Assignment 3
June 25th, 2007Due Monday@class, July 2, 2007
Two sections, two sets of questions
You may complete this with your project group or if you’re alone, you may join another group (up to size 4).
Part I Case Study: Advantage 2000 at Owens Corning
This case puts you into the management and implementation chair. This is an example of an IS organization leadership within a company that is transforming the way it does business. Owens Corning was one of the first U.S. based companies to implement common, global business processes using a highly integrated ERP package. Its Advantage 2000 goals included aggressive business objectives. It also illustrates significant business process redesign as well as an IT architecture change. The case describes the 100-week implementation plan, the project team roles, and the learnings from the early releases. The case ends with some implementation dilemmas faced by management in the midst of release 4.
According to an article published in 1999, the Owens Corning ERP implementation had brought the following results:
- 50% increase in inventory turns
- 20% reduction in administrative costs
- Millions of dollars in logistics savings
The logistics savings were largely due to consolidating shipments from different divisions to the same customers, which is enabled by a standardized order fulfillment process across all of its divisions.
Required Readings
1. Owens-Corning Case - In case the link doesn’t work, it’s in the Class Reserves inside the “BBUS 510 Supplemental Readings Folder”
2a. Putting the Enterprise into the Enterprise System - This is Harvard Business Review article by Davenport on the problems with ERP installations, especially the ERP system from SAP. This is a beginner level reading.
OR
2b. Making ERP Succeed - ERP implementations are typically late, over budget, and under deliver on its promised features. This article from the Wharton School of Business is a classic article. Most of the material still applies although the situation isn’t as depressing as in 1999. It’s shorter but weightier than the Davenport article.
Supplemental Reading
1. Business Processes - Operational Solutions for SAP Implementation - The authors put their textbook onto the web. If you’re into this, you can dive into this topic.
Required Homework Questions
1. What type of organization was Owens Corning? What were its principal products? What was its organizational structure? How would you characterize its recent organizational history?
2. What do you view as the critical success factors for Owens Corning? What were the main issue(s) confronting this organization?
3. What type of IT organization existed at Owens Corning? What were its main challenges? Describe the three major structures for the new IS organization. Why was a major change to this IS organization necessary?
4. What were Owens Corning’s goals for implementing the SAP R/3? In light of this organization and its critical issues, do these make sense to you?
5. What appears to be the advantages and disadvantages of the aggressive ERP implementation schedule? What the do you think is meant by the term “good enough reengineering”? Is this an oxymoron or do you agree with this concept?
6. What problems were being faced at the end of this case? If you were top management at Owens Corning, what would you decide?
7. Answer one of the following two questions:
a. How does the so-called integrated business relate to the execution of critical (esp. cross-functional) processes? What does this mean with respect to silos or stove pipes? Can you break functional silos if the data and hardware are also stovepiped?
b. Give me 5 thoughts regarding: 1) the difficulty with implementing an information system that aspires to arc across the enterprise; versus 2) the potential gains to be made with a successful implementation and adoption.
II. The Essentials of IT Management & IT Project Management
On Monday, July 2, Butch Leonardson visits our classroom. He has served as Vice President of Information Technology for BECU since 1999. BECU is a $4.5 billion Credit Union serving over 330,000 members.
Butch has spent over 25 years in Information Technology (IT) leadership. His initial 12 years in the profession was in strategic IT consulting and large-scale systems implementation. He served as a practice director for the financial services industry at a big five consulting firm. From 1988 to 1996, he was the Associate Executive Director and Chief Information Officer for Children’s Hospital and Regional Medical Center in Seattle, Washington.
He is a frequent speaker on IT organizational leadership and a guest lecturer for the Master’s of Business Administration program at the University of Washington, Bothell and Curtin University of Technology in Perth, Western Australia. He was the co-professor for UWB’s Summer MBA IT course in 2003. On Monday, we welcome him back as our guest instructor.
Required Reading
1. King County PeopleSoft (in the handout) - Butch will often refer to this reading. The earlier article represents the skewed public face that the county gave to the public regarding the failed install. One of the later articles gives the real deal from an outside auditor.
2. Damn the ROI, Full Speed Ahead- Whyy the ROI numbers you trust may sometimes not help.
Required Homework Questions
1. Do traditional ROI measures yield valid criteria for IT project selection? Why or why not? Give me a set of guidelines or rules (no more than 5) that you would use to guide for performing project due diligence. You should use no more than a few sentences to explain each guideline.
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