Question: MindPlay Educational Toys is a regional, California based company that currently has stores in Los Angeles, San Francisco, and San Diego. The company produces its own line of educational toys and also sells other toys from other companies in its three stores.
MindPlay's main customer base consists of parents and children interested in play that encourages learning. MindPlay has also recently created loyalty programs with teachers in the three cities and is actively looking for ways to foster relationships with local school districts and other learning institutions such as museums and zoos. The loyalty program is very basic and consists of a mailing list gathered from in-store information request cards. The CEO believes that there are many more marketing opportunities available but is not sure how to go about increasing its customer base beyond the three stores.
The production process for MindPlay and purchasing for all three stores is done out of the central office in San Diego. The production manager is responsible for soliciting bids for raw materials that are then shipped to a production facility in San Dimas. The manager has had trouble managing production over the last few years as the economy in California has changed so quickly and predicting sales on the limited information available has become difficult. During some fiscal quarters, some stores have too much inventory of MindPlay's products while during other quarters, some stores don't have enough of various games and toys. Adding to the manager's difficulties is the oversight of ordering other products from other educational game and toy suppliers. The manager orders games and toys from sixteen different suppliers throughout the year for all three stores.
Currently, the inventory is managed at the central warehouse, and the manager ships the same number of each product to each store at the beginning of every quarter. Because the inventory is controlled centrally, it is difficult to determine what inventory each store has on hand at any given moment. Most of the inventory reconciliation happens quarterly and requires managers at each store to manually take inventory at the conclusion of each quarter. As a result, the manager has noticed increased inventory loss and he also suspects that he is not managing the products in the most efficient manner. He would like a better idea of what product each store has on hand at any time and would like insight in how to better order products and materials for the production and inventory processes.
Currently, there is little communication between stores and the technology at both the stores and the central office is becoming outdated. Most communication with vendors and suppliers is occurring through email and purchase orders are being processed manually. The only connections currently between the locations are via Internet connections provided by a local ISP in each city. MindPlay's CEO knows that MindPlay needs to invest in infrastructure to solve some of the problems with the marketing, inventory and processing problems but is also interested in additional technology solutions. The CEO is interested in not only moving MindPlay's inventory online, but she is also interested in opening stores in St. Louis and Fort Worth. She believes the growing pains her company is already experiencing will be exacerbated by growth outside her region.
What are the most critical information systems related technology issues facing MindPlay? Why? What recommendations do you have for the CEO and production manager to address the most critical information systems-related issues?