Case Analysis of American Foods Company
The fundamental issue giving rise to the problems suffered by the American Foods Company's (AFC) information services is the lack of communication among the various bodies that input and output AFC's order entry system. In addition, each element of the system is too willing to assign blame to the other without attempting to communicate to try to solve the problem. The obvious symptom that requires immediate attention is the failure of AFC to process orders efficiently and in a timely manner. Monroe is understandably upset at this problem because it forms the basis of AFC's business and profit. The basis for the problem is the failure of AFC to oversee the management of the growth, maintenance and development of its information services in a way that took into consideration all the various aspects of the company. The company's order entry system is composed of approximately 700 different programs that accept orders for all AFC products, manage inventory and distribution, and prepare shipping notices and invoices. However, each of these programs was not specifically designed to be compatible with each other or with AFC's order entry system as a whole.
The AFC system is a batch system that was developed 20 years ago when AFC was basically a breakfast cereal company. As new companies with different product lines were acquired by AFC, AFC included these new companies' order processing systems into their own. Apparently, no real attempt was made to ensure that the system operated as a coherent whole; rather, the emphasis seemed to be to make as little changes as possible. This decision could have been an attempt to save money or to try not to upset the operation of the newly acquired business. The result, however, was the largely uncontrolled and unguided growth of the AFC order entry system and the problems suffered by the company in 1987. This problem was only marginally aggravated...