Case Study Analysis: Erp Implementation for Nibco

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Unit 6 - Case Study
NIBCO’s “Big Bang”: An SAP Implementation

Professor: Richard Yellen
Student: Vo Ngo Lan Phuong
Course: Ham 23
ID: 217496
Professor: Richard Yellen
Student: Vo Ngo Lan Phuong
Course: Ham 23
ID: 217496

Hanoi, 11/2012
CASE STUDY
Table of Contents
I. Overview3
II. NIBCO’s implementation of ERP solution3
III. Pros and Cons of “BIG-BANG” approach for ERP4
IV. ERP project implementation: lessons and recommendations6 List of Reference9

Case Study - NIBCO’s SAP Application Implementation

I. Overview
The case shows the implementation of SAP ERP solution in NIBCO, a manufacturer of pipe and fittings, a mid-size manufacturer with about 3,000 employees and revenue over 460 million USD. The company has implemented successfully the full package of ERP solution, provided by SAP, the leading solution provider under the consultancy of Boston Consulting Group. NIBCO has gained the success by good management and project team understanding, determination and experiences. The method of implementation of NIBCO for this ERP solution is running all in one day, this brings the company to a quite risky situation if something wrong happens. But the company has run the system successfully, with positive results. The implementation succeeds because of all the planning, personnel, management and the cooperation with application providers and consultants. NIBCO has over 3,000 employees and operates 10 plants, and 17 centers for distribution over US. The databases and information systems are not integrated therefore cannot communicate and collaborate effectively, which causes time and efforts wasting. Also, over the years of development, the business processes change, the information data increase, the old system cannot meet the demands of cross functional operations. With the consultants from BCG, NIBCO has developed a plan for implementation of new ERP system, using professional solution from a leading provider, SAP. The aim of NIBCO is to set up a new, large, integrated information system to replace the old system, connecting and integrating all the IS from factories, plants and distribution centers all over the country. With the initial project duration estimated as over 3-5 years, the management and project team has implemented the whole system in only 18 months, and successfully.

II. NIBCO’s implementation of ERP solution
Using the consultancy services from BCG, the information system of NIBCO was very weak and poor. The system do not support the provision of information for manager timely, did not support process of decision making, especially for functional departments as accounting, purchasing, selling, marketing and customer supports. Due to the lack of real time data sharing the management and manufacturing meets difficulties to improve quality and efficiencies. Over the years of operation, factories and departments have implemented their own modules or application such as order entry, manufacturing, distribution and accounting. Because of the non-systematic application and implementation, in separate factory and department, each user may have their own software, different version, and separate database. Therefore it is difficult to integrate and cooperate among factories and distribution centers. To implement the new system, NIBCO has used professional consultancy services, purchase leading software application from top vendor, and assigned top managers to manage project team, system development, and IS staff for planning, and integrating, designing, installing the new system. Although the BCG determined that there is a need for a change in information system of NIBCO, the current system is “poor” and needed “cut loose” to grow the company and become more global. The BCG’s suggestion for three to five years implementation should be too long, somehow, this can cause more cost and efforts for NIBCO than actual need (Brown, 2012, p. 491).

III. Pros and Cons of “BIG-BANG” approach for...
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