Colony Nursery and Landscaping company has opened a new office several hundred miles away from its original location, and requires a system that enables exchanging information between offices. It is needed to allow for customers to benefit from the newly introduced loyalty program. However, there is a choice to make between an information silo or a cloud service. The purpose of this essay is to evaluate both options and discuss the implementation of an ERP system to achieve these goals.
First, it must be understood what an information silo is. De Waal et al. (2019) identifies it as an IMS (information management system) that is self-contained, with great restrictions put on its ability to communicate with other systems. Before the age of the Internet, many departments implemented these types of systems due to a lack of an alternative. Nowadays, they are considered outdated due to diminished capabilities of inter-department collaboration as well as the redundancy of certain features from one branch to another (De Waal et al. 2019). It results in additional costs, communication lag, and poor efficiency. The reasons why organizations are moving to cloud services is because it is a faster and cheaper alternative. Cloud manages all the data for the company, allows for swift exchange of information, and does not imply additional costs for buying and maintaining silos.
Moving to cloud services would solve the silo problem for Colony Nursery and Landscaping. Since the requirement for the loyalty program is the ease of sharing data between offices, that already puts the cloud at a massive advantage over a silo. While the silo offers one significant advantage over the cloud – data security, the types of personal information the company would manage does not require government-grade protection. Cloud services provided by third parties are inherently more vulnerable, but also cheaper and quicker to use.
Using a cloud-based ERP system for the awards program would provide a competitive advantage to the company. They do not produce a unique one-of-a-kind product – landscaping and colony nursing is done by a multitude of providers. Therefore, to attract customers, the company must feature not only an excellent quality of the product (which is considered a given by many customers), but also a solid client loyalty program. At the end of the day, customers care about their own privileges in comparison to others. An ERP would allow managing their data, communicate with them through newsletters, and reach out to prospective customers by offering them additional benefits in exchange for loyalty.
The implementation of an ERP system would require some business process re-engineering. First, the existing silo system would have to be replaced, the specialists managing it either allocated to different tasks or removed from the roster entirely (Julie et al., 2020). The entire team would have to be trained to use the new software that interacts with the cloud. In addition, that software would have to be installed on all relevant computers. Cybersecurity would have to be improved, to compensate for the inherent weaknesses present in the cloud system. The customer awards system would function differently from now on too. If before the two silo systems would have had to compare notes through a lengthy process of communicating data, while remaining separate, now they would be much quicker as a part of a bigger whole (Julie et al., 2020). This would result in less expenditures and increased efficiency, which would, overall, benefit the company.
References
de Waal, A., Weaver, M., Day, T., & van der Heijden, B. (2019). Silo-busting: Overcoming the greatest threat to organizational performance. Sustainability, 11(23), 6860-6863.
Julie, E. G., Nayahi, J. J. V., & Jhanjhi, N. Z. (Eds.). (2020). Blockchain technology: Fundamentals, applications, and case studies. CRC Press.