spreadsheet software
_ producing trial balances, profit and loss accounts and balance sheets using an
accounting package
_ communicating internally and externally using email and faxes
_ calculating and paying salaries using a payroll package
_ paying suppliers for goods and services using financial management software.
Purchasing buys in items such as raw materials and machinery parts needed to
manufacture the products Boots sells. This function is important to Boots because
without it the company would not be able to produce any products to put in its stores in
the first place and so would not be able to make a profit.
Purchasing uses ICT to:
_ produce and track orders for items they want to buy
_ send orders and payments to suppliers using EDI
_ keep records of how long they have had their machines so that they know when to
replace or service them.
Sales
is responsible for selling and marketing Boots. products. The sales function is
very important to Boots because it is what the company is all about . selling goods and
creating sales revenue. Marketing is needed to regularly research what customers
want and to advertise the company.s products.
Sales uses ICT to:
_ advertise products
_ track sales
_ find out about customers
_ keep the stores stocked with things customers want to buy.
A spreadsheet model is used to work out how many goods the company is going to sell
in the future. It looks at the future promotions that are going to be run in each store and
any advertising that is planned and works out what the likely impact of these initiatives
will be on what the customer buys. Sales forecasting is also used to plan for seasonal
periods such as Christmas and Easter to make sure that the right products are in the
stores at the right time.
ICT is also an important factor in producing effective advertising. Boots needs good
quality advertising such as television adverts, posters, brochures etc as this increases
sales. Design programs are used to create these.
Operations
carries out the main business of the organisation which is retailing and
manufacturing.
Boots manufactures over 8000 different healthcare, cosmetics and toiletry products
which are sold in Boots. own shops and in other shops such as Sainsbury.s. The
manufacturing function is important to the company because it produces many of the
products which the company sells. Without it, goods might not be made in time to be
placed in stores and might not be of such a high quality. If this happened, the company
would lose its customers.
Manufacturing uses ICT in a number of different ways:
_ the Laboratory Information Management System (LIMS) tracks products as they are
made. This interfaces with MFG PRO (which is a real time integrated system for
linking finance, purchasing, production, quality control, stock etc).
_ ICT is used to weigh products and for quality control testing. More than half a
million tests are carried out on products, raw materials and packaging each year.
ICT makes it easier to ensure that all the products manufactured are of a
consistently high standard. This is very important since they are meant to improve
health and wellbeing. If the wrong amounts of ingredient were used by mistake the
result could be terrible.
_ CAD software is used to design packaging which is attractive to look at and
environmentally friendly.
_ The warehouse where goods are stored once they are made is computer-
controlled. Robots store the goods on shelves in the warehouse and load the lorries
making deliveries to the shops.
Communication methods
Boots uses ICT in many different ways for communication. If the company needs to
communicate with its customers it uses letters or telephone calls as they are more
formal and so suitable ways to contact customers. Boots uses .mail merging. to send
the same information to all its customers eg details of the Boots Advantage Card.
Boots has its own internal intranet which can only be used by employees. It acts in the
same way as a normal internet website except it cannot be accessed by outsiders. It
includes information about days out and holidays and also information about
retirements and resignations. Also on the intranet are details of the current products
Boots is selling and it also says who the current competitors are. The intranet includes
a directory which has employees. information such as phone numbers and email
addresses. This is a suitable method of communication because it is a quick and easy
way of contacting members of staff and to publish information and news.
Email is another vital form of communication for Boots. It is used to send messages
quickly to members of staff about a meeting or to share any current news and
information quickly around the site. People can be sent work which needs to be done
or news about a meeting to be held directly and quickly via email. Email is also
sometimes used to send informal, short messages to other companies.
Another important method of communication used in Boots is the telephone. Members
of staff can ring each other and customers can contact Boots via the telephone for help
lines and enquiries. Portable phones are available on the end of the cubicles where the
employees work. They can divert their own personal landline phone on their desk, onto
these portable phones so that they can be contacted if they move around the work
place. Boots also uses tannoys (loud speakers) in its factory so that staff can hear the
message over all the noise.
The Boots. website provides information about the company, details of job vacancies
and healthcare information. There is also Handbag.com which is a website specially for
women. The internet is becoming more and more important as a way of communicating
with customers.
How ICT is used in Boots stores
Boots has 1400 stores ranging from small community pharmacies to city centre
department stores. I have investigated three purposes for which ICT is used: space
planning, recording sales information (POS) and finding out about customers.
preferences (Advantage Card scheme).
Space planning
Boots stores range in shape and size. The biggest is 4700m2 and the smallest is just
1m2. It is very important that the sales area in each store is used effectively to display
products that customers will want to buy. ICT is used to work out what products are
going to be displayed where. Information such as how many goods were sold in each
store last week/month, what promotions are going to be run in stores over the next
weeks/months and customers. buying habits is used to decide how many goods each
store should stock. Using ICT to create store layouts and mark the position of products
is much quicker than drawing them by hand. It lets you try out different layouts and is
much easier to view. ICT also makes it easier to design layouts for different seasonal
promotions and for different shape stores. The layouts are given to the store managers
so that they know exactly where to place the products.
Recording sales
Boots needs to know how many and which products are sold in its stores each day so
that they never have empty shelves. ICT is used in Boots stores to record customer
sales. Every time a customer buys a product, details of the sale are recorded at the
POS terminal. Every product sold has a unique barcode. The POS terminal scans the
barcode and looks up the price of the product. It produces a receipt for the customer
and records the sale. Sales information from all the store.s POS terminals is stored in
the main computer. Every night once the store has finished trading, the sales
information for that day is sent to the head office computer. This ensures that head
office has accurate sales figures and knows what stock needs to be replaced. It uses
ICT to create graphs and tables to present the sales information. Using computers to
do this is much simpler than drawing the graphs by hand and lets you present the
same information in different ways.
The POS system also works out the total day.s takings and tells the stores when the
amount of money they have taken does not match the number of sales they have had
that day. This gives the managers a chance to find the error/loss before it gets reported
to head office.
Head office also uses the POS system to send information about price changes and
promotions to the stores. This ensures that prices do not vary from store to store and
all Boots stores have the same promotions running at the same time. It also uses the
system to send other important messages/information to the stores.
Advantage Card
Boots needs to know as much as possible about its customers. likes and dislikes so
that it can provide the products and services they want. The Boots Advantage Card
scheme is a good way of doing this. It is a loyalty card scheme that gives customers
rewards and treats for shopping at Boots and gives Boots lots of information about its
customers. Almost 14 million people are members of the scheme. They get 4 points for
every pound they spend on products or services in any Boots store or on the internet.
Points can be spent on anything which has an asterisk on the shelf price ticket. You
need 569 points to pay for something that costs £5.69. In most stores there is an
Advantage Point machine which gives members information about promotions and
extra points. Once they have inserted their Advantage Card into the machine, they can
browse through the special offers and choose what they are interested in buying. The
machine prints out vouchers for them to use with their card. There is also an
Advantage Card website giving information about offers and promotions.
Every time a member uses the card to have points added or to use points to pay for
something, details of what they have bought, when and where are captured and stored
in a database. ICT is used to analyze this information to find out more about customer
preferences and shopping habits. This information is needed to make marketing more
effective and to ensure that the products and services offered in Boots stores are what
the customer wants.
Conclusion
After careful consideration I have come to the conclusion that ICT plays a vital part in
the way Boots functions. Without it jobs would take longer to complete and certain
things might not be done to such a high standard. With all the information needed at
just a click away on a computer screen, the company is able to respond more quickly to
sales trends and to plan ahead. Computers are also more accurate than humans. The
Boots. ICT system provides a central point of information that all employees of the
company can access, making life easier as they do not have to go to another area of
the Boots. site to find information that they are looking for.
However, despite the positive effects of using ICT, there are still drawbacks. Even
though using computers will mean fewer employees being hired, it also means that the
company needs to buy expensive hardware and software. ICT can also lower staff
morale, as some people might be scared of being replaced by a computer or might not
be keen on having to use the new equipment.
Despite these drawbacks, I still believe that ICT is a valuable part of Boots. Without
ICT, the company would not be able to function as efficiently or compete so
successfully, resulting in less profit.