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ERP Implementation at Maruti Suzuki India
LtdA secondary research based case study on
implementation of Oracle based ERP system
INTRODUCTION
Subsidiary of Suzuki Motor Corporation
Leader of market for 20+
years
Sales 1.13 million
9000+ employees
Largest sales and service
network in India
300 strong dealer network
scattered across India
Manufacturing and sale of motor vehicles and spare parts
Added finance, leasing, insurance and pre-owned car businesses to its portfolio
MARKET SHARE OF MAJOR PLAYERS IN PASSENGER CAR SEGMENT(2010-2011)
PRE ERP SCENARIO Deployed an extensive extranet to reach business
partners in 1990 Small application running on the dealers' PCs to
manage their daily activities Home-grown systems for managing various lines
of business Different divisions followed different workflows
preventing real-time access to critical statistics Reliance on rudimentary system and basic
spreadsheets to manage the process Used mismatched systems to manage expanding
workforce
GROWING NEEDS OF MARUTI Addition of four new business sectors in
2002 Operations across hundreds of locations
within India Disparate systems could not talk to each
other Various lines of business were using
homegrown systems Requirement to enter data multiple times Constant monitoring and human
intervention
GROWING NEEDS OF MARUTI
Lack of control over processes Poor information quality Huge turn-around time Collaborate with global teams Streamlining the process of vehicle
localization Enhancing quality and reliability
WHY ORACLE ERP
Already had Oracle
Database, Oracle
Application server
Used some of resource planning
modules of Oracle E-
Business Suite
Open architecture of
Oracle components
made simplified
integration with Suzuki’s
system possible
With Oracle the company would be able to standardize
the technology
used
IMPLEMENTATION: PHASED OR BIG BANG?
Maruti chose a phased approach to make a shift from the legacy systems to the new ERP
BIG BANG• No need for temporary
interfaces• Limited need to
maintain legacy• software• Cross-module
functionality• No going back• Lower cost if no
surprises
PHASED• Smoothing of resource
requirements• Able to focus on a
particular module• Legacy system fall back• Reduced risk• Knowledge gained with
each phase
IMPLEMENTATION – PHASE 1
Phase 1Project Organization
Project Governance
Project Team
Organization Readiness
Project Kickoff
IMPLEMENTATION – PHASE 2BUSINESS REQUIREMENT DOCUMENT
A business requirements document (BRD) details the business solution for a project including the documentation of
customer needs and expectations
Objectives :•To gain agreement with stakeholders•To provide a foundation to communicate to a technology service provider what the solution needs to do to satisfy the customer’s and business’ needs•To provide input into the next phase for this project•To describe what not how the customer/business needs will be met by the solution
Packaging the BRD:•Project charter information, scope, and objectives•Current environment assessment•Future process map•Process detail table•Overall project business rules and constraints•Impact assessment (fishbone for process functions)•Functional requirements •Schedule and budget•Approver information•Team information
IMPLEMENTATION – PHASE 3• Project Planning –Detailed implementation pla n, quality review plan, resource plan, financial plan prepared
• Design & Development • Based on analysis of the existing process, simplifying or
creating new ones where required• Configuration of the new systems, interfaces and
supporting legacy systems• Setting up of business rules along with approval matrix
• Controls – Regulatory, Statutory and Financial built into the system
• Methodology of Implementation – Single Instance with Phased approach of implementation followed region wise
IMPLEMENTATION – PHASE 3Data Migration
Identify the data
Collate the data
Consolidate
Clean & Verify
Condition
Create & Verify
Migrate & Verify
Unstructured Data
Excel Files
Ledgers
Word Documents
Legacy Systems
Manual Forms
• Identifying the owner of various data sources• Data collection and removal of redundant data• Checking for data integrity• Making suitable modifications to fit the standard format• Verification of data with original after migration
IMPLEMENTATION – PHASE 3Testing
Developing scenarios as test cases based on users previous experiences
Creation of testing team and development of the test environment
Define all business transactions or business processes that use the system
Define expected results for all testing scenarios
Build tools for comparing results in the parallel test phase to match the ERP to legacy system data
Unit Testing
Integration Testing
System Testing
UAT
Conference Room Testing
IMPLEMENTATION – PHASE 3Training
Comprehensive training provided to each stakeholder as per their usage of the system “Train the Trainer” program created to propagate the usage of the system and developing familiarity of
its features
Retraining of users after a period of 1 week to ensure that there are no gaps in understanding
of the system
Walkthrough
Scenarios
SimulationPilot
User Guides
Obtaining user feedback and improving upon any gaps in training process
Making users aware of the impact of their operation of the system on related functions
Scenarios cover Operational, Daily Activities, Monthly Activities, Strategi & Company Specific ones
Simple features such as ease of navigation to complex functionalities covered
CHANGE MANAGEMENT
Change management is a structured approach to transitioning individuals, teams and organizations from
an Existing Current State to a Desired Future State
• Goal – To provide a structure necessary to effectively prepare the Human Capital for Change
• Hard Facts which were considered at Maruti-• 42% Leadership Issues• 27% Cultural Issues• 23% Technology Issues
Create Urgency
Form a powerful coalition
Create a Vision
Communicate the Vision
Remove obstacles
Create short term wins
Build on the change
Institutionalize the change
Change Management
Model
RISK MITIGATION
Phased step-by-step
implementation approach
and not ‘Big-Bang’
approach
Training of users and
employees to uniform
standards
Developing adequate
Contingency plans
Reinforce• Celebrate success• Analyse feedback to
manage resistance
POST IMPLEMENTATION BENEFITS
Single, integrated, in-strata system
Smart and Process Oriented Workforce
Tight integration for real-time performance
Budget and credit checks completed online
Lowering support and maintenance costs
Easy upgrades for the future
Provide end-to-end visibility
WHY ERP PROVED SUSTAINABLE FOR MSIL
WHY ERP PROVED SUSTAINABLE FOR MSIL
WHY ERP PROVED SUSTAINABLE FOR MSIL
FUTURE DIRECTION
A video from Oracle consultancy: Maruti
Suzuki Drives Business Growth on a Full Oracle Stack.flv
Appraise Oracle Advanced Supply Chain
Management and Oracle Enterprise Asset
Management
Cloud ERP to make the company truly integrated
in the global sense
Suppliers to be adopting cloud
ERP
REFERENCES The official website of Maruti Suzuki India Limited Oracle Consulting case study, 2008, ”Maruti supports
business growth with scalable, high performing ERP system”
“Maruti Udyog Limited: A bumpy road ahead”, Vision- the journal of business perspective Vol 10,January 2006
S. K. Majumdar, M.P. Gupta, 2001 “E business strategy of car industry”
Maruti Suzuki case study, oppapers.com Leon , Alexis, (2008), ERP Demystified, 2nd Edition Hammer,M., Champy.J., (1993), Reengineering The
Corporation: A Manifesto For Business Revolution., Harper Collins, London
Ford, Jeffery D. and Ford, Laurie W. (April 2009), Managing Yourself: Decoding Resistance to Change, Harvard Business Review
THANK YOU