Issue : SAP or ACCPA

for ATLAM
ATLAM need to consider their fund, facilities
and expertise before make decision.
The problems arise are

The implementation SAP will create many

challenges, risks and higher cost.
There is lack of asset such as personal
computer for installing SAP system.
The key personnel of ATLAM involved in
implementation phase do not have expertise
in using SAP

Issue: Resistance to Change

there are several reasons the ATLAM is resistance to change at
that time.

lack of information about SAP system

Lim understanding is SAP system is only suitable for manufacturing

industry and this system was costly compared to ACCPAC.

lack of resource to implement SAP system - funds, equipments, spaces, and intelligence resources

they are not enough PC in the departments

they do not even have the space available to house the system
some of the employee inATLAM have never used a Personal
Computer before and lack of the knowledge about information
technology

fear of loss power when change the system in ATLAM operation

ATLAM has to link its system to PETRAs to match with their group
reporting structure so that the employees tend to change their role
and responsibilities, work processes, culture and habit.
They afraid there will be cut off positions to save the cost

Issue: Termination of Lim

Reason why zulkifli want to terminate Lim from the team

project:
Zulkifli thinks Lim is a time waster and the time waster cannot be
in the project team.
Zulkifli was afraid that Lim would influence the others with his
views.
Lim was having conflict on opinion with Zulkifli when discussing
the matter of SAP system in ATLAM.
disagreed to implement the SAP system in ATLAM because of low of fund, lack of expertise, and
short of facilities
suggest to use ACCPAC system rather than SAP system because ACCPAC is more affordable and
cost efficient

Feasibility Analysis

Economic feasibility- identify financial benefits & costs

associated with the implementing SAP
Benefit :

tangible - can be measured in dollar increase speed of activity &

reduction of error

intangible - cannot easily measured in dollar improvement of

employee morale, broader societal implication

Cost :

Tangible - hardware costs, labor cost & operational cost

Intangible - losses of goodwill, employee morale &

inefficiency

operational

Operational feasibility

process of examining the possibility which proposed system will likely to solve
the problem

as the current system cannot produce financial reports, thus by implementing

SAP it can make the system more efficient because it allow segmental reporting

implementing SAP will cause a changes in work process, culture & habit but it is
hard because the staff already familiar with their work scope.

Technical feasibility
provide necessary information to enable the company to make conclusions regarding the
systems potential.
ATLAM must identify & evaluate whether SAP system will perform effectively, reliable &
capability of resources to utilize SAP system.

The risk assessment of SAP system are based on :

1)

Project size larger project, higher risk.

- large and left limited time lead to higher stress.

2) Project structure PETRA group will provide applicable system to ATLAM in

order to match with the group reporting structure.
3) Development group & user group For development group the risk is
higher compared to user group. User group only has lower risk since it never
been used before.

Schedule feasibility
all potential frames & schedule that used by company to estimate time
of a project.
ATLAM may choose to use Gantt Chart on schedule the
activity that
need to be completed within 7 weeks.

Political feasibility
how key stakeholders within the organization view or respond to the
proposed system.
Those stakeholders that not support the project may try to disrupt it.
For ATLAM, the key stakeholders is their own staff. If they refuse to
change, it will disrupt the project implementation.

INITIAL OUTLAY
COST

RM

Initial Software

1,000,000

Hardware

2,000,000

Software License

1,000,000

Training

1,271,550

Customization Work
TOTAL COST

72,840
5,344,390

PAYBACK PERIOD
YEAR

CASH FLOW
(RM)

CUMMULATIVE CASH
FLOW
(RM)

(5,344,390.00)

(5,344,390.00)

540,000.00

(4,804,390.00)

1,336,598.71

(3,467,791.29)

1,949,627.15

(1,518,164.14)

2,072,273.92

554,109.78

2,486,940.79

3,041,050.57

2,878,916.92

5,919,967.49

3 + (cumulative cash flow year 3 / cash flow year 4)

3 years + (1,518,164.14 / 2,072,273.92)
= 3 + 0.73
= 3.73 years

NET PRESENT VALUE (NPV)

YEAR

CASH FLOW
(RM)

PVIF @ 10%

PRESENT VALUE
(RM)

540,000.00

0.9091

490,914.00

1,336,598.71

0.8264

1,104,565.17

1,949,627.15

0.7513

1,464,754.88

2,072,273.92

0.6830

1,415,363.09

2,486,940.79

0.6209

1,544,141.54

2,878,916.92

0.5645

1,625,148.60

TOTAL PRESENT
VALUE

7,644,887.28

Net present value (NPV) = RM 7,644,887.28 RM 5,344,390.00

= RM 2,300,497.28

INTERNAL RATE OF RETURN

(IRR)

GANTT CHART SAP

IMPLEMENTATION SYSTEM FOR
ATLAM Duration(days) End Date
Task
Start Date
Develop SAP workplan and budget

22 JAN 02

26 JAN 02

Forming SAP development team and

executive

24 JAN 02

26 JAN 02

Perform Feasibility study of SAP and

capital budgeting analysis

26 JAN 02

1 FEB 02

Configuration of new SAP system

31 JAN 02

14

15 FEB 02

Pilot Testing

15 FEB 02

20 FEB 02

Training employee

20 FEB 02

25 FEB 02

Implement within organization

25 FEB 02

30

26 MAC 02

Prepare Analysis Report

26 MAC 02

01 APR 02

GANTT CHART SAP IMPLEMENTATION SYSTEM FOR ATLAM

Develop SAP workplan and budget

22
JA
N

1 FEB

11
FEB

Forming SAP development team and executive

Perform Feasibility study of SAP and capital budgeting analysis

Configuration of new SAP system

The tasks that make up the SAP implementation project

Pilot Testing

Training employee

Implement within organization

Prepare Analysis Report

The total time (days) of the SAP implementation project in each task

21
FEB

3
MAC

13MA
C

23MA
C

1 APR

How to Overcome Staff Resistance

Communicate Early
Before implementing the SAP system, Zulkifli need to communicate
with the ATLAMs staffs so that the staffs will be prepared and ready
for a major changes.

Communicate Often
communicate consistently about what is happening and seek for
the staffs feedbacks.
meetings and email updates are just a few way they can use to
make sure ATLAMs staffs are well informed about the current news.

The impact of SAP System For Them

the changes will improve the companys performance and help
ATLAMs staffs perform their work
Able to integrate data and access that data quicker so that it is
good for decision making.

 Provide Adequate Training

ATLAM needs to have effective communications and high
quality training since some of the staffs have lack of
knowledge on technology.
The purpose of training is to ensure that ATLAMs staffs cope
well with the changes and make a smooth transition to the
new working processes.

Get Them Involved

involved the key users by asking for their opinions on the
system requirement and then involve them in system
demonstrations.
So that, they can contribute their ideas and expertise and
bringing them on the right side as well as helping fellow
ATLAMs staffs become comfortable with the new
technology.

COMPARISON BETWEEN
ACCPAC
ACCPAC
- OLD SYSTEM VS SAP
SAP SYSTEM
NEW SYSTEM
FAST TRACK SOFTWARE AND READY
TO USE

IMPLEMENTATION WILL TAKE

MONTHS

READY VENDOR SUPPORT SYSTEM

IN HOUSE SUPPORT PETRA

GROUP

CLOSE RESEMBLANCE OF PETRA

CHART OF ACCOUNTS

STANDARD CHARTS OF
ACCOUNTS WITHIN PETRA GROUP

COMPLEX SEGMENTAL REPORTING

NO PROVISION SEPARATE COST
CENTRE - REQUIRES ADDITIONAL
SOFTWARE

COST CENTRE COULD

MAINTENED SEPARATELY
ALLOW COMPLEX SEGMENTAL
REPORTING EG DIVISIONAL P&L ,
VARIANCE ANALYSIS

NO PROVISION FOR INTERGRATION

ACCOUNTING DATA WITH OTHER
PETRA UNITS.

PROVISION FOR INTERGRATION

OF DATA EG E-BILLING

SYSTEM BACK UP DONE MANUALLY

STRONG IT SUPPORT

AUDIT POINT RAISED DURING

PROCUREMENT PROCESS MIGHT NOT

AUDIT POINT RAISED DURING

AUDIT PROCESS MIGHT

 Did Zulkifli do the right thing when he intended

to kick Lim out of the project team due to
unsatisfied of Lims behaviour??

CONCLUSION
1. After we do for the analysis and evaluate the
usefulness of SAP system project, we
recommend thatATLAM should implement the
SAP system as soon as possible. The
implementation of SAP system would bring a
lot of benefit for ALAM in the long term view.
Cost
calculations of after-tax cash flow - positive in these 6 years show that this system
will generate more cash than the cost of its initial investment
net present value - positive value and the implementation of SAP systems requires
3 years and 7months to recover the initial investment
internal rate of return

 Time constraint
Resistance to change
Zulkifli need to solve the problem arise in good manner. He needs to analyse
the problems that might arise and find the best solution to handle the problems
with care as well as understand the situation that the staffs will be faced if
ATLAM implement SAP system.

2. We are not suggesting Zulkifli to kick Lim out

from the project team because :
Lim was contributed a lot when having the discussion.
Lim is very experienced and expertise person and he
brought the issues that are important and should be
take into consideration.