This critical evaluation examines the ERP implementation failure in HP, analyzing the background, standard criteria, iron triangle, critical identification and justification of criteria, and recommendations for improvement.
Contribute Materials
Your contribution can guide someone’s learning journey. Share your
documents today.
Running head: CRITICAL EVALUATION OF A REAL WORLD PROJECT Critical evaluation of a real world project: “ERP implementation failure in HP” Name of the student: Name of the university:
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
1CRITICAL EVALUATION OF A REAL WORLD PROJECT 1. Background of the company and the selected project case Most often it is realized that, success or failure of any project is dependent on certain criteria. During the project planning and implementation phase if the project associates fail to identify all success criteria professionally then the project would fail to meet its objectives, goals and aims. For successful critical evaluation the project that has been nominated is “ERP implementation failure in HP”. HP is an American multinational corporation (headquarter located in Palo Alto, United States.The company offers their product and software services to different sectors like health, education and government also. In the year of 1983, David Packard and Bill Hewlett had initiated their business of the electronic instrument company as HP in California. The first equipment that HP developed was resistance capacity audio oscillator. This equipment was designed and implemented to test different sound equipments. In the year of 2004, the HP globally reported huge financial loss that was attributed by certain challenges faced by the migration to a centralized ERP system. In order to implement the ERP system whatever cost has been estimated was increased five times more. The company gave this responsibility to an internal investigation team to check the cause for this huge loss.The causes are not related to the system application product software. However, the ERP project failed due to the execution of project for migrating to a centralized ERP system at North America. The goal of the project was to allow all their consumers to place orders with one delivery date and invoice. However before the implementation of the project the higher authority of HP ignored all the valuable suggestions give by their employees. They warned the developers regarding the migration challenges that become apparent once problem were challenging of orders. The issues of order backlogs occurred as all the data from the older system were failed to
2CRITICAL EVALUATION OF A REAL WORLD PROJECT get transferred to the new system. The company stopped spending additional money to fulfill order by way of the flights and all direct orders through the distributors for speeding all the things up. HP promised their consumers that these operational errors are all under control but they failed to resolve those. In order to resolve these functional errors they were needed to collaborate the IT and business group appropriate. 2. Discussion on standard criteria The goal of the project is to allow their consumers to place order from various systems and combine the orders into one order with one delivery date and feedback. There are some other issues identified for this project include data integration, demand forecasting issues, poor planning and improper system testing, constitution of the project team and inadequate training between the project team members and inadequate implementation. The above mentioned factors are very essential for project success though these are not properly managed and considered by HP during the ERP implementation period. In order to implement the ERP project the project head and company were required to consider and maintain the above mentioned criteria but they failed to maintain this, As a result the ERP implementation project for HP failed. Due to poor project planning and inadequate testing facilities the employees and consumers were dissatisfied. It results bad reputation that makes loss in revenue around $400 Million and loss in implementation cost. HP failed to give competition to both IBM and Dell. The success of ERP implementation is dependent on planning that might have considered the technical aspects along with business processes. The HP again failed to build into the incident plan to have a manual backup for keeping orders graceful.
3CRITICAL EVALUATION OF A REAL WORLD PROJECT 2.1 Iron triangle In order to successfully implement any project the project manager requires considering triple project constraints in terms of project cost, time and scope management. It is responsibility of the project manager to complete the project scope within estimated time and budget. The iron triangle defines an idea regarding how important the triple project constraints are for managing projects. The financial constraints of the project are also known as project budget. The scope developed for the project requires meeting the project scope within the assigned timeline. While implementing the ERP project, HP needed to estimate their cost through several methods such as historic data, resource costs, bottom up, parametric, vendor bid, quality analysis, reserve etc. Though, the project scope was designed appropriately by HP but the needful factors that are to be considered for this implementation were not being followed professionally. According to PMBOK project management practices, time management is referred to as one of the most crucial project management knowledge area that needed to be followed by the project manager and project team members. The project head of HP failed to consider proper cost and time management plan as a result the project failed to meet the expectation of the consumers and the employees as well. It has been determined that, commercial success of ERP implementation project is partly dependent on project planning details. This also needed ot consider business processes along with the technical perspectives. 3. Critical identification and justification of the criteria After analyzing the detail ERP implementation project of HP it is defined that, the products of HP are always excellent in their quality as well as reasonable price range. The organizational structure of HP is highly decentralized and the business units were completely
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser
4CRITICAL EVALUATION OF A REAL WORLD PROJECT independent. The unit products developed by HP were also marketed and manufactured complete independently. In the early age of 1990 as the electronic industry started flourishing the era of production in the industry also commenced. HP has redesigned their business strategies to explore low priced electronic market. In the year of 2000, HP planned a phase out its numerous legacy systems and replaces them with a SAP R/3 (standard ERP solution). The reengineering process of HP initiated with shorter lead and delivery timing, cost savings and global distribution system. In the year of 1993, HP planned to began a project with implementation of different units such as product planning, material management, financial accounting and controlling. 4. Critical analysis of the case based on chosen criteria HP has adopted a business process based approach that is comprises of information technology and business objectives. For some time period the company also appreciated their aim for implementation of a single order management system. In order to gain a better business effectiveness and efficiency HP has planned to implement SAP based ERP solution or SAP basedfusionordermanagementsystemformanagingtheirbusinessoperationand functionalities. In order to do so HP also reduced the numbers of their order management systems.A soon as the system was upgraded from one version to another, different migration challenges were identified. The new system involved around more than 70 supply chain systems together. HP identified that integrated SAP ERP solution will offer unique functionalities with reduced issues of time and cost management. With progressing time, HP started facing various operational challenges that includes both the technical and business perspectives. The company also faced major disruption for three weeks due to the IT level problems and catered business
5CRITICAL EVALUATION OF A REAL WORLD PROJECT applications. The assigned internal investigation team of HP identified all the reasons of ERP migration failure and these are as follows: Constitution of the project team: It has been found that the assigned project team members are much interdependent on each other as a result various difficulties in case of program management were occurred. The project groups also faced massive communication errors. It is identified that, communication between the order taking group and the back end logistic group were not professionally maintained by the ERP project implementation team of HP. Issues with data integrity: This risk was surfaced between the new SAP system and the logistic system those were implemented. Production training and inaccurate data management were identified as the main cause for the issues data integrity. Issues with forecasting problems: The divisions cannot predict accurate requirements for al l the customized server products.Over order management has become a major problem for the company with the ERP solution. Poor planning and improper testing: The project activities were not planned accurately by the project manager and the project team members.Only for the standardized orders the system was tested. The contingency plan developed for the ERP implementation project was inadequate. Improper identification of technical, functional and non functional specifications: In depth assessment of ISS divisions were not done professionally as results the project team does not follow all the project testing specifications.
6CRITICAL EVALUATION OF A REAL WORLD PROJECT 5. Presentation of accurate conclusion It is concluded that, in order to improve the business efficiencyand competitive advantages the project manager and the project team members of HP has planned to implement an ERP solution. However, the training, testing and customization approach for the project were not professionally followed. As a result the project failed to meet the expectation of the consumers and employees as well. It was assumed that ERP solution would gives a better response to various requirements of local market and maximum availability of combined stock levels. Though, it was not implemented as the project implementation was failed. 6. Provision of suggestions or recommendations in the event It has been determined that different risks are there which impacted the HP ERP system implementation project. In order to re run the ERP implementation project the project manager should identify proper functional, technical and non functional requirements. The negative impacts are required to be mitigated by the project developers to overcome the functional and operational system application risks. Some suggestions or recommendations are given in the below section to overcome the application and implementation errors: Development of proper scope statement: Before initiating any project the project manager should develop a project scope statement. The scope statement needs to be shared to all the project team members. It will allow the project team members to realize the project aim and objectives.It can be said that, professional scope statement will help the project team members so that it can meet the aim and objectives.
Secure Best Marks with AI Grader
Need help grading? Try our AI Grader for instant feedback on your assignments.
7CRITICAL EVALUATION OF A REAL WORLD PROJECT Risk management plan: Before initiating the HP ERP implementation project the project manager should have identified the potential risks, possibilities of its occurrences and impact as well at the very initial phase. Traininganddevelopmentprogram:Inordertoovercometheoperationaland functional challenges, the company project developers are needed to arrange professional training and development plan. It can be said that proper training and development program will improve the skills and knowledge of the project team members. It will help them to meet the consumer’s expectation and employees requirements. Proper communication: In addition to this the other suggestion that is applicable for this project is implementation of open communication. The project team members are needed to follow open communication while interacting to each other. Open communication offers an independent platform to the project team members where they can share their ideas and point of views to each other. Leadershipandmotivation:Theprojectheadshouldpossessleadershipand motivational quality so that they can keep the other employees engaged to their assigned job roles and all other responsibilities. Proper cost and time management: It is mandatory for the project managers to assign project time and budget at the very initial phase. In order to develop the time plan an accurate schedule is needed to be prepared by the project manager. The finance manager should conduct a feasibility study at the project initiation phase to ensure that whether re run of the ERP implementation project will be beneficial or not. If possible change request factors are properly
8CRITICAL EVALUATION OF A REAL WORLD PROJECT identified at the initial phase, then respective change management are also needed to be implemented by the HP project development authority.
9CRITICAL EVALUATION OF A REAL WORLD PROJECT Bibliography Chang, T.S., Fu, H.P. & Ku, C.Y., 2015. A novel model to implement ERP based on dynamic capabilities: A case study of an IC design company.Journal of Manufacturing Technology Management,26(7), pp.1053-1068. Chaushi,B.A.,Chaushi,A.&Dika,Z.,2016.CriticalsuccessfactorsinERP implementation.Academic Journal of Business, Administration, Law and Social Sciences,2(3), pp.19-30 Chaveesuk, S. & Hongsuwan, S., 2017. A Structural Equation Model of ERP Implementation Success in Thailand.Review of Integrative Business and Economics Research,6(3), p.194. Demi,S.&Haddara,M.,2018.DoCloudERPSystemsRetire?AnERPLifecycle Perspective.Procedia computer science,138, pp.587-594. Gupta, S., Misra, S.C., Singh, A., Kumar, V. & Kumar, U., 2017. Identification of challenges and their ranking in the implementation of cloud ERP: A comparative study for SMEs and large organizations.International Journal of Quality & Reliability Management,34(7), pp.1056-1072. Jamil, M.Y. & Qayyum, M.R., 2015. Enterprise resource planning (ERP) implementation in Pakistanenterprises:Criticalsuccessfactorsandchallenges.JournalofManagementand Research,11(2), pp.1-17. Johansson, B., Alajbegovic, A., Alexopoulo, V. & Desalermos, A., 2015, January. Cloud ERP adoption opportunities and concerns: the role of organizational size. In2015 48th Hawaii international conference on system sciences(pp. 4211-4219). IEEE.
Paraphrase This Document
Need a fresh take? Get an instant paraphrase of this document with our AI Paraphraser
10CRITICAL EVALUATION OF A REAL WORLD PROJECT Johansson, B., Alajbegovic, A., Alexopoulo, V. & Desalermos, A., 2015, January. Cloud ERP adoption opportunities and concerns: the role of organizational size. In2015 48th Hawaii international conference on system sciences(pp. 4211-4219). IEEE. Li, H.J., Chang, S.I. & Yen, D.C., 2017. Investigating CSFs for the life cycle of ERP system from the perspective of IT governance.Computer Standards & Interfaces,50, pp.269-279. Nagpal, S., Khatri, S. K., & Kapur, P. K. (2015, September). Prioritization and ranking of ERP testing components. In2015 4th International Conference on Reliability, Infocom Technologies and Optimization (ICRITO)(Trends and Future Directions)(pp. 1-6). IEEE. Sørheller, V.U., Høvik, E.J., Hustad, E. & Vassilakopoulou, P., 2018. Implementing cloud ERP solutions: a review of sociotechnical concerns.Procedia computer science,138, pp.470-477. Sun, H., Ni, W. & Lam, R., 2015. A step-by-step performance assessment and improvement method for ERP implementation: Action case studies in Chinese companies.Computers in Industry,68, pp.40-52. Tso, R.V.Y., Chen, H., Yeung, Y.A., Au, T.K.F. & Hsiao, J.H.W., 2017. Right hemisphere lateralization and holistic processing do not always go together: An ERP investigation of a training study. InAnnual Conference of the Cognitive Science Society, CogSci 2017. Cognitive Science Society.. Zouaghi, I. & Laghouag, A., 2016. Aligning key success factors to ERP implementation strategy: learningfrom acase study.InternationalJournal ofBusinessInformationSystems,22(1), pp.100-115.