Case 1: Monolithic Industries Inc.
You have been called in on a requirements determination task for a new system for Monolithic Industries Inc. Monolithic Industries is a major distributor of electronic appliances to retail outlets (e.g., Circuit City, Best Buy, etc.) over dozen Eastern states. Monolithic Industries is considering expanding Westward. A simplified organization chart is attached.
Monolithic Industries wants to set up a Website where their client retail stores could order stock items online, track shipments, and maintain credit accounts with Monolithic Industries.
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Note: Answer each of the following questions:. Please use a drawing tool, Word doc or Smart Draw or Visio or Powerpoint to complete your diagrams. Note: please save drawings to a Word doc so I can read them. Proprietary drawing tools save images in their own type of format and I may not have a converter for them. Insert all drawings.
Q1. Devise a data-gathering strategy for determining requirements for this new online system.
Include a preliminary list of persons from whom data should be gathered, what kind of information they can provide, and data-gathering methods you would propose. Make (and state) reasonable assumptions about Monolithic Industries organization, operations, and aspirations for the new system. At the “worker bee level”, with the help of manager recommendations, you can gather inputs that will identify the greatest difficulties they have in their current processes and what changes would be most meaningful to those who do the job directly every day and will be using the new online system.
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Q2. List the activities needed to complete the Requirements Phase of the SA&D project.
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Q3. Draw a Pert diagram to schedule those activities. Show the critical path.
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Q4. Draw a Gantt chart to match your Pert diagram. Estimate manpower and skills for each step.
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Q5. Prepare a budget for the Requirements Phase. Include labor, capital, and management costs.
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Case 2. Chemical Growth Inc.
Chemical Growth is a diversified bio tech company which manufactures chemicals, and artificial additives (e.g., growth hormones) for agricultural use. The company’s motto is “Artificially Improving Life as Nature Intended” The company has its headquarters office in Adelphi MD and a converted manufacturing plant in Newark, NJ that formerly produced poison and pest control substances for Third World Countries. The manufacturing plant is looked after by a Director of Operations. The Director of Operations is supported by various departmental heads for executing day-to-day operations, plant production, plant maintenance, finance, purchase, stores (warehouse), transportation and plant administration are some of the major departments.
Your study is restricted to the purchasing operations and related interfaces. Currently, all purchase operations are being carried out manually. Management has decided to support purchase operations with a computer. An extract of the discussions with the purchase manager and his staff related to current procedures is enclosed.
An extract of discussions held with the purchase manager and his staff:
A. Overview of the Department
The Purchase Department is headed by a Manager of Purchasing and he reports directly to the Director of Operations. The Purchase Manager is supported by Material Procurement Officers (Buyers) and clerical staff, there are 20 employees in the department. The Purchase Department’s main function is to procure material for production, maintenance and other departments in time so that there should not be any situation where the plant has to be shut down due to requirement of some material requested by the departments.
At present, there are more than 300 Purchase Orders (POs) always open at any time (a closed Purchase Order is defined as a Purchase Order for which all material order is received and paid) and it has become impossible to keep track of activities and provide up-to-date status of these activities to the concerned departments.
The idea behind seeking computer support is to access information quickly and monitor purchase activity efficiently. It is also expected that after computerization, with the same manpower, future purchase load (related to diversification plans of the company) can also be met. The various procedures followed by the Purchase Department have already been studied and improved by a company approved management consultant and unless really necessary no procedures should be changed while providing the necessary computer support.
B. Procedural Details Related to Purchase Activity
Create MPR
User Departments (i.e. Production, Maintenance, etc.) prepare their own material purchase request (MPR) and send these to purchase department as and when a requirement comes up. More than one material procurement detail can be given in the same MPR. Material Procurement details contain material code, description and quantity.
Validates MPR
Purchase Department validates the MPR for material requested and MPRs received. MPRs are accepted by Purchase Department only if the required quantity is not available in stores (Stock Clearance by Stores Dept.) and concerned department has not exhausted allocated budgets for procurement. Stock Clearance from stores dept. is required only for non-stock items of specific class. (Allocated Budgets are provided by Finance Department at the beginning of the financial year and are available with purchase Department).
Send inquiries
Whenever a buyer who handles a particular material group (25 material groups have been formed on the basis of similarity of material) gets time, he reviews MPR Register and consolidates (from various MPRs) material requirement for his groups. After this exercise, he raises an inquiry (request for quotation) with registered vendors (vendors are registered with the company for specific class of items). An inquiry can contain one of many materials of a material group (for example fertilizer additive #1 etc.) which have separate material codes, can be part of single enquiry. Every inquiry has only one closing date (i.e. last date of receipt of quotation from vendors).
Select vendor
Vendors submit technical and commercial quotation (2 stage bidding). If any technical discrepancy is found such quotations are rejected after closing date for an inquiry. All commercial quotations received are opened by the concerned buyer (in presence of Purchase Manager and Vendors) and afterwards are analyzed for total value (basic cost of materials, taxes, Insurance packing freight). On lowest cost basis an offer is selected and purchase order proposal is prepared. A PO proposal contains details of all materials, payment terms and all other relevant terms and conditions.
Create purchase order
This PO proposal is sent to Finance Dept. and a financial concurrence is obtained. Sometimes in the organization’s interest, for an enquiry more than one Purchase Orders are placed (For example, out of 4 materials involved in an enquiry, 2 are cheaper from one vendor and rest are cheaper from another vendor). In a purchase Order every material ordered has a due date for delivery. Also in some purchase orders, where quantity ordered is large (this situation is typical for bulk material procurement, fertilizer, manure, etc.) staggered delivery of material is mentioned. PO is considered effective from the date of acceptance of PO by vendors. Vendors deliver material (against PO) to Store Department and submit an invoice to Purchase Department.
Generate Pay Advice
On receiving of “Acceptance” intimation from stores, Purchase Departments checks and passes the invoice and payment advice to Finance Department for payment. In case of any discrepancy in the terms & conditions such invoice is rejected. While passing invoices, adjustments are made of any material which is rejected by stores (such data is mentioned by Stores in Material Receipt Intimation).
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Suggestion: Answer each of the following questions by typing directly into this document.. Please use a drawing tool, Word doc or Smart Draw or Visio or Powerpoint to complete your diagrams. Note: please save drawings to a Word doc so I can read them. Proprietary drawing tools save images in their own type of format and I may not have a converter for them. Insert all drawings into this document.
Q6. Create a List of Sequential Activities (e.g., events) for Chem Grow’s Material Procurement System (MPS).
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Q7. Draw a context level diagram for Chem Grow’s Material Procurement System.
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Q8. Draw a Level 0 Data Flow Diagram for Chem Grow’s Material Procurement System.
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Q9. Draw a Level 1 “Explosion” Data Flow Diagram for the Process: “Generate Pay Advice”
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Q10. Create the Data Dictionary for each data flow in the Context Level diagram.
