A Study Of An Information System Commerce Essay

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"Lately, since it is realised that information is an important resource which can be used in a novel way to enhance the competitive position of business, information technology and information systems are becoming strategically important for business" [1] 

This report will focus upon the supermarket sector in order to examine the extent to which the use of a new Information System (IS) has affected the manner in which business is conducted within this sector. The report will focus on a particular supermarket in the centre of Chester in the UK in order to assess the impact of the new Information System in that specific supermarket. The report will attempt to draw out both the advantages and disadvantages of the new Information System used within this particular supermarket and assess the extent to which its addition has altered the manner in which business is conducted within the supermarket. It will attempt to understand how both staff and customers have been affected by the introduction of a new Information System. This will allow one to understand not only what impact the new Information System has had upon the business itself and the efficiency of operations within the supermarket, but also will provide a clearer understanding of the human element involved in the development and practical implementation of new Information Systems. As Woods points out, "the need for a combination of technical and human elements is something that is integral to Information Systems projects" [2] . Despite the fact that the human element within the operation of the new Information System will be focused upon it is also important that this report also focuses upon the extent to which this Information System has changed the nature of business within the supermarket.

Methodology

A number of different sources were utilised in order to compile this report. One important source of information were the staff and customers of the supermarket itself whom I interviewed in order to record their opinions and views about the operation of the Information System in the supermarket. In terms of staff I spoke to a number of different staff members at the store itself including members of the checkout team as well as the manager of the supermarket. In addition to the interviews conducted with members of staff I have also used a number of secondary sources in order to further inform the study with intellectual rigour. I am confident that the report contains the appropriate mix of primary and secondary data to ensure that it is completed to the highest possible level and that it is as informed as possible.

Structure of Report

The report will be structured in the following way. The first part of the Report will focus upon the business that will be analysed during the course of this report. The business that will be analysed is Tesco and the particular Supermarket that will be investigated will be the store in the city centre of Chester in the United Kingdom. In the first part of the report the objectives, functions and management style of the organisation will be detailed and examined. In the second section of the report the previous Information System utilised in the business will be examined and the possible reasons underlying the deployment of a new Information System will be investigated. In the third part of the report the introduction of the new Information System will be examined and the effects of its introduction, both positive and negative will be examined in detail. In the conclusion of the report an attempt will be made to draw all the various threads of the investigation together in order to offer a clear and balanced assessment concerning the impact of the new Information System.

In this report the case that will be studied is Tesco supermarket in Chester and the Information System that will be examined is the self-checkout machines that have been recently introduced throughout the stores of the supermarket chain. In their short lifetime the self-checkout machines have already established themselves as a cult presence with the phrase 'unexpected item in the baggage area' becoming popular with comedians as well as social commentators alike. However, beneath the cultural contribution of the self-checkout machines lies its primary and far more important contribution to the smooth running of the supermarket checkout system. It is an interesting innovation in the sphere of Information Systems precisely because it is a highly visible example of an Information System that many of us have witnessed and made use of in our daily lives. Perhaps even more interesting is the fact that the self checkout presents one not only with a clear example of an Information System, but also with an example of an Information System that has grown and developed in the gaze of the public sphere. In addition to this, it has developed alongside the previous Information System that continues to dominate the supermarket industry, namely the regular check out and as such direct comparisons between the two systems are readily established. The main questions that this report aims to address, therefore, are why supermarkets felt the need to introduce the self-checkout into their stores and what the impact of the self-checkout has been upon the operation of the stores in practice. These questions will be addressed via the use of primary data in the form of interviews with customers and staff as well via recourse to secondary literature on the subject of self-checkout machines. The acquisition of data on the subject of the use of self checkout and regular check out machines is the area in which I expect to encounter the greatest difficulties, particularly with regard to specific in-store data concerning the particular supermarket under investigation.

Objectives, functions and management style

The supermarket chain Tesco is one of the most dominant forces in the UK economy. Its objective is to retain and expand its market share in the UK and across the world and to continue to generate vast profits for its shareholders. In order to do so it is vital that individual Tesco stores are run as efficiently and effectively as possible and as a result Tesco has developed a strict management style in which members of staff are carefully selected and encouraged to perform at a high standard. An individual store will be structured in such a manner as to ensure that it will run as efficiently as possible. Individual stores are broken up into a variety of different areas, such as baked products for example or fresh meats and each section of the supermarket will have its own management structure. As a result, there will be one overall manager of a Tesco store and underneath them a further layer of management will oversee members of staff on the shop floor itself to ensure that customers are adequately supervised and assisted. As will be seen below, Information Systems play a large role in the operation of supermarkets, particularly at the checkout desk where Information System play a vital role in the smooth running of individual stores.

The previous Information System at Tesco Supermarket

It is probably not accurate to refer to the Information System under discussion in this section as the previous Information System considering the fact that traditional supermarket checkouts continue to account for the vast majority of checkout desks at any given supermarket. However, in technical and business terms it is certainly valid to refer to such checkouts as the previous Information System as it is quite clear that such checkouts represent an earlier evolution of the concept of checkout desks. It is perhaps more sensible therefore to refer to the previous Information System as the traditional checkout system and it is one with which the vast majority of people will be familiar. Under the traditional checkout system each checkout desk in a supermarket is marked by a member of staff known as a cashier. The customer places the goods they wish to purchase on a small conveyer belt, which gradually moves towards the cashier who scans the barcode on each purchased item into a machine that reads the printed barcode. The system of the printed barcode itself replaced the previous system of checkouts in shops in which the checkout clerk needed to have intimate and direct knowledge of the cost of their products if these products had not been fitted with a paper price tag. This information is then fed into the system, which determines the cost and any other relevant information about this product. Once all the items have been scanned manually by the cashier in this fashion the customer is presented with the bill that they can pay for either in cash or via debit card. As Juels points out, the printed barcode represented the development of a new Information System designed to alleviate a certain number of perceived flaws, most importantly significantly accelerating the checkout process. "Through a printed barcode on its packaging, a can of tomato soup identifies itself automatically to a checkout register. While a checkout clerk must manually position items to render them readable by a scanner, printed barcodes alleviate the overhead of human categorization and data entry. Over the course of well more than two decades, they have proven indispensable timesavers and productivity boosters" [3] . In addition to this, in most supermarkets customers are also able to scan their loyalty cards for which they will receive loyalty points that are automatically credited to their accounts via the checkout system. Once the customer has paid for the products they simply pick up their products on the other side of the cashier desk and leave the supermarket.

There are a number of flaws with this traditional Information System that has led supermarkets to seek to innovate this area of their businesses. The first and most obvious problem identified by supermarkets was the fact that each checkout desk requires one member of staff to monitor and administer it at any one time. As a result the supermarket checkout desk is quite labour intensive, with a typical supermarket having at least 20 checkout desks in total and between 8 and 10 in operation at any time and all of them in operation if it is particularly busy in the store. Therefore, it is quite possible that checkout desks alone could require up to 20 members of staff to administer them and in bigger supermarkets the number could be even higher than this. In the supermarket under investigation in this report, namely Tesco supermarket in Chester there are 22 checkout desks and whilst it is unusual to see all of them in operation I have observed all of them in operation during busy periods such as Saturday afternoon. There is no question about the fact that this is a labour intensive exercise, costing the supermarket a significant sum of money and increasing the overheads of the business. Another important problem that this traditional system of checkout desks encounters is the extent of the customer queues that such a system creates. Due to the fact that each individual member of staff in a checkout desk can only operate at a certain speed and the fact that demand in supermarkets is very high it creates a situation in which people often have to face prolonged queues at checkout desks in order to pay for their items. As Professor Day points out this can lead to substantial frustration in the mind of consumers, because they simply want to purchase their products as quickly as possible. "Anyone who has waited at a supermarket checkout will have encountered Murphy's Law of Queues: 'If your queue can move slower than the one next to you, it will do'. In any specific visit to a supermarket we just want to finish first on that visit" [4] . This situation is often further exacerbated by the fact that supermarkets seek to reduce the cost of overheads in their checkout staff by only manning between 6-8 checkout desks when there are far more customers than this in the store. This not only slows down the course of business in the store, but may also deter other customers from buying products in the supermarket entirely. As one person who came into the store told me when I asked him why he instantly turned back to walk out of the shop, "I'm not going to come in and spend 10 minutes queuing just to buy a drink and a sandwich" [5] . Whilst this problem might disproportionately affect small purchases there is no question that the drive to save overhead costs is not popular with customers and it is the savings in overheads is probably offset by the loss of business that such long and inefficient queues generate. It is clear, therefore, that there are a number of important difficulties that traditional checkout systems have encountered and that these problems have a detrimental impact on the business as a whole.

The New Information System

The new Information System that has been devised by supermarkets across the country is the self-checkout system. These self-checkout machines allow customers in a supermarket to pay for their items in a checkout desk without the need for a member of staff to administer that checkout. The new Information System works as follows. A customer will take their items to the self-checkout desk and scan their items manually themselves. For items with no barcode such as fruit for instance the customer places the product on a weighing scale that weighs the product and finds the correct price for the item. Once an item has been scanned, customers must place their items in the bagging area of the checkout desk where the Information System will check the weight of each product against a database in which the weight of each product is stored in order to ensure that the weights match. The use of weight to measure and confirm the product is an innovation that stops thieves from attempting to pass off one product as another by simply taking the barcode of one product and placing it on another. Once all the items have been scanned and weighed the customer select the option to pay for his or her products and once payment has been confirmed the transaction is complete. This new Information System has made use of considerable technological innovations in order to successfully come to market. A combination of electronic technology as well as computer software ensures that the machines operate smoothly. In order to scan the product optimal technology is required, for example and sophisticated software is required in order to allow the weights of each product to be checked against a database of recognised products.

There are a significant number of advantages that this new Information System holds over its predecessor. The first of these concerns the number of staff needed to oversee the self-checkout desks. As we have seen, the individual desks require no staff to administer them, but typically every 8 self checkout desks will be overseen by one member of staff to ensure that they are working properly and that customer do not attempt to steal product (something they would find difficult in any case because of the sophistication of the Information System). The manager of the Tesco store in Chester told me that this eased his worries about staff numbers and the cost of such staff considerably. "Under the old checkout system we would have had to employ 20 checkout staff to conduct the amount of business we are doing today, which would have meant that every checkout desk in the store would be working flat out. Now with 8 checkout desks looked over by lone member of staff we can have the other 12 checkout desks working as normally alongside the self-checkout. In addition to that it gives customers an option if they want to avoid queues and we've found that many are very happy about that" [6] . It is clear, therefore, that self-checkout machines have made the checkout process far more efficient and that they necessitate far fewer staff to run smoothly. In addition to this, the new Information System also alleviates the problem of queuing considerably. Customers now have an option to choose whether to wait and buy their products at a traditional checkout or whether to purchase their products at the self-checkout desk. As one self-checkout customer told me, "I really like the fact that I can avoid the queues and just quickly scan and pack my bags myself, it saves me so much time" [7] . The self-checkout therefore seems to provide a clear solution to the two biggest problems of the traditional checkout desk, namely its labour intensive nature and the long queues associated with it. However, this new Information System is not without its disadvantages. It is clear that it saves customers time if it is administered properly, but this presupposes a certain level of competence with the machinery on the part of the customer. As Claire, the member of staff overseeing the self-checkout desks told me, "so many times you see people not using the machines correctly, which holds other people up and wastes a lot of time" [8] . Another problem that self-checkout desks have encountered is technical in nature and it concerns self-checkout machines failing to register the weight of products correctly. Whereas a traditional cashier could simply type in the barcode if the scanner did not work properly the situation at a self-checkout, which relies upon registering the weight of products is far more difficult to deal with. It will require the self-checkout supervisor to come over and override the process of the Information System, costing valuable time and confusing shoppers. It is clear, therefore, that whilst the new Information System has many advantages it is certainly not without its disadvantages also.

Conclusion

It has become clear throughout this report that the introduction of self-checkout machines in the Tesco supermarket in Chester has been largely beneficial in nature and that their introduction more generally across supermarkets has been advantageous to a large extent. The problems created by the traditional system of costs in overheads and long queues have been negated by the new Information System to a large extent reducing the number of staff required to administer the checkout desks and allowing customers to choose between traditional checkout or self-checkout machines. However, we have also seen that there are a number of problems that the introduction of self-checkout machines have caused. Firstly, this new Information System requires users that are familiar with its workings in order to save time otherwise it will actually increase the amount of time customers spend at the checkout. Secondly, technical problems with the machines themselves are not only time-consuming but greatly confuse customers during their shopping experience. However, despite these problems with self-checkout machines it is perhaps most adequate to describe these disadvantages as mere teething problems that will no longer apply to a significant extent in a number of years. As customers become more familiar with self checkout machines and the Information Systems that drive them and the technology is further refined it is probable that they will begin to dominate our supermarket experience and that supermarket checkout staff will become even fewer in number. It is likely that this will not only reduce the overhead costs of supermarkets themselves but also lead to a calmer, quicker and more enjoyable shopping experience.

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