ERP Systems: Factors Contributing Benefit Realization, Case Studies

This report delves into the realm of Enterprise Resource Planning (ERP) systems, specifically examining the factors that contribute to successful benefit realization. It provides an executive summary, table of contents, and detailed discussion, exploring the advantages of ERP implementation and its impact on business operations. The report analyzes the critical factors affecting benefit realization, using case studies of multinational corporations such as Nestle, Oilco, Cadbury, and Grupo Modelo. It discusses the business cases for ERP implementation within these companies, highlighting the challenges and successes. Furthermore, the report explores the alignment of business strategies with ERP systems, including user training, software design, project control, and organizational fit. It also references various research papers and models related to ERP implementation and benefit management, offering a comprehensive understanding of the topic.

Running head: ERP -FACTORS CONTRIBUTING BENEFIT REALIZATION
ERP Systems-Factors contributing benefit realization
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2ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Executive Summary
The current study elucidates illustratively regarding the execution of SAP ERP in
majority of multinational corporations functioning in Australia. Essentially, this study
handles the justification of execution and acquirement of the ERP system by illustrating the
related advantages. In addition to this, the current study also discusses in detail the primary
reason behind the execution of the specific system and their related benefits from the
perspective of the selected corporations namely Nestle, Oilco, Cadbury as well as Grupo
Medolo. This segment also explicates in detail the challenges along with the critical success
factors involved. Moving further, this study also takes into account all the important factors
that direct the way towards execution of the current report. For the purpose of execution of
the comparable system, the study presents diverse levels of advantages received by specific
corporations.

3ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Table of Contents
Introduction..........................................................................................................................3
Detailed Discussion:.............................................................................................................4
Important factors that affect the benefit realisation of SAP ERP........................................6
Businesses Case for implementation of ERP SAP...............................................................9
Business Case on Nestle:.....................................................................................................9
Business case on Adidas Australia:....................................................................................10
Business Case on Oilco Australia:.....................................................................................11
Business Case on Cadbury.................................................................................................12
Business Case on Grupo Modelo and Corona Extra:.........................................................13
Business Alignment and the system of ERP:.....................................................................14
References..........................................................................................................................16

4ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Introduction
Enterprise Resource Planning (ERP) can be considered to be one of the most important
developments in the area of corporate information system. The related benefits of execution
and use of ERP system aid in illustrating the business interest in this type of systems.
Majority of the advantages attached to this system arises from the specific structure of the
corporation, procedure of work, assimilation of both operational as well as administrative
actions, organizational development stemming from worldwide system of standardization of
different work practices that is again backed by technology. Executing the ERP technology
can be regarded as a considered to be very difficult and at the same time costly process of
experiment for the corporation. The execution of ERP can be considered as the world’s
largest testing in business alteration for majority of the corporations. Purposes of several
corporations were to make an effort towards standardization and homogeneity of corporate
information system. Nevertheless, there has been predominance of business requirements that
laid down the fundamentals that assists in approaching the related large-scale arrangements.
Fundamentally, ERP SAPM can be considered as an important enterprise resource
planning (ERP) software that integrates the important business operations of the corporation.
Essentially, Germany Corporation builds up the software and this SAP can be regarded as a
market leader in delivering enterprise resource arrangement as well as service solutions. As
such, the legacy system of the corporation is reinstated by ERP that has now become a
factory benchmark of sector. Furthermore, this is perceived by several large corporations both
in public and private segments as a specific form of business computation. Umar (2016)
asserts that ERPM can be regarded as a global configurable package of system of information
that helps in the process of assimilation of functional areas along with information based
procedures within a specific corporation. Again, this also helps in seamless integration of all

5ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
the information flow within corporations by assimilation of information based procedures
that are both within as well as across several segments in corporations namely, finance,
accounting, marketing, manufacturing as well as distribution. Sun et al. (2015) mentions that
the small as well medium scale enterprises have ever more implemented the system of ERP
that have helped in delivering tailored products and contributed to the overall
accomplishment of business
Successful execution of the ERP system assists in bringing considerable advantages to the
corporation since they have the ability to enhance the productivities as well as efficiencies of
the corporation. Nevertheless, execution of ERP SAP also contains certain intricacies and this
leads to huge outlay of capital, extended period of execution and proneness to failure
(Sharma and Gupta 2014). Essentially, corporations executing the ERP system have the need
to systematically analyse the advantages along with the cost related to the entire system.
Detailed Discussion:
There are humongous number of research papers, journal articles and conference papers
related to the process of valuation, selection along with the execution of the system of ERP.
Illustration of different advantages of ERP SAP arrangement portrays that this kind of
benefits are reported and at the same time advocated by diverse consultants as well as
vendors of ERP (Seo 2013). Essentially, evaluation of the performance of ERP arrangement
after the process of implementation helps in comprehending the related advantages of the
system.

6ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Figure: Enterprise solutions value:
Source: Ripamonti et al. (2016)
As rightly mentioned by Ripamonti et al. (2016), there are essentially three different
means or ways that can helpm in attaining the advantages from the execution of the ERP
arrangement. This process involves integration of the data, system of information
assimilation and the procedures among diverse units of organization and processes of
business operations. However, certain fundamental operational advantages of ERP system is
decrease in the cycle time as well as cost. Again, various prior studies also suggest that the
execution of this kind of system assists in escalating the overall volume of operations,
increasing the speed of the process by automation of transactions and substitutions of labour.
Ram et al. (2014) suggests that the project based corporations are offered the benefits of
lessening the number of errors, duplication and enhancement of the responsiveness to diverse
requirements of customers. This in turn helps in the process of retention of customers and
thereby leads to enhancement of overall productivity. Certain supplementary advantages
offered by the arrangement of SAP ERP also help in reduction of risks of business

7ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
encountered by corporations. Senior officials along with project managers also helps in
management of the business resources in an improved manner by utilizing system capacity of
particular built in data evaluation that directly assists in handling and string of data in a
specific centralized database. Corporations also attain strategic advantages by execution of
this kind of systems and this can be regarded as cost leadership, innovation, grouping and
differentiation. In addition to this, the standardized as well as assimilated application design
of ERP system also assists in the process of reduction of cost of information technology,
ensuring flexibility of business for upcoming as well as present alterations (Nagpal et al.
2015). This also aids in the process of backing the infrastructure and directing towards
economic execution of new applications.
Important factors that affect the benefit realisation of SAP ERP
Ram et al. (2014) suggests that majority of transnational corporations together with
different small as well as medium sized enterprises have started the process of execution of
SAP ERP arrangement. All the way through the world, corporations have started to
implement the new arrangement of ERP systems also referred to as the SAP. Nevertheless,
these corporations also utilize analogous system of ERP and they have the inclination of
several benefits as well as values together with the certain disadvantages by detecting facets
that direct the way towards improper managing of the system. Certain specific aspects
contribute towards the procedures by advantages realising of the SAP ERP arrangement.
Despite this fact, there are also numerous benefits of the system that includes substantial
capital investment and increased profits of the corporation and execution of ERP system
(Nagpal et al. 2015). Certain related downside of this specific system includes increased
financial budget, delay in the process of execution of the system. In essence, ERP can be
considered as one of the most popular systems related to management of business that helps

8ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
in delivering the corporation with numerous benefits of attaining time capabilities and
sustaining favourable communication. There are specific factors that help in the process of
clarifying specific consideration of corporation for the implementation of the system. The
factors necessarily include user training as well as involvement, software design, control of
project, maintenance of organizational fit and plan of technology (Kale 2014).
Huang and Handfield (2015) mentions that one of the widely utilized and popular systems
specified in the literature of benefits management is essentially the Benefits Realization
Cranfield Process Model. However, the main component that is used for realization of the
benefits of this particular model is the network of beneficiary dependency. Related facets are
taken into account in this specific model for the purpose of realization of different benefits. In
this case, the structure of model is developed in a specific manner that helps in the process of
achievement of goals of investments and advantages ensuing from link in particular structural
manners associated to business corporations as per the necessities of business.
Figure: Models of realization of benefit:
(Source: Hejazi et al. 2014).

9ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Effectual realization of advantages of ERP system includes different barriers that can be
acquired by utilizing benefit management models (Holub and Bruckner 2016). Again, models
consist of different factors that include deficiency of change management, lack of discipline,
misplacement of ownership benefits, lack of support, inappropriate utilization of available
resources and poor management applications. However, one of the important issues in the
process of execution of system of ERP is the intricacies of the entire nature of technology that
are encountered together with the homogeny and compatibility. Moreover, there are also
specific issues that arise from human resources and this includes resistance of workers
towards alteration, culture of corporation, incompatibility of business procedures and
management of commitment towards any specific project (Hejazi et al. 2014).

10ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
Businesses Case for implementation of ERP SAP
Business Case on Nestle:
The business case on implementation of SAP ERP can be assessed with special reference
to the operations of Nestle. In essence, Nestle SA is a multinational food as well as drink
corporation, situated in Switzerland. The business concern decided to leverage its entire size
during the year 2000 and in this context decided to sign an agreement with particularly SAP
for introducing the ERP system in eighty different nations across the world. However, an
additional amount of approximately $80 million was expended by the corporation for
improvement and maintenance of the entire system. However it was realized by the business
concern that in case if the corporation intended to be competitive there is requirement for
standardization of processes of business. As such, execution of the specific system includes
financials namely SAP.com, management of production, handling accounts payables as well
as receivables, procurement together with planning (Gordon and Dyer 2014). Execution of
the ERP arrangement has already been undertaken by the company in the United Kingdom
branch of operations. Particularly, this was carried out prior to the process of execution in
SA. Again, British subsidiary of the company executed SAP R/3 over the 5 year period.
Essentially, this can be regarded as the largest arrangement of ERP executed with more than
6000 users. Objectives of the corporation for the process of execution were primarily
associated to the process of tightening the entire supply chain, leveraging the size of the
organization and re-engineering of procedures along with work practices. Yet another aspect
of execution of SAP ERP implementation included execution of own SAP ERP projects in
USA that in turn led to the excellence of business by means of system technology. In addition
to this, there was also execution of 5 different SAP modules that was present throughout the

11ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
entire course of 6 years. In essence, unification was necessarily one of the primary objectives
behind the process of execution of this system of ERP (Bradford 2015). Corporation has
roughly 28 points of customer entry along with nine-journals before the execution of the
specific system. Primarily, the objective of this system was to lessen the number of customer
entry points to one. However, for all the segments, the goal of execution of the system was
analogous. Moreover, ERP was necessary for controlling and centralizing data for making
reporting financials as well as forecasting more precise and reliable. Essentially both during
and before the process of execution, competitive limitation was existent. Again, execution of
such kind of system also assisted in the process of thriving in the worldwide economy and
becoming more effectual (Bradds et al. 2017).
Business case on Adidas Australia:
Adidas can be considered to be a worldwide leader in a sports sector and is a highly
recognized and well-known corporation. Again, a single storehouse of Adidas is operated in
particularly Mulgrave, Victoria that again aided in distributing the sports apparel and sporting
products to retailers across Australia. The company invested a considerable amount for
enterprise wide implementation of the SAP R/3 arrangement of the system of ERP. In this
case, the Australian Office was initially the first to execute this kind of system. Execution of
SAP in specifically Australia was primarily associated to functionality of management of
storehouse for diverse footwear products and clothing, handling of data as regards size,
colour along with style. Moreover, one of the vital sections of operation of the corporation
was warehousing, however, inclusion was essentially the main priority of the corporation
(Barkhi and Kozlowski 2017). As such, management of Adidas recognized some of the basic
needs that included utilization of wireless and handless devices for the purpose of
acquirement of data mechanically. Furthermore, a requirement for flexibility was also

12ERP SYSTEMS-FACTORS CONTRIBUTING BENEFIT REALIZATION
detected for accommodation of future alterations into the specific system and particularly for
the purpose of future growth. Basically, the key to internal inventory administration and
efficient logistics is necessarily the functionality of acquiring data faultlessly. For the purpose
of acquiring solution to data acquirement process, the corporation has adjusted to process of
(Data System International). Essentially, some of the operations of the system contains zone
picking execution for operating with the specific infrastructure of management of material.
This also includes communication regarding operation of warehouses into the specific SAP
arrangement. Akhtar (2016) mentioned that development tailored to the needs or
requirements of business help in execution of DSI. This also includes assimilation of data
between handheld radio frequency instruments and wireless instruments. Again, transactions
of SAP also includes superior movement, put ways, process of cycle counting, arrangement
of dispatch, procedure of zone picking as well as replacement (Akagic and Hodzic 2014).
There is also certain processes that include value added label price, procedure of tagging of
security at diverse offsite location that was also contained by initiating the solution of DSI
related to the consignment note printing as well as despatching specific label. Again,
corporation has also updated the process of installation of SAP.
Again, mobility software was also offered by DSI that helped business in undertaking
their operational actions and provided accessibility to data on any type of instruments
(Ahmadi et al. 2015). Again, SAP functions were also enhanced by the function of the dClink
that essentially aided in maintaining regulations of occupational health as well as safety.
Particularly, this also includes replenishments from specifically bulk practices to pickface.
However, with the process of upgradation of the SAP during the year 2013 that subsequently
led to the further expansion of the solution that involved roll-in of Adidas operating in
Australia.