...Cisco Systems, Inc.: Implementing ERP [HBR case #699022] Reviews Cisco System's approach to implementing Oracle's Enterprise Resource Planning (ERP) software product. This case chronologically reviews the diverse, critical success factors and obstacles facing Cisco during its implementation. Cisco faced the need for information systems replacement based on its significant growth potential and its reliance on failing legacy systems. The discussion focuses on where management was particularly savvy in contrast to where it was the beneficiary of good fortune. Cisco was highly successful with its enterprise resource planning (ERP) effort. What accounts for this success? What were the most important things that Cisco did correctly? Cisco’s success is greatly attributed by its 100% dedication of their teams to complete this project. It started with the senior management team approval and support. This includes its core ERP team of 20 which expanded to 100 after the board approval. Also included is the Executive Steering committee which also worked countless hours to meet this deadline. Even the hardware vendor who was an executive sponsor probably had 30 people on site at one point. This big financially but it was a great reference for them. The core ERP team represented a cross section of Cisco’s business community who were experts in its field . They were very structured and organized dividing the large 100 team into 5 process area teams or ‘tracks’. Each track had a Cisco...
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...UniversityRobert W. Starinsky, InstructorWinter Quarter, 2004 | ERP Implementation Report of Findings and Recommendations CISCO Systems, Inc. Table of Contents Table of Contents 1 Background and Scope 2 ERP Implementation scenario 2 Situation Analysis 3 Conclusion and Recommendations 4 Background and Scope Cisco System, Inc is a Computer Technologies company that was founded in 1984. The company’s primary product is the “router.” The router is hardware and software that control Intranet and Internet traffic. With the growth of the Internet, Cisco products became in high demand. In 1997 Cisco was ranked among the top five companies in return on revenues and on assets. Cisco has been classified in the same category of successful companies as Microsoft and Intel. With the growth of Cisco, their computer systems were unable to handle the increase volume. The Cisco legacy system was a Unix-Based software package that supported its operations of: Financial; Manufacturing; and Order Entry. The system lacked reliability and the ability to expand. Eventually in January 1994, Cisco’s legacy computer system malfunctioned corrupting Cisco’s central database. The company was practically shutdown for two days. As Cisco struggle to recovered from the major shutdown, the company realized that they needed to act quickly and elected to implement an ERP system. Little over a year later, Cisco successfully implemented an ERP system from Oracle. This report has been requested by...
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...Op 300 Team Members: Abby Khan, Ertugrul Caglayan, Duy Bui Application of Enterprise Resource Planning (ERP) ERP (Enterprise resource planning) is a software that allows companies to automate and integrate many of their business processes, share a common database and business practices throughout the enterprise, and produce information in real time. The objective of ERP system is that it supports the streaming and distribution of geographically scattered enterprise information across all the functional units of a business house. It provides the business management executives with a comprehensive overview of the complete business process, which in turn influences their decisions in a productive way. Many big companies have adopted ERP into ways that they run business. Oracle was one of the pioneers who custom built ERP systems for many companies around the world. Omental and Cisco were one of the first companies and pioneers who had custom built ERP system installed by Oracle. The staff had to be trained to use the system, with the help of Oracle and watch it launch off after many trial and errors along the way. Jinyang a small size Korean company chose ComputerMate, a small software company in Korean, to provide and build them there ERP system. ComputerMate provided the same service like Oracle, analyzing, implementing, training and then executing the ERP system to the entire company and monitor the progress and results. Introduction of Omantel Omantel was established in 1970...
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...Raymond Braselman Cisco Systems Case 1. Cisco’s management was very reluctant to significantly alter the structure of their IT system, even though the system was consistently failing. There were a few reasons for this reluctance. First, Pete Solvik, the CIO of Cisco at the time, was hesitant to even consider an ERP system in the first place, because he believed that each functional silo of Cisco should decide which applications it utilized (while also using common architecture and databases to accommodate the disparate systems, which complicated matters). Then, this attitude became pervasive among other managers, because most were concerned that implementing a large scale ERP system would disrupt business operations too drastically for such an implementation to be practical. 2. Once Cisco’s managers realized that their IT system needed a major overhaul, they became very focused and dedicated. One of the first aspects that led to the implementation’s success was convincing the Board of Directors of the need for an ERP system and to commit to the project, setting a “tone at the top” that established the project as a company-wide priority. This led to Cisco being able to develop an implementation team comprised of experts. From the beginning, Cisco leveraged the experience of others, and eventually prompted KPMG to become involved, not only during the actual implementation, but also throughout the drafting of the RFP and the consideration of different vendors...
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...Discussion Questions Cisco Case Questions 1. At the start of the case, Cisco’s information systems are failing, yet no one steps forward to lead the effort to replace them. Why is this? Why were no managers eager to take on this project? At the beginning of the case, Cisco’s information systems were failing because they were experiencing exponential growth and the IT systems that were in place could not provide the reliability and maintenance for this magnitude of growth. Companies that experience this kind of growth usually make decisions based off the status quo and assume that what has worked in the past will continue to work going forward. In addition, with such sizable growth, implementing changes to the company’s information systems can have substantial effects on the continued success of the company, making any recommendation for change extremely daunting. Coupled with the fact that most people are change averse, no one wanted to run over the legacy systems Cisco already had in place so they just tried to continue to Band-Aid the issues with system replacements. Managers were not eager to take on this project Although it was clear by 1993 that there was a significant misalignment between the capability of the legacy UNIX-based system and the business demand based on growth, no one within the company had led an effort to replace the old system. One reason was likely due to the lack of direction for such a project, as the CIO had originally instructed each business...
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...John Morgridge joined Cisco as a CEO in the year 1988. The very first thing he notices in the organization was the lack of professional management team. Initiation for professional management team was the first kick off for the organization. Professional management is considered to be the foundation of any big organization and Cisco started with this thereby sticking with the fundamentals. The professional team clashed with the founders ending up them leaving the company and giving a free hand to Morgridge to handle the organization in a disciplined manner in terms of management. Cisco as an organization started off with a very positive note thereby centralizing the functional areas. Except product marketing and research and development all the other areas (finance, human resources, manufacturing, IT, customer support etc.) were centralized. Although the initial changes in the organization doesn’t claims to the success factor for future implementation, but yes it certainly add a bit to It thereby streamlining the management with a transparent and clear view to proceed. The company was doing extremely well after going public in 1990 and in 1993 reaching the $500 million target. From this it can be clearly seen that the company was in a rapid move to success from the moment it became public in 1990. Analyzing the requirements in the right stage and planning for it is the first initiation which stands for cisco’s success. The need was addressed with respect to the future growth...
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...MAY 6, 2002 ROBERT D. AUSTIN RICHARD L. NOLAN MARK J. COTTELEER Cisco Systems, Inc.: Implementing ERP History of Cisco op yo Pete Solvik, Cisco Systems chief information officer (CIO), considered the last remaining line item of his ERP (Enterprise Resource Planning) implementation budget. Cisco had a history of rewarding performance with cash bonuses, but the amount allocated for rewarding the ERP team, over $200,000, was unprecedented. To be sure, they had delivered a lot in a time frame that no one had believed possible. It had not been easy either. The team members, Solvik included, had taken a risk in joining the project. Rewards should, and would, be generous. The size of the bonus pool, though, made Solvik think: they had done well, but how well? What had gone right? What had gone wrong? Given another project of this magnitude and risk, would they be able to do it again? No tC Cisco Systems, Inc. was founded by two Stanford computer scientists in 1984 and became publicly traded in 1990. The company’s primary product is the “router,” the combination of hardware and software that acts as a traffic cop on the complex TCP/IP1 networks that make up the Internet (as well as corporate “Intranets”). With the rise of Internet technologies, demand for Cisco’s products boomed and the company soon began to dominate its markets. By 1997, its first year on the Fortune 500, Cisco ranked among the top five companies in return on revenues and return on...
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...1) Cisco suffered from inertia when an attempt was made to engage business management in selecting software for their individual areas, and/or agreeing to participate in the ERP implementation project. List and explain reasons why management would hesitate to become engaged in the IT process/project. Blow is the reasons why management would hesitate to become engaged in the IT process/project. In the first place, the company’s CIO planned to let each functional area make its own decision regarding the application and timing of its move. The management wanted Cisco to keep with its tradition of standardization which shows the organizational and budgetary structures the CIO of the company had installed upon his arrival. In this tradition of standardization, all functional areas would be required to use common architecture and database. Although the existing application did not provide the degree of redundancy, reliability and maintainability the company’s business needed and the company’s significant growth prospects convinced the management the company needed a change, what they did would just run over the legacy systems they had in place and constantly band-aid the existing systems. No one really throw out the legacies and do something big. The management thought the autonomous approach to systems replacement they had adopted was going to be sufficient. Secondly, the management would hesitate to become engaged in the IT process born out of concerns about the types of “mega-projects”...
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...Cisco Systems, Inc.: Implementing ERP Introduction Cisco Systems Inc. was founded in 1984 by two of Stanford University’s computer scientists. In 1990, a matter of just six years from the start-up date, Cisco became publically traded. With the massive growth of Internet Technologies, demand for Cisco products increased dramatically, resulting in Cisco dominating the marketplace. The contributing factor to Cisco’s dominating presence in the market is due to the company’s primary product, the “router”. This is a combination of hardware and software that acts as a traffic cop on the complex Transmission Control Protocol and Internet Protocol (TCP/IP) networks that make up the internet as well as corporate intranets. TCP and IP networks provided a robust standard for routing messages between LANs and created the potential to connect all computers on an ever-larger Wide Area Network (WAN). Financially, the company experienced consistent growth from July 30, 1995 up until July 25 1998. Using figures provided in Exhibit 1 of the case study, it can be calculated that Net Sales increased a whopping 279% from 1995-1998. The year 1997 proved to be a milestone for the company. It was the first year for the company to feature on the Fortune 500 list. Cisco was ranked among the top five companies in return on revenues and return on assets. Some industry pundits predicted Cisco would be third dominating company alongside Microsoft and Intel, to shape the digital revolution. The reasoning...
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...CISCO case analysis Introduction and background As one of the largest makers of computer network gear Cisco provides a broad line of products for transportation of data, voice and video all over the globe. Cisco is one of the big impacts on how we connect as people, communicate and collaborate. Cisco are focused on the delivery of intelligent networks, technology and business architecture built on integrated products, services, and software platforms to its customers. This case is going to analyze the ERP rollout that took place after system failures in the years 1994-1995. Cisco was founded by two Stanford computer scientists in 1984 and brought public in 1990. In 1997, Cisco featured in the list of Fortune 500 companies and ranked in the top five companies in Return on Revenues and Return on Assets. Cisco passed the significant $100 billion mark in 1998 and in 1999 Cisco had more than 75% internet sharing (Nolan, R. 2005). Problem Cisco’s legacy IT department was too traditional and internally oriented and was considered being a cost center. The legacy system was very traditional only having the capabilities of very simple tasks. Cisco made years of modifications and customizations to the system which made it very complex that was comfortable for the users. In January 1994, Cisco’s legacy environment failed dramatically. The failure was so bad that the system actually was on the brink of complete failure. An unauthorized method for accessing core application...
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...Cisco Enterprise Resource Planning Name Institutional Affiliation Cisco Enterprise Resource Planning Question 1 Many factors contributed to the success of the project. Firstly, the full support and rights decisions made by the top leadership contributed to its success. Once the board of directors had endorsed the project, the CEO Morgridge introduced the ERP project to all the company`s employees, and this made them support the project. Secondly, as at the time of the ERP implementation, Cisco was still a startup company, and this gave the company the flexibility it required to implement the changes more quickly. Moreover, the company had sufficient financial resources to implement the project. Thirdly, the decision to centralize the functional organizational structure resulted in a stable organization, which promoted significant innovation. Similarly, the company`s powerful IT elite team managed to effectively respond to the implementation challenges. Furthermore, the incentive system that the company created further promoted the commitment of the employees to the project. Finally, the company received significant support from its partners like Oracle and KPMG. These partners brought onboard rich experience and professional knowledge. Question 2 Some of the most important things that the company`s management did right include: they may the correct decision to exchange the company`s Unix systems for ERP systems because the old system could no longer...
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...Cisco was founded in 1984 by two employees of Stanford University and became a public company 6 years later. After the company became public, the founders of Cisco decided to sell their shares and leave the company. This allowed the company to have a more receptive environment for growth and new management. Cisco became a fast growing and fast moving company due to the consistency of strategy, goals, organization and management that was implemented. Cisco’s goal was to become a leader in technology for the new internet based infrastructure where voice data and video could be transferred from one user to another over a single network. Cisco provides products and services that transport voice, data and video around the world. The company designs and manufactures products and services associated with the communications and IT industry as well as internet protocol networking. There are three categories of products offered by Cisco: core technology, routing and switching, advanced technology, and other products. Cisco also provides service offerings, technical support and advance support for networking devices, applications, solutions, and complete infrastructures to support the customers that purchase their products. Because Cisco provides a variety of products and services in the networking and communications industry, there are several competitors they face on various levels. The competitive environment for Cisco can be seen by looking over Porter’s Five Forces. At the time...
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... The reason is Cisco was such a big company and growing very fast at that time. The legacy system was very hard to get rid of and the efforts and time it requires to replace a new system would not be accepted by the board. The CIO was first trying to avoid an ERP solution and let each functional area make its own decision regarding the change of the core software. But to keep up with the company’s strong tradition of standardization, all functional areas would be required to use common architecture and databases. Thus this would be more difficult than to deploy one system. 2. Cisco was highly successful with its ERP effort. What accounts for this success? What were the most important things that Cisco did correctly? There are several reasons that led to the success of Cisco’s ERP implementation. a. Support from the board, it was the right time that the old system kept failing and everyone saw an opportunity to do something big to replace the whole legacy system. b. Best people from different team/function areas. c. Strong partner KPMG, an experienced integration partner that has worked on many ERP system before. d. Correct selection strategy: consulting other companies to leverage their experiences, consulting Gartner to get real report on the market. RFP to vendors and 3-day software demonstration. e. Ideal implementation team, each track (totally 5 tracks by process area teams) has an IT leader and business leader from Cisco, business and IT consultants...
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...Cisco Systems ERP – Case Study Andree Grecchi Hawai’i Pacific University 2/19/2014 IS 6005 Professor: Ken Rossi Table of Contents Who is Cisco? 2 Prehistorical Infrastructure 4 Seeking for a new start 4 Evaluation 6 Conclusion 7 References 8 Who is Cisco? Cisco is one of the most powerful and successful corporation in the IP network industry. In the fiscal 2013 their revenue totaled $48.6 billion and their Net Income was $10.0 billion (Cisco 2013 Annual Report). Cisco focuses on delivering products and services that consists in integrated networks for all forms of communication and IT. They provide their customers with an integrated architectural approach that gathers application-specific integrated circuits (ASICs) software, hardware, and services. In December 1984 Cisco Systems Inc. was founded by two computer scientist at the Stanford University, Len Bosack and Sandy Lerner, husband and wife. The two lovers wanted to communicate by email from their respective offices, but at the time different local area protocols communications didn’t exist. As a result the first multi-protocol router came out. Since then Cisco lead the networking market allowing “the transportation of voice, data and video within buildings, across campuses and around the world” (Cisco 2013 Annual Report. P.1). This is possible thanks to the routers, its core technology. A router is a device that joins multiple networks together, it allows the connection...
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...Cisco Case Analysis Cisco is a company with a clear vision and an ambitious goal of becoming the global Internet expert. The company set its sights on challenging the norm of the time and working on making voice calls over the Internet free. Established in 1984 by two Stanford graduates, Cisco became the most valuable business on earth by March 2000. The company’s strategy is to provide a complete solutions offer to its customers through offering a wide product range and growing the business through acquisitions and business alliances. From its original core technology of routers, the company is now focusing in three independent networks of phone, local and wide area and broadcast networks. The turnaround point for the company was its database failure and forced two-day shutdown in 1994. This event highlighted the need to change company’s approach to systems replacement and the need to integrate all of company’s applications. The company decided to adopt new practices and retrain its staff rather than mirroring the “old and tried”. The decision was made to collaborate with Oracle to develop a single ERP solution to replace all current systems. The project was a success and was followed by replacement and standardization of all company’s platforms and applications worldwide. Further to this project, Cisco web-enabled all its applications, resulting in customer service, HR and supply chain efficiencies. Cisco’s success continues and is being made possible by its growth through...
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