Reference no: EM133216422
Zeta & Co. is a bulk importer of finished products. Each time it purchases from its suppliers it does so in Lots, which Zeta then sells in smaller boxes to independent retail stores. The popularity of the product determines the lot size. A popular product is ordered in larger size lots, to be broken down into 50 boxes, an average product is broken down into 25 boxes, and less popular products into 10 boxes.
To improve its process, Zeta & Co. has recently introduced an automatic reordering system in which it automatically generates a new purchase requisition when 75% of the standard lot has been sold.
The system has been programmed to identify a unit of inventory as a box, and when generating purchase requisitions requests the number of boxes needed.
Since using the new system, the Purchasing Officer is simply approving all purchase requisitions, with the number of boxes needed becoming the number of lots ordered.
a) Would the Purchase Order contain a systematic or random error from a data perspective? Explain why.
b) What information quality goals are at risk in the production of the Purchase Order. Explain why.