Cisco Case Essay
However, the application didn’t provide the degree of redundancy, reliability, and maintainability that Cisco added to meet the business requirements anymore. The current systems may be good for $300 million companies, but they were not suitable for a $1 billion dollar company. Solves let each functional area make its own decision regarding the application and timing of its move, but all functional areas were required to use common architecture and databases. However, in the following years, the functional area were facing dilemma.
Anything Cisco did would Just run over the legacy systems. It turned into an effort to constantly band-aid the existing systems. So the yester replacement difficulties of functional areas perpetuated the deterioration of Coco’s legacy environment. System outages became routines. Finally, in January of 1994, Coco’s legacy environment failed. As a result, the company was largely shut down for two days. Why were no managers eager to take on this project? Because if Cisco wanted to replace the existing legacy systems, the system in each functional areas had to make change accordingly.
Take manufacturing for example, if manufacturing wanted to spend $5 or $6 million dollars to buy a package and by the way it will take a year or more to get it. It was too much to Justify. Therefore, none of managers was going to throw out the legacies and do something big. In a word, because implementation a new system would cost a lot of money and take long time to be realized, no one was individually going to go out and buy a package. 2. Cisco was highly successful with its enterprise resource planning effort. What accounts for this success?
What were the most important things that Cisco did correctly? 1 . Cisco had a clear understanding of its strategic goal. Cisco clearly defined their goal and made strategy at the beginning–Do it in nine months for $1 5 lion for the whole things. L)let started from the manufacturing perspective, and got the Order Entry and Financial groups in the company interested in doing a single integrated replacement of all the applications, instead of taking a longer time doing separate projects. 2)They know they want to do this project quickly.
So they were not going to do a placed implementation. They would do it all at once. We were not going to allow a lot of customization either. 3)They also wanted to create a schedule that was doable and make it a priority in the company as opposed to a second tier kind of effort. 2. Cisco had a very strong project management implementation– Pete Solves, CIO of Cisco; Randy Pond, a director in manufacturing; Carl Redefine, the SSP of Manufacturing; KEMP -Implementation Partner; Oracle-ERP vendor; Hardware vendor. All of them had very important role in the success of implementation. . The project got strong support from top management commitment– Cisco set up an Executive Steering Committee, comprised of the UP of Manufacturing, the UP of Customer Advocacy, the Corporate Controller, Solves, Oracle’s senior UP of Applications, and the partner-in-charge of West Coast Consulting for KEMP. The presence on the steering committee of such high level executive from Oracle and KEMP was indicative of the importance these organization to guarantee the resources support and executive priority for the project’s success. 4.
Cisco had great implementation team–They picked the best and the brightest for this team, expending from its core 20 members to 100, which represent a cross-section of Coco’s business community. As it was a career advancement possibility for each person, the effort was framed to those who work on it as a challenge. Besides, the team members were placed onto one of five “tracks”. Each tracks had a Cisco information systems leader, a Cisco business leader, business and IT consultants from either KEMP or Oracle, and additional personnel from the business as team members. 5.
Cisco had very efficient training program for the team–The first CROP(CROP) began with training the implementation team. First training was focus on getting the team trained on the Oracle applications in two 16-hours days. Second training was to participate the entire application suite. At end of training, a small “tiger team” was engaged. 6. Cisco had very effective Implementation Methodology– Team employed a development technique referred to as “rapid iterative prototyping” and broke the implementation into a series of phases called “Conference Room Pilots”(CROP) 1) CROP O: Training and Configuration of Oracle package. ) CROP 1: Detail documentation and analysis of each functional area. The team determined to need another package to support after-sales. 3)CROP 2 & 3: Centralized data warehouse was developed. Final Testing with full load of users was done. Although all of above factors played very important role in the success of ERP implementation, the most important one should be the clear understanding of its tragic goal. Cisco did correctly to define themselves and realize the current problem and make plan for project.
Without clear understanding its strategic goal, Cisco couldn’t make success in the whole process of ERP implementation. 3. Did Cisco do anything wrong in this project? If so, what? Yes. There are some problems. 1) Overall business performance plummeted as users attempted to deal with a new system that proved to be disturbingly unstable. On average, the system went down nearly once a day. The primary problem, as it turned out, was with the hardware architecture and sizing. ) A second problem had to do with the ability of the software itself to handle the transaction volume required in the Cisco environment.
The design of the application exacerbated hardware problems by inefficiently processing common tasks. Our mistake was that we did not test the system with a big enough database attached to it. ” In testing the system, Cisco had run individual processes sequentially rather than at the same time. In addition, only a partially loaded database was used. 4. We often hear that senior management commitment is important for projects like Coco’s ERP implementation. What does this mean? Senior management commitment to do what?
What can top managers do to maximize chances for success here? 1) This meaner that the support from senior management commitment is a major factor for ERP implementation to be successful. 2) Senior management commitment can provide sufficient resources and priority to motivate the project to implement successfully. In this case study, Cisco set up an Executive Steering Committee, comprised of the UP of Manufacturing, the UP of Customer Advocacy, the Corporate Controller, Solves, Oracle’s senior UP of Applications, and the partner-in-charge of West Coast Consulting for KEMP.
The presence on the steering committee of such high level executive from Oracle and KEMP was indicative of the importance these organization placed on the project’s success. 3) In Coco’s case, before top managers went to the board for approval, the whole project team took pragmatic approach to estimating project requirement. First, they analyzed disadvantage and advantage by setting SQ and SQ timeline. They finally decide to set SQ-9 months as the target date for the project.
Second, instead of developing a formal business case to demonstrate the impact that the project would have on the company, the team chose to focus on he issues that has sparked the analysis in the first place. Cisco had little choice but to move. So the top managers made evaluation to three alternatives, and talked about the pros and cons of teach alternative, and recommended that they replace their systems, big-bang, with one ERP solution. Third, they finally committed to do this project in nine months for $15 million for the whole thing.
The team breakdown of implementation costs: Software 16%, hardware 32%, System Integration 38%, Headcount 14%. With all these works done by top managers and their teams before eating to board for approval, with aid by the fact that the legacy systems crashed on the day of the board meeting, the board ended up approving the project. 5. Was Cisco smart or lucky with its ERP implementation? I think Cisco was both smart and lucky with its ERP implementation. Cisco was smart: 1.
The whole Cisco project team applied every ERP critical success factors: Clear understanding of strategic goals–Cisco clearly defined their goal and made strategy at the beginning Top management commitment– Cisco set up an Executive Steering Committee to guarantee the resources support and executive priority for the project. Project management implementation– Pete Solves, CIO of Cisco; Randy Pond, a director in manufacturing; Carl Redefine, the SSP of Manufacturing; KEMP – Implementation Partner; Oracle-ERP vendor; Hardware vendor.
All of them had very important role in the success of implementation. Great implementation team– Cisco had best people on the project. Cope with technical issues–Team employed a development technique referred to as “rapid iterative prototyping” and broke the implementation into a series of phases called “Conference Room Pilots”(CROP) Organizational commitment to change–The ERP team set up a very efficient organization structure –“Five Tracks ” with an Executive Steering Committee sitting atop. Extensive education and training–The first CROP(CROP) began with training the implementation team.
First training was focus on getting the team trained on the Oracle applications in two 16-hours days. Second training was to participate the entire application suite. At end of training, a small “tiger team” was engaged. 2. Cisco successfully adopted Waterfall Systems Development method to implement ERP into their business process. At first step, the team made definition of Cisco and made planning on what they wanted. At second step, they analysis the benefits from different vendors and make selection of Oracle as ERP vendor.