Dora Voicu s052730
07 November 2005 Managing Financial Information Systems Projects
Case 1 - Change Management of People & Technology in an ERP Implementation
The article analyses the impact of implementing an ERP system in small-medium sized enterprises and particularly in the company called PowerIT, which is an autonomous company that produces and repairs power conversion supplies. The adoption of an ERP system without assessing the impact of the change may turn into a failure, as depicted by the article.
PowerIT management decided to buy an ERP solution from a third party vendor and modify it to match its business environment. This solution was preferred because the IT department of the company could not afford to develop such a solution in a reasonable time and with a given budget.
The system acquisition process was following the steps below. Identify need for the system: where the CEO and the financial officer investigated the need for an ERP system, since the competitors already moved to this option. They bought services from a business development manager to handle the implementation. Develop invitation to tender: where stakeholders were identified and the business process was investigated. The resources for implementing the process were also allocated. Shortlist potential vendors: where three companies were identified as potential vendors. Choose vendor’s system: where each vendor was asked to present its product. Produce detailed specification: where the requirements were detailed and the implementation schedule was defined. Roll out system: where the tailored system was taken into use by PowerIT.
The usage of the new system was not a success at all, it became to cause more and more problems and soon the management started to realize its failure. They hired a team from University of Sunderland to investigate the cause. They have given three choices: re-implement the system, upgrade it or get rid of it and replace it with something more suitable. The team found many implementation errors, after spending six months in interviewing the personnel. First, the project seemed not to be given sufficient importance by the management, and though this was reflected to the employees. Lack of social skills and coordination between different teams was another critical factor that contributed to the failure. Other factors were: the incomplete analysis of the former software (MRPII) product presentation were not professional or they missed completely and management did not take any action
Dora Voicu 07 November 2005 s052730 Managing Financial Information Systems Projects some of the critical company stuff (e.g. production manager) failed to engage with the process and did not provide the required information the tailored system was missing functionality or it was difficult to use the management did not assess correctly the impact of the changes in the system on the company personnel
The investigation report concluded that some changes are needed both at the technical and organizational levels. The software needed to be changed in order to better fit the company business processes and the organization was aligned to match the new challenges raised by the implementation of the new system.