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BSA 375 Week _5 Team Assignment- Kudler Frequent Shopper Proposal

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					   Kudler Fine Foods
   Frequent Shopper Program
Business/Systems Requirements
                                                                       Kudler Fine Foods Frequent Shopper Program                                 2



Table of Contents

Introduction ..................................................................................................................................... 3
About Kudler ...................................................................................................................................3
Stakeholders .....................................................................................................................................3
Project Scope ...................................................................................................................................4
Project Goals ....................................................................................................................................5
Measures for Success .......................................................................................................................5
Project Feasibility ............................................................................................................................7
Current Business Process Summary ................................................................................................8
System Requirements .......................................................................................................................9
Proposed Business Process Summary ............................................................................................10
Functional Allocation & Design Process .......................................................................................11
Design Trade-Offs..........................................................................................................................12
Physical System Model ..................................................................................................................14
Logical System Model ...................................................................................................................15
Preliminary Design Model ............................................................................................................ 15
Testing Process ............................................................................................................................. 15
Installation & Training Plan .......................................................................................................... 16
Documentation Plan ...................................................................................................................... 17
Support & Maintenance Plan ........................................................................................................ 18
Conclusion .................................................................................................................................... 18
References ..................................................................................................................................... 19
                                          Kudler Fine Foods Frequent Shopper Proposal          3


                                      Kudler Fine Foods
                   Frequent Shopper Proposal: Business/System Requirements



       In accordance with Service Request: SR-kf-013, the design team at Team A Solutions has

developed this proposal to define the scope, goals, feasibility, requirements, and data flow for

Kudler’s Frequent Shopper Rewards Program that is being developed (Kudler Fine Foods, Inc.,

2008). We have addressed the issues involving the schedule and budget of the program’s design,

implementation, training, and support. The proposal will also discuss the network upgrades of

software and hardware related to this new program. After the stakeholders are identified, their

participation and approval will be needed throughout the project life cycle.

About Kudler
       Kudler Fine Foods is a California-based high end food store chain. Their products are

marketed in upscale neighborhoods and shopping centers. Kudler’s mission is to provide their

“customers the finest in selected foodstuffs, wines, and related needs in an unparalleled consumer

environment....and (they) will go to extensive lengths to assure that Kudler’s is the purveyor of

choice for customers aspiring to purchase the finest epicurean delights” (Kudler Fine Foods, Inc.,

2008). Kudler’s 2007 Sales Plan focuses on “increasing customer loyalty by offering added

high-margin services, (new) programs to increase loyalty and profitability of existing customers,

and to gain new high-margin customers” (Kudler Fine Foods, Inc., 2008).

Stakeholders

       By identifying the project stakeholders, Kudler can ensure that the project encompasses

all the features needed to implement a successful program with immense satisfaction from both

the user and the customer. The following persons have been identified as the stakeholders for the
                                          Kudler Fine Foods Frequent Shopper Proposal         4


frequent shopper program; input and approval from the company stakeholders will be required

throughout the project life cycle.

Company

Kathy Kudler - Owner/President
      Harvey Stephens – Director of Finance & Accounting
      Yvonne Reynolds – Director of Store Operations
              Purchasing Manager - 1
              Inventory Manager - 1
              Store Managers - 3
              Computer Support Specialists – 2

Customers

Daily Retail Shoppers                                        - Current Customers
Solicited Customers: Part 1-C of 2007 Sales Plan             - New/Future Customers
Local - Small business and Commercial Shoppers               - Revolving-Account Customers

Third-Party

Semicron Systems: Unitech MS146 Barcode Slot Reader          - Rewards POS system vendor
SUSE Linux Enterprise Point of Service: POS system           - Current POS system vendor
Gift Card USA: Loyalty Card Program                          - Rewards Card vendor
Kudler Fine Foods: Product Give-a-ways/Redemption            - Rewards vendor
Bon Appetite Culinary Masters: Cooking Classes               - Rewards vendor
JetAir Airlines: Airline Rewards and Upgrades                - Rewards vendor

Project Scope
       Design a fully integrated, Point-of-Sale (POS), frequent shopper program that tracks

customer purchases and awards loyalty points redeemable for the reward program’s products and

services. Kudler will benefit from the ability to track the items most purchased, generate reports

on new or seasonal item sales trends to forecast future purchasing, and boost revenue through

new customers and increased sales.
                                          Kudler Fine Foods Frequent Shopper Proposal           5


Project Goals
       After the initial meeting with the company stakeholders and the design team at Team A

Solutions, the project scope and the following goals were outlined for the creation of the frequent

shopper program. The newly integrated program will need to be seamless with the existing POS

systems currently used by the Kudler stores. Individual Reward cards will be issued for each

program participant, which they will present at each transaction they make at a Kudler retail

location. The expectations of this program include:

      Enhanced focus of quality food and specialized products, guided by the customers’
       purchases, interests, and feedback
      The attraction of new customer to Kudler’s shopping experience
      Ensure the privacy and confidentiality of all customer records and information.

       The newly implemented program should be successful with 3% investment of 2006

annual profits, which is approximately $ 45,000 for initial capital expense and $ 25,000 yearly

for system maintenance and redeemed program rewards. With this budget, Kudler anticipates the

ability to offer desirable products and rewards to its valued customers participating in the

frequent shopper program.

Measures for Success
       Kudler’s Fine Foods employs various techniques to ensure its competitive edge and

success in the present and future economy by providing its customers with the best quality foods

and services possible. Continually striving to provide patrons with a friendly environment and

the best values in unique, upscale, and specialty foods and products will ensure a satisfied, return

customer. These customers desire a quality, pleasant location to focus their shopping needs and

the integration of a loyalty program will offer another approach to customer appreciation at

Kudler.
                                           Kudler Fine Foods Frequent Shopper Proposal          6


       Specials are advertised in each store’s local newspaper, which are prepared and posted by

Kathy Kudler. Kathy manages advertised merchandise with each store manager on a weekly basis

to ensure products are stocked accordingly. Response to local advertising will be monitored,

tracking the change in customer volume and the amount of advertised items sold. When

necessary, merchandise is traded between locations to meet customer demands of specific items.

In addition, managers and assistant managers at each store handle much of the day-to-day details.

Line personnel helps with stocking and inventory to ensure fresh products are always available.

Specialists have been hired and placed at each location to provide advice and assist clients with

their culinary needs. Reports generated by the new frequent shopper database will provide

valuable information when forecasting and purchasing new products, allowing Kudler to

emphasize the items most desired by customers and increasing customer satisfaction.

       Kudler distributes surveys to customers and uses the feedback to amass a database of

information about customer service, promotions, and product selection at individual store

locations. Through the customer’s constructive criticism, Kudler can make improvements and

maintain its quality edge over its competitors. Meeting or exceeding a 95% satisfaction on

customer surveys is the benchmark of success. Kathy will be looking for this same level of

achievement when the frequent shopper program is introduced.

       According to the information provided in the company intranet, Kudler Fine Foods uses a

Point of Service module, which captures and reports all retail sales in details to assist with the

determination of which products are profitable and to facilitate with the analyzing of the

quantitative and qualitative data (Kudler Fine Foods, 2009). The integration of the new program

requires minimal additions to the existing system; therefore, training will be nominal as the
                                               Kudler Fine Foods Frequent Shopper Proposal       7


employees are already familiar with the bulk of the POS system. With little change, user

satisfaction should remain high and Kathy will be looking for feedback from all employees

regarding the program and POS system to ensure continued success.

        Measuring success is never an easy task, yet it is vital to guarantee a lucrative and self-

sustaining project. The following section addresses other measures for success that are attached

to the aspects of the project’s feasibility.

Project Feasibility
        Kudler Fine Foods plans to increase annual revenue as much as 5% over the next 12

months, which breaks down in four categories. One quarter percent is expected to gain during the

project rollout and employee training. One half a percent is estimated to increase profits during

the evaluation and tweaking phase of the project. Promotion of the program will be happening as

well during this time. At each phase, when customer satisfaction increases, so does the projected

revenue, leading up to the 4.75% expected increase (Kudler Fine Foods, Inc., 2008).

        Budget is the biggest area of concern, according to Kathy. The frequent shopper program

is an economical program designed to be self-funding. Cost of the program will be minimal

versus the projected income. Project design and implementation cost is projected at $42,000,

which is $3,000 below budget and gives leeway for any adjustments or unforeseen

circumstances. Cost includes project hardware and software, full compatibility testing,

installation, training, documentation, and system support; detailed specifics are discussed later.

        Analysis of customer buying habits will allow managers to adjust on-the-shelf products to

meet specific customer needs, reducing costs associated with perishables that remain on the shelf

and decreasing the expense budget. From an operational standpoint, the frequent shopper

program is easily marketed through word of mouth advertising, in-store flyers, website
                                            Kudler Fine Foods Frequent Shopper Proposal          8


notifications, and various printed materials. Legal aspects of the frequent shopper program will

be addressed in contracts between Kudler and the customer or reward vendor. Customer privacy

is of major concern, thus transmission and monitoring of personal data must be secure. Because

the new system is an addition to the existing POS system, the implementation of secure databases

and card readers is a straightforward task that will maintain the level of data security already in

place while increasing customer support of the frequent shopper program.

       The 2007 marketing budget of $ 263,000 is allotted for all marketing strategies involving

all current programs. Marketing cost associated with the frequent shopper program will be

minimal at approximately $ 7,500 yearly. A 5% increase in net sales with little operating cost can

generate $ 2,295,649 in net sales over the next four years based on a 5% increase per year. An

increase to $ 539, 810 in net sales is projected the first year as a result of the frequent shopper

program. Intangible benefits of the program such as customer loyalty, better services, and

employee morale will increase as a result of business sustainability.

Current Business Process Summary
                                          Kudler Fine Foods Frequent Shopper Proposal        9




System Requirements
       The high-level program and system requirements have been identified to ensure that the

frequent shopper program is designed and implemented in accordance with the intentions and

concepts of the new program. The requirements were based on the current POS system and

identified through research, system integration options, user interviews and questionnaires, and

small focus groups of long time Kudler customers. All requirements are mandatory and must be

met to ensure program compatibility and sustainability.

R.1    The new reward system hardware and software shall be compatible and fully integrated
with the current POS system.                                           Mandatory
                                         Kudler Fine Foods Frequent Shopper Proposal          10


R.2     Reports available through the new reward system software shall provide the company
facts and figures about product purchasing trends at each store.          Mandatory

R.3     Existing customer database shall be kept and maintained for customer not wanting to
participate in the frequent shopper program.                              Mandatory

R.4     Information within the existing customer database shall be migrated to the new database
table for customers wishing to participate in the new program.             Mandatory

R.5    Accrued points and reward redemption through the frequent shopper program will be
tracked within the newly created program database.                     Mandatory

R.6     New frequent shopper database shall provide privacy and confidentiality to each
participant in the program.                                              Mandatory

R.7    Register receipt shall provide up-to-date point information of customer account and a web
address to the website where rewards can be viewed and selected.           Mandatory

R.8   Participants shall receive a participation contract to sign, and a terms and agreement
handout, when signing up for the new program.                                Mandatory

R.9    Gift Card USA shall provide Kudler custom printed cards and a reward redemption
website, in accordance with the signed contract terms.                  Mandatory

R.10 Training shall be provided to all Kudler employees at store location upon completion of
the new system installation.                                             Mandatory

R.11 System support and maintenance shall be provided by Team A Solutions for six months
following the project completion. Any additional maintenance can be negotiated separately.
                                                                         Mandatory
Proposed Business Process Summary
       The proposed process starts with the customer's card being read by the card reader during

the transaction. This information is transferred to the POS server. This information is sent to the

database server as well as to the card service's website. Information is available to the customer

from this website regarding their card status, points, and rewards. The information from the

database is available to generate reports for management.
                                         Kudler Fine Foods Frequent Shopper Proposal           11




Functional Allocation & Design Process
       The new hardware needed to implement the frequent shopper program is minimal

because the existing POS system in being upgraded with and optional system addition. Kudler

will need to purchase 12 of the Unitech MS146 Barcode Slot Readers through Semicron

Systems, so that all the registers at each store have the capacity to input the customers account

information. These card readers attach to the existing POS terminal with a USB cord and are hot-

swappable for easy replacement. The frequent shopper card is passed through the reader, where

the information can be captured in the POS terminal. Once a card has been swiped, the POS

terminal will update the appropriate database tables, the customer account, and the register

receipt with the new points and transaction information.
                                         Kudler Fine Foods Frequent Shopper Proposal          12


       The software responsible for calculating and updating the POS and database is an

optional extension of the SUSE Linux Enterprise Point of Service software. The software will

provide for the creation of new customer accounts, changes to existing accounts, and updating

Gift Card USA with daily point and account changes. The frequent shopper database will have

greater functionality and better reporting functions then the existing databases. Novell is

providing the addition of the improved functionality as well as creating custom interfaces and

navigation to simplify the data changes and updates.

       The current POS server was purchased fewer than three years ago and it was designed

with the intentions of upgrading to meet increasing demands. Several possibilities are available,

all of which we are recommending and fit within the allotted budget. The design company will be

adding two additional hard-drives and upgrading to a RAID 5 configuration to ensure redundancy

and performance. Additional RAM will be needed to handle the increase in information

processing, so we are suggesting the maximum of eight GB. The server is already equip with

two, Intel quad core processors and will not be changed.

       With the exception of the new card readers, no new hardware interfaces will be added to

the system. Minimal, new items require less user training and easier integration into the existing

POS terminal. The software will be designed to mimic the existing user screen and interfaces, to

minimize confusion, and increase satisfaction and usability. Ultimately, the decision to stay close

to the users comfort zone will provide quick user acceptance and reduce project costs, allowing

Kudler to focus the budget on the best rewards and prizes available.

Design Trade-offs
       During the design process, some trade-offs may be made to offset changes in cost,

schedule, and performance requirements. With an aggressive time-line some decisions will be re-
                                         Kudler Fine Foods Frequent Shopper Proposal          13


factored to ensure the product is delivered on time, while still maintaining customer satisfaction

and employee usability. Consequences can arise when trade-offs are made to specific design

elements; therefore, any changes will require ample consideration and stakeholder approval

before taking effect.

         The cost of the project is limited to the budget set by Kathy, which is a firm $ 45,000.

With this cost limitation, choices in personnel size and project hardware may be adjusted.

Decisions will need to be made to determine which cutbacks may be necessary. The two primary

areas of consideration are program software and network hardware. Because the card readers are

a minor part of the budget and require no changes to implement them, trade-offs will not be made

for this hardware. Usually, trade-offs made during the development phase of program software

decrease functionality. However, the software we are proposing is an extension of the existing

software and was designed for seamless compatibility. Therefore, no trade-offs will be necessary

in the program software. As in the software, trade-offs made to networking hardware can lead to

the need for early replacement as the company grows. Kudler is already considering the addition

of a fourth store, so bare minimums will not be ideal. The current POS server is fairly new and

has ample room for easy upgrades. Included in the original budget we have proposed an upgrade

that maximizes the functionality of the POS server, even though it is the most expensive option.

Room for trade-offs in the server upgrade is available, but any changes that reduce functionality

may increase the need to upgrade in the near future. Server functionality will contain all of the

required components that will permit data sharing, purchase, and point tracking.

       Timeline is the most flexible aspect of the project trade-offs. Even though Kathy has

requested a project completion deadline of six months, the budget aspect is the only hard line.
                                         Kudler Fine Foods Frequent Shopper Proposal          14


The software functionality is an extension of the existing system and compatible hardware has

already been identified. System implementation will require testing of performance and

functionality specific to Kudler’s needs. Without proper testing, data may not synchronize

properly or often enough. The schedule may vary slightly during the projects implementation and

anything that does not make it into the initial project design can be released via version two.

Physical System Model




                                                      (Satzinger, Johnson, Jackson & Burd, 2004)
                                                 Kudler Fine Foods Frequent Shopper Proposal             15


Logical System Model

              Updated                  Inquiry
                                                      Logical System Model
               Orders




                                                                         Bank &
                                   Customers                             Credit




      Shipping                    New Orders                      Accounting                  Management




                                                                  (Satzinger, Johnson, Jackson & Burd, 2004)

Preliminary Design Model

   Customers                                      Purchases (POS)                           Customer Points




    Rewards                                           Marketing                               Kudler
     Issued                                                                                  Database




                Rewards Partner
               Rewards Partner
                                                   Customer Service




                                                                  (Satzinger, Johnson, Jackson & Burd, 2004)
Testing Process
       During the testing process, we detect and fix errors, identify gaps, and inconsistencies,

our testing phase should run smoothly. We will conduct a technical review during design and
                                        Kudler Fine Foods Frequent Shopper Proposal          16


implementation. Once we have a valid system, we will have a formal inspection to assure us of

the accuracy and functionality of the system. Because Kudler already has a viable POS system,

we will have minimal changes to worry about. To test the point accrual system, we will conduct

unit testing to make sure the proper amount of points according to the purchase are accredited to

the customer’s account and that they accumulate appropriately. Integration testing will ensure

interface compatibility, parameter values are as expected, and there are no run-time exceptions

such as “out of memory” as well as check for any unexpected state interactions.

       When the preliminary testing is complete, we can begin with the system testing which

will confirm that the system meets all requirements and is compatible with Gift Cards USA. We

will check to ensure the data migrates to the new database and that the program participant’s

information is recorded and linked to the appropriate account. The web-site that shows the

customer’s point totals and the rewards available for redemption will be tested to ensure easy

navigation and redemption procedures.

        The final stage is performance testing. This will focus on response time and throughput

as well as acceptance testing, making sure it meets user requirements. Testing is done by the

quality assurance personnel, programmers, and users. Once the system testing is complete

approval will be required. With all of these checks and balances, program testing and corrections

will take approximately two weeks.

Installation & Training Plan
       The installation process will involve the implementation of a new function to an existing

system. This installation process takes less manpower and any overlapping system modules will

be migrated after the initial software installation. The new POS system software and terminal

hardware will be put into place at each location on a staggered basis. The server upgrades will
                                           Kudler Fine Foods Frequent Shopper Proposal        17


happen concurrently with the POS hardware installation in the stores. The process will take place

over a three week time-line. The first week will cover the archiving and backup of all existing

database and POS terminal information. The middle week will be the time to install and migrate

all necessary data into the software upgrade. During the middle week, each store will be closed

for 48 hours to minimize customer frustration upon checkout, as the POS terminal will up and

down multiple times during this period. The final week has been delegated for any minor

adjustments to the system. Each location will require four contract personnel and the store

manager and team for installation. The contract personnel will be highly experienced in hardware

and software installation. The stores will receive installation on a staggered schedule; because of

this we will require eight total contractors for the duration of three weeks.

        Training will begin at each store when the installation is complete and all last minute

bugs have been addressed. The process we will be using is the Train the Trainer model. The

managers will be trained as well as a select employee who has been designated as a power user or

an on-site expert. These employees will be trained using one-on-one training techniques for two

days. Each location's end users will receive one day of training on the new system using the

manager and on-site expert. The user manual as well as quick reference charts will be available

during the training as well as a reference for later.

Documentation Plan

        The design specifications and documentation will be written after Kudler has approved

the new system following final testing. Documentation will include information on the software’s

“look and feel” and description of interface. The user manual will contain the introduction of the

system as well as user instructions and troubleshooting. It will be written to explain the intended
                                          Kudler Fine Foods Frequent Shopper Proposal           18


use of the system and outline information needed to produce the expected outcomes. The

hardware documentation will describe the hardware and the appropriate handling and

recommended maintenance of each piece of hardware. The software manual will be provided

from the vendor and it will describe the installation process, initialization, desired functionality.

An online support document will be available for troubleshooting and solution assistance.

Support & Maintenance Plan

       Team A Solutions will be responsible for maintenance and support for the first six

months. Any vendor warranties that accompany purchased products will be negotiated directly

through Kudler and the vendor. An online troubleshooting tool will be available for problems as

well as a help desk number for issues beyond the manager and on-site expert's purview. The help

desk will be staffed from one hour before to one hour after Kudler store hours of operation. A

ticket reporting process for errors in the system will be in place as well. These will be under the

maintenance and support for the first six months, continuance to be negotiable. Any new

capabilities or additions to the design would not fall under maintenance and would need to be

addressed in a future project. Maintenance documentation will be kept not only for maintaining

the system but also for any advances on the system that may be contracted for in future projects.

Conclusion

       We thank appreciate the opportunity to provide a proposal for your Service Request: SR-

kf-013. We have been able to meet or exceed all Kudler’s initial program requirements while

remaining under budget. We look forward to your response and hope you are satisfied with our

solution.
                                       Kudler Fine Foods Frequent Shopper Proposal       19




                                          References

[1] Kudler Fine Foods, Inc. (2008). Kudler Fine Foods. Retrieved from

       https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Kudler/Internet/KudlerPort.ht

       m

[2] Kudler Fine Foods, Inc. (2008). Service Request SR-kf-013. Retrieved from

       https://ecampus.phoenix.edu/secure/aapd/cist/libraries/Service%20Requests/KudlerSR/ku

       dlerSR013.htm

[3] Satzinger, J.W., Jackson, R.B., Johnson, R. & Burd, S.D. (2004). System analysis and design

       in a changing world. Retrieved from

       https://ecampus.phoenix.edu/content/eBookLibrary2/content/eReader.aspx?assetMetaId=

       4b0efa61-48f5-4272-a367-b38224337302&assetDataId=29dd3674-4aed-4fe8-a6cb-

       0ff804045483&assetpdfdataid=9ab2ccb6-b0e9-4a93-a22f-0a34b5524c15

				
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