Pamida
ShopKo and Pamida: Systems Triumph or Tragedy?
1. Evaluate the role of information systems in the way ShopKo and Pamida run their business. How important are they?
ShopKo’s information system help determine the price markdowns for overstocked items. The determination of the price is by the clearance price from the previous year which did not help the company’s financial struggles. The company did not have the demographic information of the different ShopKo’s stores it had as an item could be more popular in one city, but not another. This information system became ineffective and costly to ShopKo. The new system helped the company price its products based on various factors, including season, geography, local tastes, and historical demand. All item markdowns were optimized to each store rather than the entire system determining these for all stores. These help the company increase their profit and decrease the need for human labor.
For Pamida’s their strategy was to maintain a high stock rate and its weakness was that stores were usually out of stock on items in the store, but not the warehouses. Pamida maintain a high number of items in their warehouses and their software was not efficiently communicating with the stores. These helped decline in the company’s profit by millions of dollars, and lawsuits were filed by shareholders. The current technology for Pamida was not communicating effectively therefore the inventory was high in the warehouse and low in the stores.
2. Evaluate the importance of Pamida's distribution center consolidation project for both Pamida and ShopKo. What management, organization and technology factors prevented Pamida's new distribution center from working successfully?
Was to consolidate the distribution center from Pamida and ShopKo. Their primary goal was to established a distribution center that will permit Pamida’s store to successfully maintain a high in stock rate than in the warehouse. As for ShopKo goal was
1. Evaluate the role of information systems in the way ShopKo and Pamida run their business. How important are they?
ShopKo’s information system help determine the price markdowns for overstocked items. The determination of the price is by the clearance price from the previous year which did not help the company’s financial struggles. The company did not have the demographic information of the different ShopKo’s stores it had as an item could be more popular in one city, but not another. This information system became ineffective and costly to ShopKo. The new system helped the company price its products based on various factors, including season, geography, local tastes, and historical demand. All item markdowns were optimized to each store rather than the entire system determining these for all stores. These help the company increase their profit and decrease the need for human labor.
For Pamida’s their strategy was to maintain a high stock rate and its weakness was that stores were usually out of stock on items in the store, but not the warehouses. Pamida maintain a high number of items in their warehouses and their software was not efficiently communicating with the stores. These helped decline in the company’s profit by millions of dollars, and lawsuits were filed by shareholders. The current technology for Pamida was not communicating effectively therefore the inventory was high in the warehouse and low in the stores.
2. Evaluate the importance of Pamida's distribution center consolidation project for both Pamida and ShopKo. What management, organization and technology factors prevented Pamida's new distribution center from working successfully?
Was to consolidate the distribution center from Pamida and ShopKo. Their primary goal was to established a distribution center that will permit Pamida’s store to successfully maintain a high in stock rate than in the warehouse. As for ShopKo goal was