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ES&ITS Presentation on case study-Celanese Recentralizes with a New Enterprise System
Submitted By: Ambarish Nigam 20135005Amit Kumar - 20135006
Introduction• A global chemical company
• HQ- Texas, United States
• Five main businesses:
1. Chemicals and its Intermediaries- Acetyl products and Specialty chemicals
2. Celanese Acetate Products- to manufacture cellulose acetate filaments and tow
3. Ticona Technical Polymers- use to make chemical products for electronics, telecomm, automotive and medical industries
4. Performance Products- ingredients for food products like sweeteners
5. Celanese Ventures- specializing in R&D
• 30 facilities in 11 countries on 6 continents
• They largely focused on decentralizations during 1980-90s.
• Each independent units implemented separate customized SAP systems as per their own requirements
• They grow inorganically by acquiring small companies having their own enterprise systems
• By 2000, world economy weakens and their sales declined and forced them to reduce the expenses
• To reduce expenses: best available option was centralization
• How centralization help to reduce cost??
- To use the same version of SAP by all units
- It reduces the no. of IT staff
- It reduces financial irregularities
- Use of SAP features like SCEM
- Opportunity to cross-sell and up-sell customers between business units
• To recentralize the company: Karl Wachs, new global CIO; Task- to reduce company’s costs by integrating its information system
• Started project OneSAP
• Took 11 months and total cost of $60 million
• Challenges:
- Technical: to install new SAP software so that every unit could use it
- Organizational Culture
- Clear and absolute order from top management
How they did it??
- Divided project into seven tracks: Finance, Supply chain, manufacturing, order to cash, Business intelligence, technology, and change management
- Each track has several functional stakeholders to track progress and one person for working at higher level
- Followed six sigma philosophy- “TQM” which means every person was responsible for quality
The problems project faced:
- Unavailability of SCEM software at the time of implementation
- To include new company they purchased from clariant in early 2003
- Cleaning and integrating data from various existing SAP systems into OneSAP
Answer-1
• Bargaining power of customer is low
• Bargaining power of supplier is high
• Threat for supplier is low
• Entry barrier is high
• Competition is high
Answer-2
• to cut the cost
• Acquisition of smaller firms in other product portfolio in same business.
Answer-3
• Challenges:
- Technical: to install new SAP software so that every unit could use it
- Organizational Culture
- Clear and absolute order from top management.
- Organization Culture is the most difficult challenge .
Answer-4
• Earlier the company was trying to adapt the software to the business but now the company would have to adaot the business to software.
- Divided project into seven tracks: Finance, Supply chain, manufacturing, order to cash, Business intelligence, technology, and change management
- Each track has several functional stakeholders to track progress and one person for working at higher level
- Followed six sigma philosophy- “TQM” which means every person was responsible for quality
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