Western Governors University

BUSINESS MGT2

A. Problem Statement
The Jaunty Coffee Co. is a small company in Chihuahua Mexico run by Diego Lee. The
company manufactures decaffeinated and traditional gourmet coffees, syrups, and espresso.
The coffee is supplied to customers directly who use it to make coffee at home. Mr. Lee is
responsible for most of the day-to-day operations but des get some assistance from the
youth in the neighborhood in the afternoons. Mr. Lee currently performs inventory and other
functions manually which has worked for some time but over the last year business has
grown to the point where the company does not always have enough of the raw materials to
fill the orders. The local suppliers do not always have enough of the raw materials the
company uses to make the coffee and they are forced to use different vendors to
supplement those shortages. This inconsistency in product has caused the flavor to vary
from batch to batch. This inconsistency in the coffees has increased customer satisfaction
and is starting to affect the company’s sales.
After examination of the problems, the solution identified would be for the coffee company
to invest in a supply chain management system. The system would be used to create
accurate forecasts of supply and demand so Mr. Lee could better control his inventory which
would improve the quality and consistency of Juanty’s products. Mr. Lee has dedicated
$25,000 from his savings to fund the IT project.
The impact of failure to move forward with this proposal would have a profoundly negative
effect on both the financial future of the company and result in damage to the coffee
company’s good reputation. Mr. Lee has dedicated his savings of $25,000 for this project so
it is vital that the project succeed or in addition to the loss of future revenue and reputation,
he will lose all his current savings and quite possible the business itself.
One of the main stumbling blocks to implantation of the new system is that currently there
is no computer infrastructure due to the current manual process. To complete this project,
there will need to be significant build that includes wiring, terminals, and server
construction. In addition to the physical infrastructure there will need to be a significant
amount of training on the new system. This will all need to be within the customer’s
preliminary budget of $25,000 or Mr. Lee will need to acquire additional bank funding.
B. Scope Statement
The objective of this IT project is to install a supply chain management system to assist in
automation for many of the day-to-day tasks currently being done manually by Mr. Lee
alone