Advantages Of An Erp System

Published Date: 02 Nov 2017

Solaricot invested 1.8Million in implementing SiME an Enterprise Resource Planning (ERP) system in a hope value will be created through the integrating of operations, marketing and finance. An ERP system is a multi faceted software which automates core business functions through a centralised database.

Value is a complex concept as it is perceived differently by various stakeholders, an ERP system has the ability, in Solaricots case, to access accurate information as soon as the data has been captured, with the integrated nature of the software allowing many of the core management information systems to be updated simultaneously. This eliminates information inaccuracies and creates value through improving the adaptability and reliability of Solaricots processes. An ERP system introduces organisational standardisation which facilitates communication and collaboration amongst the various stake holders (Grabski, Leech & Schmidt 2011). The value an ERP system creates is both quantifiable and qualitative as it can improve efficiency of production resulting in increased profits and the quality can be improved through the elimination of errors.

B - Problems with SiME

A notable feature of the current implementation is the speed at which the software was acquired and installed.

An ERP system is best implemented following the steps of a proven systems development methodology such as the traditional Systems Development Life Cycle (SDLC) (also known as the "Waterfall" model) and with diligent change management which reduces risk and improves the likelihood of success (Ahituv, Neumann & Zviran 2002) .

The exact cause of the failure has yet to be identified although there appears to be no problem with the technical aspects of the software. The failure would accordingly appear to be linked to problems which may have arisen during SiME's implementation which was significantly different from the SDLC methodology.

This report will attempt to identify the various problems with SiME and recommend a short-term and two long-term solutions which will be aligned with the SDLC methodology.

1 - System requirement never defined so couldn't be met.

A possible problem which can be identified alongside the analysis phase is that SiME did not match the requirements of Solaricot’s systems thus creating a technical flaw causing the crash.

The initial analysis phase establishes the facts about Solaricot’s system. This phase of the SDLC methodology ensures that the selection of an ERP is matched to the system and user requirements and through feasibility tests the selection is made (Ahituv, Neumann & Zviran 2002). The identifying of Solaricot’s unique processes is essential when considering the implementation of a new system as it directly affects the subsequent design of the system.

In my review of Solaricot’s implementation of SiME I have deduced that there was insufficient detailed system investigation and analysis initially and there was insufficient data available to introduce a new system. This would have directly impacted the way in which SiME was designed as Solaricot has unique processes and products which were not considered.

It is possible that SiME's design is not able to accommodate Solaricot’s unique processes and this has caused a system error or fault which has resulted in the crash.

As you can see the analysis required for Solaricot’s unique processes was not there which could have directly affected SiME's ability to manage these unique processes.

2- Training & Change management

In review of SiME's implementation another possible cause of the crash can be attributed to Solaricots incomplete change management plan. Change management is central to implementing a new system. The Design phase of the Waterfall Methodology involves devising a change management plan to ensure users of the system are motivated and fully understand what the new system provides. As I reviewed the case study I found that users were angered at SiME's implementation and viewed it as an intrusion. A comprehensive management of change includes the users of the system throughout the selection, designing and implementation of a new system as they utilise it so they must be passionate and on board with the new system.

The design phase also, as well as change management, emphasises user training (Grabski, Leech & Schmidt 2011). I believe that the system was not introduced in a positive manner to the users which resulted in resentment and due to the speed at which the system was implemented users of the system were not adequately trained.

Therefore the lack of a cohesive change management plan and insufficient time to train users on the new system, in my opinion, could have caused the crash simply through an untrained user making a critical error which resulted in the system failure simply through an untrained user making a critical error which resulted in the system failure.

3- Lack of testing overlooked a critical flaw

A possible cause of SiME to crash, based on the implementation phase, could have been SiME's lack of testing to ensure it was technically ready to implement. The implementation phase involves preparing the system and its users to convert to the new system, this is done through testing, integrating the system and training users to understand and use the system (Ahituv, Neumann & Zviran 2002) . Furthermore I believe that Solaricot are understaffed in IT, with 2 support staff to design, train, test and convert to the new system this becomes infeasible as the required depth necessary for each phase would be lacking as the 2 support staff have too many important roles and processes to complete adequately.

In scrutiny of Solariots implementation process I have found that it was bought, designed and rolled out within a month, this does not provide adequate time to test every aspect of the system for inaccuracies and integration issues. The inadequate testing could have caused the crash as a simple process which did not integrate well was overlooked in the necessity to implement the system and as the process was used during operation it was unable to handle the requests or instructions it was given and crashed.

Overview of Problems

In summary, I have found that without following the sequential defined phases of the Waterfall methodology an implementation process is flawed. Specifically in Solaricot’s case I have identified 3 phases which were not adequately completed and problems which could have caused the crash arose from the corresponding phase.

The initial definition phase establishes important requirements for the entire implementation process and the lack of investigation and planning has a relationship with each problem because when the system requirements are incorrect at the start then problems will arise throughout the implementation.

Conclusively, after analysing the possible problems in relation to the SiME implementation I put forward that a more stringent approach, adhering to all aspects of each phase in the SDLC methodology, is critical to implementing a new system for Solaricot.

C - Recommendations

Quick fix solution

SiME's crash is attributed to omissions of important steps during its implementation. There is an immediate need to restart operations and regain profits.

The quick fix solution is returning to the manual system, justified as without this return more products are lost due to uncontrolled conditions and production cannot begin.

Reverting to the old system allows a more detailed analysis of Solaricot’s business situation and time to identify the best possible method of re-designing SiME or implementing a new ERP system.

Redesign SiME revert back to manual begin SiME's implementation phase 1

SiME is a major financial investment and in respect to Solaricot I recommend this system should begin its life cycle again from the initial systems planning and investigation phase.

This time Solaricot must create a interdisciplinary study team to review all aspects of the businesses unique processes and produce a preliminary investigation report which will involve key stakeholders in the process. Management and IT support staff must be directly involved with each phase of SiME's implementation and another external stakeholder who was not present in the first implementation is SiME's vendors as their support will aid in designing, training and testing the system. In the design phase for SiME's next implementation I recommend creating a prototype of SiME which users can be trained on and tested in an environment which does not have any negative consequences. Another aspect of the design phase which should be emphasised during SiME's reimplementation is a more cohesive change management plan which was absent previously. Users were unhappy with SiME therefore a renewed change management plan should include these users in every phase, constantly ensuring that they are on board and understand the system so that they are passionate and motivated. SiME during the next implementation phase must place a high importance on testing the system as this ensures there are no integration issues and the processes meet the requirements.

Finally, feasibility testing is essential and must be conducted at the end of each phase and possibly if the system is infeasible the proposition of an alternative ERP system must be considered (Aoun 2013) .

Terminate SiME and implement Cloud based ERP

Alternatively, during SiME's reimplementation if the system becomes infeasible I suggest a new Cloud ERP system is selected. I am recommending a cloud based ERP system because it is more secure and stable, data is constantly available and system upgrades and software changes are easily implemented. Many big businesses are utilising cloud based ERP systems due to the reason that in the case of a crash the systems data is in an external location and will not be affected which was a hugely detrimental aspect of SiME's crash for Solaricot (Gould 2011).

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Report 2

Value is a complex concept, the perception of value is subjective and relative to the stakeholder, it is either quantitative or qualitative in it's ability to add worth, importance or usefulness to Organisations, individuals or society. As an IS graduate Information Technology (IT) is present in all career paths and thereby the need to understand the concept of value in relation to IT and business is essential. As an IS graduate being able to capture, measure, utilise, align and pair IT value with business is important as it improves career prospects and usefulness when entering the field. IT Business value is a key concept for an IS graduate as it focuses on the value IT can create as business is becoming increasingly entwined with technology.

→ Capturing Value

An important aspect for an IS graduate when entering the industry is the ability to capture value through foreseeing where a business has Value which is not being exploited and providing comprehensive steps to utilise this unused value in business. Capturing value is essentially realising where value can be added to business which is highly sought after in today’s business environment as the associated benefits from IT can improve all the major business operations and functions. An IS graduate with an understanding of value and the value of IT, this can be used to create a competitive advantages and deliver this additional value to the customers of the business. (Hitt & Brynjolfsson 1996)

→ Measuring value

As an IS graduate who understands the value of IT and it's importance to business this enables the measurement or evaluation of Organisational IT processes, whether they are useful or appropriate.

An IS student who understands value will be able to evaluate whether IT has; increased productivity, improved business profitability and whether value has been created for consumers. (Hitt & Brynjolfsson 1996). This ability to judge and measure the value of IT in Business allows the full potential of IT to be utilised. An IS graduate who understands value and the value of IT this is beneficial for Employers who are provided with the different value IT can generate for their business which is important for future career prospects.

→ Utilising Value

As an IS graduate who understands the value of IT and it's importance to business this enables the measurement or evaluation of Organisational IT processes, whether they are useful or appropriate.

An IS student who understands value will be able to evaluate whether IT has; increased productivity, improved business profitability and whether value has been created for consumers. (Hitt & Brynjolfsson 1996). This ability to judge and measure the value of IT in Business allows the full potential of IT to be utilised. An IS graduate who understands value and the value of IT this is beneficial for Employers who are provided with the different value IT can generate for their business which is important for future career prospects.

→ Aligning IT with Business strategy to create Value

Another reason as to why understanding value and IT business value is important for an IS graduate; it allows you to align aspects of IT with business strategy which can improve many facets of the business. The ability to perceive value in aligning IT and business strategy is important for an IS graduate when devising a method which can deliver a 'unique value creating strategy' for the employer. (Melville, Kraemer & Gurbaxani 2004, p. 287) Value is created for businesses when IT can be integrated and unified with it's strategic plan resulting in improvements. An IS graduate who can align the value of IT with business strategy, this is beneficial to the business as there is a multifaceted relationship existing with business performance, IT and business strategy which an IS graduate can reorientate to improve business.

→ Pairing IT with Business opportunity to create Value

Finally understanding that value can be created by 'pairing the benefits of IT with an available market opportunity' (Hitt & Brynjolfsson 1996, p. 139) is important for IS graduate in creating new and innovative procedures for the employer.

Conclusively as an IS graduate who is surrounded by IT in business it is immensely important to understand value and the value of IT for business because this will be the avenue in which understanding value is attributed to for an IS graduate in the workforce.

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Bibliography Report 1

Ahituv, N., Neumann, S., Zviran, M. 2002, 'A systems development methodology for ERP systems', The Journal of Computer Information Systems, vol. 42, no. 3, pp. 56-67.

Aoun, C. 2013, 'Design and Documentation Information Systems Development Methodologies', UTS Online subject 31266, Lecture Notes, UTS, Sydney, viewed 27 March 2013, <https://online.uts.edu.au/webapps/blackboard/execute/content/file?cmd=view&content_id=_894921_1&course_id=_6964_1 >.

Gould, L. 2011, 'ERP Goes To The Cloud & Other Developments'. Automotive Design & Production, vol.123, no. 5, pp. 34-35.

Grabski, S., Leech, S., Schmidt, P. 2011, 'Review of ERP Research: A Future agenda for ERP systems', Journal Of Information Systems, vol. 25, no. 1, pp. 37-78.

Bibliography Report 2

Hitt, L., Brynjolfsson, E. 1996, 'Productivity, Business Profitability, and Consumer Surplus: Three Different Measures of Information Technology Value', MIS Quarterly, vol. 20, no. 2, pp. 121-142.

Melville, N., Kraemer, K., Gurbaxani, V. 2004, 'Review: Information Technology and Organisational Performance: An Integrative Model of IT Business Value', MIS Quarterly, vol. 28, no. 2, pp. 283-322.

All Up 2277

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