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Chapter eight / Enterprise Business Devices? 259 ACTUAL CASE a couple of Agilent Technology and Russ Berrie: Problems of Implementing ERP Systems Co. (www. russberrie.

com) was acquiring another fracture at changing its legacy business systems. The Oakland, New Jersey–based distributor of toys and gifts? nalized plans to roll out T. D. Edwards , Co. ‘s OneWorld Xe selection of venture resource preparing (ERP), customer relationship management, and? nancial applications. The multimillion-dollar job was timetabled to be required for phases in the next 1 . 5 years.

Russ Berrie CIO Michael jordan Saunders stated that the company, which had product sales of $225 million through the? rst eight months of 2001, hoped the OneWorld System will help it reach $1 billion in annual income in the approaching years. Within the next 12 months, he said, Russ Berrie planned to begin installing the applications one division at a time, starting with a stand-alone implementation in purchasing. “We’re not going big beat, ” Saunders said. “We’re mitigating rendering risks if you take a phased-in approach. The corporation had purpose to be careful. Three years prior to, a Y2K-related migration from its homegrown syndication,? nancial, and customer service systems to manufactured ERP applications experienced key system failures. Saunders explained the problems had been severe enough for Russ Berrie to take many of the fresh applications off the internet and come back to their older systems. Saunders wouldn’t identify the software suppliers that were active in the failed rendering, but options said that SYSTEMS APPLICATIONS AND PRODUCTS AG’s applications were section of the 1999 job.

A public spookesperson at SYSTEMS APPLICATIONS AND PRODUCTS con? rmed that Russ Berrie was one of its customers, but this individual declined to offer further specifics because of pending litigation between two businesses. Joshua Greenbaum of Venture Applications Consulting said this appeared that Russ Berrie “bit away more than they could chew” on the 99 project. Companywide rollouts are especially risky for midsize businesses like Russ Berrie, Greenbaum said. T he very good news is that Agilent Technologies Inc. (www. agilent. com) says its enterprise resource planning applications happen to be stable.

The bad news can be they received that way only after a rugged ERP migration project that cost the organization $105 mil in income and seventy dollars million in pro? ts. In mid-August 2002, the multinational sales and marketing communications and life sciences firm, formerly an integral part of HewlettPackard Company., said issues with the ERP components in Oracle’s e-Business Suite 11e software froze production to get the equivalent of a week, leading to the massive losses. The Oracle system handles about half of the company’s worldwide creation of check, measurement, and monitoring companies almost all of its? ancial procedures, as well as functions such as purchase handling and shipping. Agilent was in the process of migrating as much as 2, two hundred legacy applications that it handed down from HP to Oracle. As part of the switchover, approximately six, 000 requests in the internally developed legacy systems had to be converted to a great Oracle-friendly formatting, an Agilent spokeswoman stated from firm headquarters in Palo Enorme, California. The lady said the con? guration process acquired problems requiring correction.

Within a statement last week, Agilent Leader and CEO Ned Barnholt said the disruptions towards the business after implementing the ERP system were “more extensive than we expected. ” An Agilent spokeswoman said the problem wasn’t the standard of the Oracle application, but instead the “very complex mother nature of the enterprise resource preparing implementation. ” For its component, Oracle Corp. said is actually working closely with Agilent. “At Oracle, we are completely committed to all of our customers in the future and support them in any way necessary, ” the company stated in a assertion. We have a very good relationship with Agilent, and both corporations believe the implementation can be stable. ” Agilent as well had a takeaway lesson: “Enterprise resource preparing implementations really are a lot more than software packages, ” the company stated in a affirmation. “They certainly are a fundamental change of a company’s business operations. People, processes, policies, the company’s culture are generally factors which should be taken into consideration the moment implementing a major enterprise program. ” According to one analyst, ERP catastrophes are often caused by the user business itself.

Joshua Greenbaum, an analyst by Enterprise Applications Consulting, stated 99 percent of this sort of rollout? ascoes are caused by “management’s inability to spec away their own requirements and the implementer’s inability to implement individuals specs. ” Russ Berrie and Company. After a three-year saga that included a $10. several million? nancial hit from the failed installation of packaged applications, teddy bear machine Russ Berrie and Case Analyze Questions 1 ) What are the primary reasons companies experience failures in implementing ERP devices? 2 .

Precisely what are several crucial things firms should do to avoid ERP systems failures? Clarify the reasons for your proposals. a few. Why do you consider ERP systems in particular are usually cited since examples of failures in THAT systems creation, implementation, or perhaps management? Origin: Adapted via Marc Songini, “ERP Hard work Sinks Agilent Revenue, ” Computerworld, Aug 26, 2002, pp. one particular, 12, and Marc Songini, “Teddy Carry Maker Prepares for Second Attempt at ERP Rollout, ” Computerworld, Feb . 4, 2002, p. 16. Reprinted with permission by Computerworld.