IT management assignment help analysis report on: ERP & change management

Executive Summary

This report has been designed in order to highlight the importance of ERP in the organization. In this report various advantages & disadvantages of ERP have been mentioned in order to know more about the ERP. Various Strategies have been discussed adopted by Companies in an attempt to implement the successful change. In this report two case studies have been mentioned such as ERP implementation at BPCL and ERP implementation at HP. ERP implementation at BPCL shows the positive points of ERP whereas EP implementation at HP shows the negative points of ERP.

Advantages of ERP

There are various benefits perceived by Companies through the implementation of the ERP like Integration, Efficiency, Cost Reduction, less personnel and Accuracy.

Integration

It can be seen that integration is one of the greatest benefit in the implementation of the ERP. The major aim of implementation of the ERP is reduction of data redundancy & redundant entry of the data. If, integration is fixed as an objective to automate stock posting to P/L, then it would be viewed as a profitable project. In general, the implementation of the ERP does not enhance and improve the effectiveness of users and if they assume it, it would be an enormous disappointment for them. At last, the implementation of the ERP enhances & improves the coordination & cooperation among the users.

Efficiency
In general, the software of ERP concentrates on coordination & tends not to bother about the routine wants of people.

Cost reduction

It can be seen that the implementation of the ERP minimizes cost only, if Companies take accounting & reporting seriously before the implementation of the ERP and put efforts in it. If Companies do not care, and do simple accounting to just fill the necessary statements then in that case it’s very difficult for Companies to reduce the cost.
Fewer Personnel
It can be seen that the implementation of the ERP wants less accounting personnel & reporting, but more assistant for sales. The ERP forces the people and the organization to be accurate that means hiring of more people and distribution of better work.

Disadvantages of ERP

Expensive

The implementation of the ERP entails implementation, training, software & hardware etc. The implementation of ERP in the Company needs a programmer, purchasing of business consulting from the external source, customization & training for the end user. These all things become expensive for the Company for ERP implementation. With the implementation of the ERP in the Company, other software’s may become rigid (Fong & Kleiner, 2004)

Organizational reaction to change

It can be seen that changes happen immediately & quickly in the Company after the implementation of the ERP. But when there is no suitable knowledge of the system and exploitation of the information would show the questioning in the process of the ERP. If updating has not made in the system, then it would affect the process of the business & generate unnecessary conditions. In general, every member in the organization needs some time to accept the change.

 Problems during the ERP implementation

Enhancement of ERP’S functions

The scope of the ERP gets broader as it is used in the organization. It can be seen that repeated alterations in systems & configurations would add only to the confusion. It is very clear that when functions are managed by the machine then it becomes complex to create the mandatory changes. These problems arise only, when problems are not addressed in the stage of the implementation (Nutt, 2004)

Inflating resources for ERP implementation

It can be seen that the implementation money & time exceeds the stipulated amount and deadline and this situation creates Companies to drop faith on vendors of ERP. In general, Companies think that vendors of the ERP overplay with the time & cost required.
Organizations non adherence to the stated principles

 It can be viewed that Companies greatly experience a broad gap among preaching & practices. The consequence of loss would be greater & devastating when it rotate out to be accurate, still in the ERP case. The successful functioning of ERP is based upon procedures that would throw a significant challenge on potential right of ERP from the implementation stage.

Problem of Transformation due to ERP

It can be seen that Employees search it difficult to accept the changes that take place in the organization through the implementation of ERP. It is very clear that, employees show optimistic sign if everything goes well in the right place. The beginning expectation & interest turns out be apprehensive in specific route of time. There are some categories of the people who never encourage the implementation of the ERP from the stage of conceptualization.

Change Management
It can be seen that change management is a strategy of shifting individuals and organization from an existing position to future position.  It is observed that change management is a process that aimed at motivating employees for accepting of changes and up gradations in their existing business environment. It can be seen that theory of change management may include innovative marketing strategies to facilitate the communication among the change audiences, and formed deeper understanding about styles of leadership and dynamics of the group. It is very clear that change management helps in alignment of group expectations, coordinate team and manage the training of the people. It is observed that change management implements performance measures such as leadership commitment, operational and the financial efficiency. The Company can implement the successful change in the future through promotions & innovative change leaders. The Company should enhance urgency, and encourage people to shift and make strategies that are actual and applicable.The Company should build the team to acquire the correct people in position with the correct emotional commitment, & the combination of knowledge & skills. The company should involve so many people as it is possible, convey the essentials and react to the needs of the people. To implement the constant change, the company should emphasize on existing& future milestones (Edward & Christopher, 2006)

Importance of ERP implementation in the Organization

It can be seen that implementation of the ERP have altered the work background in organizations of IT. The implementation of the ERP takes into consideration technology & people. The package of the ERP controls the flow of the work of the whole organization & it joins the people with each other. In previous years, only big & multinational Companies wanted to go for implementation of the ERP due to great cost involved. In recent time, Many Companies go for implementation of ERP package to achieve the edge over the others. It has been analyzed that the implementation of the ERP is essential for the organization business because software packages of the ERP includes all the key work roles of the organization.  In general, the implementation of the ERP reduces the function of external system that used to intervene among two systems and offers advantages such as lower maintenance, standardization & logical data integration. The successful implementation of the ERP requires coordination of team, efforts, support, execution and the management. It has been analyzed that, the implementation of the ERP is not restricted to one particular business area, but it includes all the areas of the business. The project management of ERP must comprise members of the team through all sections because constant indulgence & maximum commitment is needed to reduce the failure of the risk and increase the rewards. The business of the organization may gather benefits from the implementation of the ERP only with proper execution & effective preparation. The whole implementation of the ERP is a lengthy process and it can take three months & 1 year before it becomes totally aligned with the goals of the Company. In general, many companies take the assistance of Consulting Companies & ERP vendors for the implementation of the ERP. The analyst at the consultant firm which is into the project of the ERP, generally maps the effectiveness of the software in recent business process. The consultants at ERP Project outline the process of the business & explain the function of ERP user (Tabije, 2010)

The ERP project becomes successful only when it accomplishes the exact strategic objectives. The implementation of the ERP coordinates & integrates the process of the business throughout the organization. At last, the implementation of the ERP chooses the organizational structure & design.

ERP implementation strategies

It has been analyzed that the implementation of change management strategies involve development & deployment of change strategy, techniques of change management, project management, resources, organizational structure , managerial style, coordination & communication. It can be viewed that the some technical strategies have been implemented for determining the success of the ERP which includes ERP Complexity, aspects of installation of ERP & cost & time implementation. The research process assists the Company in understanding the implementation efforts of the ERP and hence provides an idea from the time 1 to time 2.

Change management strategies for ERP implementation

It has been analyzed that Improvement & Enhancement strategies like implementation of the ERP basically involves change. The reaction to the domestic customers is significant for the organization to avert the complexities related with the change. To help the top management by solving the problem of workers those are reluctant to the implementation of the ERP.  There are various reasons which show that why Companies require a strategy of change management such as purchasing of the Company of equal size, receiving suppliers to implement an innovative web based process & form, relocation of the office space with the existing building, implementation of solution for ERP and releasing of new product. It can be seen that the formulation of the strategy of the change management is the initial step in implementation of methodology of the change management. The strategy offers an outcome in the decision making within the process of the change. A well designed strategy really brings the change to the life and describes how & who will affect the Company (Sparrow &Cooper, 1998)

There are various strategies adopted by Companies in order to implement a successful change such as analyzing of organizational readiness, creation of future vision, engage leaders, communicate, Transition Staff, Facilitation of Individual Change, creation of organizational Alignment, Training and Monitor & Remediate (Wang, Hutchins, & Garavan, 2009)

Analyzing of Organizational Readiness: Companies analyze the greater impact of change and search basic points of uncertainty & risk and make plans to solve them.

Creation of Future Vision: Companies express the change in a convincing & compelling manner which can be divided broadly.

Engagement of Leaders: Formation of a plan to benefit the buy in & hold of individuals which are crucial to success.

Communication: Companies form a strategy of communication & plan of roll out to form understanding & acceptance.

Transition Staff: Companies form plans for redeployment, transition of the staff and retention of the talent.

Facilitation of Individual Change: It can be seen that Companies try to build adaptability skills for the change and assist individuals internalize& go within the change.

Creation of Organizational Alignment: It can be seen that Companies analyze & evaluate significant policies for searching out the incongruence point & form plans & policies for the alignment.

Training: It has been analyzed that Companies form a strategy of training to make proficiency for working under the innovative & new model.

Monitor & Remediate: It can be seen that Companies compute performance & form strategies to solve out the problems.

BPCL

It can be seen that the BPCL is a major player in the petroleum industry of India, and successfully implemented the ERP program. The implementation of the ERP started in April, 2000 and after that the BPCL decided to coordinate all its actions with the package of ERP that is SAP R /3. The BPCL decided to increase its activities of decision making & react faster to the needs of the user with the help of ERP. The intention of the Company was to illustrate the difference in retaining of customers, service and assist to enhance the business of the customers of I & C. BPCL wanted to enhance the thrust of the retail by misusing initiatives of IT to the greatest. This case investigates in detail the implementation of ERP at BPCL. The Company, focused on the infrastructure & IT plans before the implementation of the ERP. The Company developed IT effectively to robust the position of the market and technical considerations for the ERP implementation (Schraeder, Swamidass & Morrison, 2006)

The Benefits achieved by the BPCL through the implementation of the ERP such as SAPR/3 software assisted BPCL to launch successfully its initiatives of e-biz, which allowed customers of I & C to update the status of the order online. The implementation of SAP R/3 software not only permitted the BPCL to retain the current users, but also assisted in attraction of innovative & new customers. It has been analyzed that according to the sources of the Company, the biggest benefit from the implementation of ERP was concerning the inventory management. It can be viewed that before the implementation of the ERP, the practice of Company monthly inventory examines lead to the time lag in the orders of the processing

HP

Another Case is related to the US based HP which provides detailed information on the failure of the project of the ERP. It can be seen that US based HP is a major information & hardware technology Company. This case points out the history of the implementation of the ERP at HP and shows the purpose over the decision to transfer the centralized system of ERP. This case gives the details of the circumstances which lead to the failure of the ERP and examines the efforts of damage control created by the HP. There were various issues at the company such as understanding the purpose for the implementation of the ERP software, examination of problems during the migration project of ERP, analyze the factors for failures of ERP and critically analyze the consequence of the failures of the ERP implementation.

The ERP Implementation

The products of HP were famous for reasonable & excellent quality prices. The Company had a greatly decentralized structure of the organization & each & every business unit was independently marketed, designed& manufactured the products. The Company VP was accountable for the implementation of the ERP software and supply chain. The order system of ISS became uncomfortable because of problems with the integrity of the data and need a constant enhancement & improvement in demand for the servers of HP’s standard. This type of technical glitch leads to the improper & unstable orders & created backlogs. The analysts believed that failure of ERP implementation at HP was an exhibition of how such the failure would affect the performance of overall business. Even, the Company had spent a large amount of money in increasing the momentum of delayed orders.

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