trouble selling them. VP Finance: Inaccurate cost estimating is causing much of our business to fall short of our profitability standards price quotes without estimating cost does not allow an early business analysis of profitability. Inaccurate sales price quotes result in bad revenue projections. The inaccuracy of phone price quotes is a major problem. Phone quotes are usually low and result in low profitability. The sales staff continues to use phone quotes, and customers expect them to be binding. Detailed cost estimates and details of actual costs incurred, along with revenues, are not entered into the Actuals Tracking system. Finally, no change management practices are in place. This results in customers not being billed for changes and additions to marketing programs. Chief Information Officer: The systems that are now used for work orders and price quotes are not year 2000 compliant, and must be replaced. All new systems will use a client/server architecture, We do not have current staff to create client/server systems, but we have excellent relational DBMS skills. Assessment of User Community: Entry of cost estimates into the Actuals Tracking system at a detailed level is extremely difficult and time-consulting. Users need more support for developing advanced functionality into the spreadsheets that are used for price quotes and cost estimates. With so many applications involved, phone quotes are next to impossible. Phone quotes are really just educated guesses instead of price quotes. Users did not mention response times of individual applications as an issue. Target Business Environment: VP Finance: The company wants an application that will be used to standardize processes, practices, procedures, and outputs where cost estimating, price quotes, and specification are concerned. The company wants to develop the applications in phases: - cost estimates, price quotes, and specification, and standardized customer presentations; - standardized internal reports and change management; - production workflow, and - a customer communications repository. VP Sales: The company wants to deploy the application by sales region as each phase is completed; - Midwest region, 600 users, 250-300 concurrent; - Northern region, 400 users, 200-250 concurrent; - Western region, 45-55 users, all concurrent. Chief Information Officer: The company would like to have an integrated tool that brings together cost estimates, price quotes, and specifications. This tool needs to feed information automatically into the existing Actuals Tracking system, and reuse as much of the existing relational DBMS as possible. The company will own the developed system after the first phase, maintain the current release, and develop further releases, all without external expertise. |