Professional Documents
Culture Documents
IIPM
NAME –UMESH KUMAR
BATCH- PGP/SS2009-11/IIPM-1
SUBJECT- MIT
INTRODUCTION
The following table-1 summarizes the evolution of ERP from 1960s to 1990s
So from above facts its clear that company have to invest huge amount of money as well as time
for implementation of ERP and after all if it fails to meet companies requirements and goal than
company can sunk in huge losses. So before implementing ERP in any company it’s better to
check whether is it feasible for their company or not?
1.3 Objective
To study the effectiveness of ERP in the feasibility phase for contracting organization.
To identify basic parameters for implementation of ERP in feasibility stage.
To propose a model for implementation of ERP in feasibility stage for contracting
organization who are still to implement ERP.
1.4 Methodology
1.4.4 Conclusion:
Based on the analysis relevant conclusions have been made and scope for the future work
have been suggested.
• Incorporate the risk and quality management plans in the change management plan.
• Breakdown the project into natural phases or subsystems for modular planning and for
development of cross-functional communications.
• Consider a phase-based approach for gradual implementation rather than radical approach.
• Use appropriate planning styles for different tasks, detailed task plans for tangible tasks,
iterative plans for evolving tasks, and personal communications plans for change
management.
• Prepare plans for the recruitment, selection, and training of the necessary personnel for the
project team.
• Use multi-functional project teams to bring complementary capabilities together during the
total life of the project.
• Use intra-project teams and intra- and inter industry networking for technology transfer.
• Provide stakeholders with a detailed plan of the implementation process, explain how it
achieves business objectives, and keep them informed about the system and progress of its
implementation.
• Propose possible ways for restructuring personnel and systems to accommodate the new
technology including maximizing of system integration and interfacing.
system for manufacturing industries. But very nominal work has been done to study prerequisites
for implementation of ERP in construction industry.
DATA COLLECTION
Data collection regarding Prerequisites for implementing EPR in any organization has been
collected through questionnaire survey with experts of two organizations like JMC India Pvt.
Ltd. and Jai Hind Projects Limited. In case of JMC questionnaire was conducted with Mr.
Mahendra Patel, Head of IT Dept. While in case of Jay Hind Projects questionnaire was
conducted with Mr. Keyur Shah, Sr Manager, SAP.
Jaihind owns one of the largest task force of Pipeline equipment in south Asia. Jaihind is
continuously investing in equipment to expand it project capabilities and increase the number of
spreads & projects it can simultaneously work on. Jaihind Projects Limited is a Public Listed
Company with its shares listed on the Bombay (Mumbai) Stock Exchange (BSE). As of March
31, 2008, it employs just under a 1,000 full time and contractual employees and it’s annual
turnover is around 225 crores. Its head office is located in Ahmedabad (Gujarat), India.
Jai Hind group has several projects running at various locations throughout the country also they
are planning for international market. Each project had its own database and information system,
which was not connected to head office.
One of the biggest challenges for a construction company like the Jai Hind is in estimating cost
of construction. Since the projects are usually spread over many years, aligning the projected
cost with the actual cost becomes difficult. At any given time there would be at least 20-25
construction projects running concurrently. The departments were maintaining different files in
different excel charts. The accounts department was maintaining a separate software package but
materials and purchase was not linked to those. Moreover much of this data was lying in site
offices, which was not connected to the head office in Ahmedabad.
The entire process of collecting information from various departments was being done manually.
Whenever there was a quarry, each department would have to pull out information and
consolidate it for report. This not only slowed down the decision making process but also created
power centers within the company. This made it very difficult to do real time cost estimation of
different projects.
To solve the above problem company decided to go for ERP implementation based on success of
various organization successes. For that company first of all go for ERP need analysis review
and found that Real time data and Data Transparency, this are the two main benefits for
implementing ERP. Real time data means accurate & present data regarding any item can be
obtained at any time about any of their construction site. The main value ERP systems provide is
the opportunity to integrate an entire organization through common data base and the
information flow is much more efficient & clear.
3.1.3.1.1 People:
As employee are the ultimate users of new system and if they do not agreed upon the new
system then whole investment can ruin the business,
So company first gave them training in three various stages of implementation.
During first Stage Company make aware their employee what is ERP and basics of
ERP.
During second stage employee were given “On Hand Training”, in this employees were
given demonstration about various modules according their departments and then
assignments were given to solve.
During third stage employee were given “On job Training”, In this stage now employee
were asked to phase real time situation and they use software on site and if they want
help then consultant are there to help them.
Also based on degree of customization provided by any vendor with their software, selection
is done.
For Example:
If all IS of organization are working smoothly and company does good business with that
system than these system’s can also integrated with new ERP system.
Various ERP vendors are available in market at domestic as well as international level. Based
on company budget and requirement vendor should be selected.
Domestic ERP vendors: In-house Software etc.
International: SAP, People Soft, JD Edwards, Oracle.
These are the major players in the ERP market.
In this case, main requirement was to integrate various departments like Operations,
Accounting and Finance, Asset Management (equipment), Procurement and HR. So we had
decided to go for phase wise implementation. So after discussion with consultant various
vendors like SAP, People Soft, JD Edwards, Oracle were contacted and asked for their
presentation of their software.
3.1.5 Benefits:
(1) The first and most important benefit of this solution is that information has now become
transparent and seamless.
(2) With a smooth information flow, decision making has also become much quicker.
(3) All departments and site offices are now connected on a single platform.
(4) The management team gets a complete overview of the projects and instant availability of
data and reports.
(5) Information flows freely between departments.
Private Limited, subsequently the name was changed to Joshi & Modi
The company was popularly known as JMCPL among the corporate clients. In
order to capitalize on the same, the company changed its name to JMC Projects
(India)Ltd. The company entered the field of Industrial construction with the prime motive of
servicing reputed clients with very high quality of construction work. The
company has achieved substantial growth during the last 3 years and is one of the leading
construction companies in Gujarat. It has registered as class `A ' Contractors with Government
of Gujarat. The list of prestigious clients includes Tata telcom Ltd, Videocan International Ltd,
Whenever there was a quarry, each department would have to pull out information and
consolidate it for report. This not only slowed down the decision making process but also created
power centers within the company. This made it very difficult to do real time cost estimation of
different projects. Thus need arises for integration of various functional departments by one
common platform.
To solve the above problem company decided to go for ERP implementation based on success of
various organization successes. For that company first of all go for ERP need analysis review
and found that Real time data and Data Transparency, this are the two main benefits for
implementing ERP. Real time data means accurate & present data regarding any item can be
obtained at any time about any of their construction site. The main value ERP systems provide is
the opportunity to integrate an entire organization through common data base and the
information flow is much more efficient & clear.
JMC has developed the best Management Information Systems modules for its Operations,
Accounting and Finance, Asset Management, Procurement and HR also for its core operations
and accounts such as FICO, Materials Management, Sales & Distribution, Tendering, Accounts,
By- UMESH KUMAR
IIPM
Document Management Systems, JMC decided to run in-house software. By end of July ’09
Company targeted to implement ERP at their all over sites in India. It uses other segment
specific software and systems for Human Resources, Procurement Portal, Employee Self
Service, etc. and doing wonders!
DATA ANALYSIS
4.1 ERP Pre Implementation Parameters
For successful implementation of ERP first do need analysis review, then based on requirement
select appropriate consultant based on their experience, then follow the selection criteria for
vendor selection and based critical success factor try to implement those factor and based on
critical failure factor try eliminate those factors also find out total cost of owner ship so it
becomes clear for organization that how much they will have to spend. Based on this criterion
ERP implementation should be done to reach organization goal through ERP.Bellow is the
model provided to make one understand how various people are associated at various stages and
how they perform their role in to organization and which are the parameters they consider at pre
implementation stage.
Assemble
Testing
Customization
Customization
Organization
BVendors
End User
Market
Performance
Training
Budget
Need
Value
A
Going Live-
ERP By- UMESH KUMAR
Implementation
IIPM
Different companies may install the same ERP software in totally different processes. The same
company may implement different ERP software in the same approach. There are three
4.4.1 The Big Bang
In this Companies layout a grand plan for their ERP implementation. The installation of ERP
systems of all modules happens across the entire organization at once. The big bang approach
promised to reduce the integration cost in the condition of thorough and careful execution. This
method dominated early ERP implementations, it partially contributed the higher rate of failure
in ERP implementation. Today, not many companies dare to attempt it anymore. The premise of
this implementation method is treating ERP implementation as the implementation of a large-
scale information system, which typically follows SDLC (Systems Development Life Cycle).
But an ERP system is much more than a traditional information system in the fact that the
implementation of ERP continuously calls for the realignment of business processes. Many
parties involved in ERP software systems are not IT professionals. ERP more than automates
existing business processes. ERP transforms the business processes.
Integration ERP systems won't demonstrate its full potentials unless they are properly integrated
with other enterprise software application:
Data Conversion The cost of data conversion depends on the format and the media that store the
historical data. Data conversion from legacy systems to RDBMS is a time-consuming process.
Data conversion may lead to further data gathering to fill the missing links in data requirements.
Testing ERP systems are thoroughly tested before they go into production. ERP testing includes
unit testing, component testing, regression testing, performance testing and user acceptance
testing.
Training ERP training is expensive because workers almost invariably have to learn a new set of
processes of doing their daily tasks besides learning how to use the ERP software. To reduce the
cost of ERP training and to ease the transitions from old processes to new, organizations often
seek the help from training companies which are specialized in coaching workers on using ERP
software from particular vendors.
1. ERP software,
The failures in one or more of those four components could cause the failure of an ERP project.
The failures in hardware are more easier to identify and to fix, we'll examine the failures in
software implementation, business process and user acceptance.
CONCLUSION
Not all of ERP implementations are entirely successful. In fact, about half of ERP
implementations fail to meet expectations. Most of them suffered from over-budget, over-time,
user dissatisfaction, failed to introduce all planned modules, or the big and horizontal ERP
systems pulling back into beta testing. So it’s essential for any company before going for ERP
implementation they should do feasibility study. Also company should follow the proposed basic
pre implementation parameters as well as process chart described in data analysis.