Riordan Manufacturing Business System Proposal
Paul Belanger, Aaron Ledger, Dacia Faulk, Ian Westerfield, Jennifer Gallaway
University of Phoenix

Introduction Being the industry leader in polymer materials and per our mission statement, Riordan Manufacturing must remain in step with industry trends. In order to effectively attain this objective, we must acclimatize, embrace, and take advantage of new and innovative technologies. In addition to identifying existing systems employed within the company that are in need of upgrades, the remainder of this paper will also address new systems as well as sub-systems needed and present a brief summary of why these systems would be advantageous to the future of Riordan Manufacturing.
Finance and Accounting Overview Riordan manufacturing employs nine basic finance and accounting subsystems globally and three additional subsystems at the San Jose, California corporate headquarters. The atmosphere of interoperability between each of Riordan’s offices (California, Georgia, Michigan, and China) is at best hostile. At present, each operating entity has its own finance and accounting system resulting in a number of inefficiencies due to company-wide systems incompatibility, a lot of which stems from the Michigan and Georgia acquisition. To better establish potential interoperability between existing subsystems, it is first necessary to define the current subsystems of each Riordan office, existing software solutions, and how these resources fit within or address the challenges facing Riordan Manufacturing’s finance and accounting business system.
Existing Finance and Accounting Subsystems There exist nine subsystems to the Riordan Manufacturing Finance and Accounting System (RMFAS) globally held in common: general ledgers, accounts payable and receivable, order entry, procurement, sales and purchasing histories, invoice and shipping, payrolls, and financial reporting. The locations employing all nine subsystems are: San Jose, California, Albany, Georgia, Pontiac, Michigan, and currently Hangzhou, China. Riordan Manufacturing’s headquarters in San Jose, California employs EDI, Bar Code Reading, and the Executive Decision Support System (EDSS) in addition to the aforementioned common subsystems.
Current Software Environments for RMFAS Currently, there are no common software environments between any office locations’ RMFAS system. This is a leading problem in regards to the challenges facing the global interoperability of RMFAS. In San Jose, California, a third party developer used an unspecified language to develop the Enterprise Resource Planning software for Windows-based machines. This limits the possible languages used to C, C++, C#, Basic, .Net, and Java. A third-party (now defunct) developer created and subsequently surrendered to Riordan their program and source code to the Pontiac, Michigan office. This program was written in C for an operating system capable of this and C++, COBOL, Basic, FORTRAN, and Pascal languages. The Georgia office uses an IBM-specific database language, Report Program Generator 400 (RPG400), program developed by a third party. This office does have the RPG400 source code to the program. In all reality, the Windows-based workstations are doing little more than using a Telnet session to manipulate the program they use for their finance and accounting, and manufacturing systems. The current software climate is not conducive to seamless interoperability and operations for two reasons: 1) not all office locations use the same programming language in their finance and accounting software, and 2) the software used in Michigan has virtually no possibility for integration into a seamless solution. Furthermore, problems exist in the RMFAS other than software related. Some financial data given to corporate is hardcopy needing re-entering, some by data files needing conversion.
Recommended RMFAS Solutions Current challenges facing the RMFAS include: quicker consolidation and close of General Ledger; Income Statement, and Balance sheets; in-house auditing capabilities; and compliance with government-required reporting requirements. Without a clear path to interoperability between Riordan Manufacturing office locations the potentiality of successfully meeting the outlined challenges is not to be expected. A clear path for global systems integration will likely entail a common language solution. Using a bridge to fill the incompatibility gap between systems is one potential solution. This approach is referred to as a Rosetta stone because a separate piece of software would have to be made available to provide the necessary conversions. The second and recommended solution is to essentially green-field, or scratch-build, the reporting solutions. This approach is likely to be more costly, but can be far more cost-effective. By replacing aging systems with updated technology and hiring a third-party developer to create a common and unified RMFAS program would allow Riordan greater longevity in addition to quick project completion and in-house support and development. Furthermore, Riordan Manufacturing can also benefit from implementing additional subsystems such as cash management, investments, stock, and bonds. By making these upgrades and additions, Riordan Manufacturing will have a higher productivity rate resulting in achieving and maintaining reasonable profitability. This will assure that the financial and human capital is available for sustained growth, as mentioned in the mission statement.

Human Resources Business System Overview Riordan Manufacturing’s Human Resource system is a subset of RMFAS, and was implemented in 1992. The system, mostly not automated, is responsible for the handling and dissemination of information related to human resources. In-house-processing responsibilities include: personal information, pay rates, personal tax exemptions, Hire and seniority dates, organizational information, and vacation hours. Payroll clerks update this information from written modifications submitted by employees to their supervisors.
Existing HR Subsystems In addition to in-house processing, Riordan Mfg.’s Human Resource Information System (HRIS) is extended by third-party service providers, contains certain areas of reporting outside of clerk submission, and has areas where multiple supervisors are responsible for maintaining employee information.
Training and Development Records The Training and Development Specialist is responsible for tracking employee adherence to training and development requirements using Microsoft Excel documents. This employee is solely responsible for updating and maintaining the information in those Excel documents.
Applicant Information There are several recruiters responsible for maintaining all applications and résumés regarding open positions. These résumés are stored in a central area. The progress of each applicant is tracked using Excel documents.
Worker Compensation All worker compensation data, information, and records are maintained and processed by a third-party provider.
Employee Files Employee files, to include Family and Medical Leave Act (FMLA) absences and requests for accommodation under the Americans with Disabilities Act (ADA), are kept and maintained by individual managers.
Compensation Management The compensation management subsystem tracks and maintains job analyses, salary surveys, and individual employee compensation decisions. The task of maintaining these sets of information falls to one employee, the compensation manager.
Employee Relations These records (complaints, grievances, harassment complaints, and others) are kept in one office under security and are maintained by a group of specialists.
Recommended Solutions Given that Riordan Manufacturing has provided no challenges or goals related to their HRIS, the overall effectiveness of HRIS is not under consideration. Any change to HRIS should be simply to simplify the already effective system. Considering also that employee compensation is handled by a third-party provider, simplification of the HRIS is limited to one area of obvious concern. Employee files, as they exist currently, seem to be strewn across many desks of individual mangers. To simplify the reporting of employee statistics, it would be possible to allow modification with the clerks already responsible for entering the majority of employee-related information into the HRIS. With this sort of arrangement, information about employees could be easily requested, compiled, and disseminated without interrupting the duties and activities of each individual manger.

Current Legal System

Currently, Riordan Manufacturing does not have a legal business system in place at any of its locations. The company’s legal matters are overseen by its Chief Legal Counsel, Lowell Bradford. Mr. Bradford approves all contracts before they are signed in addition to answering all legal questions. Furthermore, Mr. Bradford also consults with attorneys from Litteral & Finkel, a large international law firm with a long-standing relationship with Dr. Riordan. Litteral & Finkel provide Riordan Manufacturing with legal services in the areas of tax law, real estate transactions, employment law, immigration matters, civil litigation, workers compensation, labor law, and customs regulations. Riordan Manufacturing pays Litteral & Finkel a monthly retainer to assure prompt and immediate response to any legal inquiries. If legal matters arise, legal fees are charged against the retainer. If the amount of a particular month’s legal fees exceeds the retainer, excess charges are billed to Riordan Manufacturing at the end of the month.

Recommended Legal System Solutions

As it stands, the existing system we now have in place works reasonably well for our needs. Creating an entire legal department from the ground up does not appear to be a cost-effective solution at this point in time. It is however suggested that Riordan Manufacturing affix a more automated business system to coincide with our present system. There is a wide array of legal software available which can aid Mr. Bradford in keeping track of all legal matters within the company in addition to finances paid to Litteral & Finkel. Furthermore, this new system will support in tracking past and current legal matters for individual employees of the company which will in turn increase our overall efficiency.

Riordan Sales and Marketing System

At present, Riordan Manufacturing encompasses a robust Marketing Information System (MIS) resulting from years of innovation as well as profitability. Additionally, the Riordan MIS (RMIS) has at its disposal several forms of documentation in large quantities. However robust the current system may be, similar to the existing Finance and Account System, it is lacking cohesion in documentation, records, and information processing. To better summarize and fashion potential improvements to the present scheme, it is first necessary to recognize the current system and subsystem environments and how these separate environments can be called into collaboration. Moreover, it is important to take into account the systems benefits in addition to its limitations.
RMIS Environment Overview RMIS is responsible for seven key functions of Riordan Manufacturing’s mature and successful sales and marketing entity. These functions deal with such aspects as: (a) historical sales, (b) past market research, (c) marketing plans, (d) design awards, (e) sales database, (f) production records, (g) profit and loss statements, (h) marketing budget, and (i) marketing budget anticipated results. Of the aforementioned subsystems, only one has the likelihood for interfacing with the Finance and Accounting Information System. The remaining 85% of RMIS remains largely autonomous. The existing interoperability of RMIS is profitable, but falls short of being easily referenced. For instance, should Riordan’s historical sales need to be referenced against the current sales database, any fruition of requirements would entail multiple requests to several teams for transcribed current sales information. These transcriptions would then have to be again transcribed to cross reference them with electronically-held historical figures. The breakdown of efficiency displayed by the historical/current sales data is seen in other mission-critical correlations. When Riordan wishes to campaign for a new product being developed, it is quite significant to understand where the new campaign fits into the marketing budget. In this process (marketing plans and marketing budget), the inefficiency of requesting transcriptions of physically stored data leads to a decision bottleneck – without accurate, timely, and complete data, the marketing director (and subsequently the executive suite) of Riordan cannot completely benefit from their campaign.
RMIS Potential Solutions

Whilst our current sales and marketing scheme works relatively well, the system itself is actually spread across a number of different platforms. Some of our marketing team members still make use of paper and pen to do the job, while others use Act and similar software. Over the past few months we have been weighing up various customer management systems to accompany our new selling approach which the company will soon roll out. This new system will give our sales team a single consistent platform from which to work from and reach that $50 million revenue mark.

While there are a several commercial software options available, the most feasible option at this point appears to go the same route as the recommended solution for the finance and accounting system. Similar to the RMFAS system, the benefits for such a choice are quite abundant. While this approach may initially be more costly, the rewards are plentiful. By hiring a third party developer or company to come in and essentially scratch build us a system we can assure complete compatibility with other systems such as the RMFAS. Moreover, the company will also reap the benefits of having in-house support and development. This approach also allows the company to implement features that are perhaps not yet available in commercial software. Furthermore, this centralized system will offer enhanced data management in addition to a more efficient strategy overview in that it will allow for our marketing team to better prioritize tasks by monitoring and tracking competition as well as our own sales growth.

Current Operations System

At present, Operations are divided amongst the various factories within the organization. The manufacturing plant in China operates as a decentralized unit preparing its own forecast of electric fans for sale throughout the world. Parts and services are purchased locally which also includes shipping within China. International shipping is done through either FedEx or a neighboring shipping company which offer comparable rates. Current issues facing this facility are periodic orders received randomly throughout the year makes it difficult to predict material requirements, which also in effect have made on time deliveries average at about 93%.

The Georgia facility produces plastic bottles through yearly contracts negotiated with customers. The facility also has safety stock to deal to deal with potential shortages throughout the year. Shipping at this facility is done through Huffman Trucking Company. Similar to the China plant, the Georgia facility also faces problems dealing with periodic orders throughout the year. That being said, there is a trade-off between the cost of carrying safety stock and the cost of running out of bottles. Most of the late shipments however have been the result of adverse weather conditions. Currently, the Georgia plant has an on time delivery average of 96% and management is exploring the idea of switching to a VMI supply chain system.

The Pontiac Michigan factory is responsible for plastic fabrication which includes part design and color. Generally, custom parts are produced in small numbers but the facility must sustain an ample amount of materials in order to promptly respond to customer requests.

And lastly, the R & D Department at corporate headquarters consists of five product development personnel whose job is to research next generation heart valves, medical stents, and complementary medical devices. Due to the nature of this research, the R & D Department does not have the same supply chain problems as the other facilities within the company.

Operations System Solution

Overall, the main issue with the company’s current operation system is due in part to the supply chain.

Conclusion