Download Enterprise Resource Problems at the CSU

A Case Study into the
Problematic ERP Implementation
of the CSU System
Doug Mason
Phara Noun
Brian Soon
•
Introduction
•
Timeline Issues
•
Management Failures
•
Cost Overruns
•
Conclusion
CSU is the largest university
system in the country.
Fundamental flaws in
implementation of ERP.
Not a comprehensive analysis of
the topic but rather a general
analysis with widest possible
implications.
•
The Basics of ERP
•
ERP and the CSU system
• Silos A-Plenty
• Expected Returns
•
Voluntary Acceptance
• “Collaborative” vs. “Common”
• Implementation Phases
• “Self-selected” campuses
• Penalizing Early Adopters
•
Planning for Upgrades
• Stress and Frustration
• Roll-out prolonged thru Feb
2008
. The University lacked of
attentions on CSU business
process in early process
planning before procurements
of software products
. The University did not buy in
the each campus to implement
on share database
. The university did not share
project risk with vendor and
consultant for the contract
. The university did not select
best consultants and vendors
stating clearly the best value
for the project
. Top management support
. Strategic Planning
. Assign a project team
. Examine current
business process and
information flow
. Set up objectives and
business plan
. Training Program
. Change Culture
. Project ownership
1998 Projected Cost $332-$400
Million
1999 Projected Cost $440 million
2002 Projected Cost $662 million
Additional
•$63 million Implementation cost
•$177 maintenance and operations
cost
2002 Projected Cost $662 million
Previous Estimates did not
include:
•Additional Implementation Cost
•Integration Cost
•In-Kind Cost
•Upgrade Cost
•Additional Maintenance &
Operating Cost
Reasons for Over Budgeted ERP
Implementation.
•Failure to plan thoroughly
Investigate and plan for all relevant
cost
•Underestimated the magnitude and
complexity of project.
•Failed to regularly monitor budget
vs. actual cost.
Other Problematic ERP Projects
•The University of Wisconsin
•Asyst Technologies
Common Mistakes
•Poor Planning
•Failure to understand all relevant
cost and complexity of project
•Underestimated the importance of
cost planning
Successful ERP Projects
British Petroleum (BP)
•Understood the complexity of
Project
•Strong Disciplined and centralized
management Team
•Centralized Decision making
•Regularly monitored Budget Cost
vs. Actual Cost
•ERP
Implementation is a very
complex project
•Planning the most crucial element
of ERP Implementation
•Proper Planning increases
probability of Smooth, Cost
Efficient, and Timely ERP Rollout
Key to Successful ERP Implementation
Project.
•Indentifying a need
•Understanding the complexity of
project.
•Top down management support.
•Enforcing employee buy-in.
•Instituting proper consultants and
employee training.
•Centralizing management and
decision making
•Regularly Monitor Progress and Cost