Hersheys Erp Historic Failure

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Hershey’s EPR Historic Failure Conceptual design: There was a lot at stake in 1999 due to the fear of the predicted outcome of Y2K pressuring Hershey to request and demand the implementation of a new integrated ERP. The old system consisted of a previous system labeled Legacy that required 19 manufacturing plants, 8 contract manufactures, more than 20 co-packers and an order fulfillment time of 6 days and was not client/server friendly. The new system, A SAP R3 was predicted to provide production forecasts, scheduling and transportation management, customer relations management and effective tracking of marketing activities .These aspects are part of the conceptual design Hershey had in mind when implementing the plans for this new system as well as a precautionary aspect of the expected effect of Y2K. New improvements expected were faster and more accurate deliveries, upgraded business process, efficient customer driven processes, reduce inventory costs and better execution of business strategies.(1) There are not a lot of changes needed to be made to the conceptual plan since a successful implementation would result in all positive benefits for Hershey including increased revenues and customer satisfaction. The timing of this plan was bothersome since the IT partners included in the physical design requested a 48 month completion date but Hershey wanted the system active by 2000. Sacrificing due diligence for the sake of expediency is not the ideal plan for the implementation of a system with so much numeric value at stake. Physical design: Three software vendors were chosen to implement different software modules of this ERP system for Hershey’s: SAP, Manugistics and Siebel along with a $112 million investment. Sap was responsible for replacing the existing mainframe; Manugistics was responsible for the production forecasting, scheduling and transportation

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