Information System Report: Analytical CRM for Myer Department Store

This report presents an analysis of Myer, an Australian department store, and proposes the implementation of an Analytical CRM system to address its challenges. The report begins with an executive summary, followed by an introduction outlining the purpose and scope. It provides an overview of Myer, an industry analysis, and internal and external environment analysis using SWOT and PESTLE frameworks. The problem of Myer's unclear market position and lack of customer data analysis is identified, justifying the choice of an Analytical CRM system. A cost/benefit analysis is included, alongside system analysis, design, and a detailed system development life cycle. The report also covers post-implementation activities, project, risk, and change management strategies. It concludes with a summary of findings and recommendations, supported by references.

1/21/2020
Running head: INFORMATION SYSTEM
Information Systems
Myer

INFORMATION SYSTEM 1
Letter to Sponsor
Mr. John King
Chief Executive Office
Myer
800 Collins St, Docklands VIC 3008,
Australia
Myer is a famous upmarket retailer of Australian department store industry working with the
mission to become the favourable brand of Australians. As it is understandable that Customer
Relationship Management System is helping number of businesses in maintaining
relationship with its customers by analysing their purchasing pattern. Therefore, it is
requested to take into consideration this report and give a thought related to the
implementation of Analytical CRM system within Myer operations as it can improve the
performance of the company by retaining old customers and attracting new ones.
I am presenting this report with immense pleasure related to the Analytical CRM System
implementation in Myer. According to the report analysis, the main function of this system is
to help the top management, support, sales, and marketing personnel in defining a superior
way to serve the consumers. The time that has been projected for the system development is
five months.
I will look forward to your feedback and attaching the report regarding Analytical CRM
System Implementation.
Regards,

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Executive Summary
The purpose of the report is to perform the environmental analysis of Myer accordingly
representing the problem that it is dealing with due to the absence of proper information
system in place. The analysis of the market has revealed that the company lacks in suitable
customer relationship management system that can provide support in collecting the customer
related data and then evaluating their purchasing pattern to improve its services. After the
analysis, the system that Myer needs to implement is Analytical CRM system as it will help
the top management, support, sales, and marketing personnel in defining a superior way to
serve the consumers. In order to develop this system, a proper development life cycle has
been presented in the report. In the end, the report has provided has provided the details
related to three aspects of the implementation that are project management, risk management
and change management.

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Table of Contents
Letter to Sponsor........................................................................................................................1
Executive Summary...................................................................................................................2
Introduction................................................................................................................................4
Overview of Myer..................................................................................................................4
Industry Analysis................................................................................................................5
Internal and External operating environment.........................................................................5
SWOT Analysis of Myer....................................................................................................5
PESTLE Analysis...............................................................................................................7
Identifying Problem for IS/IT.................................................................................................8
Justification for the choice of system.....................................................................................9
Cost/Benefit Analysis of implementing CRM System.....................................................11
Cost/Benefit Analysis for Myer........................................................................................11
System Analysis and System Design for Analytical CRM..................................................12
System Development Life Cycle..........................................................................................13
Post implementation activities..............................................................................................14
Project management, risk management and change management associated with the
implementation.....................................................................................................................15
Conclusion................................................................................................................................16
References................................................................................................................................18

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Introduction
In the world of business, the substitute for the right information at right time is not available.
It is obvious that in last few decades different trials have been done for the development of
the systems that can make precise information that is readily accessible and easily available
all over the organization. The making and utilization of the information systems is said to be
a modern trend that is mainly focused on the collection, procedure, and dissimilation of
valuable information that guides a business for the better planning, improved decision-
making process and finally for better outcomes. According to Ghasemi, Shafeiepour, Aslani
and Barvayeh, (2011), information system is the collection of procedures, database, people,
software, and hardware that gathers, processes, stores, and transfers the data for the
transaction dispensation at operational level for providing a backing to the decision making to
the management. The motive of this report is to discuss about the Information system issue
that is experienced by Myer one of the well-known upmarket department store of Australia
and presenting the solution in the form of an information system that can improve its
performance in the market along with meeting its organizational goal. This procedure is
comprised of presenting the background of the company and its internal and external
environment analysis. Besides this, identifying the problem and presenting the solution and
highlighting its cost/benefit analysis. In addition to this, the report is also highlighting the
system development life cycle of the suggested solution.
Overview of Myer
Myer is the Australian upmarket department store chain. The company operates its functions
across Australia by offering a range of products like clothing for men, women, babies, and
children, cosmetics, furniture, video games, footwear, fragrance, and accessories. Besides
this, it also deals in bedding, GPS navigation, homewares, books, toys, computers, flooring,
car audio, confectionery and food, travel goods, and stationery (Bloomberg, 2019). The key

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competitor of Myer is David Jones. In fact, Myer for long time has been the largest
department store of Australia in terms of number of stores and revenue.
Mission – The mission of Myer is to be the market for people of Australia where they can
explore a variety of exciting local as well as international lifestyle brands, for entertainment
and home. Besides this, to create a user friendly and rick in content destination for shopping
(Paul, 2020).
Vision – The vision of Myer is ensuring that this brand becomes the favourite department
store of Australian customers by offering helpful and friendly services, along with exclusive
and high-quality brands and delivering compelling value to the customers (Myer, 2020a).
Industry Analysis
The retailers in the industry of department stores are struggling from last five years because
of the negative customer behaviour and weak retail environment. In this market, customers
are highly price sensitive and unwilling to invest their disposable income. In its place they
prefer to pay their debts and increase their savings. According to the analysis presented by
IBIS World, it has been revealed that the revenue of this industry will drop at the annual rate
of 0.2% in the coming five years to $18.8 billion (IBIS World, 2019). Undefined economic
situations and increasing competition from the online retailers are anticipated to add to a
0.5% decline in the revenue of the industry in this current year. The industry of department
store is considered to be intensely concentrated, with four top players predictable to comprise
for around 95% of the revenue of the industry.
Internal and External operating environment
SWOT Analysis of Myer
Strength
The major strength of Myer is that it targets the earners with extra income and focus on
delivering different styles as well as entertainment for its customers and the market. The

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company has introduced its loyalty card under which it focusses on retaining and enticing
existing customers and increase the per user usage of its products with various member
benefits like loyalty gift cards (White, 2016).
Weaknesses
It can be noticed that the decreasing customer base and revenue of the department stores in
the Australian market is resulting in closure of company’s stores due to which the
unemployment rate is increasing. This results in impacting the user’s sentiment and their
purchasing power which eventually impacts the revenue of the upmarket department store
(The Conversation, 2018).
In addition to this, the company is presently not focusing on the high-end customers and
focusing on the cost-conscious customers due to which the sales of the company is reducing
because bargain-oriented consumers only shop during sale.
Opportunities
The major opportunity available for Myer in the retail industry is to expand the business in
different international market as it can help it in increasing the sales as well as revenue of the
company.
Along with this, the company needs to try different information system that can help it in
maintaining good relationship with the existing and new customers.
Threat
The major threat for Myer is competition in the Australian department store. The increasing
competition from the top retailers like David Jones, Pacific Brands, H&M, Country Road,
M&S, etc. (Myer, 2020b)

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PESTLE Analysis
Political Force
The political stability in Australia inspires different investors to invest in the country which
results in high returns and low risk of business failure. The country’s government concentrate
on augmenting the international trade by offering growth opportunity to the traders such that
suppliers and customers can be attracted from all over the world through E-Retailing (Caselli
and Tesei, 2016). However, some of the political steps like new trade charges and taxes
influences the spending decision of the customer, which eventually decreases the revenue of
companies like Myer.
Economic Force
Change in the value of the Australian dollar and declining global economy adversely impacts
the retail industry growth. Economic factors like low saving rates, decreasing the house
prices, reducing GDP, high prices of oil adversely affect the spending pattern and confidence
of the customer.
Social Force
The increasing preferences of the customers in the market for the products of high quality in
the Australian market offer an opportunity to the traders like Myer for concentrating on the
satisfaction of the customers to attain the competitive advantage. The population of the
country is culturally diverse, and hence the industry of retail must consider the diversity by
the provision of a broad variety of the products in order to encounter the expectations as well
as needs of the consumers.
Technological Force
The increasing international competitiveness in the Australian retail industry is because of the
e-retailing and internet. The new technologies of communication increase the expansion in
the foreign market. The satellite coverage, mobile network, and fiber optic have provided a
way to connect with numerous activities which enhance the efficiency of the business (Lane,

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Follett and Lindsay, 2018). The Federal Government of the country has enabled plans that
support the inventors to protect as well as promote their new business ideas.
Legal Force
Regulations related to employment and the policies of taxation are impacting the retail
industry. Laws such as agreement with revelation requirements, protection of the customers,
and safety and health regulations impact the retail business negatively or positively (Cludius,
Forrest and MacGill, 2014). The launching of the new stores by the business must be
regulated by the government in order to control the illegal activities in the Australian market.
Environmental Force
The Australia has least amount of water due to its dry nature and the negative human
activities impacts the marine environment of the country. Working in the environment that is
not favourable for the target market is taken as a big challenge for Myer. Environmental
programs relate to climate change has a major impact on the retail industry. But, recycling of
the waste material enhances the business sustainability in the industry.
Identifying Problem for IS/IT
The major problem that has been identified in the case of Myer department store chain is that
it is tried to offer all the things to all the customers. Myer department store is focusing on
trying to hang the high-end consumers of old, at the time of focusing on appealing to the
customers who are value-conscious, but these customers only shop at the time of sale. The
place of this brand in the eyes of the customer as well as in the market is unclear, which
represents that the company do not properly access the data base of the customer that can
help it in focusing on specific target market due to the absence of specific system of customer
relationship. In February 2018, the value of the share price of Myer was continuously
declining. Due to this, the board of the company then dumped the chief executive in the same
year, highlighting the requirement for urgent action for stopping a decline in the earning and

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sales (Sands and Beverland, 2018). It seems to be shocking that this is the same department
store who have ruled the retail industry of Australia. From the 1800s, Myer along with David
Jones are associated with the taste of fashion of Australians and is the reason that have
provided an exposure to the luxury brands that were not present in the Australian market.
In order to resolve this identified issue of unclear image in the market and unclear target
market of Myer, the solution that is best suited for the company is Customer Relationship
Management as the Information System Customer Relationship Management System is a
technology that is used for managing the relationships of the company and its interactions
with the consumers and potential consumers. The objective of this system is to enhance the
relationships of the business and support the business in getting in touch with the consumers,
streamline procedure and increase profitability (Khodakarami and Chan, 2014). The focus of
this system to enhance the relationship of the company with the individual people comprising
colleagues, suppliers, customers, or service users all over the business lifecycle with them
comprising identifying new consumers, wining their trust, and offering support as well as
additional services.
Justification for the choice of system
The above section has provided the solution for the problem that is being faced by Myer is
that Customer Relationship Management System. However, there are different types of
customer relationship management system available in the market that can be used by the
businesses such as Operational CRM and Analytical CRM (Hung, Hung and Jiang, 2010). In
order to resolve the issue faced by Myer that is unclear target market and unclear image in the
market due to which it is losing its share against its competitors, the type of Customer
Relationship Management System is suitable for it is Analytical CRM. As this system will
help the top management, support, sales, and marketing personnel to define a superior way to
serve the consumers. Data analysis is the key operation of this application of the CRM. It

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analyses the data of the customer that is collected from different sources in order to have
better insights related to present company’s status (Saeed, Grover, Kettinger and Guha,
2011). It provides support to the top management of the company to take superior decisions
for the company, marketing team to know the effectiveness of the campaign, sales personnel
to augment the sales and support team to enhance the quality of support and create strong
relationship with the customer. Some of the features of Analytical CRM:
 Collecting information related to customer from different sources and evaluating the
data in organized manner.
 Supporting the business in setting the business methodology in Marketing, Support,
and Sales in order to enhance the customer loyalty and relationship (Coltman,
Devinney and Midgley, 2011).
 Enhancing the effectiveness of the CRM system and evaluating the key performance
indicators that are set by the company.
The Analytical CRM has been selected because it:
Identify new trends and forecasting – The analytical CRM tool consider the past trends of
sales and the present opportunities and directs and identify the patterns in buying behaviour.
This enable the business in forecasting and predicting the trends.
Customer Satisfaction – This CRM application allow business to analyse the data and use it
in a better way such that benefits can be visible to the customers. Customer information can
be gathered and evaluated from different channels and business will be able to create the
customer profiles and understand their values, demands and define the geographic and
demographic information (Sirk, 2019).
Marketing Campaign Optimization – This type of CRM enables the business to justify its
marketing efforts by showcasing where to place its effort and resources. By representing the

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business which campaign of marketing are working, and which are not. Through this, the
business can attain better outcomes with the low expenses of money, human resource, and
time.
Optimization of marketing and sales activity – This application of the CRM helps in
predicting the modelling for marketing which supports in using business intelligence and big
data for the anticipation of the behaviour of the customer.
Data mining and warehousing– The data warehousing confirm that entire data is properly
stored at single place and accessible for the analytical purposes. Data from the billing
invoices, feedback forms, call canters, and website can be collected quickly. Data mining
helps in analysing the huge data in order to identify the proper patterns of customer buying
(Vaish, Vaish, Vaishya and Bhawal, 2016).
Online analytical processing – This processing helps the business in unifying diverse
datasets at single place. It is also called as OLAP which confirm that the data is flexible and
also useful.
Cost/Benefit Analysis of implementing CRM System
Cost
Analytical CRM Purchase $ 15000
Updates and Maintenance $ 2000
Benefits
Increased Profit $ 10000
Cost/Benefit Analysis for Myer
Tangible Benefits
Decreasing cost of the products