VANDELAY

INDUSTRIES,INC
CASE STUDY QUESTIONS.

SUBMITTED BY-
SUBMITTED TO Sukhmanpreet Singh (401508031)
DR.GURPRAKASH Viresh Gupta (401508033)
SINGH Jasnoor Singh (401508021)
Ashish Gupta (401508002)
Q1. FEATURES OF ERP PACKAGE – R3
 Ease of use. Client-server applications often used personal
computer-like graphical user interfaces. They also ran on the
familiar desktop machines used for spreadsheets and word
processing.

 Ease of integration. The flexible client-server hardware and

operating systems could be more easily linked internally (to
process control equipment, for example) and externally, to Wide-
area networks and the Internet.

• Scalability, or the ability to add computing power incrementally.

Companies could easily expand client-server networks by adding
relatively small and cheap machines. With mainframes,
computing capacity had to be purchased in large ‘chunks
• SAP R/3 is one of the main product of SAP where R stands for Real Time
and the number 3 relates to three tier application architecture(Data base
,Application Server and Client)
• – The SAP R/3 System consists of application modules that support all of
a company’s business transactions and are integrated interactively.
  Client-server technology. As large firms moved from
mainframe to client-server architectures in the early 1990s, the R/3
system was available to them. Meanwhile, many suppliers of
existing ‘legacy systems’ did not have client-server applications
ready for market.

 Modularity, functionality, and integration. R/3 functionality

included financials, order management, manufacturing, logistics,
and human resources, the arrival of ERP, these functions would be
scattered among several systems. R/3 integrated all of these tasks
by allowing its modules to share and transfer information freely,
and by centralizing all information in a single database which all
modules accessed.

 Marketing Strategy SAP partnered with most large consulting

firms. Together, they sold R/3 to executives as part of a broader
business strategy, rather than selling it to Information Systems
managers as a piece of software.
Financial Accounting (FI)
 Q2.IMPLICATIONS FOR ERP
ADOPTION
•Expensive (can costs 100 thousands to
millions of dollars)
•Time-consuming (can take months to
years)
•Great risk for the organization
•Transfer of Knowledge
•Acceptance with the company
 USER IMPLICATIONS
• Lack of senior management involvement
• Less availability,
• Lack of detailed systems reliability and
• performance
• implementation plan • Increased security risks

• Project escalation and lack of control

• More rigid organizations*
• Structural changes
• Lack of policies and laws • Redistribution of
responsibility
• Lack of involvement of internal audit • Lack of alignment
• Poor use of consultants • Lack of project team
expertise
• ERP-as-a-service requires local software • User resistance
• High demands on
• Less customization and integration possibilities process orientation*
• Large dependency on vendor
 SUPPLIER IMPLICATIONS
• High initial investments for starting a SaaS business
• Initial reduction in turnover
• Anticipate customer requirements
• Serviticize software products
• Offer customizable services
• Contractual Changes*
• Increased demands on fast updates
• Manage service transitions
• Increased responsibility for customer operations
• Difficult to manage complex networks of SaaS suppliers
• Address end-user prosumption in
service architecture
• Manage development effectively
• Develop for flexibility
• Manage complexity of enterprise
applications
• Manage service operation and
maintenance effectively
• Manage security effectively
• High requirements on service
availability, performance and scalability
• Balance over- and under capacity
• Support several versions of software
• New sales processes
 Q3.PROJECT MANAGEMENT CONSIDERATIONS
FOR ERP IMPLEMENTATION

• What is a Project ? A project is a temporary endeavor

undertaken to create unique product, service or result.

Temporary: has a definite BEGINNING and has a definite

END

Unique : differentiate by several distinguish conditions

1. INITIATING

Project Manager Assignment

Tools and Technique :

Who is Project Manager ?

A person that is RESPONSIBLE for : achieving the project’s overall objectives
and leading the project team.
Project Manager Responsibilities
Providing thought leadership and vision
Planning and organizing the project
Organizing and managing the project team
Estimating cost and developing project budget
Monitoring and controlling the project schedule
Ensuring the quality of the final result
Stakeholder Engagement
2. PLANNING : Plan the Work, Work the Plan
COST MANAGEMENT PLAN:
 COMMUNICATION PLAN :

• Communication requirements analysis :

• Number of Potential communication channels :n(n-1)/2, àn=number of
Stakeholder
• Stakeholder : location, internal/external, department, role and responsibilities in
project, etc
• Communication Technology Factor Choice:(The methods used to transfer
information among project stakeholders)
• Urgency of the need for information (urgency, frequency, format)
• Availability of technology
• Ease of Use
• Project Environment (location—time zone–of stakeholders), culture,
languages)
• Sensitivity and confidentially of the information (confidential, security)
 Q4 DIFFERENCE
BETWEEN "IT LED
IMPROVEMENT“ AND
IMPROVEMENT LED IT
Changes lead to

• Improvements occur at several levels in an organization.

• Dimensions of organizational changes can be defined
as:
• Process
• Strategy
• People
• Technology
• Any improvement depends on one thing- ‘client
situation’.
• In Vandley’s case IT led improvemnets have been used.
• Obtain senior leadership commitment to initiating and managing IT
organizational performance and process improvement initiatives.
• Perform an objective assessment, leveraging standard models, for defining
realistic improvement goals.
• Focus on identifying the right processes and their process owners to achieve
the established goals.
• Develop a roadmap that is well understood and accepted by the identified
process owners.
• Institute a targeted marketing strategy that creates enthusiasm and greater
participation.
• Establish a governance model that enables effective management of the
program.
• Develop processes that are standard and “fit to use.”
• Facilitate organizational change management to ensure smooth
implementation of the recommended improvements.
• Enable effective benefit tracking and reporting to ensure sustained top-
management support.
 IT LED IMPROVEMENT
IMPROVEMENT LED IT
● It is also known as
● It is also known as
‘technology
‘clean sheet’
enabled change’
approach.
approach.

● Primary technology is
selected early in the ● Primary technology is
selected later.
process.

● Primary technology
selected influence the ● All the dimensions of
dimensional changes organizational change
but still enables are explored without
overall business constraints.
BUSINESS PROCESSREDESIGN MODEL
 APPROACH FOR SELECTION

• The right approach should be selected

while implementation.
• The right approach should depend on the client’s situation.
• In Vandelay’s case decision has already been made to go
with SAP.
• Therefore, ‘technology enabled change’ approach is more
appropriate.
• To guide the client, ICS used structured approach tailored
to client’s situation.
Q5. IMPACT OF ERP ON LEARNING AND INNOVATION AT WENDLEY

Impact of ERP on learning and innovation at Vandelay

R/3 implementation would

• end the existing fragmentation of the systems

• Allow process standardisation across the corporation
• Provide a competitive advantage over rivals
ERP implementation resulted in innovations in the problem areas
of the earlier systems .
The problems in the Information Systems are as follows:
• Plants used outdated MRP systems which required data to be
entered manually
• Orders were lost because they were taken manually and then
routed via fax to the appropriate plant
• Incompatible HR software, data had to be re-entered manually
when an employee transferred to another location
• The manufacturing software was not integrated with the
financial package, so information like labour hours, materials
purchased had to be entered into both systems
Problems in Business Practices before ERP implementation are:

• No uniformly recognised best way to invoice customers

• No uniform method for accounts at the month end
• Different methods to reserve warehouse inventory for
customer’s orders
• Unorganised methods to carry out hundreds of other activities in the
production process that required computer usage or input
 • An ERP system would incorporate all these fragmented
functions and result in standardisation
• Once the ERP is in place, authorised users would be able to
instantly see relevant information
• Co-ordination among different sites would improve
significantly
• Performance comparison across different locations would be
done easily
• Technology enabled change According to Kramer there are two
approaches to handle changes at strategy, process, people and
technology level: –
• Clean sheet – all 4 dimensions of change are explored without
constraints. –
• 2) technology enabled change – primary technology is selected early
and more strongly influences other three dimensions and still enables
overall business change. As the Vandelay is going with SAP
implementation , ICS used a structured approach as per the client’s
situation.