Can Information Systems Restore

Profitability to Restoration

Hardware?

Akash kumar IPG_2011013Anurag sai IPG_2011014Deepank seth IPG_2011033

Contents:

1. Background2. Balance scorecard analysis and strategy alignment3. SWOT Analysis4. Restoration Hardware's business strategy

5. Factors responsible for the problems in “Restoration Hardware”

6. Role of supply chain management 7. Current progress of the company8. Conclusion

BACKGROUND :

Restoration Hardware is a California based retailer of furniture, hardware, and home accessories (such as bathroom fixtures and decorative furnishings.)

It started operations in 1979 and incorporated in 1987

At the beginning , The company sold through multiple channels: a network of 103 retail stores and six outlet stores across the United States and Canada, a

print mail-order catalog, and its website.

To merchandise products that honors classic America, i.e The company's original furniture and fixtures were designed to match the decor and form of older houses

STRATEGY

ORGANIZATION STRUCTURE

- Poor supply chain management systems and outdated

technology infrastructure acting as profit drains.

INFORMATION

Information about what customers want and how technology is

changing . How to adapt to the change

EXTERNAL ENVIRONMENT/

CUSTOMERS-Inspiring feelings of tradition

and old times in customers- products are difficult to find

elsewhere - knows what customers

want

INTERNAL PROCESS-Scene7's eCatalog solution

introduced for its online print catalog in 2005 resulted in the

doubling of Restoration Hardware's conversion rate of

browsers to buyers-

DOMINANANT SYSTEM

-Restoration Hardware stores use point-of-sale equipment .It lacks the capability to process debit card purchases without a physical signature, nor can it automate processes such as checking fabric stocks when a customer makes a request for a

custom furniture order

BALANCE SCORECARD ANALYSIS AND STRATEGY ALIGNMENT

SWOT ANALYSIS

Strengths :

• Segmentation is the process of classifying customers into groups which share some

common characteristicUnique design of products: As the company sold products with classic American old

design and such products cant be obtained else where , they were in advantage

Dominant market: As there were very few companies and specially none with such

unique idea , they were dominant.

Scene7's eCatalog solution introduction: solution has also made it possible to

implement advanced image-viewing features such as panning, zooming, and rollover

product descriptions . has resulted in the doubling of Restoration Hardware's

conversion rate of browsers to buyers.

SWOT ANALYSIS

Weakness :

Aging and Out-dated IT infrastructure:

Restoration Hardware stores use point-of-sale

equipment that is 10 years old. The

equipment lacks the capability to process

debit card purchases without a physical

signature, nor can it automate processes such

as checking fabric stocks when a customer

makes a request for a custom furniture order

. Poor Supply chain management:

The company could not meet the

demand when there was bulk of

orders due to poor supply and

merchandise.

SWOT ANALYSIS

Opportunties :

Increased efficiency in dealing with

suppliers leading to better business

Proper management

can turn company into

profits

Increase of sales by

implementing a new system

SWOT ANALYSIS

Threats:

Potential Entrants: Threat of new entrants is high because there are already many in the industry so it is obviously easy to enter.

Industry Competitors: Rivalry among existing firms is high. Pottery Barn, Pier 1, and Williams Sonoma are a few. Competitors have greater financial, marketing, and operational resources.

Substitutes: Threat of substitute products or service is high. Same types of products can be found in specialty stores, traditional furniture stores, and department stores. .

Suppliers: Bargaining power of suppliers is extremely high. Two vendors were the source of nearly one-quarter of all merchandise purchases.

Buyers: Bargaining power of buyers is high.

Restoration Hardware's business strategy

to improve the business, the company has dominated the market. By focusing on selling Honored classic American Information Systems .This company has contributed very little strategy. Will focus on the sales plan. But it can not be done under contract with the customer. Although the company has invested Technology iPhrase, Scenne7 eCatalog investment is wasted. Analysts argue that the hardware does not control a number of factors . Can be fully available What to do Make a list of items to meet the needs of our customers.

factors responsible for the problems in “Restoration Hardware”

factors responsible for the problems in “Restoration Hardware”

Management:. Managing of the main

problems of management that supports

hardware solutions . Management is not able

to control all the variables that cause prices to

rise. And reduce the benefit May be due to

not understanding the business environment .

The limitations Business and disorders

Organizational :As the number of

customers, suppliers and other organizations

to increase. Management must be made with

the same data at the same time the most is

the accuracy and reliability of information in

the catalog . Can produce on demand. And

time of delivery.

Factors (continued)

Technological:Technological problem is to

design a system that can integrate all

processes into a single system . Planning and

infrastructure data to be updated after the fact

.

Role of supply chain management

• Supply chain management is critical to improve the hardware.

• Vendors must learn to handle .

• Editing and adding products To improve customer service Add and price competition

• This step will help to improve the management system of the supplier

• Each company must be able to predict the likelihood of consumers.

Current progress of the company

• The current website of the company is https://www.restorationhardware.com

• The company is running in loss from past 3 years as per the annual report of it in 2013-14.

• The company has recently started RH financing . Which says (Spend $3000 or More Pay As Little As $45 Per Month On Your RH Credit Card 5.99% APR for 84 Months**)

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Conclusion

• To fix the hardware on the system information. By changing technologies in use today . They do not work with the data in real-time to provide access to information that can predict future demand . This will allow the sale of products and systems management , inventory change for the better .

Advantage of the system is• - Establish a relationship between the seller.• - Reducing the time spent on the purchase order .• - Reduce the inventory system .• - Increased efficiency in dealing with suppliers. By reducing the risk

of interest.- Increase sales- Decided to meet the needs of consumers.  

Thank YOU