Reference no: EM133338421

Assignment:

Using Information System as a turnaround Strategy

Cone bakers are a fairly small enterprise in a maturing business; its existing systems are technically challenged, inflexible and pose serious compliance and business risks. Many key processes are traditional and heavily manual and as a result the company does not have timely information for tracking manufacturing outputs and warehouse inventory shipments. The company physically counts all the items in its warehouse every day; even then the inventory information is still inaccurate and out of date. Shipments are often missed and excess inventory has to be sold at a discounted price at bakery stores. The market share and sales of the company has dropped while operating costs is rising. Much of Cone baker's information about sales and products comes from its network of sales distributors. Many consultant conducted by the company agree on their recommendation for turn round "invest on information systems and appropriate technology and the company will realize a turnaround"

Eventually Cone baker's top management decided to implement a new enterprise system using software from SAP designed specifically for the food and beverage industry. The top management also decided to involve consultants from SAP and Deloitte who helped the company identify its business processes and figure out how to make them work with SAP software and restricted the changes to the software as well as enforcing rigorous project management standards which as a result the company was able to implement the new enterprise system on time and on budget. Cone top management also made many changes in its business processes to make maximum use of the enterprise software's capabilities and also offer full support to the new management team.

Through the adoption of Deloitte's best practices for the food and beverage industry, Cone bakers implemented the SAP modules for financials, order entry, manufacturing resource planning (MRP), and scheduling. The management was advised to migrate from the old system to the new through first pilot then phase implementation strategies. The system integrated information that was previously maintained manually or in separate systems, and provides real-time information for inventory and warehouse management, financial activities, and centralized procurement. The new system facilitated provision of more precise and accurate information about customer demand and inventory that helped managers to make better decisions.

Before long Cone bakers had translated itself full e-business company, what a success!!! The company's' financial condition become much healthier, inventory write-downs reduced by 60%, price markdowns by 40%, customer satisfaction increased, as reflected in the higher order fill rates and Cone bakers sales increased by 11% without having to hire more staff.

(a). From the case, analyze seven factors that made Cone baker system development and implementation a success story.

(b). Discuss other factors that can contribute to successful system development and implementation which are not mentioned in the case.