Riordan Mfg. Case Study - Internal Business Systems

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Corporations rely heavily on their internal business systems. These business systems consist of departments such as finance and accounting, human resource, legal, sales/marketing, and operations. Riordan Manufacturing, Inc. contains all the necessary business systems to operate for day to day activities. However, the current business systems are not primed for optimal efficiency. Information on current issues and suggestions on resolving companywide issues will be addressed. Finance and Accounting

The three Riordan Manufacturing locations have independent finance and accounting business systems. The locations are the Georgia plant, the Michigan plant, and the San Jose corporate office. All information is transferred to the corporate office located in San Jose, CA. The finance and accounting information is consolidated into the corporate finance and accounting operating system. This consolidation process is where additional funds and processes are wasted. All locations consist of basic components such as general ledger, accounts payable and accounts receivable. Specific components that are only managed at the corporate office, in San Jose, CA, include EDI (Electronic Data Interchange), bar code reading, and EDSS (Executive Decision Support System). During the acquirement of the Michigan and Georgia plant, the compatibility between the different operating systems was not considered. A network diagram of the San Jose location shows they are operating in a Windows Server environment. This location is running IBM server software, as they have (3) IBM servers documented. The San Jose site is using a UNIX ERP/MRP server, so they have UNIX as well. MAC operating systems are used since the site is operating 15 G5’s from the Macintosh Corporation. The Michigan plant has a vendor developed software application, and the attendant source code for the finance, accounting and process application. The vendor is no longer in business. The application runs on a pair of DEC Alpha’s using the VMS operating system, VAX4000 workstations and programmed in C. The Georgia operation of Riordan Manufacturing is dedicated to manufacturing plastic fans. Georgia had outsourced to a vendor (different from Michigan) to develop the software application, and the attendant source code for their finance and accounting system. The system runs on a pair of AS400’s using the UNIX operating system. The Georgia system also makes use of PC’s (windows) as workstations and is programmed in RPG400. Apparent issues exist with the different finance and accounting systems located at each location. These issues cause incompatibility and wasted company resources. San Jose uses a Windows based system and is entirely dependent on the application. Michigan has software that is aging and cannot be updated. Michigan’s system also runs on VMS. Georgia runs on a UNIX system. These different operating systems cause a data convergence nightmare. The data produced from each site is sent to the main office where it must be either re-entered or reformatted due to incompatibility. This extra work can be daunting and must be resolved. Consider for a moment that an income statement, balance sheet and an audit is completed each month. All this data can take an extreme amount of time to read and convert into one type of output. As things stand Riordan Manufacturing is hemorrhaging money regardless of how their product is doing. The solution is to consolidate the three finance and accounting systems in order to cut costs. Since the three systems are already paid for, they should be examined first to determine if any are viable for company wide use. The system in Michigan is outdated due to the vendor being out of business. The San Jose site is rigid and may not conform to company needs as the business continues to evolve. The Georgia system seems viable since the vendor is in business, and the source code is available. The system would need to be tested to...
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