Keda’s SAP ERP Implementation
Question #1
Keda’s silo model was aimed at fostering entrepreneurial culture and innovation. However, it affected its business negatively, due to the redundancy among its business units. This increased cost and further minimized business efficiency. The fragmentation of information hindered business managers from making holistic and strategic decisions (Fung et al. n.p). Also, the managers were not capable of assessing cost accurately, and the purchase orders correctly thus had to rely on their experience. This challenge made Keda struggle to struggle in meeting the market demand due to its sub-optimal use of assets.
Moreover, in 2004, Keda opened multiple productions and diversified its product lines and business. Keda implemented a new IT solution after the failure of the Manufacturing Resource planning (MRP-II) system in handling multiple plant operations, and the lack of the system software support in maintenance. Keda was further driven to adopt ERP due to the Chinese government pressure, which wanted the company to adopt IT and further computerize their processes, in order to make Keda compete effectively against other foreign firms. Besides, Keda’s management claimed that EPR could solve some business processes and production line problems. A single database was further proposed to be implemented by the managers. This would help in solving the data fragmentation problem and assist in streamlining the flow of data to all business units. The access of all information in the business will help the managers to make the right decisions in every decision making process.
Question#2
Keda decides to embark on an EPR implementation project because it offered a broad range of products, which ranged from the processing of building material to the planning of energy resources. Also, Keda had provided their clients with some plant design solutions and technical consulting services. The Keda’s services versatility led to minimal sale volumes with high customization while offering high sand margins.
Question#3
Off-the-shelf EPR systems processes
- Classifying the system core needs
- An act to choose an EPR vendor
- Redesign processing
- Implementation of the system
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- System testing
- Training users
- System rollout
Question #4
Keda’s managers identified the core competencies of the business and further realized that building an in-house ERP would be considered a wastage of resources.
The managers also applied a proper reward system, in which they awarded and supported the supportive employees with bonuses, and further punished employees who were unsupportive.
Question#5
Time: Used in testing the system and training users. It adopted a big bang approach, which assisted in setting the system to go live.
The resistance of working on the EPR project: This assisted in introducing a reward system, which provided extra compensatory bonuses. It also executed some punishment towards unsupportive employees.
Disagreements between consultants and module owners: This led to a 100 percent recommendation adoption of consultants, which inclined towards making some changes in the business management and workflow.
Users’ resistance: This led to the execution of organizational culture. A replacement was done to any individual who disagrees with the new workforce, and further promotions were conducted to new persons in specific positions.
Question#6
Yes. Strategies that were adopted by Keda in the implementation of EPR are applicable to every ERP implementation. This is because it clarifies the management and the concept of EPR projects.
Question#7
The success of Keda in the implementation of EPR in China was remarkable. This is because the strategies applied in the company worked in particular cultural settings. For instance, the act of embarrassment was considered a punishment and, in some cases, lead to work loss. This further gave rise to a canteen work deemed to be punishment, which was viewed to be unique in China’s enterprise management. This helped Keda managers’ to be more focused on the EPR project rather than their routine departmental work.
Nonetheless, the replacement strategy of some employees who failed to comply with EPR projects showed China’s cultural practice. The employees were at risk of losing their job when they were unable to comply with senior management. Strict follow-up of employees led to high productivity in the business.
Work Cited
Fung, Terrance et al. KEDA’s SAP IMPLEMENTATION. IVEY Business School, 2020, Accessed 28 Feb 2020.