Syscos Need for Business Intelligence Software - Case Study Example

Running Head: Cisco Case Study Introduction Sysco is essentially a food distribution company. It has various autonomous working divisions. The IT infrastructure of Sysco soon became obsolete. As a result, a lot of technical expertise was needed to extract useful data and predict the course of future demands and happenings. This demanded that immediate actions be taken which was not a very easy task. There was a lot of configuration and development that had to be done on the new software. This was because both the Enterprise Resource Program System and the data ware housing that Sysco was using was unable to keep up with the fast pace growth and the ever increasing data load. The paper focuses on Sysco’s need for Business Intelligence Software. How it was developed with the software vendor, the Business Objects and the implementation and integration decisions associated with it. It also delves on the basic license buying structures that are given to the company and discusses various important decisions such as the quantity of licenses that have to be brought. Sysco’s Organizational Structure: Sysco functions as a decentralized business body. It has different regional operations and specialties all of which are independent from each other. Each of these business systems have incorporated some form of Business Intelligence systems which have to be eventually replaced and removed. Going ahead with a common well integrated Business intelligence system would imply that the different operations of the company will have to pay part of the cost. This will bring down net profits and also call for a change in working ways. Therefore it is likely that the different departments in the business will resist its implementation. On the other hand, the advantages of having a Business intelligence system would be manifold. It will take care of Sysco’s data mining and extraction needs. It will help them generate automatic reports for data analysis and decision making. Sysco’s initial plan was to use Business intelligence software to address only 2 questions. These 2 questions were regarding the additional products that will have to be sold out to each of their customers and the current customers that they are most likely to lose. Both of these questions required a lot of introspection, research and analysis. It was a long strenuous process to answer these questions manually. More over the authenticity of the imminent result could not be guaranteed. Instead, automated, quick and constant answers to such questions would have been extremely helpful to Sysco. They were central to the company’s business and would produce a rapid and humongous return on investment. Thus the implementation of a Business Intelligence System would have helped the company in achieving its desired goal more efficiently. There were a lot of competitive advantages associated with this kind of decision making which is why Business Objects recommended this approach. The real competitive advantage lied in adhoc querying, catching and connecting. The job demanded by Sysco was well synchronized with a lot of internal factors. It helped Business objects achieve its business goals, to satisfy its users and to be able to deliver a manageable solution. Focus on a single business project for initial roll out would result in better quality. A relatively small project and development plan will go on to make access easier ensure that that Executive sponsor ship is easily obtained. This will bring down risks and maximize implementation success. The biggest disadvantage of limiting Business intelligence to only two facets is cost indeed. Sysco will need a complete business intelligence system in near future. This means that they will have to go for either a completely different system or integrate the new system with the current one. Eventually, costs will be incurred. Also though the Sysco worker will be familiar with the Business Intelligence system, they will have to reorient themselves with it again. Technology as can be seen in this example is powerful enough to shape the market and to divert its altogether. It can turn stars into dogs and dogs into cash cows. That is how powerful technology can be. However, it’s not that easy to direct the flow of technology within an organization. Sometimes when technology is introduced within an organization, managers are met with fierce resistance from all ends over its implementation. Employees are hesitant to learn the new changes, and are not convinced. They become insecure of their jobs and in most cases believe that they are better off with the previous ways. Sometimes, they lack the technical expertise to deal with technology and are unable to see eye to eye with the managers. They are not at all convinced about the potential advantages that technology can bring for the organization. Finding it hard to work their way through it, and overall resistance to the implementation of technology gives rise to a stiff mindset within the organization. This, in itself is a huge challenge for managers to cope up with. They have to work out ways to convince their employees and help them become used to technology. For these training and other guiding modes may be looked into. Managers at Sysco would be surrounded with various challenges regarding the implementation of Business Intelligence systems. They will be met with stiff resistance by their employees who wouldn’t be willing to go ahead with the change as they would have already been used to the old system. Other things that they would have to focus on would be integration, business need analysis integration, business need analysis and management, data quality, culture change, education, training and time required to implement the Business Intelligence system. The biggest and the mother of all challenges for a Non IT Manager would be training and education. This is because the non IT Manager will not be well versed himself with the working of the Business Intelligence system. He will have to associate himself with the system and familiarize himself with it. The other challenges associated with such a system might resemble those that had been encountered with the system. For instance, a non IT manager takes complete care of data quality and integration and business need analysis and management on a regular basis. The other challenges remain the same as those that come without the system too. For instance, a non IT Manager takes care of data quality and integration, business need analysis and management regularly too. For the IT manager though the learning and training challenge will be non existence but he will have to deal with issues like management of user expectations and ROI justifications. Sysco’s Module Structures: Sysco had three buying options in its hands. One of them was bare bones. According to this option, Sysco will have to buy the least number of licenses in the next six months. Business intelligence is taken care of temporarily but the need for more licenses will arise in the next six months. The advantage of this is that the upfront payment remains low because the total overall cost is low. The second option is the middle of the road. It provides broader access for the next nine to twelve months but Sysco will have to buy more licenses after a year if the system is to be fully implemented. The costs are also intermediate. The third option is Volume Discount. It is the most costly but Sysco buys licenses which cover it for the next two years. Though the upfront payment is higher, Sysco saves in licenses because it gets them in a bulk. Given the current circumstances, volume discount perspective seems to be the most viable one. This project does require initial heavy investment but Sysco’s profits at the moment have been rising high. They are well above 7 million dollars and can henceforth; afford a system those costs, 3.5 million dollars. It also means that Linda should buy around 2000 Licenses. Irrespective of the heavy initial investment, from a cost perspective, this seems to be the most viable and lucrative option. It helps get licenses at discounted prices and also reduces the total amount of investment made by the company in the long run. It also deprives them of the hassle associated with purchasing the license again in future. Other than any expansions it intends to make, Sysco will have to hire Business objectives again and also repay the consulting fees. Bulk buying will help Sysco incur cost savings. Business intelligence will help give Sysco a competitive edge. It would prove to be a competitive differentiator for Sysco. This is because such a step would bring around revenues, bring down on costs, maximize efficiency and minimize risks. The business intelligence system could not be acquired by its competitors maybe because of its added cost or the long development and integration process. Therefore it will make Sysco’s business activities more efficient and effective without threat of competitors. Conclusion Irrespective of the many obstacles, standing in its way, Sysco should go ahead with the integration of Business Intelligence systems. Business Objects is the best and the current market leader out there, in terms of Business Solutions providers, Sysco should have complete access to the most competitive business systems on the block. It will increase revenue and make it even more productive. Report generation and forecasting will also hike up in the process. Eventually the management will be able to take good decisions and make them at the right time. Because, other competitors would not have access to a system which is this advanced, Sysco will become a leader in its own right. References: Jones, G.R. Organizational Theory . M.A Addison Wesley, 1995. Read More