Introduction
Technology is playing a crucial role in businesses today. With many business challenges that have been brought about by globalization and competition, there has been the call to leverage on technology to solve most of the problems that are faced by businesses today. The ability to share information and have different departments communicating is one of the goals that many companies seek to achieve. There is a need to have communications between departments and have ways in which the different departments can share resources in a secure manner. Enterprise Resource Planning (ERP) systems have proved to be the most sought-after solutions that many businesses have been looking for. This paper will focus on a case study where ERP is proposed to solve the issues of information systems within Al Fahim Company. The proposed solution will be assessed to check if it meets the requirements of the users and whether the problems that the organization seek to solve will be achieved. The paper will also focus on having a mention of the alternative solution to the problem that the company might be facing.
Al Fahim Group is a company that was found in 1958 by Abdul Jalil Al Fahim. There are many businesses that are carried out in the company. They include automotive sales, spares, sale of oil, and also found in the hospitality industry. It has been in operation for 50 years and has grown from a small retail shop to a conglomerate of businesses. The company has not had ERP implementation in the past. They have not implemented enterprise systems in the past and most of the systems that they use are stand-alone systems which have no connectivity. The company has grown to have many businesses and many business processes. One problem that the company has at the moment is that it makes it hard to interconnect the different departments and the various locations which have come up as a result of expansion. There is a need to have different departments communicating and sharing resources. It is not yet the case because of the different aspects that the company has.
Statement of the problem
The problem that the company needs to solve is to have sharing of resources within the enterprise. There is a need to have communication between the different sections of the company. Al Fahim needs to have interconnection and proper coordination between the departments.it will help to understand the issues that are there in place within the company. If there is a file that needs to be shared, it will be shared within the company. When there is a need to share resources within the company, the sharing will be achieved through sending files over email. The people wanting to communicative and share information will send the files and information through the internet.
Proposal made
The proposal that is made in the case provided is to have ERP technology implemented in the company. Enterprise Resource Planning is a technology that will enable Al Fahim to interconnect with the departments and the different sections of the company. Al Fahim will implement ERP system in their headquarters and all the other locations will get access to the system through the internet. It will save on costs as it will not need that all branches will be required to have the system installed and implemented in each of the branches.
The ERP system will have different modules which will solve different functions. There will be procurement module, accounting, finance, human resource, and other modules which will be deemed necessary. Going this approach in the company will help solve the need to have new information systems and integrate these systems with existing networks in the company. Having ERP system will help to integrate future information systems to the ERP infrastructure. The same vendor and technologies will also be used in the connection procedures. Future compatibility will not be an issue of concern as the same infrastructure and platform will be used in the connection procedures. The development and the technology that is used in ERP is that there is a synergy of major departments. The Human resource department is synergized to run in the ERP system together with the other systems. It will be simple to share resources in the new outlook of the work. It helps to understand the requirements of the new network. The use of distributed databases has been used to share information within the company. It is important to have a way in which the data is shared between the departments.
Objectives of ERP proposal
The objectives of adopting this ERP system by AL FAHIM were meant to facilitate the provision maximum value to its clients and to continually remain profitable in the market. This is exactly what AL FAHIM achieved at the end of implementing the project
The software implementation of SAP-ERP generated many benefits in that it helped AL FAHIM integrate or link up all the manufacturing and distribution units and helped ease the departmental functions in the organization. This means that the entire functions of the whole organization can now be all run from a single computer.
ERP Vendors to choose
A serious market study will be done by the Al Fahim research team to enable it solicit for the best, successful and friendly ERP software system that was going suit the needs of the company.
Before settling to the final vendor to supply and install the best SAP-ERP software, Al Fahim will send emissaries to who visited popular vendors’ customers’ to study on the success and failure rates of the various software’s they had implemented in their companies. After a thorough soul searching and careful balancing of the identified pros and con, Al Fahim opted for the ERP software implementation using the Big bang approach because of the more advantages that come with its use, both from a short term and long term approach.
ERP systems are available through many vendors. The choice of the vendor will depend on the size and the extent in which the implementation will be done. Also of great concern is the cost of the ERP system. Most software solutions have been integrated and included by all the vendors. There are J.D Edwards, Baan, Oracle, PeopleSoft, and SAP AG. There have been inclusion of other enterprise software in the development of the software solutions in the entire process. Some of the solutions that have been included by the different vendors include Supply Chain Management, Customer Relationship Management, and Siebel Systems.
Al Fahim choice will be that of SAP-ERP. SAP-ERP has features that are attractive and will serve the purpose that the company seek to achieve. The company has been in the forefront to adopt systems and information systems which will be useful in the project.
Critical success factors
There are several factors that were combined by Al Fahim for the success of the new system to be achieved.
- Commitment from the top management
For the system to be able to pick up as planned, the support of the top management was very critical. Most individuals at the top management had a low acceptance and appreciation levels hence viewed the SAP-ERP system as a technological challenge and therefore prefered to delegate the responsibility to the Information Technology departments to oversee its implementation. This therefore became a great threat to the success in implementing this system
- Resistance to Change:
Resistance to change waas also been viewed as a great hindrance to the successful implementation of the ERP system. Historically, the implementations of ERP system have been unsuccessful and failed to reap the benefits of the program because the management has always underestimated their input in this process and instead delagated the duty of IT personnel .
- Business Adoption of ISO standards and Re engineering:
This means that all company processes in the company have to be changed to conform to the Model. The company had to employ all the ISO standards as required of any modern business. A company will either choose to implement the software as it is or choose to customize it. This will also need the organization to customize the software to be able to suit their needs or taste.
Appropriate Infrastructure:
Proper planning and budgeting needed to be done for the sake of purchase and installation of the right hardware and networking infrastructure are needed to make the ERP application operational. This ERP system fully relies on a sophisticated IT infrastructure to be operational. Hardware and software configuration of these systems will have a critical influence on the implementation. There are several issues that will have to be addressed with regard to lifecycle of the ERP system, from the planning stage to the implementation stage (Al-Mashari, Zairi, & Al-Mudimigh, 2010).
For the above success factors to be realized the following issues must be addressed: The readiness of the organization to implement the SAP-ERP system is critical. How will the system help the business to be more productive is another question that was asked by the management towards the rolling out of the system. Whose input will be needed in the implementation effort of the system is another paramount factor to be looked into.
The organization will have to strategize on the following best practices to: It will identify what are the specific benefits that will be gotten from the ERP implementation and give a lot of focus on the identified benefits throughout the implementation process. Further to that the executive management should show its support for the project by endorsing. A mission statement should also be developed so that it will help the entire team implementing the system to base on it as a target (Morris, 2011).
Metrics to measure how well the system objectives of the system are being met shall be developed to help gauge the effectiveness of the system, and also a project leader shall be appointed to lead the team. Teamwork shall be needed through the sharing of responsibilities between the IT personnel and the functional areas
A determination to see whether the institution has the in house resources like skills and personnel is sufficient. There will also be the setup of a project team that will have a steering body (management), an advisory committee plus a cross functional project team. From this point, the gap between plans and the performance of the system are closed out
Selection of a suitable Package: This level involves the determination of the features and functions in the ERP system meet the company needs. The will help in ensuring that the system is compatible with the needs of the company. The company will also look at issues relating to costs through comparing whether to buy an integrated package from a single company or vendor or independent solutions for each department from several vendors. While selecting the appropriate software, the functional capabilities, its technical features and cost should all be looked into
Implementation Plan: The most appropriate methodology of implementing the system shall be chosen from the many available options in the marked, for example, The Big Bang. This will require the procurement and installations of the relevant hardware and software. At this level, the program shall be rolled out preliminarily using phases. During the rollout, there will be a software package training for the team implementing the project,
Actual Use: The Key questions that a business will ask itself are what steps will be taken to ensure that the implementation is followed to the letter. This shall be managed through the creation of a parallel or dedicated working environment for the team doing the implementation. There will also be a data migration plan is in place for the company to change over from the old software system to the new on right from the genesis of the implementation process (Su, & Yang, 2010). The company shall also create a training plan for all the system users to enable proper understanding of the interface. Finally the management shall always evaluate all the risk, constraints and assumptions that relate to the newly adopted system.
Training of users
Knowledge transfer has become so essential in that the lack of knowledge has become prime cause of the failing of the ERP projects all over. Al Fahim therefore saw the need for training of all of its personnel. This included all the technical staff and also the user community at A Fahim. It came to realization that staff only got trained on how to use the newly acquired computer software instead of also getting taught on how business is supposed to be done differently.
Knowledge transfer is therefore essential for all parties involved in the implementation, installation and use of this SAP- ERP system. The company therefore always embarked on an ambitions training program prior to the project go live where each staff has got trained. The training targeted users affected by the process changes and the immediate end users of the system (Gumus, Yayla, & Gurbuz, 2011).
Recommendations
There are other alternative solutions that could be have been adopted for the company to be successful still. Since the company could have just adopted the use of cloud computing so that enterprise systems could be implemented in a private cloud. Private cloud is still not developed and is accessible from the internet. It puts the organization into great risk. The use of ERP will be effective in the case that has been provided because it will enable the company to have their customization. They will also have better security in the system. The use of alternative options like private cloud will put the systems of Al Fahim to greater risk.
The choice of the vendor is because of the cost and the reliability of the software. It is more reliable to have the vendor that has been selected.
References
Al-Mashari, M., Zairi, M., & Al-Mudimigh, A. (2010). ERP implementation: An integrative methodology. In I3E 01 Proceedings of the IFIP Conference on Towards The E-Society: E-Commerce, E-Business and E-Government.
Gumus, A. T., Yayla, A. Y., & Gurbuz, K. (2011, June). Performance evaluation of ERP implementation by using fuzzy MCDM. In Innovations in Intelligent Systems and Applications (INISTA), 2011 International Symposium on (pp. 445-449). IEEE.
Velcu, O. (2010). Strategic alignment of ERP implementation stages: An empirical investigation. Information & Management, 47(3), 158-166.
