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Vinsun Infra Engineering: Case On Erp: Group 7

Vinsun Infra Engineering provides electrical and civil services across India and was incorporated in 2002. It faces challenges with information overload, outdated cost calculations, lack of data integration, and improper data backups. The company is considering implementing an ERP system from either Bluechip or Codeautomations to address these issues. Codeautomations' cloud solution has the lowest initial and 5-year present value costs but organizational acceptance and risk of failure must also be considered in the decision.

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DIVYANSHU SHEKHAR
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89 views15 pages

Vinsun Infra Engineering: Case On Erp: Group 7

Vinsun Infra Engineering provides electrical and civil services across India and was incorporated in 2002. It faces challenges with information overload, outdated cost calculations, lack of data integration, and improper data backups. The company is considering implementing an ERP system from either Bluechip or Codeautomations to address these issues. Codeautomations' cloud solution has the lowest initial and 5-year present value costs but organizational acceptance and risk of failure must also be considered in the decision.

Uploaded by

DIVYANSHU SHEKHAR
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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VINSUN INFRA

ENGINEERING:
CASE ON ERP
GROUP 7
COMPANY BACKGROUND
 Line of business: providing electrical & civil services across India
 Incorporated in 2002
 Clients: production & services industries, telecom companies, commercial buildings,
institutional campuses, residences, hospitals etc.
PROBLEM STATEMENT
 Challenges in terms of information overload
 Input cost calculations were not readily available, outdated
 Lack of data integration; redundancy and incompleteness of data
 Data back-up not being maintained properly
OBJECTIVE
‘To find a way to access accurate information more rapidly’

Decision Point
Whether to implement ERP system or not?
PROS AND CONS OF ERP
 Pros
 Greater efficiency
 Allows focus on core activities
 Facilitates adoption of best practices
 Eliminates losses from outdated information
 Back-up can be accessed anytime

 Cons
 May be more costly than beneficial
 Employees’ resistance
ALTERNATIVES
 Implement ERP on premise (Bluechip corporation)
 Implement ERP on premise (Codeautomations)
 Implement ERP on cloud (Codeautomations)
PROS & CONS OF BOTH
COMPANIES
 Bluechip
 Pros: Track record of successful implementation, customization options
 Cons: Services offered only on premises, cost way over the budget

 Codeautomations
 Pros: Cost effective, both on cloud & premise
 Cons: Start-up company, risk of failure
ORGANISATIONAL ISSUES
 A few key managers are sceptical about the results associated with the roll-out
 There is no measure to quantify the returns yet
 Budget constraint: 3% of sales = 13,53,000
 If approved, choice of cloud or premises is difficult because
 Cloud database could compromise security
 Premise database results in additional costs
FINANCIALS: BLUECHIP
(PREMISE)
COST OBJECT PER UNIT COST # OF UNITS TOTAL COST
HARDWARE HARDWARE ONGOING MAINTAINANCE COST 57222.8
INITIAL COST WORKSTATION 34950 6 209700 SOFTWARE ONGOING MAINTAINANCE COST 172800
WORKSTATION UPS 3715 6 22290 NETWORK ROUTER MAINTAINANCE 1547.9
LAPTOP 66244 2 132488 NETWORK INFRA MAINTAINANCE 12000
SERVER 100000 1 100000 2 MBPS INTERNET LINE 11988
BACK-UP SERVER 100000 1 100000
SERVER UPS SYSTEM 3875 2 7750 TOTAL ONGOING COST 255558.7
572228
SOFTWARE
INITIAL COST ERP APPLICATION SOFTWARE 120000 8 960000
CONSULTING 80000 1 80000
DEPLOYMENT COST 520000 1 520000
TRAINING 180000 1 180000
1740000
NETWORK
INITIAL COST ROUTER 15479 1 15479
NETWORK INFRA SET-UP 120000 1 120000

INITIAL ROLL-OUT COST 2447707


FINANCIALS:
CODEAUTOMATIONS (PREMISE)
COST OBJECT PER UNIT COST # OF UNITS TOTAL COST
HARDWARE HARDWARE ONGOING MAINTAINANCE COST 51222.8
INITIAL COST WORKSTATION 34950 6 209700 SOFTWARE ONGOING MAINTAINANCE COST 36000
WORKSTATION UPS 3715 6 22290 NETWORK ROUTER MAINTAINANCE 1547.9
LAPTOP 66244 2 132488 NETWORK INFRA MAINTAINANCE 12000
SERVER 70000 1 70000 2 MBPS INTERNET LINE 11988
BACK-UP SERVER 70000 1 70000
SERVER UPS SYSTEM 3875 2 7750 TOTAL ONGOING COST 112758.7
512228
SOFTWARE
INITIAL COST ERP APPLICATION SOFTWARE 30000 8 240000
INSTALLATION COST 200000 1 200000
440000
NETWORK
INITIAL COST ROUTER 15479 1 15479
NETWORK INFRA SET-UP 120000 1 120000

INITIAL ROLL-OUT COST 1087707


FINANCIALS:
CODEAUTOMATIONS (CLOUD)

COST OBJECT PER UNIT COST # OF UNITS TOTAL COST


HARDWARE HARDWARE ONGOING MAINTAINANCE COST 36447.8
INITIAL COST WORKSTATION 34950 6 209700 SOFTWARE ONGOING MAINTAINANCE COST 192000
WORKSTATION UPS 3715 6 22290 STORAGE DATA STORAGE COST 60000
LAPTOP 66244 2 132488 NETWORK ROUTER MAINTAINANCE 1547.9
364478 2 MBPS INTERNET LINE 11988
NETWORK
INITIAL COST ROUTER 15479 1 15479 TOTAL ONGOING COST 301983.7

INITIAL ROLL-OUT COST 379957


FINDINGS
 Initial roll-out cost of Bluechip’s quotations is way over the budget (i.e. 13,53,000)
 Cheapest option is to take Codeautomations’ services on cloud

But wait, what about the ongoing


costs?
PRESENT VALUE OF ONGOING
COSTS
ON PREMISE ON CLOUD

YEAR COST PVF (0.12,N) PRESENT VALUE YEAR COST PVF (0.12,N) PRESENT VALUE
0 1087707 1 1087707 0 379957 1 379957
1 112759 0.8929 100682.5111 1 301984 0.8929 269641.5136
2 112759 0.7972 89891.4748 2 307984 0.7972 245524.8448
3 112759 0.7118 80261.8562 3 314584 0.7118 223920.8912
4 112759 0.6355 71658.3445 4 321844 0.6355 204531.862
5 112759 0.5674 63979.4566 5 329830 0.5674 187145.542

PRESENT VALUE OF COSTS OVER 5 YEARS 1494180.643 PRESENT VALUE OF COSTS OVER 5 YEARS 1510721.654
CONCLUSION
From the financial point of view, Codeautomations’ service on premise is the cheapest in the
long term

However we still need to consider other factors such as organisational acceptance & risk of
failure
THANK YOU FOR YOUR TIME!
HIMANSHU SUKRIT AMIT
ARORA KUMAR CHOUDHARY
1301-528 1301-421 1301-505

SAUMYA MOHIT
GUPTA SHARMA
1301-200 1301-124

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