Is 6006 – questions on assignment

1. Is 6006 – questions on assignment ERP project preparation report Due November, 18th.

2. PROJECT (see in course outline) • Group project based on the SIB case study • Comprehensive report detailing the business rationale for seeking to implement an ERP package in SIB should address the following issues: • Strong introduction on ERPs in general and what can be expected in terms of benefits and downsides (known case studies of firms having implemented ERP can be used) • Detailed analysis of proposed changes and impact on SIB from a corporate level point of view (should have a positive bias). Analysis should refer to specific business processes (eg: manufacturing scheduling etc…) • Analysis of potential impact at local level (should address the issue of potential resistance to change / how to sell the ERP project to local managers). Again, this should refer to specific business processes. • Formal scoping document which outlines in detail the target for implementation (eg: modules, functional areas etc…) • Conclusions providing a high level rationale for undertaking the project and an appreciation of how likely it is to be successful given the potential difficulties. • Worth 20% of the marks for the entire course and should add up to a substantial write up of approximately 4000 to 6000 words. Consideration should be given to the weight each section should have. • The format of the report should be consistent with industry standard for consultant reports – eg: executive summary, clear presentation, tables and figures well labelled and referenced in the text. The quality and clarity of the expression will be taken into account as this report is intended for IS as well as non-IS managers.

3. Important points • It must be a report • It must be clear and concise • It must be conclusive • It must be documented • It can be inventive (!) • Assumptions can be made as long as internally consistent • Don’t hesitate to make it more interesting

4. SIB Case Study • SIB Inc. (95 - 97) • SAP R/3 ERP • Goals: • end the fragmentation of systems • allow process standardisation • give more visibility on data across entire corporation • give competitive advantage • much enthusiasm especially amongst plant managers • high expectations / low level of understanding what ERPs are

5. Company background • Manufacture and distribute industrial process equipment • $8 billion turnover • rapid expansion from 1945 to 1985 by opening new sites and buying smaller firms • 30,000 staff on four continents • find themselves too expensive and too slow • three plant closures and 10,000 staff lost • return to profitability but fear that it may not be enough

6. Information Systems • Each plant had own systems (MRP, planning, scheduling…) • Only finance is integrated • resulting problems : • integration often impossible • scheduling incompatible => no end-to-end vision of processes as soon as more than 1 plant involved • no overall planning • order acquisition entirely manual (faxes and phones) • no integration of key functions - e.g. HR • also, processes complex on factory floors

7. The Team and the Project • SAP - the market leader at the time (6000 sites 400,000 users in 1995) • Deloitte and Touche / ICS subsidiary - favourite SAP implementer • general management consultants • SAP specialists • 18 months planned with 50 f/t staff • budget $20 million • 50/50 split: designing “to be” processes / implementing SAP • target sites: • 8 manufacturing • 4 order entry • headquarters

8. Key issues in the case • Steering committee made up of high level, highly committed managers - monthly meetings • Pluridisciplinary project team - IS + key functional areas - full time • centralisation vs autonomy (involvement of users) • standardisation of practices (e.g. part numbers) • Suitability of SAP • change business to match SAP • interface SAP with other system • extent to which SAP system matches current practices • Persuading key change agents