Implementation on Organizational Capabilities †Free Samples

Question: Discuss about the Implementation on Organizational Capabilities. Answer: Introduction: International Game Technology or IGT is the best manufacturer of slot machines and lottery machines. IGT had a habit to depend on several unique systems to control their unique departments of accounting, manufacturing, sales and orders of customers. When an executive of IGT needed to master the status of a particular order, he or she had to experience all the sorts of system to search for a simple piece of information. To get rid of this particular problem, IGT decided of adopting ERP package for their business of lottery machines (Schniederjans and Yadav 2013). Enterprise Resource Planning is the mixed management of several business activities or business processes like finance, sales, marketing, product and production planning, manufacturing, inventory and materials management (HassabElnaby, Hwang and Vonderembse 2012). ERP is referred to as the sub classification of business management software that is necessary to manage, collect, reserve and translate data from the previously mentioned business activities. Enterprise Resource Planning or ERP has various remarkable advantages, which make it extremely acceptable and famous amongst all small and big organizations (Hung et al. 2012). The major advantages of ERP are as follows: Efficiency: The main benefit of ERP is that ERP increments the efficiency and productivity of any organization and which makes it famous for all (Candra 2012). b) Competition: The next advantage is that it helps the particular organization in competing with all other organizations in the market. It makes the process simpler for them. c) Cost Effective Maintenance: It can be simply maintained in lower prices and thus can be termed as cost-effective. (Hung et al. 2012). d) Security: The next advantage is that these packages are extremely safe and secured and thus information never gets lost often. e) Scalability: ERP systems should be structured and they are extremely scalable and flexible for all organizations. The goals, which IGT wanted to attain by implementing an ERP package are as follows: i) The main objective of IGT was to integrate all of their systems flexibly. The accounting department of IGT required one simple system that will perform all of the accounting works of the organization. Simultaneously, the other departments of IGT need their individual systems (HassabElnaby, Hwang and Vonderembse 2012). Thus, it is recommended to IGT to implement a full ERP system for their organization. ii) IGT needed a particular software that can be simply integrated or updated and also it should be of low cost. Therefore, IGT selected ERP (Hailu and Rahman 2012). The version of ERP that was selected by IGT implemented was SAP R/3 version 4.6 ERP for their organization. The stakeholders of IGT needed to maintain their three major functions of business that are manufacturing, development of product, and finance via their platform of ERP. iv) Another major goal of IGT for using the ERP was to produce various changes and monitor budgets in producing and launching brand new products, just like the EZ Pay cashless aspect (Ahmad and Cuenca 2013). v) The other objective of IGT was to help the employees to search for the plant locations that are building for the machines. The previously mentioned statements clearly represent the objectives and goals of the International Game Theory that they wanted to attain by bringing ERP packages in their business (Hasibuan and Dantes 2012). Enterprise Resource Planning is the action through which a business, most often a manufacturer, manages and integrates the main departments of the organization (Galy and Sauceda 2014). The management team of an ERP system mixes all the important sections, for example the human resources, purchasing, inventory, finance, sales, planning, and marketing. International Game Technology had thought of adopting ERP for their organization (Hung et al. 2012). ERP has various pros and cons. The pros of ERP are as follows: iv) Centralized Storage: It has a centralized storage, which keeps all the information and data in a single storage. ERP software further helps in the back up of data. v) Several Modules: It has unique modules implemented in it, such as the SCM, marketing, CRM, manufacturing, human resource management, finance, and project management (Galy and Sauceda 2014). vi) E-commerce Integration: ERP software can be simply integrated with e-commerce sites and the management of tracking and processing of e-commerce sites based order can ne done easily. Cost Effective Maintenance: Maintenance of ERP can be easily done within lower budget for longer duration and thus can be termed as the cost effective maintenance. Efficiency: The main benefit of ERP is that ERP increments the efficiency and productivity of any organization and which makes it famous for all. ix) Business Intelligence: ERP software gives several functions of Business Intelligence, which gives an overall visionary on the activities of organization and recognizes areas for improvements (Ram, Wu and Tagg 2014). x) Scalability: ERP ERP systems should be structured and they are extremely scalable and flexible for all organizations. xi) Visibility: ERP produces complete visibility to all the business activities and processes for all the organizational departments. Modular Software: ERP is a modular system of software, which makes it possible to implement either many modules or some of the modules as required by the organizations (Hailu and Rahman 2012). In spite of having so many advantages, ERP do have some disadvantages. The cons of ERP are as follows: i) Time Consuming: An important disadvantage of ERP is that it is extremely time consuming and most of the time, it even takes one to three years to be completed and become functional. ii) Initial Cost: While starting of implementation, the initial investment of any ERP package is extremely high and most of the smaller businesses and organizations could not afford it (Ram, Wu and Tagg 2014). The initial software, testing, configuration and planning costs are too high in ERP. Excessive Customization: With the help of little customization it is not possible to integrate the business activities with ERP system (Galy and Sauceda 2014). iv) Indirect Costs: Direct costs are not incurred in the ERP implementation. v) Migration: It is important for any organization to move their existing data from one place to another. Any sort of migration of existing data to the new ERP software is almost impossible and therefore changing to a new system becomes extremely risky for any organization. vi) Payback: There is very little scope for payback or cost savings in ERP, which makes it less porpular for small businesses or organizations (Nour and Mouakket 2013). Participation: Users of ERP implemented organization should participate in the projects. Training: ERP is a little complicated to understand. Therefore, training of the users and the employees are required each and every time in the organization. IGT should have kept in mind the previously mentioned pros and cons before implementing ERP in their business. Any organization before the implementation of ERP should do it carefully. There is a drastic alteration in the management after the ERP is implemented (Hailu and Rahman 2012). The organizational stakeholders play distinct roles for the selection of ERP packages, the implementation, planning, adoption and the ongoing support phases. The roles of the organizational stakeholders are of several sorts. Stakeholders of an organization are individuals or collection of people within a particular organization. They have a stake in the result of an ERP implemented software project and the permission of these stakeholders is required to launch such type of project, function it further to a successful accomplishment and to make sure that the product is completely utilized (Nour and Mouakket 2013). Stakeholders, being the investors have the benefit to move a particular project towards the success. They lead the organization in selecting the perfect ERP package that can help IGT to attain its goal s (Hasibuan and Dantes 2012). Moreover, the stakeholders can even help IGT in the implementation process of ERP. The stakeholders of the organization also handle the change management of IGT. At first, the scope of the change is determined and then the scope of incorporating the change is determined. The stakeholders then either approve or reject the change in IGT. Finally, the ERP is implemented in IGT (Ahmad and Cuenca 2013). Therefore, IGT can control or manage the change management of ERP with the help of the stakeholders. References Ahmad, M.M. and Cuenca, R.P., 2013. Critical success factors for ERP implementation in SMEs.Robotics and Computer-Integrated Manufacturing,29(3), pp.104-111. Candra, S., 2012. ERP implementation success and knowledge capability.Procedia-Social and Behavioral Sciences,65, pp.141-149. Galy, E. and Sauceda, M.J., 2014. Post-implementation practices of ERP systems and their relationship to financial performance.Information Management,51(3), pp.310-319. Hailu, A. and Rahman, S., 2012, June. Evaluation of key success factors influencing ERP implementation success. 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Competitive advantage from ERP projects: Examining the role of key implementation drivers.International Journal of Project Management,32(4), pp.663-675. Schniederjans, D. and Yadav, S., 2013. Successful ERP implementation: an integrative model.Business Process Management Journal,19(2), pp.364-398.