ENTERPRISE
RESOURCE MANAGEMENT
Jackson
Laboratory is a non-profit, independent, world-renowned genetic research
institute founded in 1929. Located in Bar Harbor, Maine, it had a budget of $80
million and 1,200 employees, including 32 in IT. Jackson Laboratory decided to
install an ERP system with a $5 million budget and a one-year time frame.
Despite the installation challenges, the project’s actual cost was close to the
budget and took only about six months longer than expected.
Jackson
Lab’s major installation challenge was the integration of its unique mouse-
development functions into Oracle’s ERP system. One of the problems faced by
Jackson stemmed from an internal HR issue (i.e., the risk that the action or
inaction of the software provider would hinder the implementation). Jackson Lab
coped with these challenges by modifying the ERP system to accommodate its
business process, placing special emphasis on training, seeking a fixed-fee
contract with Oracle, and purchasing a surety bond to reduce project risk. The
surety bond was issued by an entity on behalf of a second party, guaranteeing
that the second party would fulfil an obligation or series of obligations to a
third party.
In
the event that the obligations are not met, the third party would recover its
losses via the bond. Every year about $3 billion worth of surety bonds are
generated by construction projects compared with a mere $8 million for IT
(mostly for governmental contracts); however, there is insufficient commonality
and standardization in the IT industry on the bonds. A surety bond works well
only for a fixed-fee contract because it provides the benchmarks needed to
frame a bond price. Jackson Lab selected an integrated ERP suite from Oracle
rather than a best-of-breed option. The Oracle applications suite included modules
for process manufacturing, accounting, e-procurement, and HR, among others.
Their biggest challenge was modification of the Oracle Process Manufacturing
(OPM) module to accommodate the lab’s unique business processes of raising and
distributing mice. The OPM module was designed for companies that mix
ingredients together to produce such products as bread or beer, not for a lab
environment.
The
implementation team chose a phased-implementation approach instead of a big
bang approach. The first phase initially went live in February, including the
management of production capacity, accounts receivable, some general-ledger
functions, and the purchasing of manufacturing material; in April, they
launched other modules including accounting for research grants, the rest of
general-ledger functions, accounts payable, and fixed assets.
For
the second phase, which began in June, the remaining modules including process
management, human resources, payroll, labor distribution, and a grant filing
application were installed. Jackson faced personnel problems during ERP
installation when the best and brightest employees were involved in the
implementation process, leaving them shorthanded to do the everyday work. In
addition, Jackson’s IT staff lacked experience with ERP, only one person had
some experience in installing an ERP.
Further
cost overruns resulted from training, an especially big-cost item. The time-
and-materials basis contract would have increased the risk of overtime and
going over budget because vendors and consultants have an interest in quoting
low and seeing the work grow as the project proceeds. There is a natural
competitiveness between the buyer and the ERP vendor.
The
vendor benefits by placing a “veil of complexity” over their work; the buyer
wants to get the system up and running with the least amount of work and
customization. The service-level agreements generally tend to be very complex
because a much clearer definition of roles and responsibilities between client
and service provider is needed. From a consultant’s and vendor’s perspective, a
high (>25 percent) contingency is quite reasonable depending on the nature
of the work, whereas this is too much from the buyer’s perspective.
Objectives(s):
This
assessment item relates to the unit learning outcomes as in the unit
descriptor. This assessment is designed to improve student collaborative skills
in a team environment and to give students experience in constructing a range
of documents as deliverables for different stages of the Enterprise Resource
Planning using a simulated industry case study.
INSTRUCTIONS
Carefully read the associated case study above
and from this Assignment you are to prepare the following documents.
1.
SystemDescription
2.
Scope of the System
3.
ExecutiveOverview
3.1 Project Identifiers
3.2 Project Summary
4.
SoftwareRequirementSpecification
4.1 Functional Requirements
4.2 Non-Functional Requirements
5.
ERP Selection & Implementation
5.1 ERP Selection
5.2 Vendor Satisfaction
5.3 Deployment Options
5.4 Implementation Approach
6.
SystemDescription
6.1 Analysis and Design
6.2 Methodologies
6.3 Prototype
6.4 Acquisition & Development
6.4.1 HardwareandSoftware 6.4.2 Customization
6.4.3 Configuration
7.
FeasibilityAnalysis
8.
Issue, Risk & Change Management
8.1 Open risks
8.2 Open change requests
9.
ERPimplementationcosts
9.1 Project costs
9.2 Project duration
9.3 Success & Failure
10.Conclusion
The
above list of documents is not necessarily in any order. The chronological
order we cover these topics in lectures is not meant to dictate the order in
which you collate these into one coherent document for your assignment.
Your
report must include a Title page with the title of the Assignment and the name
and ID numbers of all group members. A contents page showing page numbers and
titles of all major sections of the report. All figures included must have
captions and Figure numbers and be referenced within the document. Captions for
figures placed below the figure, captions for tables placed above the table. Include
a footer with the page number. Your report should use 1.5 spacing with a 12
point Times New Roman font. Include references where appropriate. Citation of
sources is mandatory and must be in the Harward style.
Only
one submission is made per group. The group should select a member to submit
the assignment by the due date and time. All members of the group will receive
the same grade unless special arrangement is made due to group conflicts. Any
conflict should be resolved by the group, but failing that, please contact your
lecture who will then resolve any issues which may involve specific assignment
of work tasks, or removal of group members.
USA 
India