Upload
abhirup-mukherjee
View
1.896
Download
1
Embed Size (px)
Citation preview
Timberjack PartsPackaged software selection process
By:Abhirup Mukhopadhyay(02)
Aniket Singh Mahra(10)Bhanu Manchanda(26)
Disha Kashyap (32)Lopa Mudra Panda(58)
Scope of Timberjack
• Leading manufacture of heavy equipments.• Formed through number of acquisitions during
1980s and 1990s.• Operated two service parts operations in Marsta
and Sweden .1995 :Market Share : 25%Sales : 627m USDProfits : 88 m USDEmployees : 1600
Why ERP• Instability of the existing system
• Heavy modifications led to frequent system failures
• Lack of user reliability
• Future need for integrating manufacturing, dealer network , parts and service.
• HP’s reluctance to provide further support to it aging software MM3000.
• Issues with integration of financial data
Timberjack: Sweden
• needed a faster change as its operations were badly effected
• Not satisfied by the RPF model used to select vendors
• Strong preference for QAD
• No customization
Timberjack: Atlanta
• had time and wanted to implement a universal system.
• Satisfied with the RFP model
• Strong preference for Oracle
• Needed to customize
Decision Rationale
• Aging MM300 software
• Instabliity of existing systems
• Financial Integration
• Employee transfers
• User reliability
Business
• Narrowing down to common requirements of Atlanta/Marsta
• Disparate systems
• Oracle/ QAD Preferences
• Different application and server requirements
• Risk of obsolescence
Technology
• Customizations Required- QAD : Dealer System , Oracle : Order Processing
• Implementation Cost / Time : Oracle – High
• Consultant support
• Overhead Costs (Oracle high)
• Support Fees (QAD high)
Implementation
• Cyclical Industry
• Backward and Forward Integration (Manufacturing/Dealer/Service)
• Integration of North America operations
• Competitive advantage in vendor selection
• Complete “Distribution Package”
Strategic
The RFP processCONSULTANT-COOPERS & LYBRAND
Sessions with members from each functional
area
Ensure all processes are
covered in detail
Consideration for any additional
software
Business process breakdown
Timberjack list compared with C&L
list developed for prior clients
List of requirements were sent to Marsta for
review
Additional requirements
for Marsta
Benefits review started at Woodstock
Business statistics and dealer system
details incorporated in
RFP
Hard copies and soft copies
dispatched for vendors
Issues regarding the RFP
-Woodstock vs MarstaADDITIONAL REQUIREMENTS FOR MARSTA
Requirements related to: Multilanguage capability
EFT for payments to suppliers
Intrastat reporting used in Europe for tracking of goods
ADDITIONAL REQUIREMENTS FOR WOODSTOCK
Benefits analysis to weight the potential functionality improvements
OPPOSING VIEWS Marsta wanted an enterprise syatem
at the earliest while woodstock was in no hurry
Marsta would have preffered a RFP running for just 5 pages while that developed by Woodstock went on for 200 pages thus building in a delay in RFP evaluation by the vendors
Marsta was focusing short term to solve its current needs while Woodstock had a long term perspective going into the project.
VENDOR SELECTION
Constraints limiting the potential suppliers
• System to be UNIX based , as specified by DSI
• A preference of Oracle database as corporate standard
• Package’s presence in both Europe and North America
Vendor list based on manufacturing systems with secondary strengths in distribution and service
Out of 13 companies selected, 6 bids were received – Lawson, Oracle, Computer and Associates, QAD, Scala and American software
Critical functionality – Planning, customer service, warehousing & finance
Scala and American software dropped due to lack of functionality & UNIX based modules
Narrowing the vendor list
ORACLE•Early presentationnot received well –staff inefficiency,complicatedsoftware & technicalproblems
CA• Relied on software
acquisition ratherthan ongoingdevelopment –concern aboutsupport& longtermcommitment to thepackage
Lawson• Techinically strong
software packege,but lacked somefunctionality thatwere critical toAtlanta team
QAD• System was not
flexible enough tmake changeswithout affectingthe source codedifficulties inmigrating to Oracledatabase
Oracle –preference by Atlanta
group
QAD –preference by Swedish
group
Factors considered for narrowing to two vendors:License fee for software , Functionality comparison , Implementation consulting cost , Gartner Grouparticles
Factors Oracle QAD
Functionality shortfalls – Work needed in these areas
Order processing module to match current dealer system functionality
Customization on dealer systems, order type & safety stocks
Total cost of dealer system modifications
$ 30,000 $ 200,000Mod in safety stock program & order type functionality requirements
Implementation Consulting More consultants over a longer duration, consulting fee to install in both sites is $ 500,000 USD, later reduced by 25%
Not much consultants required as it is not a huge and complicated package
Installation time At least one year Six to seven months
Complication Highly complicated & hence require more personnel assistanceinitially
Simple & hence easier implementation with lesser personnel assistance
Site visits True TemperStepwise implementationLarge no. of people used for installationProject took more than 1 year to complete
MatrixRunning on a low version packageModules hard to modify without affecting the core system
Recommendation
• Oracle as first choice to be implemented as compared to QAD (Sap based software)
Reasons to support Oracle
• Covering 95% of functionalities as compared to 88% of QAD hence low customization and more reliable.
• QAD being SAP as base is more rigid in structure (good for standards but poor flexibility)
• A huge gap in forecasting and dealer system which are very essential part of the ERP module needed in industries( Gap analysis in sec 7)
• Oracle as a organization is more reliable for future existence hence secured future maintenance.
• Noncompliance penalties applicable over Oracle also makes it more viable.
Oppositions
• Need for 2 different systems for manufacturing and parts and services
• Higher cost for Oracle
• 40% higher overhead required in database
• Expensive hardware and software expected