CURRENT CHALLENGESPROBLEMS FACING THE ORGANIZATION

CURRENT CHALLENGES/PROBLEMS FACING THE ORGANIZATION

Coding of New Collection Components and Data Entry (Design Department—Purchasing Department Manager)

This process requires the coding of both the finished product and its single components (leather, heel, sole). LSB considers it as a crucial process, with a very high priority and importance for the preparation of the collection. Thus, this process requires the accurate respect of time, roles and liability constraints.

It is interesting to notice that even if LSB organizational chart includes the position in charge of the coding process (Figure 4), nobody has held that position for the last two years.

At the moment, the staff working for the design department manually performs the coding of sample components, by writing the codes on paper. These codes are then inserted into a computer by a member of the purchasing department.

While collecting orders from customers, LSB sales agents should have access on their notebook computers to all the codes related to the required products (for both the finished product and its single components). Most of the time this information is not available because the manual insertion of codes is a very slow process. One of the reasons is the need of coordination between many different roles. Furthermore, the code of a specific component stored into the computer based information system (CBIS) sometimes turns out to be incorrect, because data are copied from the CBIS to the agents' notebooks without any check on the codes completeness and integrity. Not surprisingly, this lack affects the sales agents' image and quality of work.

The coding process is characterized by definitely redundant procedures. As the data flow diagram in Figure 9 shows, the envelope holding the cardboard model together with its codes and the provisional bill of materials (holding the same codes, manually copied from the envelope) follow different paths. It is essential to underline that codes are registered into the Finished Products Technical Form when information on the bill of materials is still provisional, because it refers to its first drawing up, while codes held into the envelope often undergo various changes. In fact, this information can be modified by a member of the Time Study Department as well as the chief of the cutting department (both of them receive the envelope with a copy of the original codes). Thus, the real problem is the lack of synchronization between the different copies of codes (envelope vs. bill of materials).

One of the reasons for this situation is that LSB requires the printing of a production note before cutting the sample upper. Obviously, this procedure can be carried out only when the required information has been stored into the CBIS. Nevertheless, this constraint does not seem to be sufficient to justify the inadequate performance of the process.

Because of its strategic importance, this process should be well formalized and effectively supported by ICT. Instead, roles, tasks and responsibilities ("who does what") are not formalized at all, and the process is carried out completely manually. Moreover, the CBIS does not verify any integrity constraint. As an example, the insertion of an incorrect code or an incomplete bill of materials does not produce any alert.

The lack of completeness of the coding process basically depends on the people in charge of it. They are often unaware of the coding operations. In addition, the coding process managers usually underestimate the importance of the coding incompleteness, and they do not consider themselves responsible for this problem.

Another issue regarding data consistency is the uncontrolled management of the bill of materials (i.e., the opportunity to change its content all the time) does not allow the employee in charge of data entry operations to keep the correctness of the inserted data under control. Thus, this process lacks coordination of information flows. Each organizational area takes care of its output, without considering that it may be used as the input by some other area's process. This is one of the main reasons for the inefficiency of the coding process. Delays and incomplete data mostly affect the performance of the last phases of the process. Consequently, it is often up to the employees who work on these last activities to find a solution to such problems, even if their cause depends on someone else's activity.

Moreover, the chance of making mistakes is higher because of the very high number of codes. Every pair of shoes belonging to a specific collection (there are two collections per year) is composed of about 20 codes (components and working processes). The average number of shoes within each product line is about 150 and there are four product lines. The high number of codes would definitely justify the process formalization. On the contrary, the current lack of formalization determines a superficial development of the process, itself.

The misalignment between the actual strategic importance of the coding process and its poor ICT coverage mostly depends on the lack of formalization of the process itself, which does not allow a correct exploitation of ICT potential. Both the CIO and the Time Study Department manager are aware of this problem, but this turns out to be useless because of the top managers' lack of trust in ICT.