Scribd
Upload
119 views36 pages

ERP Case Study

The document discusses several famous ERP failures including: 1) Hershey's failed SAP ERP, Siebel CRM, and Manugistics supply chain systems which prevented $100 million in candy shipments. 2) Nike's $400 million ERP/SCM upgrade caused $100 million in lost sales and stock dips due to integration issues. 3) HP's centralized SAP project in 2004 encountered multiple problems, costing $160 million in backlogs and lost revenue. 4) Several universities like UMass faced buggy portals and ERPs that disrupted students' class schedules and financial aid. 5) Waste Management is embroiled in

Uploaded by

Gaurav Ranjan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
119 views36 pages

ERP Case Study

The document discusses several famous ERP failures including: 1) Hershey's failed SAP ERP, Siebel CRM, and Manugistics supply chain systems which prevented $100 million in candy shipments. 2) Nike's $400 million ERP/SCM upgrade caused $100 million in lost sales and stock dips due to integration issues. 3) HP's centralized SAP project in 2004 encountered multiple problems, costing $160 million in backlogs and lost revenue. 4) Several universities like UMass faced buggy portals and ERPs that disrupted students' class schedules and financial aid. 5) Waste Management is embroiled in

Uploaded by

Gaurav Ranjan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 36

Information Systems

Session 5A:
Enterprise Applications - ERP
Effects of Additional Risk Factors (Large Size, High
Technology, High Requirements Volatility) on Project
Risk
What People Expect and What Often Happens at System
Cutover
Project Benefits
The Three Primary Enterprise Systems
Enterprise Resource Planning
Enterprise resource planning – Integrates all
departments and functions throughout an organization
into a single IT system (or integrated set of IT systems)
so that employees can make enterprisewide decisions by
viewing enterprisewide information on all business
operations
Enterprise Resource Planning
Reasons ERP systems are powerful tools
• ERP is a logical solution to incompatible applications
• ERP addresses global information sharing and reporting
• ERP avoids the pain and expense of fixing legacy
systems
Enterprise Resource Planning System
Overview
ERP systems collect data from across an organization and correlate
the data generating an enterprise-wide view

Jump to long image description


ERP Process Flow
ERP Systems Automate Business Processes

Jump to long image description


The Organization before and after ERP
The Organization Before ERP

Jump to long image description


The Organization before and after ERP
ERP Bringing The Organization Together

Jump to long image description


The Benefits of ERP
Core ERP component – Traditional components
included in most ERP systems that primarily focus on
internal operations
Extended ERP component – Extra components that
meet the organizational needs not covered by the core
components that primarily focus on external operations
The Evolution of ERP

Jump to long image description


Core ERP Components and Extended ERP
Components

Jump to long image description


Core ERP Components
Three most common core ERP components
1. Accounting and finance
2. Production and materials management
3. Human resource
Accounting and Finance ERP Components
Accounting and finance ERP component – Manages
accounting data and financial processes within the
enterprise with functions such as general ledger,
accounts payable, accounts receivable, budgeting, and
asset management
Production and Materials Management ERP
Components
Production and materials management ERP
component – Handles the various aspects of production
planning and execution such as demand forecasting,
production scheduling, job cost accounting, and quality
control
Human Resource ERP Component
Human resource ERP component – Tracks employee
information including payroll, benefits, compensation,
performance assessment, and assumes compliance with
the legal requirements of multiple jurisdictions and tax
authorities
Extended ERP Components
Extended ERP components include:
• Business intelligence
• Customer relationship management
• Supply chain management
• Ebusiness components include
• Elogistics
• Eprocurement
Measuring ERP Success
ERP systems contain multiple complex components that
are not only expensive to purchase, but also expensive
to implement
Costs include:
• Software
• Consulting fees
• Process rework
• Customization
• Integration
• Testing/Training
The Four
Primary
Perspectives
of the
Balanced
Scorecard

Jump to long image description


Organizational Integration with ERP 1 of 2
SCM, CRM, and ERP are the backbone of ebusiness
Integration of these applications is the key to success for
many companies
Integration allows the unlocking of information to make
it available to any user, anywhere, anytime
Organizational Integration with ERP 2 of 2
Balanced scorecard – Enables organizations to clarify
their vision and strategy and translate them into action
Balanced scorecard views the organization from four
perspectives
• Learning and growth
• Internal business process
• Customer
• Financial
ERP Implementation Choices

The three
primary ERP
implementation
choices driving
the next
generation of
business
operations
On-Premise ERP
On-premise systems – Include a server at a physical
location using an internal network for internal access
and firewalls for remote users’ access
• Legacy system – An old system that is fast
approaching or beyond the end of its useful life within
an organization
Cloud Computing Example
Cloud computing offers new ways to store, access, process, and
analyze information and connect people and resources from any
location in the world where an Internet connection is available

Jump to long image description


Advantages of SaaS Implementations

Jump to long image description


Hybrid ERP
Hybrid ERP – Splits the ERP functions between an on-
premises ERP system and one or more functions
handled as Software as a Service in the cloud
Scenarios common in hybrid architectures of ERP:
• A business with a very specific local focus, such as
single-site or multisite within a single country or region
• A business with operations geared strongly toward a
specific industry
• A newly acquired operation with a mismatch of
multiple outdated, unsupported ERPs
• A small company with no formal ERP in place
Thank You
Five Famous ERP Failures
Definitely Not a Sweet Experience for Hershey.

• Failed Technology implementation could lead to failure ?

• Hershey’s ghastly problems with its SAP ERP, Siebel CRM, and
Manugistics supply chain applications prevented it from delivering $100
million worth of Kisses for Halloween that year and caused the stock to
dip 8 percent.
Just Do It: Fix Our SCM System

• Nike’s SCM and ERP


• $400 million upgrade
• $100 million, in lost sales, a 20 percent stock dip, and a collection of
class-action lawsuits.
• This was all back in 2000, and the horrendous results were due to a bold
ERP, supply chain, and CRM project that aimed to upgrade the systems
into one superstar system.
HP’s “Perfect Storm” of ERP Problems.

• The epic tale of HP’s centralization of its disparate North American ERP
systems onto one SAP system proves that one can never be too pessimistic
when it comes to ERP project management.

• In 2004, HP’s project managers knew all of the things that could go wrong
with their ERP rollout. But they just didn’t plan for so many of them to
happen at once.

• The project eventually cost HP $160 million in order backlogs and lost
revenue—more than five times the project’s estimated cost.
A New Type of Freshman Hazing.

• Pity the college freshman at the University of Massachusetts in fall 2004:

• The last thing they needed was some computer program to haunt their lives
and make their new collegiate experience even more uncertain. But
more than 27,000 students at the University of Massachusetts as well as
Stanford University and Indiana University were forced to do battle with
buggy portals and ERP applications that left them at best unable to find
their classes and at worst unable to collect their financial aid checks.
Waste Management Trashes Its “Fake” ERP Software.

• Garbage-disposal giant Waste Management is still embroiled in an


acrimonious $100 million legal battle with SAP over an 18-month installation
of its ERP software.

• The initial deal began in 2005, but the legal saga commenced in March 2008,
when Waste Management filed suit and claimed SAP executives participated
in a fraudulent sales scheme that resulted in the massive failure. Several
months later, SAP fired back, claiming that Waste Management allegedly
violated its contractual agreement with SAP in several ways, including by
“failing to timely and accurately define its business requirements” and not
providing “sufficient, knowledgeable, decision-empowered users and
managers” to work on the project.

• In the fall of 2008, accusations were still flying about documentation,


depositions, and delays in bringing the case before a judge. And that
proposed 18-month implementation now sounds like a dream scenario

You might also like