NIBCO Inc. free essay sample

INTRODUCTION (5 Points) NIBCO Inc. is a middle size company that is privately held and that specializes in the manufactures of pipe fittings as well as valves. The organization’s headquarters are in Elkhart in the same city in which it was founded more than a century ago. Prior to December 1997 the company utilized a legacy system in its administration and operations. However, a number of events and processes set into motion a move towards significant change in the organizational system in the company between 1995 and 1997 (Brown et al, 2012). Various problems regarding information systems and high cost of operation resulted in concerns on the effectiveness of the strategic planning mechanisms under use. ISSUES/PROBLEMS (20 Points)* Functionality: The functionality of the legacy system was a major issue which greatly affected performance of the company. The BCG conducted a study and determined that both internally and externally widespread dissatisfaction existed on the issue of the functionality of the legacy environment. We will write a custom essay sample on NIBCO Inc. or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page Suspect data: Data were suspect given that multiple access points and databases existed for the legacy system. Errors in data entry were possible and as such discrepancies could occur under accounting systems (Brown et al, 2012). Common system blow ups: Ad hoc changes regarding information systems for the four major legacy systems were frequent and therefore regularly staff members experienced blow ups in the systems. This resulted in people ridiculing the information systems people although the mistake was not their but it was based on the legacy system in use. Mainframe system information transaction problem: Initially NIBCO worked under a mainframe system that was characterized by lack of conformity in mainframe applications. Considering that various platforms such as IBM/MVS and HP3000 were being used in the same information system, inefficient information transfer was inevitable. SOLUTIONS (Taken by the company) (20 Points)* An ERP package was the solution to the legacy environment problem. In order to determine the best package that would suit the organizational needs of  NIBCO research was conducted on seven ERP packages, comprehensive evaluation was done on them and rather than combine several top level modules, one single package (SAP R/3) was chosen. A big bang approach was selected and possible phased and parallel approaches were rejected for a number of reasons. EVALUATION OF SOLUTIONS/ANALYSIS (30 Points)** Disconnections occurred between the various systems established for different departments in the company. The manufacturing package for instance ran on a Hewlett Packard while IBM was used for the accounting system. The distribution group was repackaged so that it was able to work on IBM. With these differences in systems, there was no link between the various departments hence no department could see what the other was doing. The distribution couldn’t see entries done by sales and those done by manufacturing. Adoption of an ERP system was necessary given that information could not flow from one process to another. By adopting ERP NIBCO targeted to have centralized database that would enhance control of all activities in the company from one point. Additionally, information would easily flow across all departments hence allowing for monitoring of client processes upon request. The adoption of a big bang approach too was founded on appropriate logic. Considering the complexities associated with adopting an entirely new system, resentment may develop. There was a proposal of three-five years phased implementation but rather than risk possible pull out before full implementation, it was better to strategize on how to avoid immediate risks and implement the new system with a big bang. The case study relates to chapter 5 because it serves as a real-life application of concepts such as enterprise resource planning, client/server systems and data warehousing. In chapter 5, enterprise resource planning is presented as a beneficial system for organizations that operate with a heterogeneous system landscape (Brown et al, 2012). Toyota is given as an example of a company that successfully implemented SAP. Tame system is implemented in NIBCO and despite some challenges; it too is characterized by success. Adoption of a client/server platform to address the mainframe problem was a commendable strategic measure. Through the client/server platform various programs in the information system would cooperate and it  would be possible for multiple applications to gain access to the information system’s resources at the same moment. This would bring flexibility, accessibility and centralization into the information system of NIBCO. RECOMMENDATIONS (10 Points) Considering the possible resentment that may occur during phased implementation of a system change, an organization shifting from legacy system to an ERP system can best use a big bang approach. Although a big bang approach is associated with high costs of implementation and the risk of unsuccessful grasping of new system concepts, effective planning can avoid these risk and the potential benefits outweigh the high costs here stated. It is hence recommended that a big bang approach be used for entire enterprise system change. CONCLUSION (5 Points) NIBCO was initially experiencing challenges in functionality of the legacy environment, suspect data and system blow ups. Adoption of an ERP system was recommended and big bang approach chosen. The solutions hypothetically served as appropriate in the case study here analyzed. It is recommended that a big bang approach be chosen when it comes to a complete shift of administration and operational systems in a company although consideration has to be made on business initiatives first. The solutions adopted by NIBCO to address problems in functionality, occasional system blow ups and data entry lack of transparency were well researched and appropriate. An ERP system would enable flow of information across the various organizational processes and the big bang approach covered business initiatives while reducing the risk of full out before full implementation RELATION TO THE CHAPTER (10 Points) By relating this case study to chapter 5, one learns that the concepts learnt in class all have advantages and disadvantages. In real life application, it is the responsibility of the individual to evaluate and determine which concept works best for the specific circumstance.