Tektronix’s Enterprise Resource Planning System
Introduction
Enterprise resource planning can be termed as an approach adopted by organizations that seeks to consolidate the departments and functions of a company into one computer system that is able to serve the needs of each department. Enterprise resource planning usually involves convergence of software, hardware and people to form an effective and efficient service, production and delivery system that results to profits for the organization. In most circumstances different organizations adopt different procedures and systems that are specifically designed for the needs of the company.
The various functions and departments of the companies are tasked with their own duties where the human resource department is responsible fro managing the employees’ records and other employee related. The financial department is responsible for financial data. The manufacturing side is responsible for production of the products offered by the company, whereas the marketing department is responsible for sales and other customer relations. Inka (2008).
The aim of the enterprise resource planning is therefore to ensure that all the functions and departments of the organization are in sync so as to facilitate decision making in the organization. With the enterprise resource planning, each department in the institution has its own mode of working but they are glued together by one system. Thomas (1998).
Implementation of ERP in stages
Implementation of the enterprise resource planning took place in stages. This was attributed to the fact that the organization had three major divisions and they all were involved in different activities. The implementation of the enterprise resource planning took place in ‘waves’ where each wave had a set of functions that were to be performed by the specific divisions. By deciding to implement the enterprise resource planning system in stages. Tektronix was able to achieve various benefits. The teach technique enabled the organization to get feedback form the system that would be arrived at by implementing part the system. This would therefore make it possible to make adjustments without having to undergo the cost in implementing the whole system and then making adjustments after full implementation.
The implementation of the system in stages also enabled the managers in the organization to have some flexibility in scheduling. This was an advantage to the company as it was possible to conduct an upgrade of the software before implementation to the next stage. If the organization had decided not to implement the system in stages, it would not have been possible to make new upgrades of the system prior to implementation. As a result of this Tektronix was able to have many benefits. This improved the morale of the human resource in the company. The implementation of Tektronix’s resource enterprise planning system was conducted in five stages. The first stage was implementation of the financials, followed by implementation of order management/ accounts receivables across the three divisions and the final was the global rollout of the project to subsidiaries in other regions of the world.
The first stage of implementation of the financials was to take place simultaneously with the implementation of the order management/ accounts receivables in the color printing and imaging division. By implementing the system in stages, it would enable the company to have the basic functionality of the system in a single country prior to having implementation in the dynamic international environment. In this first stage of implementation of the system, Tektronix was to conduct standardization and simplification. This was aimed at terminating the existing transfer pricing practices that were complex in nature. It was therefore possible for the company to roll up its financials and close its books. It also enabled the company to have financial status and information that was up to date and did not have to wait for the end of period reports.
Decision between implementing in stages or going ‘big bang’.
While implementing the enterprise resource planning system, organizations should be very careful in the decisions that they take. While planning on how to implement the enterprise resource planning organizations should first consider implementation of the system in stages. This is important as organizations are dynamic and they have different departments with different functions.
The decision to implement the system in stages enables organizations to have a feedback of how the enterprise resource planning system and its effect on the functions and departments of the organization. It also enables an organization to make modifications to the processes in the company to be able to suit the enterprise resource planning system. It also important to implement the system in stages where the organization starts with the parent company prior to implementing in its other subsidiaries. This enables an organization to have a sense of how the enterprise resource planning system functions.
By starting with implementation of the system in stages, an organization is able to avert the possible costs that may arise with changing processes of all branches of the organization where changes are required. After an organization has implemented the system in stages and it is verified that it is compatible with the processes in the organization, then it can make the decision to go ‘big bang’. This happens where an organization decides to implement the enterprise resource planning in all the other regions in which it has subsidiaries. This is done to ensure that there is uniformity in the functions and procedures of the organization in all regions where it operates.
Tektronix’s management of the risks of ERP implementation
Tektronix had to manage the risks that were associated with the implementation of the enterprise resource planning system. One of the risks that the company faced was during the implementation of the order management/accounts receivables. The execution of the order management/accounts receivable was conducted in a manner that tried as much as possible to adhere to the core principles. While adhering to separability, shared services and plain villa implementation, Tektronix faced the risk of not meeting the needs and requirements of its customers. This therefore called for the need for the company to avert the risk.
For the company to be able to avert the risk it had to conduct customization and for it to achieve this it had to deviate for the core principles. The call to deviate from the core principles of implementation and to customize the enterprise resource system was derived by two factors. The first reality was that there was need to have divisional differences since each division had different types of customers. Failure to customize the activities in the divisions on accordance with the needs and requirements of the customers would lead to the organization not having a competitive advantage hence losing business.
The second reason as to why there needed to be a change in the divisional principles was attributed to the enterprise resource package lacked some of the functions that were required for order management/accounts receivable. In some instances the functions were planned after there had been release of the package. Tektronix therefore decided to avert the risk of having delays in release and decided to modify the software. One of the areas that required essential customization was the local language support.
The customer facing documents of the organization needed to be in accordance with the provisions of the local language requirements of the specific country. For the organization to be able to achieve this it, designed a multilingual engine that operated parallel to the enterprise resource planning system. The multilingual system had the capability of acquiring the necessary data from the database where it formatted and printed the data on electronic forms that were in accordance with the language of the different countries where Tektronix operated.
Assessment of the Tektronix enterprise resource project
In my assessment the enterprise resource panning system of Tektronix was worthwhile. By deciding to make changes in the way the operations of the organization took place, the chief financial officer of Tektronix adopted an enterprise resource project that enabled the organization to have better and improved processes.
The enterprise project was able to enable the organization to have better products that suited the customers in an effective way. By achieving this, the organization must have improved the level of customer loyalty and increased sales as well as revenues and profits. Though implementation of the enterprise project was costly, the costs incurred could not be compared with the benefits that were derived from the use of the project.
The implementation of the enterprise project must have improved services at the organization and this must have consequently motivated the human resource. It was therefore possible for Tektronix to have employees that had the morale to work and hence better services were provided by the employees in the company.
The decision to implement the enterprise project was also beneficial to the organization as it was able to attend to areas that needed adjustments for delivery of better products. If the organization had failed to do this, it would have lost its competitive advantage as it would not have attended to the needs and requirements of its customers. I would therefore term the enterprise resource project by Tektronix as one that was efficient and effective as it resulted to massive positive changes in the organization.
Conclusion
Organizations that seek to perform better and have better functioning and operations should seek to implement an enterprise resource planning system that is in accordance with its activities. For there to be effective implementation of the enterprise resource planning system, it is essential for companies to ensure that they have put in place managers who comprehend the essence of the project. The human resource in the organization needs to be trained for them to be able to adapt to the changes that are brought about by the ERP project. This would enable the smooth implementation of the project as those involved understand how it is supposed to work. Organizations should also ensure that they start by implementing the ERP project in stages and should not rush to full implementation. Mureell G (2001).
References:
Thomas H. Davenport (1998) “Putting the Enterprise into the Enterprise System”, ‘Harvard Business Review’.
Mureell G (2001) E–Business and ERP: Rapid Implementation and Project Planning. John Wiley and Sons, Inc.
Inka Heidi (2008). “A method for improving ERP implementation success by the principles and process of user-centered design”. Enterprise Information Systems 2 (1): 47–76.
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