How Mr. Retailer Broke Free of the GRN Trap
Once upon a time, there lived a happy retailer. Other than running a successful business, he enjoyed singing songs and munching apples.
He hadn’t always been happy but a few timely decisions had made his life considerably easier. He had purchased an automated system that seamlessly managed his retail business. Life was happy, retail was simple, or was made simple by the automated system.
But then, life can dish out unexpected problems.
One day, Mr. Retailer was casually singing a song and munching an apple when he opened his stock report.
“What?” he said aloud. There were a number of products in his store that he had never ordered. Apparently someone at the warehouse was having generous moments at his expense.
“Either Mr. OO (Mr. OO was the warehouse manager) is obliging the supplier or he simply likes to overstock the warehouse with products of his choice,” thought Mr. Retailer.
After thinking through the entire problem, Mr. Retailer came up with a solution:
All GRNs will be based on purchase Orders. Yes. PO based GRN is the solution.
Mr. Retailer thus implemented this check and went about this business as usual meaning he continued singing retails songs and munching apples.
However, a few weeks later, Mr. Retailer again spotted a glaring problem in the stock reports. Though there were no irrelevant items, but the stock was way too much.
How did this happen when GRNs were being made against Purchase Orders?
What happened was this: since GRNs were made against Purchase Orders, no product other than the ones mentioned in the Purchase Orders could be received. But the person making the GRNs could change the quantity of the goods received and thus receive more.
“Seems like the supplier is Mr. OO best friend and he keeps obliging him,” thought Mr. Retailer.
After much deliberation, Mr. Retailer came up with this solution:
The system will not save the GRN if the received quantity is in excess of the Purchase Order quantity.
And then Mr. Retailer went on to implement another fool proof check:
Purchase Order will show zero quantity to the person making GRNs. Mr. OO won’t be able see how much was ordered. He will scan the received items and the scanned quantity will be loaded in the GRN.
These two checks meant: If the item is not in the PO or if its quantity is in excess of the PO, the system will not allow you to save it.
“Ah! Life is good when retail becomes so simple,” Mr. Retailer said doing a leisurely arm stretch.
Mr. Retailer was smart, wasn’t he? Or was he using a smart system? I think it’s both.
P.S I know many of you might be thinking that Mr. Retailer could have fired Mr.OO instead of looking for ways to make GRN foolproof. True. But it wouldn’t have been a long term solution. The smart strategy is to go for a smart system. And this is exactly what Mr. Retailer did.