Summer Internship Project Report

On

Understanding the Critical Success Factors for Implementation of Enterprise

Resource Planning (ERP) through Case Studies

In Partial Fulfillment of
PGDM, Batch - FMG 29

Submitted to

Prof. Roopesh Kaushik

Submitted by
Anuj Sharma
Roll No.: 291070

FORE School of Management, New Delhi

 Declaration by the Student

I am, Mr Anuj Sharma, Roll No. 291070 have completed my summer internship at

ClearDekho Eyewear Pvt. Ltd., Ghaziabad and has submitted this project report entitled

Understanding the Critical Success Factors for Implementation of Enterprise

Resource Planning (ERP) through Case Studies towards partial fulfilment of the

requirements for the award of the Post Graduate Diploma in Management (FMG-29)

2020-2022.

This report is the result of my work, no part of it has earlier comprised any other report,

monograph, dissertation or book.

————————————

Anuj Sharma

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 Certificate

This is to certify that Mr Anuj Sharma, Roll No. 291070 has completed his summer

internship at ClearDekho Eyewear Pvt. Ltd., Ghaziabad and has submitted this project

report entitled Understanding the Critical Success Factors for Implementation of

Enterprise Resource Planning (ERP) through Case Studies towards partial fulfilment

of the requirements for the award of the Post Graduate Diploma in Management (FMG-

29) 2020-2022.

This report is the result of his/her work and to the best of my knowledge, no part of it has

earlier comprised any other report, monograph, dissertation or book. This project was

carried out under my overall supervision.

Date:

Place:

————————————

Prof. Roopesh Kaushik

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 Acknowledgement

I would like to express my special thanks to my internal faculty guide Dr Roopesh

Kaushik, FORE School of Management, New Delhi for his invaluable guidance and

support throughout the research period. I would like to extend my sincere gratitude to the

FORE School of Management for providing me with the opportunity to conduct this

research project on “Understanding the Critical Success Factors for Implementation

of Enterprise Resource Planning (ERP) through Case Studies”. It has helped in

expanding my knowledge and skillset in the given field.

Lastly, I would also like to thank Mr T. Sai Prashanth, Operations Head, ClearDekho

Eyewear Pvt. Ltd., Ghaziabad for providing me with the opportunity to gain first-hand

experience of working on an ERP Implementation project.

Thanking You

Anuj Sharma
FORE School of Management

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 Contents

Declaration by the Student ................................................................................................... 1

Certificate .............................................................................................................................. 2

Acknowledgement ................................................................................................................ 3

Contents ................................................................................................................................ 4

Executive Summary .............................................................................................................. 6

I. Introduction .................................................................................................................... 9

Organization of Study ..................................................................................................... 10

II. Literature Review ........................................................................................................ 11

What is E.R.P.? ............................................................................................................... 11

Benefits of E.R.P. ............................................................................................................ 13

Types of E.R.P. Software ............................................................................................... 16

Implementation of E.R.P................................................................................................. 18

Key Challenges in E.R.P. Implementation ................................................................. 19

Key Phases in E.R.P. Implementation ....................................................................... 22

Critical Success Factors for E.R.P. Implementation ..................................................... 26

III. Objective ................................................................................................................... 32

IV. Research Methodology ............................................................................................ 33

V. Case Studies ............................................................................................................... 34

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 Fulton & Roark ................................................................................................................ 34

N&N Moving Supplies ..................................................................................................... 35

Green Rabbit ................................................................................................................... 36

Zerodha ........................................................................................................................... 37

Teabox ............................................................................................................................. 38

Indian Institute of Management, Indore ......................................................................... 39

Rialto Enterprise Ltd. ...................................................................................................... 42

The Hershey Company ................................................................................................... 43

Nike Inc. ........................................................................................................................... 44

Nestlé USA ...................................................................................................................... 46

VI. Key Takeaways ........................................................................................................ 49

VII. Conclusion ................................................................................................................ 52

VIII. Limitations & Future Scope ...................................................................................... 54

IX. References ................................................................................................................ 55

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 Executive Summary

An Enterprise Resource Planning (ERP) software is a powerful tool that helps an

organization in streamlining its business processes. Implementing an ERP is a

complicated process. It requires proper research, planning and a huge amount of

investment. Still, nearly 50% of ERP implementations fail and most of the implementation

projects involve budget overruns, mainly, because of mid-project modifications. As lots of

investment goes into the implementation of ERP in terms of time and money, it is

important to study various critical factors that contribute to the successful implementation

of ERP.

The objective of this research is to understand these critical success factors through case

studies of some successful and unsuccessful ERP implementation projects and to gather

insights about ERP implementation.

Exploratory research based on secondary data was carried out. Cases involving different

types of ERPs and organizations have been studied to understand the challenges faced

at different levels.

ERP software offers various tangible and intangible benefits to organizations. But all

these benefits are subject to the successful implementation of the software. Companies

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can select different types of ERPs, i.e., general, open-source, industry-specific,

lightweight depending on their requirements and budget.

In this research 10 cases related to ERP implementation were studied and evaluated for

various success factors. The first case of Fulton & Roark had committed top management

which led to employee acceptance and faster implementation of NetSuite ERP. N&N

Moving Supplies case highlight excellent change management by the organization as the

organization kept the morale of its employees high throughout the project. In the case of

Green Rabbit, ERP provided the management with a solution to handle a complex supply

chain. Zerodha’s case highlights the ease of adoption of a highly adaptable and

adjustable open-source ERP. Whereas, Teabox’s case highlights the affordability of these

open source ERPs. The cases of IIM-Indore and Rialto Enterprise discusses the

implementation of industry-specific ERPs (education & manufacturing) and their benefits.

On the other hand, failed implementations in the case of Hershey’s, Nike and Nestle

highlight the importance of realistic implementation timelines, thorough end-user training

before implementation, and patience in the implementation of the ERP system.

The success of ERP projects depends on the number of business goals achieved or the

return on investment received by the organization. If not implemented properly, these

projects can hurt the reputation and performance of the organizations. But with proper

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planning and implementation, these systems have the potential to drastically improve

organizational performance.

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 I. Introduction

ERP systems have been used to integrate information and accelerate its distribution

across functions and departments to improve an organization's operational effectiveness.

Because of its capacity to combine the flow of material, finance, and information to

support organizational initiatives, ERP is becoming increasingly significant in modern

business. Therefore, ERP system adoption and utilization are vital to corporate

performance and survival.

Commercial ERP solutions such as SAP, Oracle NetSuite, and others provide an “off-the-

shelf” answer to the problem of business integration for managers who have laboured to

combine incompatible information systems and inconsistent operational methods at

tremendous expense and with great frustration.

ERP systems, according to various researches, can help businesses gain a competitive

advantage in the information technology (IT) era. There has been a global tendency to

integrate corporate processes based on the company's strategic implementation,

particularly in the e-business era. However, implementing an ERP system is a

complicated, time-consuming and expensive project. Its success depends on various

factors from the selection of the right vendor to the commitment from top management.

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This study, therefore, focuses on these factors influencing the implementation of ERP

systems. An exploratory research methodology was used to study different successful

and unsuccessful implementations of ERP systems by different organizations. Based on

the analysis of these cases, a relationship has been established between different factors

that influence the successful implementation of ERP systems.

Organization of Study

The report starts with the introduction section which provides a rationale for the study.

Section II, i.e., Literature Review discusses all the relevant literature related to ERP

systems, their benefits and implementation. Section III discusses in detail the objective

behind the study. Section IV explains the research methodology followed in the study.

Section V discusses various cases that have been studied during the research. Section

VI discusses the takeaways from these case studies. Section VII provides the concluding

remarks and Section VIII discusses the limitations and future scope of the study.

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 II. Literature Review

What is E.R.P.?

Enterprise Resource Planning (ERP) is a management and integration technique used

by firms to manage and integrate the various aspects of their operations. ERP systems

are used to integrate information and accelerate its distribution across functions and

departments to improve an organization's operational effectiveness.

Many ERP software systems are beneficial to businesses because they assist them in

implementing resource planning by unifying all of the operations required to manage their

businesses into a single system. It is a tool for standardizing and integrating business

processes to increase access to common resources across the firm. These systems aid

in information exchange and operational efficiency. Planning, purchasing, inventory,

sales, marketing, finance, human resources, and other functions can all be integrated

with ERP software.

An enterprise resource planning system (ERP) is a glue that holds a large organization's

various computer systems together. Without an ERP solution, each department's system

would be tailored to its own needs. Each department still has its system, but with ERP

software, all of the systems can be accessed through a single application with a single

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interface. Because of its capability to combine the flow of material, finance, and

information to support organizational initiatives, ERP is becoming increasingly significant

in modern business.

By connecting information about manufacturing, finance, distribution, and human

resources, ERP solutions can help a company become more self-aware. An ERP solution

can minimize costly duplicates and incompatible technology by connecting multiple

technologies utilized by different parts of an organization. ERP architecture allows diverse

business applications to share a similar database, which serves as the organization's

foundation for cross-functional integration. Accounts payable, stock control systems,

order-monitoring systems, and customer databases are frequently integrated into one

system.

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Figure 1: Various ERP Modules (Source: www.netsuite.com)

Benefits of E.R.P.

Enterprise resource planning (ERP) is used by businesses for a variety of objectives,

including increasing their business, lowering expenses, and enhancing operations. The

benefits sought and attained by one company may differ from those sought and attained

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by another. There are two types of benefits that can be derived from ERP implementation:

tangible and intangible.

Some of the notable tangible benefits of an ERP system are:

 Inventory reduction

 Personnel reduction

 Increased productivity

 Improvements in order management

 Faster closing of financial cycles

 Increased on-time deliveries

 Improved customer service

 Reduction in IT and procurement costs

 Improved cash flow management

 Increased revenue and profits

 Reduction in transportation and logistics costs

Some of the notable intangible benefits of an ERP system are:

 Increased visibility of corporate data

 New or improved business processes

 Improved responsiveness to customers

 Improved communications

 Unexpected cost savings

 Better integration between systems

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  Standardization of computing platforms

 Increased flexibility

 Global sharing of information

 Improved business performance

 Improved visibility into the business

Integrating and automating corporate operations reduces redundancy, increases

accuracy, and boosts output. Departments with interlinked processes can now

synchronize their efforts to obtain better results.

Some companies benefit from improved real-time data reporting from a single source

system. Accurate and complete reporting enables businesses to plan, budget, forecast,

and convey the status of their operations to internal and external stakeholders, such as

shareholders.

ERPs enable businesses to instantly access information for clients, vendors, and

business partners, resulting in higher customer and employee satisfaction, faster reaction

times, and higher accuracy. As a corporation becomes more efficient, associated costs

frequently fall.

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Departments are better able to interact and share information; a newly synergized

workforce can boost productivity and boost employee satisfaction by allowing employees

to see how each functional division contributes to the company's mission and vision.

Menial, manual duties are also avoided, allowing employees to focus on more important

responsibilities.

Types of E.R.P. Software

ERP software can be broadly grouped into the following categories:

1. General ERP: Many traditional and cloud ERP systems are generalists. They can

adjust to procedures in a variety of sectors. These solutions offer a high level of

customization and integration to meet the needs of various industries. It's also not

surprising, given the fact that generalist ERP vendors are among the biggest.

NetSuite ERP is an example of this type of ERP solution.

2. Open-Source ERP: Companies with in-house tech teams can use open source

ERP solutions like Odoo ERP to develop and connect their apps into the ERP.

Because the ERP may churn out highly customizable procedures, open-source

boosts usability and user acceptance for developers.

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 3. Industry-Specific ERP: These ERPs strive to specialize in a specific industry,

such as construction, grocery distribution, or retail fashion. Microsoft Dynamics

AX is one of the most well-known examples of this platform.

4. Lightweight ERP: These are cloud or on-premise ERP solutions that are available

off the shelf. Frequently, the ERP is modularized with fewer functionalities.

Lightweight ERPs such as PeopleSoft ERP service one or two business

processes and leave the others out, rather than giving a fully integrated system.

For example, it just has HRM and accounting functions, with CRM, inventory, and

supply chain management as add-ons.

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Implementation of E.R.P.

Implementing an enterprise resource planning (ERP) system is a difficult task that affects

many aspects of a company's operations. A well-thought-out implementation plan is

essential for any large effort. You can increase your chances of success by breaking

down your implementation into phases, each with its own set of goals.

In contrast, jumping into an ERP deployment without first creating a defined project

direction, scope, and structure increases the chances of subsequently facing major

issues.

The process of planning, setting, and installing an ERP is referred to as ERP

implementation. The procedure takes a few months on average, and it's complicated

because an ERP system supports and automates a wide range of operations.

To achieve a successful deployment, the company must first establish its requirements,

then find out how to restructure procedures to make use of the system, then configure the

ERP system to support those processes and thoroughly test it before releasing it to users.

To complete all of those procedures on time, proper planning and an organized, staged

implementation method are required.

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Key Challenges in E.R.P. Implementation

People and technology are both involved in ERP adoption. As a result, it may confront

both people-related and technical issues, such as resistance to change. The following are

some of the most common ERP adoption challenges:

1. Project Management: Discovery and planning, design, development, data

migration, testing, deployment, support, and post-launch updates are all phases of

an ERP project. Each step has its own set of vital activities, and all of them must

be completed on time, which necessitates precise project management.

Successful project and people management, which requires realistic expectations,

time frames, and milestones, as well as timely two-way communication, is

important for successful implementation. As with change management, executive

and other senior leaders' support is critical to overcoming this obstacle.

2. Project Planning: A realistic project plan that anticipates and addresses potential

speed bumps and minor cost overruns can ease decision-making and keep the

project on schedule. Organizations frequently underestimate the amount of time

and money required to complete a successful implementation. Scope creep—

when a company adds capabilities or features to a system that weren't originally

planned—is one of the most prevalent reasons for budget overruns, as is

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 underestimating manpower needs. Avoiding those concerns can be as simple as

developing a clear and realistic plan from the outset.

3. Data Integration: This may out to be even more difficult than anticipated. The data

could be buried in accounting systems, department-specific software,

spreadsheets, and even on paper throughout the business. Data migration that is

well-planned can assist keep the ERP implementation project on track and within

budget. It's also a chance to weed out any obsolete or redundant data that may be

lurking in the organization's older systems. Under-prioritizing data migration, on

the other hand, might result in difficulties such as erroneous or duplicate data, as

well as delays in your go-live date.

4. Data Quality: In many cases, organizations' systems include duplicate versions of

the same data. Information may be stored in a variety of formats; there may be

discrepancies; some information may be erroneous, and information may be

outdated. Before transferring data to the ERP system, ensuring data quality can

become a large effort in and of itself, involving evaluating the data, cleaning out

duplicates, and adding the missing information. Before going live with the ERP

system, the new data should be thoroughly tested.

5. Change Management: Change resistance can be a significant hurdle, so securing

early buy-in from leadership and stakeholders from several departments is critical

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 to a successful implementation. Switching to a new software system isn't the only

part of an ERP setup. It usually entails reorganizing corporate operations to take

advantage of the new solution's efficiency and productivity gains. Many employees

will have to adjust their mindsets and work methods as a result of this, which will

bring normal change management issues.

6. Cost Overruns: ERP projects are notorious for blowing beyond budgets once

implementation begins. Many businesses underestimate the amount of effort

required to implement a new business system, resulting in higher costs than

anticipated. Cost overruns are common in a variety of sectors, including

consultancy fees, data migration, and training expenditures. Companies should

budget more than they expect for these and other overlooked expenses to avoid

blowing their budgets. It's always preferable to come in under budget versus the

alternative.

7. Continuous Improvement: To meet new business demands and technology, the

solution must continue to evolve. After deployment, the project team must continue

to manage the project, resolving issues and supporting new requirements as they

arise. Because an obsolete ERP system might start to impair a company's

operations, it's worth evaluating whether it's preferable to stick with the current

system or go on the lengthy process of seeking a replacement regularly.

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Key Phases in E.R.P. Implementation

Figure 2: ERP Implementation Stages (Source: www.netsuite.com)

A typical ERP installation strategy is broken down into six phases, each with its own set

of goals. Because every business is different, the phases may differ slightly from one

another and may overlap.

1. Discovery & Planning

This phase entails conducting research and selecting an ERP system, as well as forming

a project team and specifying specific system needs. The ERP project team will be in

charge of a wide range of tasks linked to the implementation, including laying out the
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project plan and deadlines, ensuring enough resources are provided, making product and

design decisions, and managing the project on a day-to-day basis.

During this phase, the team may choose and purchase an ERP system when the firm

gets a clear understanding of its needs. One important option is whether to em ploy an

on-premises or cloud-based ERP solution. The hardware and software for an on-

premises system are purchased and installed in the data centre of the firm. Cloud-based

ERP, on the other hand, is typically delivered as a subscription service that can be

accessed through the internet, making it easier to adopt and requiring less in-house IT

expertise.

2. Design

The design phase develops a detailed design for the new ERP system based on precise

requirements and an understanding of present workflows. Designing new, more efficient

workflows and other business processes that take advantage of the technology is part of

this phase. Because users have the most intimate awareness of current business

processes, it's critical to include them in the design phase. Involving users in the design

process also ensures that they will accept the new system and use it to its maximum

potential. Gap analysis can be used to detect process subtleties and peculiarities that

may necessitate ERP software modification or workflow or process changes to better

match with the ERP system.

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 3. Development

The development phase can begin once clear design criteria have been established. This

entails setting and adapting the software to accommodate the revised procedures, as

needed. It could also entail integrating the ERP system with any other existing business

applications that aren't being replaced by the ERP system. For an on-premises ERP

system, the relevant hardware and software will have to be installed.

The team should develop training materials in tandem with software development to

assist users in adjusting to the new system. It also has to start thinking about data

migration, which can be difficult. During this phase, the project team should decide which

data to transfer, rather than migrating all previous data, much of which is likely irrelevant.

4. Testing

Testing and development can happen at the same time. The project team might, for

example, test certain modules and features, then design modifications or adjustments

depending on the results before retesting. It might also be used to test one ERP module

while another is being developed. Initial software testing should be followed by thorough

testing of the system's full capabilities, which should include allowing some employees to

use the system for all of their day-to-day tasks. This phase should also involve data

migration testing as well as first end-user training.

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 5. Deployment

During this phase, the system goes live. The project team should be ready to answer

inquiries, explain the system to users, and strive to resolve any concerns. If

troubleshooting is required, the implementation partner should be able to assist. Users

may need some time to adjust to the system and realize the expected productivity

advantages.

Some data can be moved ahead of time, while other data, such as current transactions,

should be moved right away before coming live.

Some companies want to implement all of the ERP system's modules at the same time,

while others want to start with a few high-priority modules or procedures and add others

later. To limit risk, some companies run older systems in tandem with new ERP

implementations for some time, albeit this might increase project costs and lower user

productivity.

6. Post Implementation Support & Updates

During this phase, the project team may still be in charge of the ERP system, but its focus

will shift to listening to user feedback and making adjustments to the system as needed.

As new features are added to the system, extra development and configuration may be

required. The system will also need to be taught to new employees.

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Periodic software updates will be required with an on-premises ERP system, and

hardware may also need to be changed over time. In a cloud-based ERP system, the

vendor may be able to automatically update the software.

For every company, implementing an enterprise resource planning (ERP) system is a

huge step. Because an ERP implementation is such a large project with such a broad

impact, it's critical to follow best practices at every stage to ensure that the ERP

deployment goes smoothly and that the business gets the maximum value from the

system. Establishing a strong project team with clear requirements, identifying specific

KPIs, establishing a project management framework that will guide the ERP deployment

to success throughout the implementation period, building a mutual understanding of the

ERP implementation goals and objectives with clear communication and a collaborative

approach, and carefully planning data migration are some of the ideal implementation

practices.

Critical Success Factors for E.R.P. Implementation

Implementing an ERP system is neither a cheap nor a risk-free endeavour. Because of

the potential for implementation issues, 65 per cent of executives say ERP systems have

a moderate likelihood of damaging their organizations. As a result, it's important to look

into the aspects that will, to a large degree, influence whether or not the implementation

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is effective. Several authors have identified several elements that can be deemed crucial

to an ERP implementation's success. The most well-known of these are listed below.

1. A clear understanding of business goals

ERP projects necessitate the creation of a clear, compelling vision of how the firm should

run over the next three to five years to satisfy customers, empower workers, and enable

suppliers. Goals, objectives, and deliverables must also be clearly defined. Finally, the

company must describe why the ERP system is being introduced and what essential

business needs it will answer.

2. Committed top management

Top management must provide strong leadership, dedication, and participation for

successful implementations. Because executive input is essential when analyzing and

rethinking existing business processes, the implementation project should include an

executive management planning committee that is dedicated to enterprise integration,

understands ERP, fully supports the costs, demands payback, and champions the

project. Furthermore, the project should be led by a well-known executive-level project

champion.

3. Project Management

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Successful ERP deployment necessitates excellent project management on the part of

the firm. This comprises a clear definition of goals, the creation of a work plan and a

resource plan, as well as meticulous project tracking. Furthermore, the project plan should

include ambitious, but realistic, schedules that instil and sustain a sense of urgency.

4. Change Management

ERP implementations may result in significant cultural shifts. To support the

organization's goals, an ERP system may necessitate the reengineering of core business

processes and/or the development of new business processes. To maintain the efficacy

of the reengineering efforts, altered processes necessitate a matching realignment in

organizational control. Most functional domains and many social systems inside the

company are affected by this realignment. Organizational structures, rules, processes,

and people may all be impacted dramatically as a result of the changes.

Denial, resistance, and anarchy will be predictable results of the changes brought about

by the implementation if people are not properly prepared for them. However, if suitable

change management practices are used, the organization should be able to make use of

the new ERP system's benefits.

5. Implementation Team

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The implementation team is critical since it is in charge of developing the project's first,

detailed project plan or overall schedule, allocating responsibility for specific activities,

and determining due dates. The team also ensures that all relevant resources are

available when they are required.

ERP implementation teams should be made up of top-tier individuals recruited for their

abilities, past achievements, reputation, and adaptability. These individuals should be

entrusted with making key decisions. Management should interact with the team

regularly, but it should also allow for empowered, quick decision-making.

6. Accuracy of Data

For an ERP system to function correctly, data accuracy is essential. Because ERP is so

interconnected, if someone inputs incorrect data, it can have a negative domino effect

across the entire organization. As a result, in an ERP deployment, users should be

educated on the importance of data correctness and proper data entry techniques.

7. Extensive End-User Training

ERP implementation necessitates a critical mass of knowledge for individuals to be able

to address problems within the system's framework. End-users must correctly use ERP

before the full benefits of the system may be realized. End-user training should begin

early, preferably well before the installation begins, to ensure success. Top management

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must be completely committed to allocating sufficient funds for education and end-user

training and including it in the ERP budget.

Post-implementation training is also required. Periodic meetings of system users can aid

in the identification of system flaws and stimulate the sharing of knowledge gained

through experience and increased familiarity with the system.

8. Performance Measures

Performance measures for evaluating the new system's impact must be carefully

designed. Of course, the metrics should show how well the system is working. However,

the measures must be developed in such a way that all functions and persons are

encouraged to engage in the desired behaviours. On-time deliveries, gross profit margin,

customer order-to-ship time, inventory turns, vendor performance, and so on are

examples of such metrics. The project must be continuously supervised until it is fully

implemented. The system must be measured and monitored at all times.

9. Multi-Site Implementation

A phased approach is typically thought to be desirable in a multi-site installation. This is

because the success or failure of the first attempt at implementation often determines the

project's overall fate. As a result, the management team can get traction by picking a pilot

site with a high chance of success. And, if ERP is implemented in stages ––module by

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module, department by department, or plant by plant––the experiences acquired at the

first sites can help with later implementations.

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 III. Objective

Enterprise Resource Planning (ERP) streamlines all the major business processes of an

organization onto one single platform. Organizations implement these systems intending

to optimize their business processes and improve business performance. But the

successful implementation of ERP depends on various factors as discussed before.

Therefore, this report on Understanding the Critical Success Factors for

Implementation of Enterprise Resource Planning (ERP) through Case Studies is

necessary for the managers to understand these factors through real-life case studies of

various organizations.

It was necessary to understand what goes into the implementation of ERPs as these are

time consuming and expensive projects. These projects require proper planning, project

management and commitment from the organization to provide positive results to the

organizations. These projects have the potential to significantly improve organizational

efficiency, thus, allowing the businesses to earn more profits and expand. Hence, this

study was done to understand the factors behind the successful implementation and

highlight their impact on the organizations.

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 IV. Research Methodology

An exploratory research methodology was adopted during the research. The study was

done using secondary data collected from relevant research papers, websites, and

textbooks. Comparative research on case studies was done to explore the critical factors

enhancing the performance of the organization. Various case studies/stories of

successful ERP implementations were studied to understand and assess the strategic

impact of the implementation of ERP on business performance. These case studies

depict how organizations of different sizes and scales have different kinds of

requirements. It also puts light on what it takes to successfully implement an ERP

software and what kind of benefits different organizations can reap with the successful

implementation. Finally, based on case analysis, a relationship was established between

different factors contributing to the successful ERP implementation.

For example, in the case of Teabox, an Indian Start-up, the management lacked

experience in fields like inventory management, order processing, etc. The introduction

of ERP in their organization streamlined all these functionalities into one software and it

became easier for the management to operate effectively.

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 V. Case Studies

Fulton & Roark

Fulton & Roark, a men's grooming products retailer based in North Carolina, kept track of

its inventory in a spreadsheet and its financial data in Sage Live, a desktop accounting

software. When revenues began to double year after year, the company's leadership

realized that its current processes couldn't keep up. Spreadsheets couldn't account for

fluctuating inventory costs, and accounting software lacked the procedures required to

track the cost of goods sold (COGS), a crucial financial indicator.

As a result, the company's co-founders opted to deploy NetSuite ERP to concentrate all

work in one spot. The implementation process took three weeks to complete. And,

according to the members of the team, the changes were noticeable right away. Fulton &

Roark was able to achieve the following results after implementing NetSuite ERP:

 Recognize and fix inventory-related bookkeeping errors.

 Stop working with outside accountants, and which led to an increase in the unit

and dollar volumes with no additional staff.

 Increase revenue by about 50% year over year without hiring more people.

 Obtain a more accurate picture of margins and inventories, which aided in the

expansion of its online business.

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N&N Moving Supplies

After expanding from one site in Georgia to three locations in different states and more

than quadrupling its staff, N&N Moving Supplies, a family-run distributor of moving

equipment and supplies, successfully deployed an ERP system.

It was practically hard to preserve correct time records and reconcile payroll with general

ledger accounts while using QuickBooks and third-party payroll services. As a result, N&N

relied on ERP to run its accounting and payroll operations. N&N partnered with a NetSuite

partner to add a time-clock solution to the primary system during the NetSuite ERP

deployment process.

Through NetSuite ERP, N&N was able to:

 Reduce the time it takes to process payroll by 84 per cent.

 Faster account reconciliation.

 Improve the accuracy of counting hours and vacation time.

 See how labour costs have changed over time in each of the company's three

sites.

 At each of its locations, give staff access to individualized ERP dashboards via

iPads.

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Green Rabbit

Green Rabbit is a supply chain logistics company that specializes in delivering perishable

goods quickly. Various food corporations were interested in their self-designed heat-

sensitive supply chain. The company's present operations, which relied on QuickBooks,

Excel, and email, were put to the test. Green Rabbit's many databases were unable to

communicate with one another, preventing real-time data analysis. The warehouse was

also frequently in need of assistance from the IT department.

As a result, Green Rabbit picked NetSuite ERP, and the company was up and operating

on the system in three months thanks to the NetSuite professional services team.

Green Rabbit was able to:

 Assist customers in shipping candies, snacks, and other items across the country

in 24 hours or less, while avoiding inventory errors.

 Deliver tens of thousands of orders every day on time.

 Instead of risking errors from manually entered data, get guaranteed error-free

data from its ERP system.

 Have the ability to increase its order volume without affecting its systems, if

required.

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Zerodha

Zerodha is India's largest stockbroker, with the lowest, most affordable brokerage rates

for futures and options, commodity trading, equity, and mutual funds. It manages billions

of records in its database, including 1.5 billion general ledger entries, 9 billion invoice

items, 4.5 billion daily records, and 2 million customers.

The Zerodha team was seeking an open-source ERP platform to manage their HR

activities when they came across ERPNext. ERPNext's flexibility allowed it to be quickly

implemented at Zerodha with minimal customizations, and users were able to take up the

user interface with little training. ERPNext runs their entire business, from ledgers to

stockbroking compliance to support and HR.

Through ERPNext, Zerodha was able to:

 Streamline all HR operations into a standardized workflow, allowing them to quickly

create forms and applications in response to the company's ever-changing

business needs.

 Streamline the process of business development for them.

 Ensure that the UI and UX of their internal applications are consistent.

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Teabox

Teabox is an Indian tea company that distributes Darjeeling, Assam, Nilgiris, and

Nepalese teas and tea-based items. Their single-origin teas are well-known. Mountain

rose and Darjeeling musketeers are two of Teabox's most popular teas. Moroccan mint,

Ivory geranium, Darjeeling spring plus tea, and summer musketeers are among the green

or distinctive blends available in India.

It was difficult for the start-up to manage inventory, solutions, and orders because it lacked

the necessary experience. Teabox's processes are complicated because it is a

manufacturing company. They get tea and ingredients from all over the world, deal with

a variety of suppliers, and each ingredient has a distinct shelf life that necessitates

preservation in a certain way. They needed a solution that could manage these tasks for

a reasonable price. Their several verticals each had their own set of apps, which were

managed by different departments. Apps for quality, logistics, accounting, orders, and

inventory were all different.

SAP and Oracle were considered by their management, but the costs were prohibitive.

Teabox is a young firm, thus they couldn't afford to invest a lot of money. As a result, they

chose ERPNext, which was far more cost-effective.

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Teabox chose all of the available modules, including manufacturing, buying, selling,

stock, accounts, and so on, and the project took 6 months to complete. There were two

phases to the implementation.

During the implementation, the organization had to deal with the issue of change

management. They were accustomed to using and performing tasks in a specific manner.

Change management slowed them down at first, but once the team realized the

ramifications and relevance, they became more familiar with the system and it became

easier to use.

Teabox now aspires to deliver on a global scale. They are fully utilizing modules such as

accounting, quality, and manufacturing, and are awaiting HR and website integration.

Their ambition is to sell their teas on Amazon, in India, and throughout the world. They

will be able to expand globally now that they have over 2,000 reviews. They regard the

United States to be one of their most important markets.

Indian Institute of Management, Indore

The Indian Institute of Management Indore was founded in 1996 and is the sixth in the

prominent IIM family of management schools. Academic programs, executive-

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management development programs, and faculty development programs are among the

many programs offered at IIM Indore.

The institute saw a need for a system that could support its two campuses in Indore and

Ras Al Khaimah (UAE), while also handling the various statutory and regulatory

requirements of both regions. The system required to be scalable to accom modate

growing programs and offerings.

Business Issues faced by IIM-Indore

 Students' records, timetables, faculty availability information, student feedback,

and exam results were all kept in Excel spreadsheets. It was difficult to keep track

of data from numerous programs and a large number of students and faculty

members.

 Students would submit written requests or emails to the academic staff for various

types of leaves. It was difficult to keep track of student's leaves. The student leave

application process was ineffective without this information.

 Employee information was kept on a manual basis. All of the approvals were done

on paper. This led to a waste of manual labour. Reporting requirements required

time because of manual records.

 For day-to-day operations, the purchase and inventory management department

relied on a legacy system. In these processes, a lot of manual labour was required,

as well as a lot of paperwork. Various levels of approvals were required in the

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 approval of Purchase Requests/ Purchase Orders, etc. It was laborious and time-

consuming to track and manually follow up on the same.

IIM-Indore switched to TCS-ION to automate their processes. With the help of TCS-ION,

they were able to:

 Change the registration process for students to choose their subjects and faculties

online.

 Digitize the timetable, as well as online attendance tracking and faculty feedback.

 Capture, process, analyze, and preserve student transcripts in an efficient and

scalable manner.

 Deploy Self Service Module for students for leave application, viewing their grades

online.

 Make the leave application process easier for employees through the HRMS

module.

 Simplify the reporting process by generating reports on demand.

Key benefits achieved:

 Data redundancy was reduced, resulting in accurate data availability.

 Manual activities and follow-ups were reduced.

 Staff and students benefitted from increased transparency.

 Collaboration between faculty and students was improved.

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  Data and information could be accessed at any time and from any location.

Rialto Enterprise Ltd.

Rialto Enterprise Ltd. is a Gilette India toothbrush manufacturer. In India, they

manufacture the OralB product line for Gilette. Rialto Enterprise's main business

challenges were in the areas of procurement and quality control. Their supply schedule

was unpredictable, and the raw ingredients for their products needed to be thoroughly

inspected.

The majority of their issues stemmed from out-of-date and disconnected software.

Upgrading these programs became a frequent annoyance, with suppliers refusing to

provide help. The company eventually decided to upgrade their IT infrastructure. They

wanted to employ software that didn't need to be maintained. They also desired a vendor

who was dependable and consistent. As a result, they chose TCS-ION.

Rialto chose the iON manufacturing solution, which was integrated with Finance,

Accounting, Payroll, and HRMS systems. They got a highly integrated program that

covered all applications and didn't require any maintenance. It allowed them to readily

expand in terms of consumers and applications. After implementation, the vendor

provided a 24x7 toll-free number for support.

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The Hershey Company

The Hershey Company, also known as Hershey's, is an American multinational

corporation that is one of the world's leading chocolate producers. It also sells baked

goods such as cookies and cakes, as well as beverages such as milkshakes and a variety

of others that are made around the world.

Hershey's embarked on a mission to merge its patchwork of legacy IT systems into an

integrated ERP platform in 1996. It went with SAP's R/3 ERP, Manugistics' supply chain

management (SCM), and Seibel's customer relationship management (CRM) software.

Even though a 48-month implementation period was advised, Hershey's insisted on a 30-

month turnaround to install the systems by the year 2000.

The cutover was scheduled for July 1999, based on the scheduling requirements. This

go-live date fell during one of Hershey's busiest seasons when the company would

receive the majority of its Halloween and Christmas orders. Hershey's implementation

team had to cut corners on important system testing phases to meet the schedule

demands. As a result, unforeseen difficulties arose which prevented orders from flowing

through the systems when they became operational in July 1999. Hershey's was unable

to fulfil orders worth $100 million of Kiss and Jolly Rancher, despite having the majority

of the inventory on hand.

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What went wrong for Hershey's?

 Hershey's implementation team made the fatal error of putting expediency ahead

of systems testing. As a result, important data, process, and system integration

problems could have gone undiscovered until it was too late.

 Hershey's committed yet another classic implementation blunder, this time in terms

of project schedule. It attempted to cram a sophisticated ERP deployment project

into a ridiculously short time frame.

 Another crucial scheduling error made by Hershey's was timing its cutover during

the company's peak season. Hershey's expected too much of itself to be able to

fulfil peak demand when its personnel hadn't been completely trained on the new

technologies and procedures.

 Finally, instead of focusing on a single centralized solution, Hershey sought to

simultaneously deploy three distinct resource planning solutions. This caused

friction between the various operations.

These concerns produced operational paralysis, resulting in a 19% loss in quarterly profits

and an 8% drop in Hershey's stock price. For nearly nine months, analysts had lost faith

in the company's ability to keep its commitments.

Nike Inc.

Nike, Inc. is an American multinational corporation that designs, develops, manufactures,

and markets footwear, clothes, equipment, accessories, and services around the world.

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Nike opted to update their ERP system in 1999 and switched from SAP to i2

Technologies, Inc. Other manufacturers' modules were purchased for integration into a

new ERP system, including SAP's R/3 software (the strategy's basis), i2 supply software

(demand and collaboration planner), and Siebel's CRM software. Forecasting market

demand and meeting these requests in a timely and exact manner were the goals of the

new ERP software. The i2 software, which was built to assist Nike in projecting market

shifts and helps the corporation automate its major procedures, was a critical component

of this project.

Nike, on the other hand, overestimated the hurdles and dangers, failing to take the

necessary measures. Nike made several blunders, including:

 They did not hire a third-party integrator to assist them in smoothly implementing

the new system.

 They didn't waste any time implementing i2 as part of their SAP ERP

implementation. They opted to install i2 software while the legacy systems were

still in use.

 Because its software has multiple business rules and stores data in different forms,

the i2 program experienced an integration problem. To work with Nike's historical

systems, this program had to be substantially altered. A single entry could take up

to a minute to be logged by the software. As a result of this problem, the system

would frequently collapse due to the tens of millions of product numbers Nike used.

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  When it came to building an ERP system, Nike chose the "Big Bang" strategy.

 They failed to properly train personnel on new methods, resulting in an excess of

unsold shoes.

Nike experienced problems as a result of this deployment, which spread to factory orders.

When the system predicted a higher demand for Kevin Garnett-branded footwear rather

than Michael Jordan-branded sneakers, issues arose. Nike found themselves sending

thousands of unsold units, while retailers couldn't get their hands on the Air Jordan

inventory that customers wanted.

It grew into a catastrophe that resulted in a loss of more than $100 million in sales and a

20% drop in the stock price at the time. In addition, the company's health deteriorated as

the stock price dropped for almost a year.

Nestlé USA

Nestlé USA, initially, was a collection of brands, each of which operated separately.

Nestlé USA was largely dispersed at the time, but in 1991, it was reformed into a group

under a single roof of American corporate management. However, 1997 research

revealed that their decentralized strategy was causing them several problems.

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As a result, they started their own ERP project, codenamed "BEST" (Business Excellence

through Systems Technology). The completion date was set for the first quarter of 2003.

Purchasing, financials, sales, distribution, and supply chain were among the SAP

modules and Manugistics modules that will be implemented during that time. Nestle

wanted to combine operations across multiple locations, as well as centralize and control

data, through the "BEST" project.

But they made several huge mistakes and suffered roadblocks during the implementation:

 There was a failure of communication among important stakeholders.

 Employees' resistance to changes in company processes that have been altered.

 The team had failed to properly integrate the various components due to their

urgency.

 Too much emphasis on deadlines without enough planning resulted in a loss of

sight of the wider picture.

 There was far too much emphasis on technology and not nearly enough on existing

components.

In June 2000, the project was officially suspended, and the team reevaluated the project's

future. The following are the solutions they came up with:

 Rethink your company's requirements.

 Shape the project timetable to meet the needs, not the deadline to meet a set

deadline.
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  Interact with the project team and the many functional divisions.

They were able to complete rollouts by the first quarter of 2003 using the new blueprint.

By spring 2002, the organization claimed to have saved $325 million.

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 VI. Key Takeaways

The key insights from the Fulton & Roark case are that ERP implementations don't

have to take a long duration as can be seen in the case, where implementation was

completed in three weeks. The company's success story also highlights a key success

factor: commitment from management for an ERP installation. The initiative was started

by the co-founders in this example, which analysts say often leads to employee

acceptance.

N&N Moving Supplies case, mentions another important implementation success factor:

employee morale management. ERP projects frequently fail due to a lack of buy-in from

executives and other staff. N&N addressed this pitfall by delivering tailored dashboards

and, ideally, outlining their benefits to staff before installation. The case study also

demonstrates how a third-party partner can assist in personalizing the ERP system to

your company's specific needs.

When done effectively, ERP makes it easier to manage a complex supply chain, as

demonstrated by Green Rabbit's case study. The importance of ERP in terms of business

growth cannot be overstated. Green Rabbit embraced ERP after experiencing significant

growth and anticipating further expansion.

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From the Zerodha case, we understood that if the ERP software is highly adaptable

and adjustable, it becomes a lot easier to adopt. Furthermore, open-source software

enables businesses to fully tailor the software to their specific requirements and construct

several internal micro-services for use in their everyday operations.

Also, open-source ERPs give an affordable choice for growing start-ups and

organizations like Teabox to streamline their business processes with appropriate

changes. It also enables businesses to grow their operations across other geographies.

ERPs offer scalability to organizations while integrating all of their business on one

platform as seen in the case of IIM Indore. With the help of ERP, the institute was able to

digitize its manual procedures which resulted in greater transparency and collaboration.

Data redundancy was also eliminated and it became accessible from remote areas as

well.

With the help of ERP, Rialto enterprise was able to update their IT infrastructure and use

it without any responsibility of maintenance, which was undertaken by the vendor.

Nestle USA's case highlights the importance of not just introducing correct individuals but

also emphasize the need for communications between the divisions and the project

team. The project timelines should be realistically decided according to the goals of

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the project. There should be no compromise with the training and testing phase of

the project. It is vital to choose the right business procedures for reengineering.

Unnecessary re-engineering of all the procedures will attract resistance from employees.

Two essential lessons can be learned from Hershey's case. First, an ERP deployment

should not be rushed to meet an unrealistic deadline, as this would result in crucial

concerns being neglected. Testing phases serve as safety nets and are an important

element of the implementation process. During the testing phase, no compromises should

be made. Second, even in the best-case scenario, never schedule go-live during peak

seasons. There will always be steep learning curves and operational performance

drops while implementing ERP. The corporation earns slack time to iron out any flaws

by scheduling the go-live during off-seasons. Another benefit is that staff will have more

time to master new business procedures and systems as a result of this.

Finally, we learned from Nike's experience that patience is a necessary virtue when it

comes to ERP software adoption. Nike hastened the installation of i2 software because

it wasn't part of their SAP ERP project, resulting in incompatibility issues. The "Big-Bang"

strategy should never be used, as Nike did. They could have detected the issues

before the scheduled go-live if they had attempted phased rollout and rigorously tested

modules. It is also critical for an organization to recruit outside specialists and

consultants to ensure a successful ERP deployment.

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 VII. Conclusion

This study was done with the purpose to study a few successful and a few failed ERP

implementations. The main objective was to understand what led to the success and

failure in the implementation of ERP and understand the critical factors that played an

important role in the implementation. The study also tried to highlight some of the benefits

achieved by the organizations after they successfully implemented the ERP.

The key to achieving success in an ERP implementation project is the 9 critical success

factors namely, Clear understanding of business goals, Committed top management,

Project Management, Change Management, Implementation Team, Accuracy of Data,

Extensive End-User Training, Performance Measures, Multi-Site Implementation.

There are a variety of ERP systems available in the market. Thorough research must be

done by the organizations before finalizing a vendor for their ERP implementation. Each

company faces different kinds of challenges during and after the implementation of ERP.

Patience and proper planning are required to navigate through these challenges.

An ERP implementation project is considered to be successful if it achieves a significant

part of the business goals it was required to achieve. Another metric that can be used to

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measure the success of the ERP is the ROI achieved by the organization after the

implementation.

Enterprise Resource Planning is a complex project which requires patience, commitment,

proper planning and monetary investment. From the cases studied, it can be concluded

that ERPs are powerful tools that, if implemented properly, will have a positive impact on

organizational performance.

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 VIII. Limitations & Future Scope

This study is based on the case studies available on the websites of some of the most

famous ERP vendors. While the study covers different types of organizations, one must

also study the success factors for ERP implementation across various fields like

manufacturing, retail, finance, IT, supply chain, etc.

The case studies are provided from the perspective of the ERP vendors only. Therefore,

a detailed study involving primary research on the companies which have implemented

ERP must be done to understand the effectiveness and benefits of the ERP

implementation.

With the oncoming of the COVID-19 situation, many companies are focusing on cost-

cutting and optimizing their operations. A study on how ERP can help organizations

navigate through the challenges of COVID-19 will be valuable for the organizations.

COVID-19 situation may have also affected the willingness of organizations to implement

ERP as it requires lots of monetary investment. Hence, a study on a company’s

willingness to implement ERP during COVID-19 and challenges faced during this situation

can also be done.

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 IX. References

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Caldwell, A. (2020, October 2). 7 Key ERP Implementation Challenges and Risks.

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Fargreatco, B. (2019, October 21). ERP Implementation’s failure cases (Valuable

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Fruhlinger, J., Wailgum, T., & Sayer, P. (2020, March 20). 16 famous ERP disasters,

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Schwarz, L. (2020, September 25). 6 Key Phases of an ERP Implementation Plan.

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