Difficulties in Managing Enterprise Resource Planning Systems - Case Study Example

Difficulties in Managing Enterprise Resource Planning Systems al Affiliation) Inflexibility of the Enterprise Resource Planning SystemInflexibility of an Enterprise Resource Planning system occurs when the users cannot perform any form of modification, with an intention to upgrade certain aspects of the system. The essence of Enterprise Resource Planning System being inflexible may occur when the user performs certain customization within the system and later face challenges, when the user intends to upgrade the system.

A Case example is evident in the Kennametal Company that has invested over 10 million US dollars to maintain their SAP systems, component of the Enterprise Resource Planning System. The Company made approximately 6000 customizations on the SAP system, but later began experiencing challenges when Kennametal made intentions to upgrade the system. The Inflexibility occurred in the sense that; upgrading the SAP system would take too much time and efforts that supersede the benefits of the upgrade.

The cost that would be incurred by the Kennametal Company to upgrade the SAP system was determined to be relatively higher as compared to the projected costs. Pros and Cons of Aligning an Organization’s Processes to Procedures of an ERP SystemProsThe alignment of an organization’s processes with the Enterprise Resource Planning System enables an organization to comprehend its complicated operational processes. This enables the company to operate faster and efficiently hence improving its competitive advantage.

In addition, the application of the Enterprise Resource Planning System by aligning the processes of an organization towards its procedures enables the organization to customize its activities with regard to the applications of the ERP Systems; hence creating efficiency in its operations. ConsOne of the challenges that may be faced by aligning the processes of the organization to the procedures of the ERP system is that: There may be increased costs that are incurred when the user intends to upgrade some aspects of the system.

Upgrading the system may also involve consumption of high amounts of time as well as relatively higher amounts of efforts. On the other hand, there may also be high costs of maintenance associated with ERP system especially if there is a vendor involved to provide maintenance services to the ERP system. Recommendation with Regard to Implementing the ERP SystemIn contrast with the strategy applied by the Dana Company to maintain their Enterprise Resource System by using an external vendor, I would opt for the use of internally trained IT experts to provide maintenance services to the ERP Systems.

Basically, this idea would facilitate the reduction of extra costs that may be incurred to hire an external vendor. The initial costs of training or recruiting Internal IT experts may be higher, but the long term costs are relatively cheaper as compared to the continuous use of an external vendor. Additionally, I would opt for the use of ERP systems without major modifications in order to avoid future challenges that may occur in the case that my Company decides to upgrade the system. However, in the case that my Company decides to upgrade the system, it would be guided by an IT expert in order to ensure that future upgrading challenges are avoided at all costs.

ReferenceIntroduction to Information Systems: Supporting and Transformin Businesses (4th ed.). (2011). New York: McGraw-Hill Irwin.