MIDTERM

Chapter 1 Introduction to Enterprise Systems for Management 1

Review Questions:
1. How is the role of ERP systems different from traditional TPS, MIS, DSS, and others? Can
an ERP system support all levels of management?
- Answer: Enterprise Resource Planning (ERP) system can be defined as collection of management
software that integrates businesses in managing different functions like product planning,
purchasing, inventories, supplier, customer service, sales, marketing, accounting and order
tracking into a cohesive database. ERP systems in a company are concerned with the managing
and the integrating the important part of the business. ERP is a real-time monitoring of business
functions and permits timely analysis of quality, availability, customer satisfaction, performance,
profitability and so on.
- ERP system is different from the traditional systems like MIS, TPS, DSS etc. as it brings all the
business process together in an enterprise. Thus maintaining the transactions occur one time at
the source. It unites all departments, open communication and all database into one accessible
database. The traditional systems like Transaction Processing System (TPS), Management
Information System (MIS), Decision Support System (DSS) and others, perform routine
operations on a regular basis and provides data to other systems but used to have limited
support for decision making. Whereas in ERP system decision making support is high. The ERP
system in an enterprise results in making information flow dynamic and immediate, resulting
the increment in its usefulness and value. TPS, MIS, DSS these all are types of information
system used in an organization in different level. In these systems the information is isolated to
particular system and hence if any information is needed, we need to enter particular system to
transfer data to the system. But in ERP system, company uses to connect its business activities
across departments so everyone is working with the same data and processes i.e. in ERP system
there is a common interface and terminology.
- No ERP cannot support all levels of management, since it allows each level to utilize information
in customized manner. For example: upper-level management can only utilize reports suited to
their positions within an organization whereas operational management can only utilize detailed
reports for their specific functions. Each level management have their own specific working
area.

2. Discuss the evolution of information systems in an organization. How can the use of ERP
systems remove information or functional silos in organizations?
- Answer: The evolution of the information systems in the organization started with the use of
basic information systems in the mid- 1950s. The systems like Sales Information System (SIS),
Transaction Process System (TPS), Management Information System (MIS), Office Automation
System (OAS), Decision Support System (DSS) and others were in practice in the organizations.
These are usually called divisions or silos and are not integrated with each other. Thus if the
information is required in other functional area, then the information is collected by re-entering
to each and every particular system. This process was very time consuming and less efficient.
Over the past 50 years there has been significant progress in the Information System with new
 specialties and research communities. The progress can be monitored by looking at the use of
cards, electronic calculators back then, coming to the age of e-business and mobile computing.
- The ERP system has capacity to handle large data reducing the data repetition and mistakes in
the data. Depending on market and organizational need the information system that an
organization use get evolves in size per their current need from standard platform. Information
that is required for an organization keeps growing and growing and as their needs and market
positions change, eventually they will find that they need an information system that can better
aid their business practices. And this leads to a large number of information system which
becomes complex and time consuming. There are large number of organizations with thousands
of information system and database because of their business needs and growth in market area.
With increasing demand in market area, at some point they have to decide to implement an ERP
system from a vendor such as SAP, Oracle so that the large number of information system will
have dynamic flow. It prevents and eliminates duplication of work improving the performance in
information flow. When a company implements ERP system, it eliminates the division occurred
in the organization.
3. Among all the ERP components listed in the chapter, which component is most critical in
the implementation process and why?
- Answer- Among the different components of ERP system people factors can be termed as most
critical component in the implementation process. As the organization is run by the people and
the system and the business is also remaining under the employees. Employees at different
levels and management are the users and this directly affects the ERP system. The
implementation directly depends on how much knowledge the employees has about this system
and the level of interest and effort they show on using the system. The decision to implement an
ERP system will be of the employees and also the willingness to change the business practices
using this system. An ERP system will be successful only when the people in the organization are
willing to accept the possibility to change and business reform.
4. Discuss the role of ERP in organizations. Are ERP tools used for business process
reengineering (BPR) or does BPR occur due to ERP implementation?
- Answer- ERP systems integrate all data and processes of an organization into a unified system. A
typical ERP will use multiple components of computer software and hardware to achieve the
integration. A key ingredient of most ERP systems is the use of a unified database to store data
for the various system modules. In an organization it can be viewed as the system to run and
handle all the daily works and data on daily basis with full efficiency and escaping the data
redundancy. An ERP software solution seeks to streamline and integrate operations, processes
and information flows in an enterprise. The role of an ERP in organizations is to integrate
departments and allow them to function as a single infrastructure that serves the needs of each
department. A BPR is the process of a group of activities or tasks that has been coordinated to
achieve a business goal. When an organization implement an ERP system it does brings forth
Business Process Reengineering (BPR).
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 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 criterion and
why?
- Answer- SAP, Oracle, Infor, Microsoft Dynamics are the most popular ERP vendors. Before
selecting the ERP vendors an organization should meet up the criteria that directly affects the
organization and the system. For an organization which don’t have any experience in developing
ERP system it is best to use one. The organization must carefully study the present and future
needs in enterprise management systems and then select the appropriate vendor. Also, proper
examination and reviews of the hardware, network and software infrastructures must be done
so that it would meet up all the requirements for the vendor implementation. Besides, Vendor
specialization is one of the compulsory tasks as it studies whether the vendor of the
organization supports the size of the very huge organizations like Woolworths with more than
200000 employees. An organization should also take a look at the reputation of the vendor so
that it could get knowledge on the previous implementations and use their ERP system.
Furthermore, an organization should be aware of the licensing and upgrading policies of vendors
maintaining the efficient customer service and support with affordable cost. Among these
criteria, longevity can be considered as most important one as several upgrades and adaptations
must be done to cope with the growing technologies and inventions in this fast-growing
technical era. For example, SAP is being marketed for more than 30 years with several upgrades
and adaptations to latest disruptive technologies like web, mobile platform, cloud computing,
software as service. With new inventions in technologies, it is the system that must be upgraded
with new add-ons and features that facilitates the organization and customers without
disturbing the daily basis tasks and transactions.
7. From the examples provided in the chapter on ERP success and failure stories, what are
the critical factors of success and failures?
- 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 the 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 can 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.
Case Questions:
1. What do you think of RR’s ERP implementation project? Did they select the right
implementation strategy?
- Yes, they selected the correct implementation strategy for upgrading their legacy systems into
enterprise system. In vanilla implementation, the working practices of RR have to be adopted
with functionality of SAP with mapping their current functions to its processes. This, of course,
will reduce the cost and time of modifications of SAP.
- Previously, RR gave contract to Electronic Data Services (EDS) for all of its IT function because of
which there were inaccurate data and was difficult to maintain. Later ERP implementation from
RR was undertaken by out sourced company EDS and hired expert ERP consultants for better
implementation of SAP. All the business processes needed to be mapped to SAP processes
according to their current function. After ERP implementation, they started deploying their
employees with better knowledge in business area and expertise in RR functional area so that
they can give input to SAP implementation team about the business requirements for better
mapping of SAP. As per RR requirement, the SAP team needed to provide new business process.
Even though RR implemented vanilla implementation of SAP, the technical team had to
overcome to avoid the duplication of data which was RR’s major concern because the reports
generated from SAP had to be precise. Because of ERP implementation selection it helped the
business to adopt new functionality and there was a phase roll out in RR business. They started
giving employee a training to use the new ERP system by adopting training strategy

2. Discuss the critical success factors of RR’s implementation strategy and the role of SMEs in
the project.
- The credit for success of RR’s implementation strategy goes to all the team and experts. They
outsourced EDS Company for ER implementation and hired expert ERP consultants from SAP
too. The implement process was divided into small process and team also form to complete the
specific task assigned. SMEs (subject matter experts) and staff with vital knowledge of cross
functional business relationships and experiences of the old legacy system were deployed. OBU
(operations business unit) responsible for implementing work changes and training were
working together with the project team.
- The project was implemented in one business area at time with two stages: wave one and wave
two. After successful result of wave one, they completed the wave two stage so that the error
and problem could be minimized with great efficiency. They use Phased roll out procedure to
adapt business with new functionality. They trained individuals stepwise along with meetings
and presentation illustrating the benefits to the company with the new systems. They focused
the implementation in cultural, business and technical aspects. In this way, the implantation was
succeeded.
- SMEs has played critical role in the project by using cross functional business relationship and
experience of the old legacy system so that the modification of system goes flawlessly without
skipping any important data.
3. What advice can you give to RR’s technical team on their approach of migrating legacy
system with the SAP software?
 - The advice that can be given to RR’s technical team is that while migrating the data, they can
use alternate quick method so that the daily operation is not affected much. Also, they need to
verify the migration of data and cleaned of the data over the certain period so that no garbage
duplicate data is not created. Besides, the team in the project should be expert in every field
according to the division of team member. It should also be known if the time taken to finish the
implementation can be covert. The technical team should also look if it is possible to reduce
time while doing any sort of work. They should make ensure that the data is cleaned that there
is no any error or inaccurate data. They should also avoid any duplication of data which was the
major concern of RR. The technical team should look after all the system so that there won’t be
any technical challenge after migrating from legacy system to the SAP software.

Chapter 2 Systems Integration 35

Review Questions:
1. Refer to the Air Cargo case in this chapter. Discuss the silo problem at ACI and how it was
solved via the e-Enterprise system.
- ACI had different business applications for different departments that were not integrated, like
dispatching, invoicing, freight audits, and reconciliation, which made the communication
between departments difficult. For example, before converting to ERP, ACI’s accounting staff
had to export and import text files to communicate across accounting and business applications.
This took time and made even the most recent report slightly dated. ACI implemented four e-
Enterprise applications – financial series, distribution series, customization series, and
integration series – and integrated them with a database management system, Microsoft SQL
Server, at the backend.
2. Refer to the Air Cargo case in this chapter. Discuss both short-term and long-term benefits
of the e-Enterprise system.
- The short-term benefit of e-Enterprise is the integration of systems, which enable the update of
all departments. The long-term benefit is the reduction of time and cost.
3. Why do you think functional silos are not appropriate for today’s organizations? Discuss
your answer from organizational and technical perspectives.
- Companies with functional silos may have greater difficulty in creating strong, competitive
products because they may fail to recognize the benefit of cross-functional team. Nowadays it is
very important that companies have communicative and collaborative systems in order to keep
information timely and available.
4. What is the relationship between the logical and physical system integration? Why is it
important for organizations to have both together?
- Logical integration allows organizations to share data with all of its stakeholders based on their
need and authorization while physical integration provides seamless connectivity between
heterogeneous applications systems. It is important for organizations to have both because
logical integration complements physical integration, so they can share data with seamless
connectivity.
5. Why is business process re-engineering needed for implementing an ERP?
 - Because if business processes do not change, an organization will not be able to take full
advantages of the ERP capabilities. The organization has to change its business processes and
policies to take advantage of better information sharing facilitated with integrated systems.
6. Discuss the role of management in systems integration in terms of the ethical and other
challenges they face during the systems integration process.
- Management needs to understand the tangible and the intangible benefits of integrated
systems. In addition to the immediate benefits of sharing organization-wide information,
systems integration allows decision making to be cascaded to all employees in the organization.

Systems integration raises several ethical issues for management. Integrated systems open up
new ways of sharing information, but it also brings the possibility of some employees exploiting
this information for their personal advantage as well as illegal access of information that they
can easily do from their desks. To avoid the unethical use of information, management needs to
develop a policy on ethical usage of information as well as user proper security software and
hardware to prevent, track, and monitor information access and usage.

Case Questions:
1. What are some of the system integration challenges faced by UPS?
- They originally dealt with an overwhelming number of customer service calls, which led to a
time and cost-consuming process to manually locate package statuses, so their challenge was to
put the power into the customers hands and provide them the information they need faster.
- They also needed to bridge the gap between physical products/services and access to electronic
information. UPS made a lot of errors in their original process, such as sending packages to the
wrong addresses, loading boxes on the wrong trucks, and picking the wrong boxes just because
many UPS products look very similar. With their multiple separate systems requiring redundant
processes to utilize the data, UPS was challenged with performing a complete BPR.
2. Discuss the systems integration solutions at UPS. How does it help UPS integrate new
technologies?
- They added a new variety of services integrated with core transportation functions in order to
better serve the customers. They purchased two different ERP modules from Oracle for both HR
and financials, which saved a lot of money for goods and services purchased. They built a
rigorous UPS logistics network on well-defined technological standards, which makes it easy to
now add new applications that fit into the IT infrastructure. In turn, this also prevents unwanted
data from being stored. This helped UPS tremendously because the process became a lot more
customer-focused and technology-reliant, which is essential in today’s world. Now, instead of
the common shipment errors, UPS has a much lower fault tolerance and can provide better
services to customers related to package shipping and tracking.
3. Discuss the advantages of systems integration for UPS customers.
- From a customer standpoint, systems integration makes a huge difference. Customers can easily
track the shipment of their packages and have a better estimate of when they can expect the
arrival. The tracking system is easily accessed from the UPS website or by software provided by
UPS. If the customer accidentally enters an incorrect zip code, an error message will prohibit the
 process from continuing, thus reducing the likelihood of an error in shipment. Additionally, the
system integration provides “smart data” which is able to identify things such as rural addresses
that may be hard to get to or out of the way, allowing UPS to better estimate the amount of
time it will take to deliver the package. Lastly, the auto-fill fields allow easy ordering for frequent
receivers. This ultimately puts the power into the customer’s hands, which improves customer
satisfaction and, as a result, company profits.

Chapter 3 Enterprise Systems Architecture 57

Review Questions:
1. What is necessary for the ERP implementation to be successful?
- Customization or changes are therefore often necessary when implementing the ERP
modules. Management needs to evaluate carefully when and how much modification is
essential. ERP software provides different level of flexibility in modifying the system
during implementation.
2. What is ERP system architecture?
- RP technical architecture basically defines layout of layers of application deployment
between servers and desktops, interfaces and software objects. ERP architecture is no
more meant to just provide technical functionality, user interface and platform support
but should be able to absorb emerging technologies.
3. Why is it important to have good enterprise system architecture?
- Because it explains the relationships between complex information systems
components such as hardware and software, with complex organizational components
such as business functions, processes, and people.
4. What is the role of architecture in ERP implementation?
- The architecture in ERP implementation is highly essential in an enterprise-level system.
Three-layer architecture is the most prevalent today and includes Web, application, and
database servers. It is the most reliable, flexible, and scalable architecture. You can scale
the number of users from 10 to 100 by adding servers.
5. List five of the major functional modules of ERP.
- ERP vendors provide modules that support the major functional areas of the business
such as accounting, production, financial management, human resources (HR), and sales
order processing.
6. Discuss the different types of ERP architectures.
- The data tier focus is on the structure of all organizational data and its relationships with
both internal and external systems. This tier generally consists of the SQL Inquiry and
Report Writer tools that are available for advanced users who have the authorization to
filter, process, or filter and process the data from any table in the database.
 - The application tier is where data are entered and shared with other components of the
system. It shields the business users from the inner workings of an ERP system, but still
provides the information relevant to their job and business process.
- Employees rarely interact with SAP through an application tier. A Web-based self-service
portal allows users the ability to access and analyze information through their Web
browser.
7. List benefits and limitations of one ERP architecture.
- Web Services Architectures - The key benefit of using the Internet platform as the
foundation is that organizations are able to provide a wide range of end users with
access to ERP applications over the Web as well as more easily integrate their ERP
applications with existing internal systems and external trading partner systems. On the
other hand, it does tend to have slower response time because all user requests are
processed on the server.
8. What is service-oriented architecture and how is it different from Web services
architecture?
- Service-oriented architectures represents object-oriented architectures for Web
platforms. SOA is similar to Web services, but it is not the same. Web services is an
application of SOA with such Web-based technologies as SOAP and XML. SOA is more
than a set of technologies; it is a standard that runs independent of any specific
technologies.
9. What are the key benefits and limitations of systems integration?
- The key benefits of systems integration are: increased revenue and growth, leveling the
competitive environment, enhanced information visibility, and increased
standardization. While its limitations are: high initial setup costs, power and
interdepartmental conflicts, long-term and intangible ROIs, and creativity limitations.
10. What is the role of management in designing enterprise systems integration?
- The benefits expected from ERP is the availability of information that helps in the
decision-making process and consistent information is shared across within the
organization. Moreover, ERPs permit the co-influence of departments, which forcibly
eliminates the Silo concepts from the business. With physical integration, ERP systems
compel companies to concentrate on upgrading and removing legacy systems which
result in companies having improved flexibility.
Case Questions:
1. Compare and contrast the self-service implementation between Wipro and MBH. Which
company did a better job? Explain.
- Wipro identified their self-service objectives as: increase information access, enable
strategic, reduce administrative costs, eliminate process steps, approvals, forms, and
improve service to employees and managers.
- With the implementation of web-based self-service architecture, MBH identifies many
challenges inherent to this transition: real-time access to back office through the web-
 based self-service architecture is subject to the time constrain of the current back-office
server, complex modifications to existing data can be costly, back-office have many
unique patterns or habits that may be projected to the user interface on the web,
thereby decreasing user satisfaction. Each company has its own back-office processing
technology that is extremely difficult to duplicate at another site. This can cause one
self-service solution to be completely different from another from the same company.
Last upgrades are needed to the back office in order to integrate into the web
application thus upgrade may constrain priority objectives from previous upgrades.
There are numerous challenges facing the implementation of any new ERP architecture.
Self-service is extremely challenging because success depends on many factors, with the
largest factor being user satisfaction.
- In this case study Wipro did a better job than MBH because Wipro methodically
achieved the following self-service succuss factors: collaboration among HR and IT,
adequate budgeting or funding, CEO/high-level executive commitment, strategic plan
that prioritizes application, process design or reengineering, marketing-employee
communications, corporate standard for technology solutions, business case, any time
and place access, metrics, consistent look and feel, and consistent interface across
media.
2. Are the measures used by Wipro (i.e., costs, returns, and cycle time) appropriate for
evaluating their self-service implementation?
- Wipro has also been evaluating the quantitative business side by measuring costs,
returns, cycle time, and so on to understand the complete value of this project.
3. What would happen to the self-service implementation at MBH if the company decided to
adapt the SOA model? Does self-service implementation make it easier or more difficult
to implement SOA? Explain.
- MBH need upgrades in the future as the biggest concern for companies implementing
self-service architecture. Vendors can release upgrades annually or biannually, with a
long implementation process that bulls many resources from the company.
- The self-service is extremely challenging with MBH because success depend on many
factors, with the largest factor being user satisfaction.

Chapter 4 Development Life Cycle 88

Review Questions:
1. What is the role of the systems approach in the SDLC?
- Systems approach is used for problem solving. This approach takes complex problems
and breaks them down into small manageable problems. It identifies problems from the
top-down and then solutions are derived from the bottom-up.
2. Briefly discuss the key phases of the SDLC methodology.
- Traditional SDLC included five phases. The investigation phase checks if the new system
is feasible. It also checks the costs associated with the system. The analysis phase
determines the user requirements for the system. The design phase produces the
technical specifications for the system. The implementation phase starts with gathering
the tools and hardware needed to put the system into motion. This includes any testing
and training needed to put the system into operation.
3. Discuss the alternate approaches of SDLC and the benefits of these alternatives.
- One rapid development approach is prototyping. This approach does not go through the
analysis and design phases; instead, it implements a skeleton or a prototype of actual
system with a focus on input and output. The idea is to demonstrate the system
functionality as soon as possible to the users and to get their feedback on the prototype.
Their feedback is incorporated into the new system and demonstrated back to the
users. This approach had proven to be very effective with user-interactive systems
because the prototype is eventually converted into a full-scale system.
- Another rapid development approach is end-user development, which lets the end
users create their own applications. This process popular in the 1980s with the advent of
personal computers. In this process the users are trained by the IT staff or professional
trainers to develop customized applications.
- The benefits of these alternatives: provides the necessary background to understand
the ERP life cycle methodologies and see why the SDLC approaches cannot be used
without changes for ERP implementation.
4. Compare and contrast the three major ERP implementation categories.
- The first is a comprehensive ERP integration plan which is the most expensive and time-
consuming plan. It involves making sure that the implementation has full functionality. It
also involves a high level of Business Process Reengineering. The second plan is called
the middle-of-the-road ERP implementation plan. It is not as expensive or extensive as
the comprehensive plan, but it is not as clear-cut as the vanilla plan. It also involves a
high level of BPR. The last plan is called the vanilla ERP implementation plan. It basically
aligns the business processes to the ERP system and minimizes reengineering.
5. What is ERP implementation methodology? Give examples.
- This refers to a well-thought-out approach to solving a business problem. Some
examples are Total Solution, FastTrack, Rapid-Re, ASAP, BIM.
6. List the major tasks in the scope and commitment phase of the ERP life cycle.
- 1. Gap Analysis - what functions are necessary and can your operation handle it.
2. Physical Scope - geographic location of the sites and the number of users.
3. BRP Scope - what is happening to the current process (changing or ending).
4. Technical Scope - how much the software it changing and will it be customized.
5. Resource Scope - time and money needed for the project.
6. Implementation Scope - how should it be implemented (phase, pilot, parallel, big
bang)
7. List the major tasks in the analysis and design phase of the ERP life cycle.
- 1. User Requirements
2. Differences between current business process and the embedded process in the ERP
software.
3. Data Conversion, System Conversion, and Training.
4. Execution Plan for the new system release.
5. Prototype of the ERP software.
8. List the major tasks in the acquisition and development phase of the ERP life cycle.
- 1. Purchase license for production version of the software.
2. Configure platform with hardware, network, security, software, database, and real
production data.
3. Customization of embedded rules, data in the tables, input screens, and reports.
4. Migrating data from old to new system.
5. Configure ERP system with proper security.
9. What is the role of change management in the ERP life cycle?
- Using the gap analysis, the team must develop a design that includes a change
management plan. This must be detailed with an execution strategy for the release of
the new system. This team must work with the end users on implementing the changes
in business processes with the prototype version of the software. Change management
is also part of the implementation stage to smoothen the transition. When it gets to the
operation stage, the team carefully monitors user feedback from training to make
necessary adjustments to the change management approach.
10. List the major differences between the ERP life cycle and SDLC.
- 1. In SDLC the new application is made for the user requirements. In ERP life cycle the
business process must be changed to fit the best practices of the ERP software.
2. In SDLC consultants are limited to IT hardware, software, and training. In ERP life cycle
consultants are important from beginning to end in advising the organization on
software selection, reengineering of business process, and software installation and
change management.
3. In ERP life-cycle software is selected very early in the implementation process. In SDLC
it is not brought up until the fourth stage.
Case Questions:
1. Compare and contrast the implementation of OilCO and ExploreCO. What were the
similarities and differences between the two implementations?
- The implementation of the system at OILCO involved major change to the company’s
business processes, so they matched the ERP’s processing methods. Even though they
recognized that some existing business process changes were necessary, OILCO aimed
to maximize the integration benefits of the ERP while simultaneously streamlining the
company’s existing processes. This implementation also involved the development of an
oil industry-specific module. The ERP implementation resulted in substantial business
 benefits for OILCO. They included better sales forecasting, fully automated ordering and
delivery processed, real-time financial data, improved data quality and streamlined
business processes.
– ExploreCO had to decide either to rework and upgrade the existing system or to replace
it. They chose a new system and conducted a feasibility analysis of several ERP systems.
For budgetary reason and because it suited their exploration business, they decided to
implement an ERP system.
2. Why do you think the projects were successful? Was it the articulation of CSFs? Was it
their strategy of minimal customization? Or something else? Explain.
- The project was completed on time and on budget and was described by highly
experienced project manager as the” easiest implementation” he had” ever been
involved in”. The business benefit of the ERP-2 system was significant. Base on this case
study and tabular summary of the importance of each CFS is then presented. It shows
the CFS in a particular phase. The number of dots in each cell represents the strength of
the participants’ consensus that particular CSF was necessary in that phase.
3. What can we learn from this case? Also, provide suggestions for improvement.
- I feel that we can learn several things from the case regarding a successful ERP
implementation plan. They include critical success factors such as strong executive level
leadership, strong project and change management, SME participation, minimize
module customizations, effective training, and selecting the proper ERP system
architecture. If these were included, all ERP implementations would be more successful.
- OilCO could have improved their ERP implementation by choosing the correct system.
This would have eliminated the need to create a new oil industry module. They could
have hired a full-time executive level officer to be the head leader. CIO hire would have
saved on the money spent on their ERP.

Chapter 5 Implementation Strategies 139

Review Questions:
1. What are the components of an ERP system?
- The three components are hardware, software, and people. Hardware consists of
computer devices and peripherals that will be used by an ERP system. Software is
usually the ERP applications, and other necessary applications to allow the ERP software
to function, and is the tool necessary for building the system.
2. Why would a company choose to implement an ERP?
- The choice for a company to implement an ERP is based upon its desired operational
and functional capacity compared to its current limitations from existing systems. A
company would choose to implement an ERP after a careful determination of business
inputs, processes, and outputs which they have identified the current system being
inadequate to handle, thus requiring an ERP to improve business performance.
3. What are third-party products and why are they needed?
 - Third-party products consist of software components that provide necessary
functionality to the ERP to make the system operational. This could include things like
extra modules to support current ERP software or new software components that work
in conjunction with, but independently from, the ERP system to ensure operational
needs are satisfied.
4. What is an implementation methodology and why is it important in ERP
implementations?
- Implementation methodology involves identifying requirements from an ERP and
modifying the implementation plan to maximize returns in the most efficient way. It is
important to choose the right methodology as it will affect the entire implementation
process, ensuring deadlines are met, budgets remain on target, and functionality yields
desired outputs.
5. What are the pros and cons of implementing a system without customization?
- Being able to implement a system without customization yields the most benefits and is
the most cost-effective solution. The pros of using a Vanilla (non-customized)
implementation strategy include lower costs, easier and less time-consuming upgrades,
and retaining full vendor support. The con of this strategy is that a company must
choose from “out of the box” processes and functions and have little control over
functionality.

6. Why are there differences between a transactional and reporting database?

- ERP systems require databases that can provide the quickest data entry and retrieval. A
single relational database instance is simply too inefficient for long- and short-term data
storage and retrieval. Therefore, two types of database instances were created:
transactional and reporting. Transactional databases handle individual pieces of info for
updating or inquiring, while reporting databases import data from transactional ones for
long term storage and for producing specialized reports.

Case Questions:
1. What were the key goals in the Army using an ERP system?
- Common view of the rapidly changing operational environment
- Eliminate boundaries between One Army and One Enterprise
- Synchronize transformation between Institutional and Operational Army
- Optimize the Army at the enterprise level
- Rapidly affect combat operations by anticipating change and providing decisive and
dominant combat capability where and when required
- Transform the Army from end-to-end

2. What were the key implementation considerations that were addressed as part of the
planning process, especially related to using an integrated ERP and transforming the
culture?
 - Sponsorship/Leadership–Successful ERP systems require dedicated and engaged
leadership. The Army has a unique situation where leaders rotate, and an ERP
implementation can span over multiple sponsors.
- Stakeholder Alignment –The Army’s previous structure did not require each area to
work together. There needed to be tradeoffs in each of the areas to have the best
overall solution for the organization, so there needed to be decisions made at a higher
level than the area that are implementing the tradeoffs.
- Cost –Transformation Management (TM) is a key element to the success of the
implementation. It must be communicated and accepted by the leadership in advance.
Often times when there are cuts to the budget it is the first thing to be cut.
- Project Lifecycle –TM needs to be part of the project from the beginning and is key to
the overall success of the project.
- Culture –As with any organization that has a long-term history, change will be a
challenge. Leadership must take an active role within the Army to support the change.
- Communication –The Army has many areas in which communication is key to success,
both internal and external to their organization. A good communication plan must be
put into place.

3. How was the change management process incorporated into the implementation?
- The Army used blueprinting, which is a comprehensive set of pilots to test proposed
changes and ensure that the proposed changes will work as advertised. Additionally,
the Army evaluated customization of the software versus changing the process on a
regular basis.

4. Discuss the pros and cons to customizing the system?

- Pros–The software will better meet the needs of the Army and their unique processes
and business processes. Users will not have major changes and therefore adjust to the
new system more readily.
- Cons–Upgrading to a newer version of the software will be more time consuming and
expensive; customizations are not supported by the vendor and customizing can cause
delays in the project and possibly destabilize the software.

Chapter 6 Software and Vendor Selection 167

Review Questions:
1. What are the steps in purchasing an ERP?
- The steps are as follows:
 Vendor research and informational gathering
 Decide on functional requirements and IT criteria
 Request information from vendor on features
 Review information with company’s functional requirements
  Request bid from vendor Review and Eliminate vendors not suitable
 Negotiate with selected vendor on price and functional requirements
 Come to an agreement and prepare licensing agreement
2. Who generally needs to be involved in the ERP selection process and why?
- Everyone in the organization needs to be part of ERP implementation. ERP
implementation affects everyone and by keeping an open line of communication it will
help everything run as smooth as it possibly can.
3. What is total cost of ownership (TCO) and why should it be a part of the ERP selection
process?
- TCO is the total cost associated with ERP implementation, including training, software
implementation, and upgrades to the system. It is an important part of the selection
process because it gives a company an overall look at how much an ERP system will
actually cost.
4. What are the key components in contract negotiation and licensing?
- The key components in contract negotiation are to evaluate the company’s functional
requirement and financial resources with the vendor’s features and price. Then
formulate a plan to make a successful ERP implementation.
5. Why is it important in the request for bid process to make the vendors reply in a specified
format?
- By formatting the request for bid the vendor understands directly what the company
wants and needs for ERP implementation. They also understand the who, what, why,
and when of the selection process.
6. Why is communication important in this phase?
- Communication is important because vendor selection involves negotiation and
informational gathering. Without clear and periodic communication there is no way ERP
system implementation will work. Without clear communication the vendor can
misinterpret requirements and not provide the client with the business process
software to meet their needs.
7. What is the difference between an RFI and RFB?
- RFI is a formal request of information made by a company to a vendor. The information
should include both the vendor’s features and the compatibility of these features with
user requirements. RFB is a formal request of bid which explains who, what, where,
when, and how a vendor will be selected and the ERP system will be implemented.
8. What are the benefits of a bidding process to purchase an ERP?
- The bidding process allows vendors to compete for the best price, producing a more
affordable ERP system implementation and more flexible vendor to the functional
requirements of the company.
Case Questions:
1. What are some of the tracking issues a fruit and vegetable manufacturer must utilize in an
ERP to better ensure success?
- Tracking issues in a fruit and vegetable manufacturer is very complex because it has
variable inputs and they have to make sure that the outputs are consistent. The
following must be utilize in an ERP to better ensure success:
- The system must have the capacity to facilitate multiple, nonrelated units of
measures on a lot of basis. An example of a system is provided by O2 ERP system
that provides this capability to juicers.
- It must allow a fruit beverage company to manufacture to the company’s and
customer’s specification or ‘best-fit’ of to meet the customers’ requirements.
- It must be able to keep vendor-specific information about purchased items to be
able to produce a settlement sheets including charge backs and commissions for
accounting purposes.
- Quality control and food safety will need to be utilized – eg sterilizing the fruit upon
receipt.
- Tracking Allergen as well as color/product scheduling issues so that the ERP system
can capture the cost-saving benefit of minimizing changeover time.
2. What is an “organic system plan,” and what are some of the key features an ERP must
include?
- An organic system plan is use to support organic producers in food processing and
manufacturing including full distribution management throughout the supply chain.
- Some key features for the ERP are:
 record keeping for organic raw material purchases
 country origin tracking of purchases
 organic supplier tracking
 separate organic product storage to prevent product comingling
 hazardous chemical tracking and reporting to prevent contact with prohibited
substance
 online processing procedures to ensure adherence to compliance standards
 online record keeping and audit trails for fast compliance reporting

3. Why are some manufacturing systems specific to a product?

- Some manufacturing systems are specific to a product because of the unique sets of
issues they have from safety to organic technology. The organization requires to
monitor the different stages of production to make sure that they produce a good
quality product. This is a good example of implementing a ‘chocolate’ version of ERP as
the system needs to be changed or customized to fit the business processes.