5. Why is the design and selection of ERP architecture crucial for the implementation project? What are the long-term implications of selecting a wrong architecture?

 
A business organization must start with the correct architecture to meet their needs for a new ERP system.  If they choose a chocolate implementation, but really only need a package-driven vanilla architecture, they may waste large sums of company money and time.   Chocolate implementations can be very time consuming and costly.  Also, vanilla implementation architectures are toted as being the best option from vendors, as they utilize the “best business practices” across various industries.
 

6. Discuss the criteria for selecting ERP vendors. Which is the most important criteria and why?

 
The criteria to consider are what industry the ERP vendors specialize in and what sizes of organizations their software supports.  Also important to consider is the reputation of the vendor, how successful their implementations have been and their outlook in terms of longevity. Other items to seriously consider are their customer support services, total cost of ownership, IT requirements for the software and the ability to integrate third-party software.
 

7. From the examples provided in the chapter on ERP success and failure stories, what are the critical factors of success and failure?

 
For success, it is critical that all management is on board with the plan to implement an ERP system.  Their attitudes towards the system and willingness to be a part the developmental stages will decide its success. Choosing the correct architecture and moving forward with it is also important.  The failure stories have two things in common: they did not have everyone on the same page, nor did they stick to the implementation plan. 
 

8. What are the critical steps of an ERP project cycle? Discuss the critical success factors.

 
The first critical step is to identify a project manager and subsequent teams.  Then, to find a vendor that is able to deliver solutions identified by the project manager and upper management is the next step. Other important steps include establishing a project timeframe, deciding if consultants are necessary, and most importantly performing adequate ERP testing.  Finally, after going live, it is essential to work closely with the consultants to solve any problems that may arise during implementation. Keeping these steps in mind will aid in a successful project implementation.
 
 

DISCUSSION QUESTIONS

      

1. Refer to the Hershey case. What were the goals and details of the Enterprise 21 project?

 

1. Establish a single supply chain across all divisions.
2. Streamline all business processes by reengineering them across all functional areas.
3. Increase the gross margin and maintain sales growth.
4. Save $75 – 80 million through corporate restructuring and closing of older distribution sites.
5. Fix their Y2K problem and replace existing mainframe environment.

 

2. Refer to the Hershey case. What were some of the key problems that Hershey encountered when choosing, integrating and implementing their new ERP system?

 
The implementation of the ERP for Hershey was beset with difficulties due to a number of failures:

a.      Project management issues, not faulty software: The company did not use the proper resources do ensure a good launch. This especially includes the failures of top management.
b.      Big Bang versus phased implementation: With their second attempt Hershey was able to plan more thoroughly in order to reduce redundancies, properly train and troubleshoot on a manageable basis.


There were several key problems Hershey faced during the implementation of their new system:

• Lack of upper level management—the absence of IT executive leadership before the arrival of George Davis.
• Lack of a perspective—lower level managers were making decisions based on their individual business needs rather than addressing the needs of the company as a whole.
• Big bang approach—three new systems were implemented simultaneously, rather than employing a phased implementation.