Reference no: EM132271163

Assignment -

SCM and Its Critical Success Factors -

For a supply chain management project to be successful, a company must achieve certain key factors. The Advisory Council at Information Week has put together a list of those key factors:

Business-driven strategy: The information system for managing the supply chain must focus on the customer, allowing the customer greater efficiencies in the process. The customer should find that ordering material from the vendor is now more efficient with the new system. The system is based on a complex business process model. When a vendor fulfills a customer's order, many different business processes are at work to ensure quality products, timely deliveries, and good prices.

Management commitment: As with any IT project, top management must be committed to support the project; otherwise, the project is doomed to fail.

Supplier and partner expectation management: An SCM implementation requires change from all parties. A company implementing an SCM project must be prepared to work closely with both vendors and customers and manage that change from all angles.

Internal expectation management: Change management is especially important within a company. Personnel involved in a new system must be informed and trained to manage any anxiety they might experience in their job changes.

Learning period acceptance: Companies implementing SCM must accept that it takes a long time to fully realize the benefits of the system. SCM has the further benefit of driving business value. Simply put, SCM will help your company's bottom line by making it more efficient for customers to buy your product and for you to buy your suppliers' products. In this way, your entire company will benefit and become more efficient. Implementing an SCM system without paying attention to the critical factors listed above will result in poor performance. In fact, a large percentage of companies that implement SCM are not satisfied. Forty-five percent of respondents to a Booz Allen Hamilton supply chain management survey report that their IT solutions are failing to meet expectations. SCM consultants often find that companies have unrealistic expectations of the technology. However, companies dealing in the service parts business (for example, Caterpillar Logistics and Ford Motor Company) are finding that SCM allows them to decrease inventory by between 10 and 30 percent, according to AMR Research Inc. Companies must decide how their supply chains should be designed and run, and then use technology to implement those goals.

Questions:

1. Assume you were recently hired in an IT role at a large manufacturing company. Your first job is to convince the manufacturing manager that the implementation of an SCM system is feasible. Write a memo to that manager, highlighting advice on how to ensure the smooth implementation of such a system.

2. Outline the potential pitfalls that your company may encounter when implementing SCM.

Sarbanes-Oxley Five Years Later -

The Sarbanes-Oxley Act has been a part of doing business in the United States since 2002, and its impact is both widespread and unclear. A study by AMR Research has estimated the costs of compliance for U.S. business at $26 billion, while a controversial 2005 study conducted by Assistant Professor Ivy Zhang, then a graduate student, estimated the law's costs at a staggering $1.4 trillion. Other researchers claim the law has reduced investment in R&D and overall capital spending, and has led to an increase in the takeover of publicly traded companies by private-equity buyers (private firms do not have to comply with Sarbanes-Oxley requirements). No one argues that the law has been good for auditing firms, which is ironic given that the failure of auditors at Arthur Andersen contributed to the Enron collapse. As firms have strengthened their financial controls, many have had to restate their financial results - 1,403 firms did so in 2006. But as firms have improved in their ability to comply with the act, that number has been dropping. The costs of complying with the act are also coming down. According to a 2007 survey of 200 companies with average revenues of $6.8 billion, the typical cost of Section 404 compliance was $2.9 million in 2006, which was 23 percent lower than in 2005. Relaxed audit standards approved by the SEC in 2007 will allow a more pragmatic, common-sense auditing approach that may lower compliance fees by up to 50 percent.

Question:

1. Use the Internet to research the latest regulations surrounding the Sarbanes-Oxley Act.

Q) Explain why the Human Resources function is critical to the success of a company.

Q) Identify and describe problems associated with accounting and financial reporting in un-integrated information systems.

Q) In which industries is Supply Chain Management important? In which industries is it not? Why, or why not?