Rolls Royce

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Int. J. Production Economics 87 (2004) 251–266

Enterprise information systems project implementation: A case study of ERP in Rolls-Royce Yahaya Yusufa,*, A. Gunasekaranb, Mark S. Abthorpec
a Business School, University of Hull, Hull HU6 7RX, UK Department of Management, University of Massachusetts, 285 Old Westport Road, North Dartmouth, MA 02747-2300, USA c Department of Mechanical and Manufacturing Engineering, Nottingham Trent University, Burton Street, Nottingham NG1 4BU, UK b

Abstract Economic globalisation and internationalisation of operations are essential factors in integration of suppliers, partners and customers within and across national borders, the objective being to achieve integrated supply chains. In this effort, implementation of information technologies and systems such as enterprise resource planning (ERP) facilitate the desired level of integration. There are cases of successful and unsuccessful implementations. The principal reason for failure is often associated with poor management of the implementation process. This paper examines key dimensions of implementation of ERP system within a large manufacturing organisation and identifies core issues to confront in successful implementation of enterprise information system. A brief overview of the application of ERP system is also presented and in particular, ERP software package known as SAP R/3, which was the ERP software package selected by Rolls-Royce plc. The paper takes an in-depth look at the issues behind the process of ERP implementation via a case study methodology. It focuses on business and technical as well as cultural issues at the heart of the Rolls-Royce implementation. The case study also looks at the implementation time scales and assesses the benefits from the project both tangible and intangible. r 2003 Elsevier B.V. All rights reserved. Keywords: ERP; Information systems; Implementation; Success factors; Rolls-Royce

1. Introduction The global nature of modern marketplace requires active players to internationalise their operations. In the past, companies were used to competing based on one or two competitive performance objectives such as price and quality. However, present markets demand both price and *Corresponding author. Tel.: +44-1486466933; fax: +441482466216. E-mail address: (Y. Yusuf).

quality in addition to greater flexibility and responsiveness and thus today’s organisations must compete based on all competitive objectives. In order to achieve such simultaneity in performance objectives, some organisations have decentralised their operations by global outsourcing of activities. This places enormous challenge on companies to achieve a co-ordinated and integrated supply chain. The emergence of various information technologies such as the Internet, electronic data interchange (EDI) and WWW facilitate the attainment of an integrated supply

0925-5273/$ - see front matter r 2003 Elsevier B.V. All rights reserved. doi:10.1016/j.ijpe.2003.10.004

252 Y. Yusuf et al. / Int. J. Production Economics 87 (2004) 251–266

chain and in turn flexibility and responsiveness in meeting changing market requirements. Information systems such as manufacturing resource planning (MRPII) and enterprise resource planning (ERP) in particular have gained ground in providing support for achieving an integrated supply chain. Firms around the world have been implementing ERP systems since the 1990s to have a uniform information system in their respective organisations and to re-engineer their business processes (Rajagopal, 2002). ERP system as a packaged software has the advantages of reduced cost, rapid implementation, and high system quality (Lucas et al., 1988). Although application packages have these benefits over custom design software, packaged software have problems of uncertainty in acquisition and hidden costs in implementation. Successful ERP implementation must be...
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