University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
ERP Implementation Project
Rolls Royce is one of those pioneers global companies which they have facilities in the most of the world countries, many suppliers, partners and huge base of customers all over the world, moreover as the most pioneers global organisations actions to avoid the hypercompetitive in the global market, globalization and many challenges Rolls Royce decided in 1998 to change its organizational strategies to be more flexible and more response to the customers’ demands which that need to flatten its organizational structure hierarchy and turn to be process oriented rather than functional oriented so they divided the company into two business units the first one called customer focused business unit (CFBU) which there all the orders and sales deals comes and where all focused on customers’ needs to achieve best sales and second one called operation business unit (OBU) which there is the production of products to fulfill other units demands, Executive group who managed all the units and all decisions come from them to be distributed to whole company staff.
Rolls Royce has recognized that changes of its organizational strategies, aspiration and plans in growths over all the world will not be supported by the legacy resources planning systems which it owned them and the difficulty of theses systems to be fixed and development and because the important of the information technology and the internet to create process oriented business environment and how much is effective to transfer the organization from rigid structure to be more flexible, so Rolls Royce decided to sign partnership with electronic data service company (EDS) to find for it modern business solution system for the data information management and resources planning to be more flexible and modify of its requirements which is in its turn decided to implement the SAP enterprise resources planning system (ERP) on operation business unit (OBU) and in my point of view the step that sign with outsourcing partner to find solution to specific issue like what Rolls Royce did with EDS and outsourcing the IT solutions issue one of one of the steps have done by Rolls Royce to overcome the complications of the ERP implementation and let it just focusing on the its field of engines manufacturing.
Important steps has done by outsourcing the implementation project to specialized company because Rolls Royce has realised the fact that this kind of projects on huge organisation are risky, any error in implementation will lead to huge money losing, many practical examples prove that, like the fail in implementation ERP system cost DELL 10 $ billions just to scrap it, moreover this kind of systems very expensive to remove it or to retrieve the data from it or even to modify it, the customization for this kind of systems is very expensive, this kind of system need high integration between departments, peoples and users because in truth the ERP system need board organisational transformation process specially in the organisation management model , organisation structure , management style and culture and particularly to staff so the organisation must be ready to implement the ERP system, ready to change which Rose Royce was ready to this transformation and there is integration between department instead the success implementation will make the company get all the benefits and advantages of this kind of the systems like process automotive and the quick access of up to date and timely management information which give the organisation competitive advantage which the Rolls Royce one of those organisations want to achieve that’s advantage so it was critical to the Rolls Royce to achieve success ERP project implementation, so they forming project team to implement the ERP system in success fashion, this team consist outsourcing specialists from external company EDS , which EDS itself has specialized on SAP system , SAP consultants and internal managers and staff have good experience with cross-functional business relationships and experience on the old systems, all of them will corporate to achieve the project implementation success. As any complicated projects of implementation, the Rolls Royce ERP project implementation faced some problems can be grouped into three area of culture, business and technical.
Culture problems we can conclude it in sentence of the people are afraid of what they do not understand, as unexpectedly the new system faced resistance from the people in spite of the new system do the same functions or better than the legacy one has, so the project team decided to increase the original plan period because they need more time to illustrate them the advantages of the new system and how will do positive effects on the department and the company as whole, moreover they need to make the people integrate and to train them how to use it in effective way they tried to make the accept it as new work environment practices through educational plan to educate the staff in the new system which the plan consists , presentation , demonstration , information delivery and expert training moreover the team trained around 10000 employees in the organization, the project team strategy realised that important to accept the system and turn them to new environment practices which consider significant to running the system in success way and to create proper integration between the departments to achieve the advantages of the new system unless the ERP system will not add value or competitive advantage if the users not integrate between each other’s, for that the project team take all the time required to overcome this problem .
The Technical problems had raised in the implementation project is the data and how much this data important and valuable to the organization in hand and the high cost of retrieve, transfer and storing these date in new system server in other hand, also the fairs to lose the valuable data on the old system servers and the difficulty to retrieve the data from the old system which its stored there in sensitive format moreover the possibility of the data duplication all of these problems the team success to solve it with lowest cost to achieve that the project team in some special area of the old system they kept it running until they can phased it out by the new system then they have built interface bridge between the old system and new system, like when they kept the computer aided design (CAD) used by Rolls Royce the same.
Rolls Royce ERP implementation project is success practices case study for complicated and costly projects as the ERP implementation project, as we noted from this case study the project implementation require organization willingness to change on its organisational structure, the pepole integration between different departments is vital factor to achieve success fashion of implementation, ERP system modification and customization are costly and expensive that lead us to said that the ERP implementation projects is term of organisation processes, organisation style, organisation fashion, organisation pepole integration, organisation pepole practices modification not system customization, the organisation realization of complications of implementation the system lead it to form expert project teams to achieve success implementation even by outsourcing service unless will be error in implementation which that disaster as we read in the paper real disaster examples of error ERP implantation and how its cost the organisation billions, in finally when the organisation decide to implement the ERP system it must be ready and able to define the main core businesses requires the ERP system then the organisation can deiced which of ERP modules is fit to the organisation need.
Yasuf, Y., Gunasekaran, A. & Abthorpe, M., 2004. Enterprise information systems project implementation: A case study of ERP in Rolls-Royce. International Journal of Production Economics, 87 (3), pp.251-266.