Case Study Report for Cisco System, Inc. Implementing Erp

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Case Study Report for Cisco system, Inc. Implementing ERP

Team Members: Nick Qiao, Ginger Yang, Cynthia Lai, Wellington Chou

* Cisco Company
Cisco was set up in 1984 and developed into one of the top companies in the world. Its main business was related to the network which remained in IT industry. In this industry, the competition was fierce. Cisco faced competition from rivals such as 3Com, Nortel, Lucent etc. To strengthen its market position, Cisco integrated the strong spirit of innovation in both technology and management which represented the value of Silicon Valley. The talents in Cisco can be addressed as IT expert and elite as Cisco itself was attractive enough for the young and smart. As we mentioned above, the company’s IT background and its company innovation culture helped to launch the ERP system in a short time period. Besides the IT talents the company had actually became a big advantage when Cisco began to choose manpower within company for the ERP implementation team. * the Management Team

In 1988, John Morgridge was nominated as the CEO of Cisco who was an experienced executive in the computer industry. With the departure of the two founders in 1990 due to the IPO, Morgridge was free to continue his plans to install an extremely disciplined management structure. Besides Peter Solvik joined Cisco as CIO later on, he made reforms. Firstly, the IT-reporting relationship was changed from accounting to the Senior Vice President of Customer Advocacy. IT department was no longer viewed as a cost center reporting through accounting department since then. This reform enhanced the function of IT department in the whole company and made the importance of IT department obvious. Secondly, the IT budget pertaining to the functions were returned to the functions, leaving a small portion in the general and administrative account. This created a structure in which all IT application projects were client-funded. All the change of the management team and the reforms regarding to IT department created a better circumstances under which the following ERP system could be implemented more smoothly. * the original IT system

Prior to ERP system, Cisco was running a UNIX-based software package to support its core transaction processing. The functional areas supported by the package included financial, manufacturing and order entry systems. The scale of IT systems was too limited to support Cisco’s growth. The IT systems were not standardized which meant they were not flexible or robust enough to meet management requirements. The applications didn’t provide the degree of redundancy, reliability and maintainability. Thus it was hard to make changes to meet the business needs. All the above shortcomings of legacy systems led to the final ERP implementation. SUCCESS OF ERP SYSTEM

* Clear goals, objectives and scope
Cisco faced the dilemma of the functional areas in late 1993, and the systems replacement difficulties of functional areas perpetuated the deterioration of Cisco’s legacy environment. In January of 1994, Cisco’s legacy environment failed so dramatically that the shortcomings of the existing systems could no longer be ignored. As a result, the company was largely shutdown for two days. Cisco’s struggle to recover from this major shutdown brought home the fact that the company’s systems were on the brink of total failure. In order to solve this problem, an alternative approach was needed. The IT release team focused on detailed data gathering during the global design review process. Clearly defined business and strategic objectives are in the most cases very important critical factor. Clear goals and objectives should be specific and operational and have to indicate the general directions of the project. They should also provide a clear link between business goals and IS strategy. Well-defined objectives help to keep the project constantly focused, and are essential for analyzing and...
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