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  • pg 1
									Implementing ERP

            Hector Ocegueda
            The Contemporary Firm
            Dr. Minder Chen
            MBA – November 2010
• Founded in 1984 by Len Bosack & Sandy Lerner, Stanford
computer scientists.
• Creators of the Router.
• By 1997 Cisco was ranked among the top 5 in Return on
Revenues and ROA by Fortune 500.
• By 1998 its market capitalization reached the 100 billion
mark just behind Microsoft and Intel.
• Don Valentine, venture capitalist hires John Morgridge as
• Cisco becomes public in 1990, original founders depart
from company.
• Peter Solvik joined Cisco in 1993 as the company’s
new CIO

• Cisco was a 500 million Co. running a UNIX based
software package to support Manufacturing, Finance
and Order Entry systems.

• Solvik’s experience and company’s significant growth
prospects convinced him that Cisco needed a change.
• RichardPond, Director of Manufacturing was
concerned in regards to the current legacy systems,
system outages became routine.

• Legacy Environment fails dramatically.

• Solvik, Pond and other managers concluded that
another approach was needed.
 - Consistent with the need of a strong Cisco team,
 the company would need strong partners and

- Mark Lee, PM for KPMG helped select the ERP product.
- The team’s strategy was to build as much knowledge as possible.
1. Better manufacturing capability.

2. Deep commitment for long-term
  development of functionality of the

3. Flexibility offered by Oracle’s being close
- Cisco had little choice but to move.
- We replace our current systems with one ERP solution.
- Commit in a time frame between 5 to 12 months.
- At 15 mil. the single largest capital project ever for Cisco.
- The board ended up approving the project.
           $15 MILLION BREAKDOWN                   IMPLEMENTATION DATES

                                                        PROCEDURE                      DATE

                                            Project Kickoff                         June 2, 1994
           Headcount   Software
              14%        16%                Prototype Setup Complete                July 22, 1994

                                            Implementation Team Training            July 31, 1994

                                            Process, Key Data, Modification       August 31, 1994

                                            Functional Process Approval          September 30, 1994

                                System      Hardware Benchmark & Cap.             October 15, 1994
Hardware                      Integration
                                            Planning Validated
  32%                             38%       Critical Interfaces, Modifications   December 1, 1994
                                            & Reports
                                            Procedure & End User                 December 16, 1994
                                            Documentation Complete
                                            Conference Room Pilot Complete       December 22, 1994

                                            End-User Training Begins               January 3, 1995

                                            Data Conversion Complete              January 27, 1995

                                            Go Live!!                             January 30, 1995
- Increase from 20 to 100 team members.
- Team divided in tracks, and supervised by personnel from KPMG & Oracle.
                                                Executive Steering

                                               Program Management

                                                                     Sales/Reporting   Technology
    Order Entry Track   Manufacturing Track       Finance Track
                                                                          Track          Track

      Business Lead        Business Lead          Business Lead         IT Lead         IT Lead

                                                                       Business         Business
        IT Lead               IT Lead                IT Lead
                                                                      Consultants      Consultants

       Business                                     Business
                        Business Consultants                         IT Consultants
      Consultants                                  Consultants

     IT Consultants        IT Consultants         IT Consultants

         Users                 Users                  Users
- STRATEGY: Conference Room Pilots (CRP)

 OBJECTIVE: Training the implementation team on the
 Oracle application and setting up the technical

 CONCLUSION: Cisco would not avoid modification of the
 ERP software, some changes would be require to fit its
OBJECTIVE: Making each track made the system work within their
specific area.

CONCLUSION: There were huge number of business processes that
the software could not support which led to unplanned changes in the
project plan and budget.

OBJECTIVE: Expanding project scope to include major modifications,
and a new aftersales support package.
Utilizing data warehouse would allow all of Cisco applications to
access a single course for their information needs.

CONCLUSION: Deepening its understanding of the Oracle and
service packaging.
OBJECTIVE: Testing the full system with a full
transaction load and all users involved and
assessing the company’s readiness to GO LIVE.

CONCLUSION: Ready for Cut-over!
- Performance plummeted as users dealt with a new system.

- The Hardware architecture and sizing.

-The ability of software itself to handle the transaction
volume required in the Cisco environment.
-Problems proved to be short lived.

- 3 months to stabilize system w/addition of capacity.

- New information system would fulfill and support the
rapid growth of the company.
- Big Celebration party and a bonus of over 200K for
the team!
- Very complex project.
- Limited time for implementation vs size of ERP system.
- Invest heavily in a new ERP system.
- Insufficient testing due to very few data.

- Efficient decision making.
- CRP phase procedure helped revise and improve their
- Selection of effective professional partners like KPMG.
- Effective team management contributing on meeting deadlines
on such a tight schedule.
- Efficient modifications and re-engineering to fit the system for
better performance.
- Which functions did Cisco’s previous application package supported mainly?
a) Project Marketing, R&D
b) Supply Chain Management
c) Manufacturing, Finance, Order Entry
d) Purchasing, Inventory Control

- Which was NOT an advantage from Oracle to implement Cisco’s ERP system?
a) Better manufacturing capability
b) Development and functionality of the product
c) Proximity to the company’s headquarters
d) Largest vendor interviewed

- Mention which Conference Room Pilot (CRP) had to include major modifications
   to the overall ERP project?
a) CRP2
b) CRP1
c) CRP3
d) None of the above

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