Reference no: EM133274949

Fox's Furniture Division

Beulah Burton is the vice president of Fox's Furniture Division. Fox is a corporation with businesses in many different industries. The furniture division has always been profitable; however, many years have passed since any overhaul of systems, equipment, or processes has been done. Jo Simon, chief executive officer of Fox Industries, believed the time was right to give the furniture division a face lift. That was one reason she hired Beulah. Beulah has a reputation within the furniture industry of modernizing furniture companies.

As Beulah reviewed the current systems, equipment, and processes, she was shocked at how outdated things were. Fox Furniture Division was at least two decades behind the rest of the industry. Beulah was further amazed that it was a profitable division. Beulah wondered how much waste was going unnoticed because of antiquated systems. She was convinced that a lot of data were missing and this made any analysis ineffective.

Beulah met with Jo and explained that Fox needed an enterprise resource planning system. She believed that the furniture division had continued to make a profit only because most of the workers had been there for years. However, as they retired, she was convinced that their knowledge could not be easily replaced by new employees. Fox needed better data collection and data management. Clearly, this would be a huge undertaking.

Once the ERP system was installed and operational the first reports began to flow. Beulah realized that there was a lot of excess inventory. It was more than just too many of a certain part, for example, wood spindles. It was a case of having inventory that was not used for any of their current product line. They had tens of thousands of dollars of obsolete inventory sitting in their warehouses.

Question

a. You work for Beulah Burton. She directs you to determine what specific actions the furniture division needs to take in order to clean up the inventory system and to have the new system implemented effectively. What will you report?

b. You are part of a team tasked by Beulah to anticipate what problems may occur in the planning and implementation of an ERP system. Think about the scenario presented in the case. What specific problems may they encounter? What common problems, (i.e., ones happening in many companies) may they encounter? What solutions or contingencies do you recommend?

c. Do you agree with Beulah's plan to jump all the way in, concerning an ERP system? Why? Shouldn't Jo have slowed things down and said they would implement it more piecemeal? Explain your thoughts.