m




 
  


 



By
Rohit Garg (09609137)
Shretima Gupta (09609138)
Archit Bansal (06503879)

28-Sep-10 THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN 1

INTEGRATIVE FRAMEWORK



 

ë pt is a useful tool that businesses are turning to, in order to build strong

capabilities, improve performance, undertake better decision-making, and

achieve a competitive advantage.
ë Half of ES implementations fail to meet expectations.
ë Organizations adopting ES certainly acquire benefits such as an increase
suppliers¶ and customers¶ satisfaction and an increase in productivity but the
level of (ROp) is rather low.
ë The important issue concerning managers is the appropriateness of ES to
meet organization¶s needs.
ëThe study provides a research framework of the critical issues involved in ES
THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN
adoption process INTEGRATIVE FRAMEWORK 2
28-Sep-10




ë Technological, business and organizational

contexts should be studied in a unified way, which
encourages the examination of interrelated key
success factors.
ë The certain issues such as unsuitability of ES
modifications to meet institutionalized business
operations and the extent of business processes re-
engineering required prior to the implementation of
the software.
ë pn traditional pS development theory, the software
has to fit in to certain business processes, probably
adopting and reproducing organizational
inefficiencies.
ë pn order to develop a framework of ES adoption
following issues should be considered.
Modification of the standard ES configuration
options to fit business processes is costly, risky,
time consuming and difficult. THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN
28-Sep-10 3
INTEGRATIVE FRAMEWORK
 
m
m 

ë

Ô pts aim at making the organization
more flexible and responsive to customer needs.
A key factor is the identification of the degree to
which the adoption of an ES contributes to
business strategy of the organization
ë The degree is difficult to assess in quantitative
terms, a qualitative assessment possible by
interviewing on basis of qualitative techniques
such as Likert type scales.
ë Simulation, probability and sensitivity for
assessing the relative importance of alternative
options.
ë For example, business processes integration is a
strategic activity as long as integration has an
impact on the competitive position of the
organization, while at the same time is also
operational as long as it results in cost reductions
in the daily activities of the organization. THE ENTERPRISE SYSTEMS IMPLEMENTATION: 4
28-Sep-10 AN INTEGRATIVE FRAMEWORK
 

ë


   Ô The evaluators should
consider the impact of ES on external
stakeholders, specifically the customers,
suppliers and business partners. Alliance is one
of the strategic benefits incurring from ES
implementations. The co-operation between
business partners is essential .

ë  

!  Ô pt is important that

both tangible and intangible assets and
hidden costs should be taken into account
from the outset when considering ES
projects. Underestimation of the time it takes
to implement an ES . Consultants¶ fees,
personnel training, data conversion, to name
but a few, can be a very heavy burden on the
budget for supportive activities.
THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN
28-Sep-10 INTEGRATIVE FRAMEWORK 5
½" #m ½ $%m
| A major implication of ES deployment is that it involves drastic changes in
the organizational structure, business processes and the people of an
organization.
| The re-engineering exercise is undertaken with the aim of achieving the
optimization and integration of business processes according to the
software¶s inbuilt best practices.
| Thus, in so far change management is effective, competitive advantage and
financial returns on investment are expected

THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN

28-Sep-10 INTEGRATIVE FRAMEWORK 6
a
a







a


  m ½½m 



&
½

| Starting point of Enterprise Systems initiation/acquisition.

| Required for effective IT/IS project implementation.
| Clarifies the organizationǯs direction, goals, and the business model
behind the implementation of the project.

THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN

28-Sep-10 INTEGRATIVE FRAMEWORK 7
½$% "'
&
(%  m 
'
½
m m

For successful implementation of the ES systemÔ

| The decision concerning the adoption of an ES has to be made according to

both the current and the future status of the enterprise.
| A detailed critical ES functionality and enhancements requirements matrix,
followed by a list regarding the organizational and technological changes
should be developed and evaluated according to certain criteria.
| Companies should avoid the design of a system that the ES software is
capable of providing but which is beyond the capabilities of the company to
absorb as a daily routine.
| A well defined set of objectives and an on-going commitment to meeting
them are essential from the outset of an ES project.

THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN

28-Sep-10 INTEGRATIVE FRAMEWORK 8
)$%*" m ' 
For this company, re-engineering for ES involvesÔ
| Extracting the best finance, logistics and sales practices from
multiple divisions
| Then standardizing them into an integrated ES system that
could provide business consistency, such as credit terms, across
all company¶s divisions.

THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN

28-Sep-10 INTEGRATIVE FRAMEWORK 9
 BUSINESS REQUIREMENTS
Effectiveness of ES requiresÔ
| Collaboration between partners
| Coordination of decisions
| Accurate and real-time information flow in a
network of enterprises.
| A radical change in business processes, towards
simplification and efficiency, must take place.
| Critical factorÔ the desire and the commitment
to continuous change not only by top
management but also by the steering
committee, the systems¶ users and by all
members of the project¶s implementation team.
| pn case of high risks ES acquisition will have to
be postponed or rejected.
| E.g.- Dell Computer Corp, in which the
implementation of SAP R/3 had to be
terminated, in view of the company¶s CpO¶s
conviction that a single monolith software
could not keep pace with the company¶s growth
THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN
28-Sep-10 INTEGRATIVE FRAMEWORK 10
½
m m

Î Technical
The Î rganizational
constraints Î
uman
are classified Î inancial
in five Î Time
categories: constraints.

THE ENTERPRISE SYSTEMS

IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 11
 Costs incurring from using multiple
hardware and software platforms.

Scalability and flexibility of

the pT infrastructure.

changes in the pT infrastructure

± to support the ES system.

THE ENTERPRISE SYSTEMS

IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 12
½+ 
These includeÔ
| the degree of decentralization
| the management structure
| the style of leadership
| the rigidity of business processes
| the company¶s culture.
| resistance to change
| prestige , job security feelings and departmental
politics.
THE ENTERPRISE SYSTEMS
IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 13
 ,
,

 
A cross functional team
consisting of both business
and pT is required.
Lack of experienced and
trained employees is also a
major constraint.

THE ENTERPRISE SYSTEMS

IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 14
 
m
 
A project should have
adequate financial resources
as there are many hidden
costs which may prove to be a
barrier to successful
implementation .

Unrealistic time frames

and deadlines may add
unnecessary pressure and
lead to project failure.

THE ENTERPRISE SYSTEMS

IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 15
%,&

,


,
ë This phase includes selection of ES modules that support critical business
functions.
ë Certain weighted criteria for the selection of vendor, product and
implementation partner should be set and evaluated at this phase.
ë Characteristics, like multi-language and multicurrency capabilities can be the
key drivers for selection of an ES.
ë The availability and functionality of additional applications to support current
and future business needs such as SCM or CRM is an important factor in ES
software selection.
THE ENTERPRISE SYSTEMS
IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 16
 THE ENTERPRISE SYSTEMS
IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 17
- -½&
( 
m-½- '

½m.

--

-!-/


AdvantagesÔ AdvantagesÔ
| Provides system robustness | Provides increased functionality.
| Additional functionality to support | Companies can rely on more than
company¶s operations. one vendor.
DisadvantageÔ E.g. Boeing Commercial Airplane
| Risk of relying on only one Group has adopted the best-of-
vendor. breed approach by implementing
E.g. Colgate-Palmolive¶s SAP R/3 demand-forecasting software by i2
solution, which integrated the Technologies, ES by Baan and
processes of the company and product data management by
connected ten thousand users Structural Dynamics Research.
worldwide after a 5-year
implementation effort
THE ENTERPRISE SYSTEMS IMPLEMENTATION: AN
28-Sep-10 INTEGRATIVE FRAMEWORK 18
 ½
½
ë The decision to acquire an ES and the adoption process is becoming

increasingly complex in a changing and competitive environment.

ë Enterprises pursuing systems integration should evaluate and select systems that
contribute to this goal without sacrificing the functionality of applications they
believe are crucial for their business.
ë Careful adoption process of vendors, products and services provided is
necessary .
ë However the final decision has to be made considering the amount of
organizational change required for the adoption and the implementation of the
selected ES.
THE ENTERPRISE SYSTEMS
IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 19
 THE ENTERPRISE SYSTEMS
IMPLEMENTATION: AN INTEGRATIVE
28-Sep-10 FRAMEWORK 20