MIS-636 Final Presentation Part-I  SAP Implementation at Apple Computers Inc., USA Presented by: Sathwik Nikhil
Part-II Analysis of an IT Contract Presented by: Annah Urmila
SAP R/3 at Apple Computers, USA
About Apple Computers <ul><li>incorporated on January 3, 1977  </li></ul><ul><li>designs, manufactures, and markets microp...
Why SAP R/3 ??  <ul><li>Niall O’Connor ,VP of Information Systems & Technology was a strong believer in SAP R/3 ‘s capabil...
SAP R/3 Implementation Timeline <ul><li>Kick off Date: January 1998 </li></ul><ul><li>Go Live Date : January 2nd 1999 </li...
Implementation Partner <ul><li>KPMG Consulting Inc., presently known as BearingPoint </li></ul><ul><li>The team consisted ...
How much did they spend? <ul><li>Our best estimate is $45 million to $50 million based upon the size of the company, the i...
Modules Implemented <ul><li>Finance </li></ul><ul><li>Sales & Distribution </li></ul><ul><li>Manufacturing  </li></ul>
Performance Impacts after SAP <ul><li>Improvements in manufacturing processes </li></ul><ul><li>Complete Integrated Soluti...
Stock Performance Stock Price  before implementation (January 1998)  was $9.16 Stock Price after Go-Live (January 1999) wa...
Applying the Matrix of Change  Existing Business System of Apple Inc  (before Jan 1999) <ul><li>Logistics support to  Busi...
Applying the Matrix of Change  Target Business System of Apple Inc  (within 12 months) <ul><li>Build-to-Order and Configur...
MOC generated for Apples Case
Analysis of IT Contract
Industry Selected <ul><li>Value added electronic distribution </li></ul><ul><li>A diverse product mix including: </li></ul...
Industry Selected  cont … <ul><ul><li>Wire cutting and stripping services </li></ul></ul><ul><ul><li>Custom or standard ba...
Motivations for this IT project implementation <ul><li>To provide connectivity to their existing SAP ERP system via wirele...
Key contract terms <ul><li>An initial payment upon execution of the agreements </li></ul><ul><li>Subsequent payments based...
Key Contract Terms  cont… <ul><li>The software provided remains under the ownership of vendor  </li></ul><ul><li>There are...
Project Deliverables <ul><li>A web-based/wireless SAP connectivity software for up to 50 users  </li></ul><ul><li>SAP adap...
Enforcement of IT deliverables <ul><li>A initial down payment on execution of contract agreement. </li></ul><ul><li>Subseq...
Conclusion  <ul><li>Contract Classification </li></ul><ul><li>One stage outsourcing with fixed incentives i.e. class 3 in ...
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Final ppt

  1. 1. MIS-636 Final Presentation Part-I SAP Implementation at Apple Computers Inc., USA Presented by: Sathwik Nikhil
  2. 2. Part-II Analysis of an IT Contract Presented by: Annah Urmila
  3. 3. SAP R/3 at Apple Computers, USA
  4. 4. About Apple Computers <ul><li>incorporated on January 3, 1977 </li></ul><ul><li>designs, manufactures, and markets microprocessor-based personal computers </li></ul><ul><li>Some of its popular products are </li></ul><ul><li>- Power Mac, Power Book, iMac, iPod </li></ul><ul><li>- MAC OS operating system </li></ul><ul><li>reported sales of $7.98 billion for the fiscal year ending September 2000. </li></ul>
  5. 5. Why SAP R/3 ?? <ul><li>Niall O’Connor ,VP of Information Systems & Technology was a strong believer in SAP R/3 ‘s capabilities of achieving high level of integration. </li></ul><ul><li>SAP R/3 was the market leader in ERP solutions </li></ul><ul><li>Existing system was fragmented over 16 disparate legacy systems </li></ul>
  6. 6. SAP R/3 Implementation Timeline <ul><li>Kick off Date: January 1998 </li></ul><ul><li>Go Live Date : January 2nd 1999 </li></ul><ul><li>Implemented in a short span of 12 months </li></ul>
  7. 7. Implementation Partner <ul><li>KPMG Consulting Inc., presently known as BearingPoint </li></ul><ul><li>The team consisted of 90 individuals which included 35 KPMG Consultants. </li></ul>
  8. 8. How much did they spend? <ul><li>Our best estimate is $45 million to $50 million based upon the size of the company, the implementation time frame and the size of the implementation team. </li></ul><ul><li>- Estimate derived from industry sources and SAP consultants </li></ul>
  9. 9. Modules Implemented <ul><li>Finance </li></ul><ul><li>Sales & Distribution </li></ul><ul><li>Manufacturing </li></ul>
  10. 10. Performance Impacts after SAP <ul><li>Improvements in manufacturing processes </li></ul><ul><li>Complete Integrated Solution </li></ul><ul><li>Better Relationships with Business Partners </li></ul>
  11. 11. Stock Performance Stock Price before implementation (January 1998) was $9.16 Stock Price after Go-Live (January 1999) was $20.59
  12. 12. Applying the Matrix of Change Existing Business System of Apple Inc (before Jan 1999) <ul><li>Logistics support to Business Customers and 3 rd parties </li></ul><ul><li>Order Status Tracking </li></ul>Core Services <ul><li>Relational database </li></ul><ul><li>Tracking System </li></ul>Information Systems
  13. 13. Applying the Matrix of Change Target Business System of Apple Inc (within 12 months) <ul><li>Build-to-Order and Configure-to Order manufacturing capabilities </li></ul><ul><li>Available-to-promise and rules-based allocations </li></ul>Core Services <ul><li>Web-enabled Configure-to-Order Order Entry </li></ul><ul><li>Real – time credit card authorization </li></ul>E- Services <ul><li>Electronic Tracking of Customer Orders </li></ul><ul><li>Enhanced Database connectivity (Integration to Advanced Planning Systems </li></ul>Information Systems
  14. 14. MOC generated for Apples Case
  15. 15. Analysis of IT Contract
  16. 16. Industry Selected <ul><li>Value added electronic distribution </li></ul><ul><li>A diverse product mix including: </li></ul><ul><ul><li>Custom assembly electronic components </li></ul></ul><ul><ul><li>Integrated, custom production resources for complex assembly, sub-systems and other out of the ordinary needs. </li></ul></ul><ul><ul><li>Contract manufacturing aimed at supporting customer design and manufacturing needs. </li></ul></ul><ul><ul><li>Electrical and mechanical assembly of interconnection products and switches </li></ul></ul>
  17. 17. Industry Selected cont … <ul><ul><li>Wire cutting and stripping services </li></ul></ul><ul><ul><li>Custom or standard bar coding </li></ul></ul><ul><ul><li>Military and customer specific intermediate and outer-level packaging that are water, vapor and weather proof. Including packaging for aerospace and defense contractors. </li></ul></ul>
  18. 18. Motivations for this IT project implementation <ul><li>To provide connectivity to their existing SAP ERP system via wireless medium such as PDAs, Cell phones and the Internet on any computer to facilitate easy electronic ordering, checking of order status and shipment tracking for their key customers and their mobile sales and workforce . </li></ul>
  19. 19. Key contract terms <ul><li>An initial payment upon execution of the agreements </li></ul><ul><li>Subsequent payments based on three milestones set in the contract. </li></ul><ul><li>Telephone and email maintenance and support for the first year of the contract. </li></ul><ul><li>The contract agreement is in force for ten years from the date of execution </li></ul>
  20. 20. Key Contract Terms cont… <ul><li>The software provided remains under the ownership of vendor </li></ul><ul><li>There are no warranties on any client equipment, hardware or network. </li></ul><ul><li>The supplied software is under limited warranty that does not guarantee compatibility with future versions . </li></ul>
  21. 21. Project Deliverables <ul><li>A web-based/wireless SAP connectivity software for up to 50 users </li></ul><ul><li>SAP adapter </li></ul><ul><li>PDA and a PC/WEB front end device </li></ul>
  22. 22. Enforcement of IT deliverables <ul><li>A initial down payment on execution of contract agreement. </li></ul><ul><li>Subsequent payments based on three key milestones namely </li></ul><ul><ul><li>Re-vamping of the HTML front end </li></ul></ul><ul><ul><li>Training and </li></ul></ul><ul><ul><li>Configuration of basic warehouse management functionality for PDA use </li></ul></ul>
  23. 23. Conclusion <ul><li>Contract Classification </li></ul><ul><li>One stage outsourcing with fixed incentives i.e. class 3 in Ding-Wu-Hitt classification. </li></ul><ul><li>Advantages: </li></ul><ul><ul><li>Better risk and expectation management </li></ul></ul><ul><ul><li>Customer satisfaction </li></ul></ul><ul><ul><li>Clear and specific milestones for measuring project success . </li></ul></ul>

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