The document discusses a study on implementing enterprise resource planning (ERP) systems in small and midsize manufacturing firms. It presents profiles of 4 case study companies that implemented ERP systems. The companies ranged in annual revenue from $55-200 million.
It then outlines the ERP implementation process explored in the case studies, dividing it into 3 phases: planning activities, justification and selection activities, and installation activities. For each phase, it discusses the findings from the case studies and presents propositions related to the activities within each phase. The goal is to help understand what leads to successful ERP implementations.
Manufacturing Companies today are constantly in search for ways to achieve
better business performance and sustain competitive advantages through effective
deployment of resources and business processes. To improve business performance,
Manufacturing Companies require an efficient planning and control system that
synchronizes planning of all processes across the industry. Enterprise Resource
Planning (ERP) provides a centralized framework for all data and processes of an
industry. It integrates all aspects of a business from planning to inventory control,
manufacturing, sales, marketing, finance, customer service and human resources.
Manufacturing Companies undertake ERP implementations to achieve tangible
benefits including a significant return on investment. Accordingly the most common
benefit of Manufacturing Company is for an increase in response time due to better
availability of information. Another common benefit is increase in interaction across
the company, integration of business operations/processes, improved interaction with
customers, reduced direct operating and labour costs, reduced IT maintenance costs,
improved lead-time, improved inventory levels and improved interaction with
suppliers. A study was undertaken to assess impact of ERP as a Change Management
Tool in Manufacturing Companies. This article presents the key findings, conclusions
and suggestions.
Manufacturing Companies today are constantly in search for ways to achieve
better business performance and sustain competitive advantages through effective
deployment of resources and business processes. To improve business performance,
Manufacturing Companies require an efficient planning and control system that
synchronizes planning of all processes across the industry. Enterprise Resource
Planning (ERP) provides a centralized framework for all data and processes of an
industry. It integrates all aspects of a business from planning to inventory control,
manufacturing, sales, marketing, finance, customer service and human resources.
Manufacturing Companies undertake ERP implementations to achieve tangible
benefits including a significant return on investment. Accordingly the most common
benefit of Manufacturing Company is for an increase in response time due to better
availability of information. Another common benefit is increase in interaction across
the company, integration of business operations/processes, improved interaction with
customers, reduced direct operating and labour costs, reduced IT maintenance costs,
improved lead-time, improved inventory levels and improved interaction with
suppliers. A study was undertaken to assess impact of ERP as a Change Management
Tool in Manufacturing Companies. This article presents the key findings, conclusions
and suggestions.
Analysis of Enterprise Resource Planning Systems (ERPs) with Technical aspectszillesubhan
In the past few years, the information
technology has emerged as a key driving force for
growth of business organizations. The trend of
implementing the latest tools and technologies has
reached to maximum extent. The majority of business
organizations has adopted new and innovative tools
to manage their business tasks effectively. In this
scenario, an enterprise resource planning (ERP)
system is a huge information system that
organizations implement to manage their business
tasks. This is a huge information system which links
almost all the business departments and functional
areas. This report presents a detailed analysis of an
enterprise resource planning system. The
implementation of an enterprise resource planning
system requires taking into consideration various
critical factors, which are essential to be considered
in order to make this implementation fruitful. This
report presents a detailed discussion on the
advantages provided by ERPs to business
organizations. The basic purpose of this report is to
analyze critical success factors involved in the
implementation of ERPs. This report also presents
recommendations with every factor that an
organization can follow to make best use of these
systems.
AN ANALYSIS OF THE CONTRACTING PROCESS FOR AN ERP SYSTEMcsandit
Enterprise Resource Planning (ERP) systems integrate information across an entire
organization that automate core activities such as finance/accounting, human resources,
manufacturing, production and supply chain management… etc. to facilitate an integrated
centralized system and rapid decision making– resulting in cost reduction, greater planning,
and increased control. Many organizations are updating their current management information
systems with ERP systems. This is not a trivial task. They have to identify the organization’s
objectives and satisfy a myriad of stakeholders. They have to understand what business
processes they have, how they can be improved, and what particular systems would best suit
their needs. They have to understand how an ERP system is built; it involves the modification of
an existing system with its own set of business rules. Deciding what to ask for and how to select
the best option is a very complex operation and there is limited experience with this type of
contracting in organizations. In this paper we discuss a particular experience with contracting
out an ERP system, provide some lessons learned, and offer suggestions in how the RFP and bid
selection processes could have been improved.
Success Factors for Enterprise Systems in the Higher Education Sector: A Case...inventionjournals
Many large organisations have moved to Enterprise System solutions in recent years, including the higher education sector (HES). Whilst the benefits of Enterprise systems are well known, the sector has a social mission and characteristics that do not necessarily map to a commercially-focused corporate conceptualization, and assessing the suitability of any particular enterprise solution requires a qualified set of criteria to be applied. This paper looks at an “essential set” of critical success factors (CSFs) relevant to enterprise systems in the HES and applies them in a case study of a large Australian University. The CSFs found to be most relevant to successful ES deployment show differences from CSFs reported in other studies, mainly those in commercial sectors, suggesting a sector based approach be taken to evaluating ES success. We generalise our practical findings to theory, and propose further theory development and validation through confirmatory case studies and specific hypothesis testing.
Risk of Adopting Open Source ERP for Small Manufacturers: A Case StudyPlacide Poba Nzaou
Purpose - This study aims to explore the process of open source software (OSS) adoption in small and medium-sized enterprises (SMEs), and more specifically open source ERP as a “mission critical” OSS application in manufacturing. It also addresses the fundamental issue of ERP risk management that shapes this process.
Design/methodology/approach - The approach is done through an interpretive case study of a small Canadian manufacturer that has adopted an open source ERP system.
Findings - Interpreted in the light of diffusion of innovation theory and the IT risk management literature, results indicate that the small manufacturer successfully managed the adoption process in a rather intuitive manner, based on one guiding principle and nine practices.
Practical implications - This research confirms that open source is a credible alternative for SMEs that decide willingly or under external pressure to adopt an ERP system. Moreover, it suggests that a high level of formalization is not always necessary. For ERP vendors, this study shows that SMEs are more in search of flexibility in an ERP system than in the “best practices” embedded within these systems.
Originality/value - We argue that rich insights into the dynamics of the OSS-ERP adoption process can be obtained by framing this process within a risk management context.
KEYWORDS:
Open source software; ERP adoption; SME; Small business; IT risk management.
Critical Success Factors for Implementing an ERP System within University Con...IJMIT JOURNAL
Nowadays, Information Technology (IT) plays an important role in efficiency and effectiveness of the organizational performance. As an IT application, Enterprise Resource Planning (ERP) systems is considered one of the most important IT applications because it enables the organizations to connect and interact with its administrative units in order to manage data and organize internal procedures. Many institutions use ERP systems, most notably Higher Education Institutions (HEIs). However, many projects fail or exceed scheduling and budget constraints; the rate of failure in HEIs sector is higher than in other sectors. With HEIs’ recent movement to implement ERP systems and the lack of research studies examining successful implementation in HEIs, this paper provides a critical literature review with a special focus on Saudi Arabia. Further, it defines Critical Success Factors (CSFs) contributing to the success of ERP implementation in HEIs. This paper is part of a larger research effort aiming to provide guidelines and useful findings that help HEIs to manage the challenges for ERP systems and define CSFs that will help practitioners to implement them in the Saudi context.
Critical Success Factors (CSFS) of Enterprise Resource Planning (ERP) System ...csandit
Nowadays, Information Technology (IT) plays an impo
rtant role in efficiency and effectiveness of the
organizational performance. As an IT application, E
nterprise Resource Planning (ERP) systems is
considered one of the most important IT application
s because it enables the organizations to connect a
nd
interact with its administrative units in order to
manage data and organize internal procedures. Many
institutions use ERP systems, most notably Higher E
ducation Institutions (HEIs). However, many project
s
fail or exceed scheduling and budget constraints; t
he rate of failure in HEIs sector is higher than in
other
sectors. With HEIs’ recent movement to implement ER
P systems and the lack of research studies examinin
g
successful implementation in HEIs, this paper provi
des a critical literature review with a special foc
us on
Saudi Arabia. Further, it defines Critical Success
Factors (CSFs) contributing to the success of ERP
implementation in HEIs. This paper is part of a lar
ger research effort aiming to provide guidelines an
d
useful findings that help HEIs to manage the challe
nges for ERP systems and define CSFs that will help
practitioners to implement them in the Saudi contex
t.
Integration impediment during ERP Developmentijtsrd
ERP (Enterprise Resource Planning) systems have increasingly been developed and integrated with other internal and external systems. This paper contributes to the field of enterprise systems integration by clarifying the concept of integration in the context of ERP systems. We investigated integration obstacles during ERP development in 5 large organizations through theme-based interviews. Besides considering integration as purely technical challenge, our findings reveal the other perspectives of integration. In total 31 environmental, technical, managerial, and organizational integration obstacles were identified from empirical data and further mapped with 13 ERP challenge categories derived from the literature. Our findings reveal that integration barriers are related to all 13 categories of ERP challenges. This indicates that integration should not be a separate project from ERP development. Identifying the integration obstacles is necessary for practitioners to develop counteractions to enterprise integration problems Jaychand Vishwakarma"Integration impediment during ERP Development" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-2 | Issue-3 , April 2018, URL: http://www.ijtsrd.com/papers/ijtsrd12735.pdf http://www.ijtsrd.com/computer-science/other/12735/integration-impediment-during-erp-development/jaychand-vishwakarma
An EBS Retirement Party - You're Uninvitedeprentise
Not long ago, IT may have stood for Innovative Technology. Today's economic climate has caused a shift: budgets became constricted, dollars were redirected, and much of the collective investment that would have previously been thrown at innovation was thwarted by cost-cutting initiatives geared toward maintaining both existing enterprise applications as well as the status quo. As a result, the functionality of enterprise resource planning (ERP) systems such as Oracle's E-Business Suite (EBS) suffered due to management's focus on the present (time to results - regardless of the quality) rather than on the future (time to value).
View the original Blog post: http://www.eprentise.com/blog/the-changing-enterprise/an-ebs-retirement-party-youre-uninvited/
Website: www.eprentise.com
Twitter: @eprentise
Google+: https://plus.google.com/u/0/+Eprentise/posts
Facebook: https://www.facebook.com/eprentise
Analysis of Enterprise Resource Planning Systems (ERPs) with Technical aspectszillesubhan
In the past few years, the information
technology has emerged as a key driving force for
growth of business organizations. The trend of
implementing the latest tools and technologies has
reached to maximum extent. The majority of business
organizations has adopted new and innovative tools
to manage their business tasks effectively. In this
scenario, an enterprise resource planning (ERP)
system is a huge information system that
organizations implement to manage their business
tasks. This is a huge information system which links
almost all the business departments and functional
areas. This report presents a detailed analysis of an
enterprise resource planning system. The
implementation of an enterprise resource planning
system requires taking into consideration various
critical factors, which are essential to be considered
in order to make this implementation fruitful. This
report presents a detailed discussion on the
advantages provided by ERPs to business
organizations. The basic purpose of this report is to
analyze critical success factors involved in the
implementation of ERPs. This report also presents
recommendations with every factor that an
organization can follow to make best use of these
systems.
AN ANALYSIS OF THE CONTRACTING PROCESS FOR AN ERP SYSTEMcsandit
Enterprise Resource Planning (ERP) systems integrate information across an entire
organization that automate core activities such as finance/accounting, human resources,
manufacturing, production and supply chain management… etc. to facilitate an integrated
centralized system and rapid decision making– resulting in cost reduction, greater planning,
and increased control. Many organizations are updating their current management information
systems with ERP systems. This is not a trivial task. They have to identify the organization’s
objectives and satisfy a myriad of stakeholders. They have to understand what business
processes they have, how they can be improved, and what particular systems would best suit
their needs. They have to understand how an ERP system is built; it involves the modification of
an existing system with its own set of business rules. Deciding what to ask for and how to select
the best option is a very complex operation and there is limited experience with this type of
contracting in organizations. In this paper we discuss a particular experience with contracting
out an ERP system, provide some lessons learned, and offer suggestions in how the RFP and bid
selection processes could have been improved.
Success Factors for Enterprise Systems in the Higher Education Sector: A Case...inventionjournals
Many large organisations have moved to Enterprise System solutions in recent years, including the higher education sector (HES). Whilst the benefits of Enterprise systems are well known, the sector has a social mission and characteristics that do not necessarily map to a commercially-focused corporate conceptualization, and assessing the suitability of any particular enterprise solution requires a qualified set of criteria to be applied. This paper looks at an “essential set” of critical success factors (CSFs) relevant to enterprise systems in the HES and applies them in a case study of a large Australian University. The CSFs found to be most relevant to successful ES deployment show differences from CSFs reported in other studies, mainly those in commercial sectors, suggesting a sector based approach be taken to evaluating ES success. We generalise our practical findings to theory, and propose further theory development and validation through confirmatory case studies and specific hypothesis testing.
Risk of Adopting Open Source ERP for Small Manufacturers: A Case StudyPlacide Poba Nzaou
Purpose - This study aims to explore the process of open source software (OSS) adoption in small and medium-sized enterprises (SMEs), and more specifically open source ERP as a “mission critical” OSS application in manufacturing. It also addresses the fundamental issue of ERP risk management that shapes this process.
Design/methodology/approach - The approach is done through an interpretive case study of a small Canadian manufacturer that has adopted an open source ERP system.
Findings - Interpreted in the light of diffusion of innovation theory and the IT risk management literature, results indicate that the small manufacturer successfully managed the adoption process in a rather intuitive manner, based on one guiding principle and nine practices.
Practical implications - This research confirms that open source is a credible alternative for SMEs that decide willingly or under external pressure to adopt an ERP system. Moreover, it suggests that a high level of formalization is not always necessary. For ERP vendors, this study shows that SMEs are more in search of flexibility in an ERP system than in the “best practices” embedded within these systems.
Originality/value - We argue that rich insights into the dynamics of the OSS-ERP adoption process can be obtained by framing this process within a risk management context.
KEYWORDS:
Open source software; ERP adoption; SME; Small business; IT risk management.
Critical Success Factors for Implementing an ERP System within University Con...IJMIT JOURNAL
Nowadays, Information Technology (IT) plays an important role in efficiency and effectiveness of the organizational performance. As an IT application, Enterprise Resource Planning (ERP) systems is considered one of the most important IT applications because it enables the organizations to connect and interact with its administrative units in order to manage data and organize internal procedures. Many institutions use ERP systems, most notably Higher Education Institutions (HEIs). However, many projects fail or exceed scheduling and budget constraints; the rate of failure in HEIs sector is higher than in other sectors. With HEIs’ recent movement to implement ERP systems and the lack of research studies examining successful implementation in HEIs, this paper provides a critical literature review with a special focus on Saudi Arabia. Further, it defines Critical Success Factors (CSFs) contributing to the success of ERP implementation in HEIs. This paper is part of a larger research effort aiming to provide guidelines and useful findings that help HEIs to manage the challenges for ERP systems and define CSFs that will help practitioners to implement them in the Saudi context.
Critical Success Factors (CSFS) of Enterprise Resource Planning (ERP) System ...csandit
Nowadays, Information Technology (IT) plays an impo
rtant role in efficiency and effectiveness of the
organizational performance. As an IT application, E
nterprise Resource Planning (ERP) systems is
considered one of the most important IT application
s because it enables the organizations to connect a
nd
interact with its administrative units in order to
manage data and organize internal procedures. Many
institutions use ERP systems, most notably Higher E
ducation Institutions (HEIs). However, many project
s
fail or exceed scheduling and budget constraints; t
he rate of failure in HEIs sector is higher than in
other
sectors. With HEIs’ recent movement to implement ER
P systems and the lack of research studies examinin
g
successful implementation in HEIs, this paper provi
des a critical literature review with a special foc
us on
Saudi Arabia. Further, it defines Critical Success
Factors (CSFs) contributing to the success of ERP
implementation in HEIs. This paper is part of a lar
ger research effort aiming to provide guidelines an
d
useful findings that help HEIs to manage the challe
nges for ERP systems and define CSFs that will help
practitioners to implement them in the Saudi contex
t.
Integration impediment during ERP Developmentijtsrd
ERP (Enterprise Resource Planning) systems have increasingly been developed and integrated with other internal and external systems. This paper contributes to the field of enterprise systems integration by clarifying the concept of integration in the context of ERP systems. We investigated integration obstacles during ERP development in 5 large organizations through theme-based interviews. Besides considering integration as purely technical challenge, our findings reveal the other perspectives of integration. In total 31 environmental, technical, managerial, and organizational integration obstacles were identified from empirical data and further mapped with 13 ERP challenge categories derived from the literature. Our findings reveal that integration barriers are related to all 13 categories of ERP challenges. This indicates that integration should not be a separate project from ERP development. Identifying the integration obstacles is necessary for practitioners to develop counteractions to enterprise integration problems Jaychand Vishwakarma"Integration impediment during ERP Development" Published in International Journal of Trend in Scientific Research and Development (ijtsrd), ISSN: 2456-6470, Volume-2 | Issue-3 , April 2018, URL: http://www.ijtsrd.com/papers/ijtsrd12735.pdf http://www.ijtsrd.com/computer-science/other/12735/integration-impediment-during-erp-development/jaychand-vishwakarma
An EBS Retirement Party - You're Uninvitedeprentise
Not long ago, IT may have stood for Innovative Technology. Today's economic climate has caused a shift: budgets became constricted, dollars were redirected, and much of the collective investment that would have previously been thrown at innovation was thwarted by cost-cutting initiatives geared toward maintaining both existing enterprise applications as well as the status quo. As a result, the functionality of enterprise resource planning (ERP) systems such as Oracle's E-Business Suite (EBS) suffered due to management's focus on the present (time to results - regardless of the quality) rather than on the future (time to value).
View the original Blog post: http://www.eprentise.com/blog/the-changing-enterprise/an-ebs-retirement-party-youre-uninvited/
Website: www.eprentise.com
Twitter: @eprentise
Google+: https://plus.google.com/u/0/+Eprentise/posts
Facebook: https://www.facebook.com/eprentise
CRITICAL SUCCESS FACTORS FOR IMPLEMENTING AN ERP SYSTEM WITHIN UNIVERSITY CON...IJMIT JOURNAL
Nowadays, Information Technology (IT) plays an important role in efficiency and effectiveness of the
organizational performance. As an IT application, Enterprise Resource Planning (ERP) systems is
considered one of the most important IT applications because it enables the organizations to connect and
interact with its administrative units in order to manage data and organize internal procedures. Many
institutions use ERP systems, most notably Higher Education Institutions (HEIs). However, many projects
fail or exceed scheduling and budget constraints; the rate of failure in HEIs sector is higher than in other
sectors. With HEIs’ recent movement to implement ERP systems and the lack of research studies examining
successful implementation in HEIs, this paper provides a critical literature review with a special focus on
Saudi Arabia. Further, it defines Critical Success Factors (CSFs) contributing to the success of ERP
implementation in HEIs. This paper is part of a larger research effort aiming to provide guidelines and
useful findings that help HEIs to manage the challenges for ERP systems and define CSFs that will help
practitioners to implement them in the Saudi context.
Overcoming Common Challenges in ERP Implementation for Manufacturing.pdfshantitechnology
ERP for small manufacturing businesses can now compete with the giants. Streamline your operations, optimize processes, and boost productivity with our cutting-edge ERP solutions. Enhance efficiency, reduce costs, and stay ahead of the competition.
Smart TV Buyer Insights Survey 2024 by 91mobiles.pdf91mobiles
91mobiles recently conducted a Smart TV Buyer Insights Survey in which we asked over 3,000 respondents about the TV they own, aspects they look at on a new TV, and their TV buying preferences.
Epistemic Interaction - tuning interfaces to provide information for AI supportAlan Dix
Paper presented at SYNERGY workshop at AVI 2024, Genoa, Italy. 3rd June 2024
https://alandix.com/academic/papers/synergy2024-epistemic/
As machine learning integrates deeper into human-computer interactions, the concept of epistemic interaction emerges, aiming to refine these interactions to enhance system adaptability. This approach encourages minor, intentional adjustments in user behaviour to enrich the data available for system learning. This paper introduces epistemic interaction within the context of human-system communication, illustrating how deliberate interaction design can improve system understanding and adaptation. Through concrete examples, we demonstrate the potential of epistemic interaction to significantly advance human-computer interaction by leveraging intuitive human communication strategies to inform system design and functionality, offering a novel pathway for enriching user-system engagements.
GDG Cloud Southlake #33: Boule & Rebala: Effective AppSec in SDLC using Deplo...James Anderson
Effective Application Security in Software Delivery lifecycle using Deployment Firewall and DBOM
The modern software delivery process (or the CI/CD process) includes many tools, distributed teams, open-source code, and cloud platforms. Constant focus on speed to release software to market, along with the traditional slow and manual security checks has caused gaps in continuous security as an important piece in the software supply chain. Today organizations feel more susceptible to external and internal cyber threats due to the vast attack surface in their applications supply chain and the lack of end-to-end governance and risk management.
The software team must secure its software delivery process to avoid vulnerability and security breaches. This needs to be achieved with existing tool chains and without extensive rework of the delivery processes. This talk will present strategies and techniques for providing visibility into the true risk of the existing vulnerabilities, preventing the introduction of security issues in the software, resolving vulnerabilities in production environments quickly, and capturing the deployment bill of materials (DBOM).
Speakers:
Bob Boule
Robert Boule is a technology enthusiast with PASSION for technology and making things work along with a knack for helping others understand how things work. He comes with around 20 years of solution engineering experience in application security, software continuous delivery, and SaaS platforms. He is known for his dynamic presentations in CI/CD and application security integrated in software delivery lifecycle.
Gopinath Rebala
Gopinath Rebala is the CTO of OpsMx, where he has overall responsibility for the machine learning and data processing architectures for Secure Software Delivery. Gopi also has a strong connection with our customers, leading design and architecture for strategic implementations. Gopi is a frequent speaker and well-known leader in continuous delivery and integrating security into software delivery.
UiPath Test Automation using UiPath Test Suite series, part 3DianaGray10
Welcome to UiPath Test Automation using UiPath Test Suite series part 3. In this session, we will cover desktop automation along with UI automation.
Topics covered:
UI automation Introduction,
UI automation Sample
Desktop automation flow
Pradeep Chinnala, Senior Consultant Automation Developer @WonderBotz and UiPath MVP
Deepak Rai, Automation Practice Lead, Boundaryless Group and UiPath MVP
GraphRAG is All You need? LLM & Knowledge GraphGuy Korland
Guy Korland, CEO and Co-founder of FalkorDB, will review two articles on the integration of language models with knowledge graphs.
1. Unifying Large Language Models and Knowledge Graphs: A Roadmap.
https://arxiv.org/abs/2306.08302
2. Microsoft Research's GraphRAG paper and a review paper on various uses of knowledge graphs:
https://www.microsoft.com/en-us/research/blog/graphrag-unlocking-llm-discovery-on-narrative-private-data/
Slack (or Teams) Automation for Bonterra Impact Management (fka Social Soluti...Jeffrey Haguewood
Sidekick Solutions uses Bonterra Impact Management (fka Social Solutions Apricot) and automation solutions to integrate data for business workflows.
We believe integration and automation are essential to user experience and the promise of efficient work through technology. Automation is the critical ingredient to realizing that full vision. We develop integration products and services for Bonterra Case Management software to support the deployment of automations for a variety of use cases.
This video focuses on the notifications, alerts, and approval requests using Slack for Bonterra Impact Management. The solutions covered in this webinar can also be deployed for Microsoft Teams.
Interested in deploying notification automations for Bonterra Impact Management? Contact us at sales@sidekicksolutionsllc.com to discuss next steps.
DevOps and Testing slides at DASA ConnectKari Kakkonen
My and Rik Marselis slides at 30.5.2024 DASA Connect conference. We discuss about what is testing, then what is agile testing and finally what is Testing in DevOps. Finally we had lovely workshop with the participants trying to find out different ways to think about quality and testing in different parts of the DevOps infinity loop.
State of ICS and IoT Cyber Threat Landscape Report 2024 previewPrayukth K V
The IoT and OT threat landscape report has been prepared by the Threat Research Team at Sectrio using data from Sectrio, cyber threat intelligence farming facilities spread across over 85 cities around the world. In addition, Sectrio also runs AI-based advanced threat and payload engagement facilities that serve as sinks to attract and engage sophisticated threat actors, and newer malware including new variants and latent threats that are at an earlier stage of development.
The latest edition of the OT/ICS and IoT security Threat Landscape Report 2024 also covers:
State of global ICS asset and network exposure
Sectoral targets and attacks as well as the cost of ransom
Global APT activity, AI usage, actor and tactic profiles, and implications
Rise in volumes of AI-powered cyberattacks
Major cyber events in 2024
Malware and malicious payload trends
Cyberattack types and targets
Vulnerability exploit attempts on CVEs
Attacks on counties – USA
Expansion of bot farms – how, where, and why
In-depth analysis of the cyber threat landscape across North America, South America, Europe, APAC, and the Middle East
Why are attacks on smart factories rising?
Cyber risk predictions
Axis of attacks – Europe
Systemic attacks in the Middle East
Download the full report from here:
https://sectrio.com/resources/ot-threat-landscape-reports/sectrio-releases-ot-ics-and-iot-security-threat-landscape-report-2024/
JMeter webinar - integration with InfluxDB and GrafanaRTTS
Watch this recorded webinar about real-time monitoring of application performance. See how to integrate Apache JMeter, the open-source leader in performance testing, with InfluxDB, the open-source time-series database, and Grafana, the open-source analytics and visualization application.
In this webinar, we will review the benefits of leveraging InfluxDB and Grafana when executing load tests and demonstrate how these tools are used to visualize performance metrics.
Length: 30 minutes
Session Overview
-------------------------------------------
During this webinar, we will cover the following topics while demonstrating the integrations of JMeter, InfluxDB and Grafana:
- What out-of-the-box solutions are available for real-time monitoring JMeter tests?
- What are the benefits of integrating InfluxDB and Grafana into the load testing stack?
- Which features are provided by Grafana?
- Demonstration of InfluxDB and Grafana using a practice web application
To view the webinar recording, go to:
https://www.rttsweb.com/jmeter-integration-webinar
When stars align: studies in data quality, knowledge graphs, and machine lear...
Implementing Erp Systems In Small And Midsize Manufacturing Firms
1. The Emerald Research Register for this journal is available at The current issue and full text archive of this journal is available at
http://www.emeraldinsight.com/researchregister http://www.emeraldinsight.com/0144-3577.htm
IJOPM
23,8 Implementing enterprise
resource planning (ERP)
850
systems in small and midsize
manufacturing firms
Joseph R. Muscatello
Infiniti Systems Group, Brecksville, Ohio, USA
Michael H. Small
Department of Management, University of the West Indies, Bridgetown,
Barbados, and
Injazz J. Chen
Department of Operations Management and Business Statistics,
College of Business Administration, Cleveland State University,
Cleveland, Ohio, USA
Keywords Resource management, Project management, Technology led strategy, Case studies
Abstract Enterprise resource planning systems, if implemented successfully, can bestow
impressive strategic, operational and information-related benefits to adopting firms. A failed
implementation can often spell financial doom. Currently, most of the information about the
failures and successes are based on reports on implementations in large manufacturing and
service organizations. But enterprise resource planning vendors are now steadily turning their
marketing sights on small and medium-sized manufacturers. The time is ripe for researchers to
gather, analyze and disseminate information that will help these firms to implement their projects
successfully. This research adopts a multiple case study approach to investigate the implementation
process in small and midsize manufacturing firms in the US. The research focuses on
implementation activities that foster successful installations and are developed using information
gleaned from our field studies of four projects. Avenues for future research are also suggested.
Introduction
Enterprise resource planning (ERP) systems are designed to address the
problem of fragmentation of information or “islands of information” in
business organizations. ERP systems promise to computerize an entire
business with a suite of software modules covering activities in all areas of the
business. Furthermore, ERP is now being promoted as a desirable and critical
link for enhancing integration between all functional areas within the
manufacturing enterprise, and between the enterprise and its upstream and
International Journal of Operations &
Production Management downstream trading partners.
Vol. 23 No. 8, 2003
pp. 850-871
To date, most of the reported studies on these systems have focused on large
q MCB UP Limited
0144-3577
ERP installations with individual investment costs of well over $100 million.
DOI 10.1108/01443570310486329 Hence, most of the information that is available pertaining to the
2. implementation of ERP systems and their successes and failures are concerned Implementing
with larger installations. Over the past few years, however, ERP systems’ ERP systems
developers, systems integrators and consultants have consistently been
turning their sights on smaller enterprises (Fleishaker, 1999; Parker, 1999).
These smaller manufacturers can be adversely affected if they fail to upgrade
their information technology (IT) with systems that can readily communicate
with their larger supply chain partners or with corporate headquarters
851
(Chalmers, 1999).
While ERP installations often help small and midsize manufacturers to
improve their strategic and competitive capabilities (Smith, 1999; Jenson and
Johnson, 1999), there are several reasons why some firms are not rushing to
install the systems. First, the ERP implementation efforts of many of their
larger counterparts have resulted in partial failure, and in some cases total
abandonment. Trunick (1999) reports that 40 percent of all ERP installations
only achieve partial implementation and that nearly 20 percent are scrapped as
total failures. Others suggest that the failure rate may be even higher (Escalle,
1999). Second, small manufacturers often lack financial resources and may be
forced to adopt, at best, a piecemeal approach to integrating the typically
expensive ERP systems into their facilities (Ferman, 1999). It is also felt that the
low IS staff levels in smaller enterprises is inadequate for the rigorous and
extensive IT training and development requirements of an ERP project (Hill,
1997).
Smaller firms, with their limited resources, are less likely than their larger
counterparts to survive or quickly overcome a failed implementation of an
expensive ERP system. Therefore, it is extremely important to gather, analyze
and disseminate information that will help them to choose appropriate ERP
systems and then implement these projects successfully. This research uses a
multiple case study approach to investigate the ERP implementation process in
four small and midsize firms in the US. Our objective is to attempt to build
rather than test theory. Therefore, the case-study method is used to develop
conclusions about activities that lead to successful ERP implementations that
others may later test by means such as surveys, experiments or simulation. In
addition, avenues for future research are suggested.
This research contributes to the ERP literature in the following ways:
.
It outlines the desirable steps in the ERP implementation process.
.
It addresses ERP implementation in midsize manufacturing facilities. The
very limited empirical research on ERP implementation that has been
done has concentrated on larger facilities.
.
The findings of this study can help corporate management to better
support the deployment of ERP in their divisional facilities.
.
Avenues for continuing theoretical and empirical investigations in the
field are presented.
3. IJOPM An overview of ERP systems
23,8 ERP represents the latest stage in the evolution and expansion of production
planning and control techniques for manufacturing enterprises from material
requirements planning (MRP) (Orlicky, 1975) to capacity requirements
planning (CRP) to manufacturing resource planning (MRP II) (Wight, 1982;
852 1984). MRP II systems began evolving into ERP systems as early as 1988 when
Dow Chemical Company purchased its first ERP manufacturing module from
SAP AG of Germany (Schaaf, 1999). The term “enterprise resource planning”
which describes systems that are designed to plan and schedule all the firm’s
internal resources was first used by the Gartner Group of Stamford,
Connecticut, USA. However, during the period 1988 to 1994 the terms MRPII
and ERP were being used interchangeably.
The distinctiveness of ERP systems became more evident in 1994 when SAP
AG released its next-generation software known as R/3. The release of R/3 also
marked a shift in technology platforms from the mainframe to the increasingly
popular UNIX-based client-server architecture. In the ensuing years,
manufacturing and some service companies began to make heavy
investments in ERP systems offered by SAP and its major competitors such
as Oracle, Baan, PeopleSoft and J.D. Edwards. Since activities related to
planning and installing ERP are, generally, more costly than the software
product itself, consultants and systems integrators have also moved
aggressively into the implementation market. The ERP-related revenues for
each of the five leaders in the consulting and systems integration markets
exceeded $1 billion in 1998 (Escalle et al., 1999). Advanced manufacturing
research (AMR), one of the principal ERP industry observers, is forecasting
that the ERP market for software sales and ancillary services will exceed
annual revenues of $50 billion by 2002.
ERP systems are comprised of a suite of software modules, with each
module typically responsible for gathering and processing information for a
separate business function, or a group of separate business functions. ERP
software modules may include accounting, master scheduling, material
planning, inventory, forecasting, finite scheduling, distribution planning and
others. A typical ERP system integrates all of the company’s functions by
allowing the modules to share and transfer information freely (Hicks and
Stecke, 1995). In addition, all information is centralized in a single relational
database accessible by all modules, eliminating the need for multiple entries of
the same data. While large firms usually budget heavily for ERP and may
install a substantial number of the available modules (Chalmers, 1999), smaller
firms often adopt a piecemeal approach, starting with a few modules or a few
components of each module (Ferman, 1999). Customers and suppliers with
network security clearance are allowed to access certain types of information
by way of an external communication interface.
4. ERP benefits and limitations Implementing
Many industry reports extol the virtues of ERP and its ability to bestow ERP systems
multiple benefits on those firms that can successfully implement these systems.
One of the primary objectives for installing ERP as well as one of its principal
benefits is the ability to integrate business processes (Brakely, 1999;
Davenport, 1998, 2000). The use of ERP has also been found to be critical in
improving customer satisfaction. For example, NEC Technologies credits its
853
installation of ERP for increasing its speed of order processing, improving
invoicing and in drastically reducing its customer-service response times
(Michel, 1997). ERP has also been found to be effective in reducing inventory
costs, improving efficiency and increasing profitability (Appleton, 1997;
Brakely, 1999). In addition, ERP has also been credited with reducing
manufacturing lead times (Goodpasture, 1995). Other potential benefits of ERP
include: drastic declines in inventory; breakthrough reductions in working
capital; abundant information about customer wants and needs; and the ability
to view and manage the extended enterprise of suppliers, alliances, and
customers as an integrated whole.
It should be noted, however, that not all enterprises that have implemented
ERP are satisfied with the results of their investments. Many businesses consider
their implementation attempts to be failures. For example, FoxMeyer Drug, a $5
billion pharmaceutical company, recently filed for bankruptcy. FoxMeyer argued
that major problems were generated by a failed ERP system, which created
excess shipments resulting from incorrect orders (Bicknell, 1998; Boudette, 1999).
In addition, Dell Computer scrapped their ERP system claiming that it was not
flexible enough to handle their expanding global operations.
In seeking to explain why some firms succeed in their implementation while
others fail, it is critical to understand that, although the technical capabilities of
ERP systems are relatively well proven, implementing these systems is not a
simple matter of purchasing and installing the technology. Many believe that,
as with all advanced technology systems, managerial issues, from planning to
implementation, present major barriers to the effective adoption of ERP
systems. The need for and importance of empirical studies on technology
planning and implementation issues has been emphasized in the literature
(Chen and Small, 1996; Voss, 1988).
Case studies in the implementation of ERP systems
The case study research methodology has been highly recommended by many
researchers as an ideal tool for improving conceptual and descriptive
understanding of complex phenomena (Flynn et al., 1990; McCutcheon and
Meredith, 1993; Yin, 1994). ERP implementation is an expensive and extensive
undertaking involving activities related to planning, justifying, installing and
commissioning of the installed system. An ERP system extends across the entire
organization and sometimes even beyond to cover integral partners in the supply
5. IJOPM chain. Furthermore, ERP projects can take two or more years to fully implement
23,8 (Bradley et al., 1999; Parker, 1999). All the above factors contribute to the
complexity of ERP installations, and make snap-shot cross-sectional approaches
unsuitable for investigating the ERP implementation process.
The case study method also offers many benefits such as the ability to
directly observe causality and combine evidence and logic to build, develop or
854 support theory that is not available using other research methods (Maffei and
Meredith, 1995). In contrast to survey research formats, it allows for more
meaningful follow-up questions to be asked and answered and can result in
more extensive findings and insights that are valid, generalizable and rigorous
(Meredith, 1998). This study adopts a longitudinal case study methodology to
delineate the steps in the process and to investigate the myriad and complex
relationships within and between these steps. However, unlike the majority of
studies in this area that focus on single case studies, this study reports on ERP
implementations at four diverse manufacturing facilities.
Multiple methods were used to collect data for this study. These methods
included direct observation by two of the authors who were academic observers
for the projects from the project initiation stage. The authors were given free
access to historical documents and other records including financial data, and
non-personnel related operations statistics. The authors were also allowed to sit
in on regularly scheduled project-team meetings. Ongoing, open-ended
interviews were also held with corporate officers, divisional managers,
project-leaders, super-users, consultants and various project team members
both during and after the implementation of the ERP projects. These interviews
permitted the project participants to identify and frame the important issues and
factors that affect ERP implementation success as suggested in Maffei and
Meredith (1995). This approach is consistent with the recommendation that, in an
area where theory is relatively undeveloped, researchers should use an inductive
approach to the process of identifying issues for inclusion in the study (Spector,
1992; Flynn et al., 1994; Hensley, 1999).
Company business profiles
The four companies covered by this study were divisions of larger companies.
They represent a range of firm sizes ($55 million to $200 million in annual
revenues), products, types of manufacturing (continuous process, batch and job
shop) markets and organizational arrangements. The companies also had
different prior experiences with manufacturing and IT. The business profiles of
the four companies are detailed in Table I.
The ERP implementation process
This section will outline the results of our investigations. The findings will be
presented in three subsections under the general headings of planning
activities, justification and selection activities, and installation activities.
6. Company A Company B Company C Company D
Type of business Chemical manufacturer – Inorganic coating Electronics assembly Centrifugal and static
division of Fortune 500 manufacturer – division of manufacturer – division of foundry – division of $300
company Fortune 500 company Fortune 500 company million industrial
manufacturing company
Annual sales $90 million $75 million $200 million $55 million
Primary markets Industrial buyers only Industrial buyers only Original equipment Industrial buyers only
manufacturers (OEM’s),
retailers and end customers
Type of manufacturing Continuous process Batch/repetitive Batch/repetitive Job-shop
Performance prior to the High finished goods High finished goods High finished goods High raw material inventory
decision to implement ERP inventory inventory (3.5 months) inventory and high WIP
inventory levels High WIP inventory inventory compared to
High raw material their industry
inventory
Inventory turnover rates Low compared to industry Low compared to other Slightly below industry Low compared to industry
divisions in company and
industry
On-time (in full) delivery 60 percent [85 percent] 78 percent [70 percent] 62 percent [85 percent] 76 percent [60 percent]
performance versus
[industry on-time
performance]
Production planning systems MRP MRPII MRP, SFC None
used prior to ERP
Impetus for process change Declining profits (40 percent Declining profits over a Just breaking even in a Losing money, struggling
over a three year period) ten-year period. Profits growing market with shop loads and
below corporation targets coordination of orders
through multiple work
centers
Corporate stance Improvement or wholesale Improvement or closure of Improvements or will Improvements or closure
management changes the division with transfer consider outsourcing
of work to another country
Implementing
ERP systems
Company profiles
Table I.
855
7. IJOPM Propositions related to each of the activities within each of the subsections will
23,8 be presented at the end of the discussion of each activity.
Planning activities
Strategic objectives and top management involvement
856 The corporate management of each of these companies had recent encouraging
experiences with enterprise system (ES) installations at their headquarters or in
other divisions. Hence, they were favorably disposed to ES solutions and
viewed integrated ES as a means of improving efficiencies and
communications across all their divisions and between the divisions and
corporate headquarters. Given the fact that the main impetus for change came
from corporate headquarters it was not surprising that all projects had
widespread executive management support. However, achieving divisional
management support would prove to be more difficult.
The divisional managers at company A were initially supportive of the IT
changes. However, feedback from steering committee meetings suggested that
much of this support might have been aimed at appeasing corporate
management rather than a strong belief in the strategic value of integrated ES.
Except for a few managers who had some training and some positive
experiences with integrated operating systems, the divisional managers of
company’s B, C and D were not, generally, supportive of the proposed ERP
projects. Many managers preferred to view them as another unnecessary
imposition from corporate headquarters.
Companies A, B and C each had an executive sponsor who was a corporate
officer at the vice-presidential level. In company D the executive sponsor was
the plant manager. Unlike typical ERP projects in larger facilities, however,
these sponsors were not supported by a formal top-level executive steering
committee, even though there was no doubt that top corporate management
supported the projects. The influence and support of the executive sponsor
proved to be especially important for companies A and B, which experienced
significant changes in divisional management personnel during the process of
the implementation. The constant availability of the executive sponsor kept the
project manager and project teams at these companies encouraged and focused.
The results were not as good in companies C and D. The executive sponsor for
company C resigned from the corporation during implementation of the project
and his replacement did not have the same fervor for the project. In company D,
the reassignment of the plant manager (executive sponsor) and the resignation of
the project leader and a key super-user effectively killed the project. The new
plant manager, who was focused on cost cutting to prevent further company
losses, did not view the completion of this project as a priority item.
But achieving success in the divisional setting also requires the support and
cooperation of workers, especially those workers that will be involved in the
implementation of the ERP. In those projects where divisional management
showed enthusiasm for the project, workers tended to be more supportive. In
8. company A, where the senior division manager who served as project manager Implementing
for the ERP project moved his desk onto the manufacturing floor as a ERP systems
demonstration of his commitment, worker support was generally high. When
divisional management showed a lack of enthusiasm for the projects, workers
tended to be less supportive.
In summary, while corporate management encouraged and provided visible
support for the development of the ES project as a strategic, operational and
857
information/communications tool, divisional management did not
wholeheartedly share their enthusiasm. Although each company started with
an executive sponsor, a framework was never put in place to provide top-level
corporate support for this sponsor through the aegis of formal executive
steering committees. Therefore, it was not surprising that no replacements
stepped in when the sponsors for companies C and D left. It is also interesting
to note that those firms that maintained the same sponsor throughout the
implementation process achieved their initial objectives for installing the
systems.
The executives that had the most success had a more proactive rather
than reactive approach to their ERP implementations strategy. They were
willing to reconcile the trade-offs inherent to the demands of an ERP
initiative and focus on the important contributions the system would
provide in the next three years. Also, they were able to overcome “short
term” corporate expectations by saying no when the expectations on
evaluation, risked the ERP projects goals.
The results also show that managing the strategic integration between
manufacturing and marketing provided the successful firms congruence of
purpose and function for the new ERP systems processes. Understanding
corporate objectives, order qualifiers and winners, process choices and support
infrastructure provided the ERP implementation team valuable knowledge for
developing business cases, performance measurements (current and future),
long term strategic and tactical goals and package selection techniques. One
telling sign that strategic understanding is valuable was that successful firms
had an easier time selecting their software package since they understood what
they needed for the future. The unsuccessful companies tended to focus more
on current tactical practices such as inventory entry, billing, purchase order
entry, etc. and not at strategic alignment issues.
Reengineering efforts
Prior to determining the type of ES changes that were needed, companies A
and C conducted reengineering efforts designed to lay the groundwork for
streamlining their business operations to more closely match their customers’
current and expected future requirements for quality, timeliness, innovation
and customization. As suggested by Hammer and Champy (1993) the
reengineering activities were focused on identifying and improving the
9. IJOPM efficiency of critical operations, on restructuring important non-value-adding
23,8 operations and on eliminating inefficient processes. Significant emphasis was
also placed on mapping information flows related to operation processes and
procedures. Detailed mapping and analyses of external transactions with
customers and suppliers were also carried out, paying particular attention to
their impact on internal functional and inter-functional transactions. Special
858 emphasis was also placed on mapping information requirements and
information flows between functional managers and managers on the shop
floor. A direct consequence of the reengineering efforts of both of these
companies was significant streamlining of work and information flows,
departmental redesigns, reductions in paperwork transactions and
combination of tasks that had previously been performed by different people.
Company B also evaluated their core business processes prior to choosing an
ERP solution, but they focused on improving current processes rather than a
comprehensive reengineering effort. Consequently, their “real” reengineering
effort was delayed until management recognized that the system that they had
initially chosen was inadequate for meeting their future operational and
customer support needs. Company D did not reengineer their processes or
attempt to redefine any business practices. They naively thought, as Ross
(1999) suggests often happens, that the software would solve their problems by
imposing discipline and process integration on their organization.
Divisional management at companies A and C considered their
reengineering efforts to have been very worthwhile. They felt that the
resultant redesign of departments, changes in job descriptions and adjustments
in management tasks accurately reflected the required customer-focus.
However, these improvements were accompanied by elimination of jobs,
creation of new jobs and even a shake-up in the management ranks. But
companies A and C avoided the long confrontation that company B had to
endure because they reengineered during the project. Even during their
reengineering effort, divisional management at company B spent a
considerable amount of time discussing the validity of old processes and old
mind-sets, rather than focusing on reengineering. The consulting team
encouraged corporate management to get the reengineering process back on
track by arranging meetings with executives of similar companies that had
successfully used reengineering techniques as a precursor to their decision to
adopt ERP. Eventually, divisional management at company B completed the
reengineering exercise and acknowledged that the reengineering effort had
forced them to renew their focus on customer needs and the requirement for
operational changes to meet these needs. Of course, the delay in reengineering
resulted in an extended implementation process and some costly
reconfigurations in the ERP system.
Company D had performed minimal up front analysis and relied heavily on
the opinions of the current managers who, admittedly, had little knowledge
10. about ERP concepts and programs and little formal training or education in ES. Implementing
The consultant’s advice about talking with executives from other companies ERP systems
that had reengineered their business processes prior to implementing ERP
systems was not heeded.
On the basis of these results, it appears that reengineering can contribute to
streamlining operations and to the design and development of an enterprise
solution. Since company C’s ERP implementation was eventually abandoned,
859
reengineering prior to project implementation does not appear to guarantee
success. Indeed, Welti (1999) suggests that reengineering prior to the ERP
project implementation may promote two real dangers: mis-specification of the
software requirements (if the firm is unable to accurately project customer
requirements) and possible political dangers arising from BPR exercises, which
have the tendency to stir up contentious feelings. Therefore, firms should be
aware that a contentious BPR project can lead to worker-resistance to ERP
projects. Furthermore, they should be especially cautious about converting
reengineering requirements into ES configurations.
Reengineering should be undertaken to insure that the strategic objectives
mentioned earlier are feasible. The reengineering effort should create a uniform
response from all aspects of the business. When goals are common, improvement
becomes a shared task (Hill, 2000). By using reengineering techniques to develop
a uniform vision depicting the company’s processes after the ERP
implementation, a firm will likely minimize uncertainty and achieve success.
ES needs analysis
All four of the companies performed “needs” assessments. However, there were
some differences in their approaches. Company D used an in-house team and
examined software packages from various vendors. Companies A, B and C used
independent, third party consultants to assist in their assessments. Companies A
and C used the results of their reengineering efforts to develop the configuration
for their ERP packages. They performed a checklist assessment provided by the
consultants to determine the best fitting software. Company B used a similar
checklist and was aided by an outside consultant on their selection of a package.
Since they had not yet performed their process reengineering, they selected a
package based only on an evaluation of their current processes. After company
B’s reengineering efforts, changes had to be made to the chosen ERP system to
incorporate the requirements of expected future processes. The checklists used
by all three companies included questions on:
.
current IT systems (including hardware);
. type of business (continuous, repetitive, batch, job shop);
.
market analysis (demand management, forecasting, customer
relationship management, etc.);
11. IJOPM .
scheduling (MPS, MRP and BOM requirements, shop floor scheduling,
23,8 etc.);
.
logistics (warehousing, transportation scheduling, etc.);
.
purchasing (EDI, Internet, integration of inventory and MRP, etc.);
.
inventory (transactions, bar codes, package types, analysis, etc.);
860 .
performance measurements (types of measurements); and
.
financial and accounting (GL, AP, AR, credit, on line banking,
depreciation, aged inventory, budget control, costing, etc.).
All companies came to the conclusion that they needed to install modern
information systems, and that this was at least part of the answer to their
problem(s). This conclusion was reached after examining current trends in the
market place and after careful consideration of IT needs for their current or
reengineered processes, their current IT systems (including hardware), and
available IT solutions. The firms all reached several common conclusions
about their existing systems that suggested a need for the implementation of
new information and manufacturing systems. Following is a list of some of
these conclusions:
.
The existing systems required multiple points of input and there was
significant duplication with the same data being entered at multiple
points in the system. While companies A and C had streamlined many of
their information flows during their BPR exercise, there were still some
pockets of multiple data entry.
.
The organization’s current and/or future information and manufacturing
technology needs were not adequately being met by the existing systems.
.
Maintenance and support for the existing systems required significant
effort, both in terms of time and human resources.
.
The enterprise had islands of information and many of these systems
were incompatible.
.
In too many instances, employees were unable to respond easily and
quickly to questions or information requested by key customers or
suppliers.
The IT system of choice was ERP because these systems have been designed to
alleviate most of the information-related problems that the firms had identified.
The companies expected the ERP systems to provide the required crucial links
between factory floor operations and information requirements across all the
support functions of the business. The fact that these systems could also be
extended to cover partners in the supply chain was also appealing to these
companies. The decision was also due, in large part, to the influence exerted by
corporate management.
12. ERP profiles of the companies Implementing
As a result of the needs analysis the companies budgeted for ERP investments ERP systems
ranging in cost from $0.7 million for company D to $3.0 million for company
C. The configuration of each system is presented in Table II. There were some
differences in the components installed by each company, with companies B
and C opting for more extensive systems. Company D chose a basic
accounting/finance and production package. While companies A, B and C had 861
previous experience with MRP and MRPII systems, company D did not.
Table II also depicts the ERP profiles of the four companies.
Although all four companies felt that their “needs assessment” efforts helped
them to configure and select ERP systems that would provide a good fit with
their operations, it is clear that the process followed by companies A and C was
more systematic. It also appears that the approach adopted by company D has
a low likelihood of success unless the in-house team is extremely
knowledgeable about its processes and about the currently available IT
solutions. Only three of this company’s management personnel had moderate
training on ERP systems. The fact that company D did not attempt to
reengineer their business processes prior to selecting their ERP system made
an in-house approach even more risky.
Justification and selection activities
Economic and strategic goals
All four companies expected ERP to yield considerable cost reductions (see
Table II). Although they did not quantify the expected savings, company C’s
project team expected the project to yield significant reductions in inventory
holding costs. However, the real benefit to the business was expected to be the
system’s ability to increase customer service level from 78 percent to a
sustainable 95 percent. Company D did not perform an analysis, preferring to
rely on information from a sister division that indicated that the ERP would
yield substantial savings in labor costs owing to headcount reduction, along
with improved manufacturing efficiencies. Only companies A and B had set
specific quantifiable, although mainly operational, objectives for their projects.
These were also the only companies that were eventually successful in
installing and integrating the chosen ERP modules. It appears, therefore, that
setting realistic strategic and financial goals is an important aspect of the
pre-installation decision making.
Economic and strategic justification
Companies A and B completed payback analyses. Company C’s justification
was strategic and non-financial in nature. Company C’s accounting and
inventory legacy system could no longer support the advanced, high volume
manufacturing techniques required to compete in this industry. Therefore, they
believed that changing to ERP was crucial to ensure their long-term survival.
13. 23,8
862
installed
IJOPM
Table II.
sub-systems
Company ERP
profiles – modules/
Company A Company B Company C Company D
Estimated ERP cost $1.0 million $1.2 million $3.0 million $0.7 million
Year of ERP implementation 1993 1994 1997 1998
Estimated (actual) One year (two years) One year (2.5 years) 1.5 years (abandoned prior to One year (abandoned prior to
implementation time full implementation) full implementation)
Expected areas of savings Inventory savings of Inventory savings of Reduction in inventory Labor savings owing to
and process improvements $400,000 $500,000 saving costs head-count
AP days outstanding Overhead savings of Achieving a sustainable reductionImprovement in
reduction $150,000 $250,000 customer service level of at manufacturing efficiencies
Manufacturing efficiency Direct labor savings of least 95 percent
savings $450,000 $500,000
At least 95 percent customer
service level
ERP modules/sub-systems General ledger (GL) General ledger (GL) General ledger (GL) General ledger (GL)
selected Accounts payable (AP) Accounts payable (AP) Accounts payable (AP) Accounts payable (AP)
Accounts receivable (AR) Accounts receivable (AR)
Budgeting
Sales order processing
Master production schedule Master production schedule Master production schedule Master production schedule
Material req. planning Material req. planning Material req. planning Material req. planning
Inventory Inventory
Capacity req. planning Capacity req. planning Capacity req. planning
Shop flow control Shop flow control Shop flow control Shop flow control
Statistical process control
JIT/Kanban JIT/Kanban
Order entry/billing Order entry/billing Order entry/billing Order entry/billing
Advanced planning Demand management
Warehousing Distribution
Forecasting Forecasting
No. of division employees, 87 [14] (16.09 percent) 131 [12] (9.16 percent) 145 [14] (9.66 percent) 106 [9] (8.49 percent)
[number] and (percent) of
employees involved in ERP
Implementation
14. Although they did not evaluate the proposed benefits or perform any type of Implementing
financial analysis, this company expected a payback of 18 months. The ERP systems
estimated payback for company D’s project was one year, however, this was
also based on the experience of the sister division.
Typically, ERP investments in larger firms represent between 2 percent and
5 percent of their annual sales revenue. The initially proposed ERP investments
for the four companies in this study only represented between 1.1 percent and
863
1.6 percent of their annual revenues. While the firms might have been
convinced that there was no need for a rigorous justification of these projects,
their failure to evaluate all the expected costs and benefits still had a
deleterious effect on monitoring the progress of the project. In this regard, the
approach adopted by companies A and B, although not as extensive as it could
have been, was preferable to the approach adopted by the other firms.
The research shows that the two common denominators used in
manufacturing businesses as the basis for control and performance
measurement (time and money) are strongly tied to the success of an ERP
implementation. Without linking these denominators to the economic, strategic
and financial goals of the ERP implementation, a firm may miss-align the
essential elements of this investment and not achieve its objectives. Successful
firms understand that the traditional investment policies and measurements
(ROI, ROA, etc.) are necessary to manage the costs of the investment. However,
they also realize that investment appraisal methods are not the only
substantive factors that need to be examined. Others include order-winner
policies, the supply chain performance as a whole, life cycles of products, new
processes and speed to market. By managing both the time and money aspects
of an ERP implementation a firm can significantly increase their chances of
success.
Installation activities
Education and training requirements
For all companies, the needs assessment exercise had uncovered several
training and skills deficiencies. Rectification of the training deficiencies was
accomplished in three ways: reassignment or replacement of managers, hiring
of new personnel with substantial knowledge in manufacturing and ERP
systems, and training of managers and key employees. Two types of training
were provided: fundamental ERP systems education and technical training in
the usage of the ERP software.
In companies A, C and D, ERP training was provided by outside consultants.
In company B, since substantial implementation time was lost in the prolonged
reengineering exercise, executive management made a decision to replace
several managers with new managers with ERP knowledge and experience,
rather than losing more time training the managers. The new managers helped
to train the retained managers and other key employees. Vendor personnel
15. IJOPM provided software training. All the companies spent considerable time and
23,8 money training their employees on the use of the software packages. This
training emphasized the keystrokes, screens, reports and other tools needed to
obtain user information.
Communications provided the biggest barrier to project success,
especially in companies C and D. Company C’s project, which had been
864 progressing smoothly up to the time of the departure of the executive
sponsor, began to unravel because the new executive did not have the
same passion for the project. The lack of leadership and understanding
that ensued led to divisions in the project team. Deadlines were missed,
project meetings were delayed or canceled and project timelines were
consistently being lengthened. Eventually, this project was scaled down to
the basic accounting, inventory and purchasing modules and currently
functions as an accounting system. Management apathy also resulted in
failure to assess gains even in the accounting system.
In company D, executive management neither provided enough financial or
visible support nor fostered effective communication channels for the project.
They effectively assumed that divisional management would be able to handle
the project and took a hands-off approach. The project was plagued with
problems from its inception. The project did not follow the project management
structure. No effective project plan was ever generated. Therefore, project teams
were fragmented with lapse reporting requirements. The departure of the general
manager, who had been the project sponsor, meant that the project folded after
installation of the accounting system. The project was deemed a failure.
The amount of literature, training programs and college courses on the
subject of operations management has increased significantly over the past 20
years. However, the research indicates that most mid-market manufacturing
managers have not increased their education or training to the level of larger
corporations. Thus, the concepts of ERP processes are somewhat foreign and
vague to mid-market managers. This may cause a smaller firm to have to
invest significantly more time and money (on a per person basis) than a larger
firm, and in some cases may require the demotion or replacement of individuals
who cannot meet the new responsibilities.
Project monitoring and reporting
Company A used Harvard Project with timelines and critical paths. The team
introduced project impact reports, and prepared weekly team reports and
quality reports. They also held daily project meetings. Companies B and C used
Microsoft Project with timelines. They also introduced project impact reports
and weekly team reports. They held weekly meetings. Company D used a
spreadsheet-based project outline from the software vendor. While the
company also planned for weekly project reports and weekly meetings, the
meetings were often delayed or cancelled, resulting in significant time overruns
16. and eventual abandonment of the ERP project. Although companies A and B Implementing
were reasonably consistent with their meetings and reports there were still ERP systems
significant time overruns in both projects, suggesting that the original
implementation time estimates may have been grossly underestimated.
Company A had estimated completing their implementation in one year, the
actual completion time was two years. The actual completion time for company
B’s project was 2.5 years compared with their expected completion time of one
865
year. Company A and B had cost overruns of 22 percent and 75 percent
respectively. The fact that some of these cost overruns were owing to
underestimated hardware costs suggests that the needs assessment and
financial justification aspects of this project were not as complete as they
should have been. The time overruns stemmed from organizational problems
related to ensuring managerial competence and employee training and
development. Companies C and D spent their budgets of $3 million and $0.7
million, respectively, without completing their projects. Declaring the projects
failures, these companies did not provide any ending analyses.
Overall project performance
Information on the outcomes of the four projects in terms of costs, benefits and
time is presented in Table III. All information presented was garnered from
historical records, company financial data and other operations reports.
Companies A and B had implemented all of the ERP modules they had
purchased. The modules were fully integrated and there was, for example, no
longer a need for multiple entries of the same data. However, the companies
were still struggling with issues related to the timeliness of data entry in some
departments. These companies were also achieving some of the business and
operational objectives that they sought from the systems. Among the benefits
being obtained were substantial improvements in on-time delivery
performance and improvements in market share. An additional benefit for
company B was the elimination of two external warehouses.
Except for concentrating on financial objectives rather than considering
both financial and strategic objectives, the successful projects (A and B) paid
substantial attention to all the activities outlined in the research. Company C
had covered the planning activities quite well, but had failed to adequately
address the justification activities. The greatest failure of this project appears
to have been the unwillingness of executive management to manage and
monitor the implementation process after the planning stage. Company D’s
project only concentrated on the activities of basic management processes and
nothing modern and/or strategic. Admittedly, many of the problems
experienced by company D appeared to have been due to gross
mismanagement of the entire implementation process.
In summary, those companies that were willing to pay at least moderate
attention to all the planning, justification and installation activities for both
17. 23,8
866
Company
IJOPM
Table III.
performance
Company A Company B Company C Company D
Estimated (actual) project $1.0 million ($1.22 million) $1.2 million ($2.1 million) $3.0 million ($3.0 million) $0.7 million ($0.7 million)
cost
Reasons for cost overruns Hardware requirements Hardware requirements No cost analysis No cost analysis
Reengineering costs
Assessment costs
Expected (realized) annual $1.0 million ($1.195 million) $1.25 million N/A
savings ($1.625 million)
Expected (realized) 1.0 (1.0042) 0.96 (1.29) N/A
payback (years)
Cost and efficiency Reduced inventory Reduced inventory
improvements requirement by 50 requirement by
percent, saving $700,000/yr 40 percent, saving
Reduced labor cost by $380,000/yr
$360,000/yr Reduced labor cost
Reduced overhead cost by by $1,000,000/yr
$135,000/yr Reduced overhead cost
Reject rates reduced by by $245,000/yr
25 percent to slightly Elimination of two external
more than 1 percent warehouses
On-time delivery 60 percent (93 percent) 78 percent (96 percent) 62 percent (not available) 76 percent (not applicable)
performance before firm closed
(after) ERP installation
(continued)
18. Company A Company B Company C Company D
Market share before (after) 30 percent (35 percent) 65 percent (70 percent) 30 percent (not available) 15 percent (not applicable)
ERP
Company assessment of All selected modules were All selected modules were Only accounting, inventory Only accounting module
ERP project installed and have been installed and have been and purchasing modules installed
successfully integrated successfully integrated installed
Current status of firm Company A is still in Company B is still in Company C is still in Company D closed its
business and enjoys an business and is the business. It lags the operations in 1999
excellent reputation in largest producer in a industry leader on most
its market. It continues declining market. financial measures. Only
to expand its ERP Although this company the accounting module of
modules. It also still enjoys some of the the ERP system
continues to use TQM gains from their ERP functions
teams and lean installation they have
manufacturing not been proactive in
principles to improve its embracing new
business manufacturing
principles
Implementing
ERP systems
Table III.
867
19. IJOPM strategic and tactical processes were successful in achieving their initial
23,8 objectives. The companies that fell down in any of these areas failed.
Discussion
The experiences of companies A and B show that effective executive
868 management commitment can help a project to achieve success. It appears,
however, that a considerable amount of this effectiveness is due to the activities
of the executive sponsor. Therefore, in the case of deployment of technology to
a division, top management should ensure that an effective committed sponsor
is chosen from among the corporate officers. The experiences of companies C
and D (where the projects faltered after the executive sponsors left) also present
a strong case for a back-up executive sponsor.
The research also shows a strong relationship between manufacturing
strategy and successful ERP implementations. Companies A and B took a more
futuristic, long-term view of their processes and linked the ERP investment
with strategic planning and modern evaluation and control systems.
Our study supports the need for reengineering prior to selection of the ERP.
However, to be effective the reengineering project should not take place under
the assumption that an ERP or any other type of pre-selected information or
manufacturing technology, will be implemented. The type of technology to be
adopted should flow from an analysis of the requirements of the reengineered
process or processes. In this way, management will be assured that the
reengineering effort will point to the technology, rather than the other way
around. In each of our cases corporate management was predisposed to an ERP
solution and this presented a major problem for company D, which did not
have prior experience with an integrating technology such as MRP or MRPII.
The “needs assessment” exercise is a very critical aspect of an ERP project.
It is from this activity that the basic configuration of the ERP system will
evolve. Inadequate attention to “needs assessment” will, most likely, lead to a
system that does not fit well with the organization. It appears, however, that
our firms used this process mainly to determine the software requirements of
the ERP system. The fact that both companies A and B had hardware cost
overruns indicates that required changes in the hardware legacy systems were
not adequately taken into account. Hence, the needs assessment exercise must
be extended to specifically cover hardware requirements. There also appears to
be a pressing need to survey management and operator education and skills at
this stage to ensure that the company’s personnel have the wherewithal to deal
with the reengineered processes and any prospective ES. If the gap between
required skills and available skills is too wide, as was the case with company B,
management should recognize that they have to adopt a less sophisticated
system, develop extensive training programs, or hire employees that will be
adept at operating the proposed systems. Therefore, management and operator
education and skill audits should be included in the “needs assessment.”
20. Careful attention to the planning aspects of the project should help to ensure a Implementing
smooth justification process. However, the problem of forecasting the time that it ERP systems
will take to break the functional gridlock and encourage the involvement of all
concerned operators will still remain. In the four projects covered in this study,
most of the time overruns were due to personnel and team problems not directly
related to the technology. It is these types of problems that smaller companies
must avoid. Hence, executive management and divisional management must 869
focus on developing effective communication and team building skills to create a
climate for these multi-layered project teams to thrive.
Conclusion
While this report deals with some of the major activities involved in the
adoption of ERP systems, it could not adequately cover all implementation
actions. Although these four cases were diverse enough to illustrate some
common traits that can contribute to successful implementations, more detailed
studies are required to help develop theory in this area. Future studies can focus
on specific stages of the implementation process (i.e. planning, justification,
installation or commissioning). It is also interesting to note that the ERP
implementation problems experienced by the firms in this study are similar to
those that have previously been reported for the implementation of integrated
information and manufacturing technologies such as MRPII and CIM (Small
and Yasin, 1997). The successful firms in our study had also concentrated
significant effort on many of the planning, justification and installation
practices that have been found to lead to successful adoption of MRPII and CIM.
This suggests that there may be some common traits in the implementation of
modern technologies, especially among the human-factors related activities.
Future studies can focus on determining if there is a one-to-one matching of
successful implementation actions across all types of integrated technology
adoptions, or if dissimilar technologies have some unique success
characteristics. Whatever the route future researchers into ERP
implementation practices may take, it is important to recognize that theory
development is only a first step. In this regard, it is important for researchers to
be aware of the fact that many firms still view these technologies as proprietary
and will be reluctant to share information. It is very likely that the case study
methodology will continue to be the empirical research tool of choice in this
area until usage of these systems become more widespread and routine.
Therefore, the important next step of wide-scale theory testing using more
sophisticated techniques such as surveys, may still be a few years away.
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