Kenny’s Bookshop Case Study
The Base Problem4 Problem Management service in Kenny’s Bookshop IT environment4 Organizational /Managerial responses, changes4 Business Information System changes5 Benefits and drawbacks6 Comments, proposals7 References8 Executive Summary Kenny’s Bookshop is a unique bookshop with new, out-of print and rare books, antiques, and arts available via on/offline stores. The company has a leader position in the Irish market and a relatively large market share globally.
The secret of this small family business’s success lies in the finding of the market niche in this industry and the usage of the most appropriate computer program. Overview Market position Kenny’s bookshop belongs to the Catalogue and Mail Order Houses Industry which is experiencing rapid growth in market share with the global spread of the internet usage As Kenny’s delivers internationally, the range of competitors is very broad. Customer base Most significant customer group of Kenny’s are people with Irish origin in the US mainly. Consumer groups include libraries, specialists, collectors, universities, other shops, private persons etc.
Kenny’s Bookshop was established in High St, Galway in 1940 by Des & Maureen Kenny. It is Ireland’s biggest online bookstore, selling new, out-of-print and rare books, antiques and arts. Five of Des and Maureen’s six children and three of their grandchildren now work in the family business. In total, the company employs nearly twenty people. Kenny’s operated as a traditional business throughout decades, but as they were always innovative they adapted the ‘bricks and clicks’ business model as the internet started to emerge in the 1990’s.
During the implication they had to face the fact that their system was not appropriate. This was the major cause of Kenny’s problems, but also the driving force of innovation. The Base Problem Although Kenny’s Bookshop was one of the market leaders in the bookstore market, it had problems with the cataloguing of the large volume of books in the warehouse. Only 1/10 of the total amount of books were catalogued, which means that 900 000 books could not be sold as these were not present in the catalogues. If the company wanted to sell these products all of the books had to be on a computerized database.
The problem was solved by introducing a new cataloguing system which would be able to work faster and more precisely and offer higher level of service. Furthermore the company wanted expand to new markets, so the database must be easily operable by international customers. Problem Management service in Kenny’s Bookshop IT environment Problem Management is the ongoing service concerned with minimising the impact of problems affecting the availability and services of the service delivery environment, whilst minimising expenditure of resource and maintaining the highest level of client satisfaction.
The main problem in the case of Kenny’s bookshop is related to the broadening of the computerized database of books and being able to catalogue other product groups besides books. The responsibility of Problem Management process is to identify, document, analyse, track, and resolve all of these problems in the IT environment of the company. The employment of a good IT expert of a contract with a program developer company seems to be a good solution for this IT derived problem. The lack of computerized database was solved with the employment of process management consultancy.
With the help of Business System Selection Kenny’s was able to easily identify its requirements, build tender documents and based on the responses, select a vendor that best suited the needs of the company and finally resolve problems. Organizational /Managerial responses, changes As Kenny’s faced all the problems discussed above they needed to implement radical changes in managerial sense as well. Their business strategy was altered to meet the requirements of the changing economic situations. Therefore Kenny’s have formed an inside team and consulted third party experts to overcome the arising problems.
Kenny’s rapid development called for the application of new systems to meet market demand and customer requirements, therefore Kenny’s introduced OCLC system. To successfully implement the system they had to construct a team. Kenny’s also consulted many external specialists to broaden the insight and bring in expertise. The project team is constructed to supervise development and implementation of the new systems (OCLC, POS) and to support the external team. It was also important to be consistent with Kenny’s business strategy.
The project team included the following specialists: managing director (Conor Kenny), IT manager (David Lohan) a retail manager (Karen Golden), a GM (Jim Shaughnessey) and an accounts manager (Tom Gilligan). Through a series of workshops, all staff was involved in the process of detailing required functionality and requirements – from warehouse staff to accounts staff to marketing staff. This level of involvement meant that the final system would mirror (and better) the processes that were in place already. Business Information System changes
Being an internet based company, Kenny’s adjusted the business strategy to eBusiness models and their systems were changed accordingly. Kenny’s had been looking for a system that helps them integrate everything into one system. The major goals were to customize reports for sales reporting, cataloguing and for getting book data onto the website, also carrying the entire migration process out effectively. Kenny’s approached Galway-based process management consultancy BSM to assist them in identifying what their requirements actually were.
BSM was introduced to Kenny’s by Enterprise Ireland Using Business System Selection, a very structured and iterative process designed by BSM, Kenny’s was able to easily identify the requirements, build tender documents and select a vendor that best suited their needs.
Even though Kenny’s had a very good idea as to the type of system they required – a combination of ERP and Library Management System – the company did not have a good understanding of the requirements of the system. The consultancy was profitable for Kenny’s, helped them understand the usiness environment and enhanced expansion overseas. For several years Kenny’s used a full Library Management System and catalogued to Marc 21 standard using OCLC records making them one of the first commercial bookshops to catalogue to this standard. They were able to provide shelf ready books to clients with full OCLC information. Given that Kenny’s specializes in not only new but also out-of-print and antiquarian books they found the systems to be too limiting in terms of information they could include with the book. Benefits and drawbacks
There were countless benefits of the newly operating computerized database. One example is the increased rate of cataloguing the books on stock; therefore they could be sold faster, releasing cash from stock. Furthermore by establishing a solid back-end system, Kenny’s could add new a service to the customers in the future. This system also allows tracking. Finally the responsibility of the management is the following reporting and practicing control over the current system. On this way the failures that may be occurring can be eliminated.
After the precise identification of Kenny’s requirements, and the implementation all of those changes in company life, the modification in different business dimensions had become noticeable. The result is manifested in higher revenue. After the employment of the new database, and the OCLC code and bibliographic record attached to it, decreasing costs (on both business and customer side) had been observed and this led to an extra 400-500 purchases. Moreover the computerized database enables customers to find books of their personal interest, thereby increasing sales and profitability.
According to goindaba. com one of the main drawbacks of the system is the inability to re-price. Change management is one of the most important tasks but costly and time-consuming. It is used to smooth the transition of staff and the company. The other problem that caught our attention is the lack of IT staff. Kenny’s should have employed IT staff who could deal with day-to-day problems or hire a specialised company when implementing the new system. This could prevent failures and loss of profit. Comments, proposals Organisations must be realistic about the potential cost of a project of this nature.
When Kenny’s put together the original budgets for its eBusiness project it seemed unreasonably low, but as costs started to come in it turned out that their estimations were correct. Although we have to mention that on some points they lacked staff and experts, and these could have been expensive, yet might have made the implementation faster, therefore at the end of the day they could have had less cost. The time, effort and budget invested by Kenny’s resulted a technology solution that they planned will last them for a number of years.
This foundation has been designed such that they can offer more services to their clients without having to outlay a large amount of budget. Kenny’s had problems concerning the synchronization of the different systems. To overcome this Kenny’s had been looking for several years for a system that would help them not only list online but list with adequate bibliographic information. During our research we have found that Kenny’s introduced a new system recently, called Indaba which integrated all functions into one coherent system.
The new system enabled Kenny’s to introduce wants list for libraries, which allowed them to lodge a large wants list for out-of-print books with associated prices for each book. As those books are bought by Kenny’s and appear on the database, the libraries’ requests can be automatically fulfilled. This is a very efficient way of selling and also a good tool for estimating demand, therefore they became more cost-efficient. Carrying on the logic they also started the requirements lists with which Kenny’s database could interrogate client databases identifying the exact needs of that client.
This is a very creative solution of the inventory management problems. The system also allowed Kenny’s to have a solid database that can be opened up to other bookshops and online book portals around the world to increase sales. Although the end customer will shop at their local bookstore or portal, they could well be looking at Kenny’s database of books. Targeted offers is a new service using the keywords generated by each customer purchase and stored with their customer record, books that might interest them can be offered for sale.
This very targeted method of marketing will allow Kenny’s to build closer relationships with its customers around the world. Cost concerns are important in this case as well, along with the fact that this solution also increased sales and profitability.