Riordan Manufacturing Proposal 1

Riordan Manufacturing Proposal

University Of Phoenix

CIS/319

Cornell Perry

September 26, 2005

Introduction
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There are many compelling reasons to pursue deployment of an IT infrastructure

in the business world today. Most enterprises already have a IT infrastructure in place,

and are now taking the lessons they've learned from previous efforts to remedy

problematic areas like data quality and infrastructure standardization. At the same time,

many enterprises are also moving toward the next steps in the evolution of IT

infrastructure and are adopting new technologies and approaches such as data

management and computerized controls. Riordan Manufacturing would benefit

tremendously by the implementation of an IT infrastructure. Currently, Riordan

Manufacturing is suffering from corporate inefficiency that is detrimental to revenue and

long term financial goals. An IT infrastructure would solve many of these problems.

Cost savings would be realized through the reduction of duplicated efforts and service

offerings across the corporation, lower maintenance support because of consistent

hardware and software applications, and structured communication channels between

departments and a newly formed corporate IT department (CIT). A CIO will provide

technical leadership for IT related issues and Cost Centers will be created at each

installation to adhere to strict purchasing guidelines. In addition, the CIO will establish

Riordan Manufacturing’s online presence with an emphasis on streamlining processes,

such as manufacturing and distribution, so they can do business more efficiently with

their resellers and suppliers. While short term financial goals will be impacted by this

sizable project, the long term health of the company will benefit from this necessary and

important step.
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Riordan Manufacturing strives for continued profits and market share for the year

2006. A 50 million dollar sales revenue figure is an approachable goal. However, the

company needs to streamline processes, as short and long-term goals will be increasingly

difficult to achieve using current standards. The problem analysis will focus on

streamlining finance and accounting departments, employing sales and marketing

upgrades, and overall, information technology implementation in all departments.

Finance and Accounting documentation errors lead to inaccurate data and costly

retroactive audits. Major compatibility issues exist as each major division of the

company uses a different system. The Georgia and Michigan plants use different

accounting systems and the corporate center in San Jose uses a different system as well.

Delays in financial reporting are common which lead to decreased investor confidence

and lack of future capital investment. Homogeneous finance and accounting software

must be implemented in all divisions with timely and accurate information reported to

corporate headquarters in San Jose.

Finance and accounting purposes need to be broken up, identified, and then

maintained by various software and hardware packages. Accounts payable, accounts

receivable, order entry will be maintained by one system, and a suitable software package

will be found to meet all the above options. A single server, with mirroring will suffice

for the above needs, and of course; a proper backup solution will be needed for

safekeeping of this data. Various software packages are out there that could handle the

above needs. Microsoft has a few that could be explored. These include Solomon and

Great Plains. Others may also be explored, with one being settled on by price, and

functionality. All this data needs to be made available to the headquarters in California at
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a moments notice. The software will need to be able to be run across WAN’s, so people

in California can bring up any reports they desire to see at a moments notice.

Financial reporting is the next package to look at. The Finance and Accounting

department will be responsible to keep this software up to date. The software itself needs

the ability to tie into the above software for tracking purposes, and report building. It

would run off the same server, or another could be purchased to run this piece. The data

needs to be up to date, to the second for reporting purposes to gain investor confidence.

The software will need to be able to produce reports showing financial trends, which

could be reported to California as needed, or requested. The profit and loss statement

part to financial reporting will need to work in unison with the Sales and Marketing

department to be able to share valuable financial information, such as trends, so the sales

and marketing department can adjust their consumer strategy on the fly. This can be

accomplished with electronic meeting software available on Windows based PC’s, or by

telephony-over-IP systems.

The Sales and Marketing department is in dire need of a historical and current

database. Current and past sales can then be compared and trends can be analyzed for

further profits. Currently, historical sales are stored in file cabinets. Prestigious design

awards are stored in showcases in the Marketing Department. These awards need to be

added to the website for greater visibility. Riordan Mfg. also needs a greater online

presence with a state of the art website to attract customers. Sales need to be established

online.

The Sales and Marketing department itself will be using the newly created IT

department quite heavily. They will need databases built to consolidate customer
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accounts. These databases will also need to store historical sales figures, and will need to

be able to cross-reference with table in the Financial department. These reports that

could be generated from cross-referencing sales data with financial tracking will produce

marketing reports and trends. These trends will allow sales to adjust their output, and

thus increase profit in the lines that are currently a hot item. The profits, or losses,

generated by the market trends will be relayed back to the Finance and Accounting

departments for historical use, and to set yearlong trend information.

Riordan Mfg. has grown to such a size that implementation of an IT department is

necessary for company survival. Information Technology (IT) and IT-based systems will

be an important aspect of Riordan Manufacturing normal business processes. While these

systems have enormous potential to make information much more accessible and to

greatly improve Riordan The creation of an IT department will require a setup or diagram

of the needs of the company and the expected date that it can be implemented. To assist

in this manor a systems analyst will have to be hired to formulate the specific needs base

upon location, design, needs and projections. Other criteria will also have to be

considered such as, security issues, e-commerce and automation and collaborations of

various systems. Once the specifics have been determined and implemented there will

now be systems in place to cover most of the information in terms of finance, daily

operations, sales, and global synchronization and information sharing.

Manufacturing’s efficiency, there is a need to ensure that new systems projects are

properly designed and that their implementation is effectively managed. Information

systems projects follow a life cycle consisting of several phases. Each division of Riordan

Manufacturing will be assigned a systems analyst from Corporate Systems IT (CIT) in

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San Jose, California who will interact daily with the CIO. System analysts should also

contact the Manager, Corporate Systems IT (CIT), to discuss the most appropriate phases

of the Systems Development Life Cycle Methodology to be used at each location.

Generally, Riordan Manufacturing information systems projects will require five phases

(see Figure I):

A Initiation – Estimating potential resource and cost implications and key

milestones. Any computer system that is intended to process Riordan
Manufacturing data must have a formal proposal developed. This proposal must
provide a statement of costs, a planned implementation schedule and an outline of
the technical environment needed to support the application.

B Planning

1. Analysis – Documenting the client and server requirements and determining

the feasibility of the proposed implementation and timeline.
2. Design or Package Selection – Developing a system design (if software
development is required) for each division and department. Software
development will be handled on an individual basis. However, all divisions
will have similar frameworks. For example, the Sales and Marketing
divisions at every facility will use an identical system.

C Execution – Implementation of the proposed solution. This phase includes

software development, package installation, testing, documenting and
training. The systems analysts will oversee this phase at each facility.

D Control – Executed for the life of the project. Includes monitoring progress,
updating project plans, schedule and conduct of meetings, Quality Assurance
Inspections, management of risks and issues as required, scope management.

E Support – Moving the system to a corporate production environment and

preparing for on-going maintenance and support. Corporate IT databases will
be linked to production facilities in this final phase.

Riordan Manufacturing will use Cost Centers at each facility to prevent

problematic over budgeting. Each Cost Center will relay IT expenditure to Corporate IT

(CIT). Each Cost Center will also ensure that the business and IT needs of Riordan

Manufacturing are met and will ensure that a consistent and streamlined approach to
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purchasing IT products is attained. Cost Center Responsibilities: Cost Centers will have

a significant role in the undertaking and maintenance of purchasing arrangements on

behalf of each division. This work is part of the normal budgetary and financial

reconciliation process.

a. Cost Centers will be responsible for making an informed business decision in

relation to the purchasing of a product and will make themselves aware of the
contractual arrangements in respect to warranties and will agree to abide by them.
b. Cost Centers will review the quarterly report uploaded to the intranet by CIT
detailing recorded location, item/s and payment information. It is the
responsibility of the cost center to check this information and notify CIT via email
of any changes. This procedure will be reviewed at the end of each quarter.
c. Cost Centers will be responsible for ensuring that all goods are protected,
appropriately used and maintained.
d. Cost Centers will be responsible for ensuring that funds are available for the
maintenance of IT equipment and all associated software updates.
e. Cost Centers will be responsible for reporting lost/damaged goods that are leased
to Riordan Manufacturing. CIT will forward an insurance claim form for
completion by the Cost Centers. The completed form will be forwarded back to
CIT, then onto the insurer.
f. Cost Centers will be responsible for ensuring that the product returned to the lease
supplier at the end of the lease is the same as was originally leased, this includes
but is not limited to:
i. Operating System (O/S) CD
ii. Driver CD
iii. PCMCIA card
iv. external modems
v. carry bags
vi. manuals
vii. all cables including power cables.
viii. Non-return of relevant items will incur a fee imposed by the lease
provider. The removal or rectification of any additions or modifications
will be the sole responsibility of the cost centre.
g. Cost Centers will be responsible for making certain that any leased items have
adequate warranty support to ensure that the goods can be returned to the lease
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supplier in working order. Warranty support can be determined in consultation

with CIT. Insurance coverage of leased equipment is funded centrally by
corporate IT (CIT).
The implementation of identical operating systems at all manufacturing facilities is

needed. Riordan Manufacturing must make a concerted effort for homogeneity amongst

its operating systems. First, a standardized electronic communication system must be

established between all entities. This can be achieved through a Microsoft Exchange e-

mail system. Each manufacturing facility appears to be operating individually with little

or no communication between them. All operating units will use equivalent software and

hardware with phasing in to begin immediately. Accurate Finance & Accounting records

must be kept. Computerized accounting systems will track accounts receivable and

payable. All operating units will use standardized corporate financial software to achieve

this goal. The Sales and Marketing units will need to establish an online order system.

The online retail industry is a multi-billion dollar a year entity. Riordan Manufacturing

needs an online presence. The Raw Materials & Inventory Departments will also benefit

from system-wide changes. The use of electronic controls for raw material storage and

inventory controls will save expense and time. All these implementations cannot take

place without the creation of a company-wide IT department. The IT department will be

created at the San Jose, California facility with a CIO being used as liaison with corporate

management. Each operating system will follow a structured approach to implementation

to avoid costly production interruption. A new website will be created to represent the

new Riordan Manufacturing image. All production facilities will be retrofitted with the

latest homogeneous computer hardware to complement all the software changes.

Finally, electronic sales will need to be established with an online web site. The

companies overall image could be made over with a newly redesigned website.
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Incorporating today’s technologies with an online sales engine will ensure a higher profit

margin, and greater notability in the business world. The web site could be featured in

several pertinent magazine and newspaper articles to generate buzz about the new face on

the company. This will generate new interest, and new clients and customers.

In order to streamline operations within the inventory process there are a couple

of systems within the company that will need to be improved. The first system that will

be streamlined will be the invoicing and shipping areas. These departments will input

information into a computer using either a scanner that uses OCR, by hand keying the

information into the system, or with the use of software that will take direct orders. Once

the information is inside the computer the information will be controlled through

database software. This will allow for the ease of information recall and storing, and aid

in billing and distribution. The second system will be the implementation of a barcode

reader and the use of Radio Frequency Identification Markers (RFID). This will allow

for inventory within the company to be electronically tracked; through a manual system

of scanning barcodes or an automatic system using RFID. RFID is a promising

technology in which the inventory talks to the system, with the use of RFID, the user

knows exactly where the inventory is. The use of these items will enable the third

process to be improved that will be the up to date communication about of inventory

levels. This will help to improve supply concerns that are occurring regionally.

There is a need for the company to increase sales and the projections are as high

as 50 million dollars. IT implementation will increase this projection quickly. The use of

e-commerce software and the ability to track your sales online will be an asset to the

finance department. Software like QuickBooks or much more sophisticated software can
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give you tracking and invoicing tools and provide you with tax information and overall

detailed breakdowns. This will require fewer hands on from the finance department and

will allow for more tasks to be achieved.

With more companies relying on IT to get them over the hump of financial gain

the Riordan Company is no different. With the company having multiple locations it is

necessary to have all the information compiled into one source. Databases are the

primary source of calculating and collecting and shared data throughout the networks.

Affiliation and joint ventures are crucial to investing and venture capital that is

need for the company to grow. Being involved in the securities business will definitely

bring on worldwide investors. With this company being a member of the SEC shows

worldwide investors that they have the potential for growth. As the investors become

involved the shares will increase and so will the profit margin.

IT appears to be the primary source amongst many for the growth of this

company. The infrastructure has a sound base of investors and profit that makes it a

viable company. With these options the company can attract more investors and expand

its markets to allow for the anticipated growth expected in the projections. Please see

Figure II for details about the network topography.

Finally, the stakeholders should be considered. Aside from the four basic

stakeholders involved which is the People’s Republic of China, this is a joint venture the

Georgia, Michigan, and California entities, there is additional interest both inside and

outside the company. The shareholders, who consists of banks, and lenders, customers,

workers and several divisions within the internal financial structure of the company
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everyone form the CEO to the board of directors. Other involvement comes from the auto

industry, healthcare, and the Department of Defense.

Conclusion

It is now evident that for businesses to grow and succeed, organizations and

companies need information technology to manage corporate functions. Companies from

across a variety of industries are embracing information technology, realizing the

enormous competitive advantage it provides through better data management,

standardization of hardware/software, and increased efficiency. Riordan Manufacturing

has reached a terminal point in that inefficiencies are undermining revenue and profits.

Therefore, Riordan Manufacturing needs a homogeneous IT system to regain its

competitive advantage. Similarly, in a manufacturing company such as Riordan,

activities such as customer/product enquiry, order processing, obtaining part/quotes

information from suppliers, and the like had been traditionally done using telephone,

faxes, and traditional postage mail. These activities can now be performed dynamically

with little or no human intervention by exposing functions using IT infrastructure,

thereby automating the entire work flow process. In addition, a corporate IT (CIT)

department can oversee all operations from a remote facility. In general, economists

agree that utilizing new technologies in the business place is a requisite for survival.

Overall, the intent of this report is to lay an intellectual framework for implementing

information technology applications within Riordan Manufacturing’s corporate structure.