Springs Industries Inc Essay Example

information systems as a top priority and focused on increasing profits by utilizing new technology and information sources to improve marketing, customer service, and inventory management (McFarlan, pp 1-2, 1997). Springs' clients are major retailers such as Wal-Mart, Kmart, and Target, who expect suppliers to manage inventories based on current purchasing trends identified through the collection of Point of Sale (POS) data and sophisticated IT analytics.

Springs recognized that their current structure could not meet the needs of large retailers, and thus needed to expedite the implementation of new application technology. Additionally, in order to keep up with customer demand, Springs understood that upgrading their weaving, fabrication, and IT systems would improve the efficiency and cost-effectiveness of their manufacturing system. These upgrades would provide a stronger foundation for decision-making in regards to production planning, development, and control.

According to McFarlan (2004), before Jim Wood became the Vice President of Information Systems in 1992, Springs lacked a clear IT vision and leadership. To address this issue, Wood focused on Information Technologies and utilized his expertise in project management methodology to develop and hire skilled technicians. This allowed for improved manufacturing flexibility, efficiency, and a reduction in cycle time. As a part of this effort, Wood directed Springs' transition from mainframe systems to advanced microprocessor technology which enabled direct access of vital information through employee desktop terminals. Additionally, Springs' manufacturing systems were upgraded with Wood's guidance to support high volume order fulfillment transactions. The implementation of these changes have put Springs on the right track, according to McFarlan (2004).

According to McFarlan (1997), the incorporation of new technology in established workplaces has both advantages and technical challenges. Connecting

Springs' facilities to form a single, cohesive area for collaborative work and information sharing poses several issues. These complications include software compatibility, networking, and reliability problems. Presently, Springs' technicians are responsible for maintaining more than 40 software configurations, which results in a squander of important resources.

Wood (1997) stated that a connected and cohesive enterprise would allow various organizational departments and partners to collaborate effectively.

According to McFarlan (1997, p. 6), when individuals utilize diverse software packages, it becomes difficult to collaborate on tasks and share documents. This issue detrimentally affects productivity, cycle time, as well as customer service. Given these challenges, Springs made a significant investment to implement a desktop pilot program across the company. With the installation of 200 PCs, Springs' primary objective was to integrate all divisions into a uniform suite of applications hosted on an enterprise server architecture. This would eventually pave the way for an architecture that is web-enabled (McFarlan, p.).In 1997, the company created a project management model that allowed users and technicians to form partnerships. However, the integration of the two faced a significant challenge known as the "evolution versus revolution" problem. The company aimed to modernize their existing capabilities at a faster rate than human organizations could adapt, which slowed down progress. It was essential to standardize project management standards to overcome this problem. To implement their long-term Information System plan, Wood's established a new IS management team and upgraded the existing employees' skills. The company also sought additional support from external sources.According to a 1997 survey cited by McFarlan (p. 6), Springs' employees lacked sufficient training and the organization struggled with recruiting and retaining capable IT professionals

to implement their strategic plan. However, prior to Wood's arrival, Springs had already invested heavily in new technologies, including the PACER system for Material Resources Planning (MRP). While some systems were still in need of revamping, PACER was too expensive to replace and provided adequate benefits to meet the organization's demand. Its implementation improved manufacturing's planning and scheduling capabilities by providing visibility for material and capacity. Once the PACER system was operational and efficient, other programs could integrate with it (McFarlan, p.).

On July 7, 1997, Springs implemented an order management system (OMS) that could function alongside the PACER system. This system consists of 16 different applications, including order reception, pricing, customer databases, and product shipping. The OMS facilitates strategic partnerships with retailers and enables Springs to process and monitor orders with unrivaled precision, resulting in quicker customer responses. The system also provides the ability to acknowledge orders, calculate inventory and production times, and promise timely delivery dates.

By employing OMS to provide customer services and through the direct interface of PACER with the manufacturing division, Springs was able to link order fulfillment with factory planning and scheduling electronically, thereby ensuring that their progress remained on track (McFarlan, p.7, 1997). The Information Engine of Springs was also developed as a means of supporting their existing infrastructure. By offering consolidated sales and inventory data, the data warehouse would provide support for management decision-making whilst the investment in PCs made graphical representation of the company's data more user-friendly. An additional system, the real-time online human resource system introduced by IT director Carl Hicks for Financial and Human Resources, would give HR personnel a consolidated and accurate source of

information relating to human resources.

According to McFarlan (1997), he developed a consistent technical infrastructure across financial systems. This resulted in a variety of benefits including improved efficiency in payroll and administrative functions, error-free month-end closings, better customer support, and the compilation of year-end statements. Although Springs recognized the benefits of the new system, the product planning and scheduling system for the finishing plant was a challenging and expensive implementation. However, the system eventually provided the expected returns. Despite these successes, Springs still faced the issue of making their systems Y2K compatible for the new millennium.

According to McFarlan (1997), a team of 30 consultants and collaborators worked continuously to ensure the Year 2000 compliance of Springs' systems and suppliers. With the integration of all aspects of the organization, Springs is now ready to implement electronic enablement technologies, such as the Internet, Intranet, and Extranet. These technologies have long-term implications beyond marketing and sales as they improve productivity and service by facilitating data sharing, standardization, and procedure alignment across the enterprise. By allowing customers to access vital systems and databases with value-added hookups, Springs can proactively address their needs (McFarlan, 1997).

Spring has recently invested in technologies to shift their position on the IT grid from "support" to "strategic," which has proven successful. As the company prepares to make e-commerce their primary means of doing business, they will need to expand their offerings and invest in new systems, equipment, and proactive marketing capabilities. The company will focus on enhancing their Intra, Extra, and Internet platforms to create value-added e-business strategies that benefit Springs' customers and all aspects of their business operations.