Management Information Systems: Global Bike Inc - Assignment Example

Management information systems case study: GLOBAL BIKE INC. INFORMATION SYSTEMS APRIL 2011 AUTHORS: COURSE DETAILS: Section: Course Code: Professor: Table of Contents Table of Contents 3 Organization’s background 4 Background 4 Global Bike Inc. SWOT Analysis 4 Current IT infrastructure 6 The rationale for the new information system 7 Potential of the current infrastructure 8 Recommendations for ERP system 9 ERP impact and Business Process Reengineering 10 Implementation of ERP 11 Management issues 12 Conclusion 13 References 14 Organization’s background Background The company traces its roots to the passion that her founders had for bringing new design in bikes that are used for racing. The design that was founded about twenty years ago was brought about by the need by the founders to make it easier to use them. The founders have races which they had to undertake and win but the bikes which were there at the moment were not able to satisfy them. They were not up to the task of races. They therefore decided that they would design their own bikes that would be able to make these races easier. The company has two branches, one in Germany and the other in Dallas, America. The American branch was created by John Davis while the German branch was created by Peter Weiss. The company branch in Germany is called Heidelberg Composites because it dealt with manufacturing frames from carbon composites which were found to be stronger. This was the idea of the founder, Peter Weiss. The Dallas branch, called Frankenstein Bikes, grew in popularity and many people preferred their bikes than any other company. As fate would have it, the founders of the two companies met in the year 2000 and their passion for coming up with better bikes for sports; their passions soon led to the merging of the two companies to form the Global Bike Incorporated in the year 2001. The two founders are acting as co-CEOs of the company. Global Bike Inc. SWOT Analysis The company has many things they are supposed to look into in order to have a secured future. The table below shows the requirements they are supposed to follow in order to optimize the outcome. Strengths Weaknesses They have a well developed brand The company is located strategically so that they are in a position to tap out of the two markets The company sells products to more than 60 countries in Europe, Asia, America and Africa Has cordial relationships with the suppliers The research function of the company will help the company to integrate latest technologies in the company. It has a large line of production The company has weakness in the accuracy to predict the future It has not yet established manufacturing capabilities The brand is not well known in the Motorsports market There is unnecessary reliance on large suppliers. The company does not have good channels of distributions The company is regarded as being smaller than the competitors Opportunities Threats The Internet is proving to be a new avenue for customers which have been proven to be a potential for savings on cost and dealership China has not been fully exploited and it promises to be a market which can bring good benefits and return The entry into the lower market for bicycles can add value to the company Entry into markets where bicycles are regarded as substitute products. These markets include Raiser Scooters. The substitute products are cheap and popular among many. There are foreign competitors which are seen to be entering Europe and the US There is demand dynamics where people are shifting their demands for lower priced bicycles. There is a lot of concern about the environment. Current IT infrastructure At the moment, the company uses the manual process of business processes. The functions of business are done autonomously. This means that the accounting, marketing, procurement, personnel management are operated differently. Although there are information systems which have been used to solve the manual processes, there is need to have the business processes integrated so that someone in the accounting department can be able to access the details in the procurement department without physically going to the department (Darrell et al., 2002). This is what is happening in the organizations. When an order of products is made by the clients, the process followed the traditional method where the customer will make a request, goes through the manual invoicing and purchase. During this cycle, the accounting and indeed all the other departments are not aware of what is happening until the department is informed manually. There are information systems which have been installed in the organizations that are used to manage the various department operations. There is the procurement process that is used for the functions of procurement. There are also many systems that are used in the finance department. One system that is used is the Oracle system which is used as an accounting and procurement system. All these are effective in their own departments. They are confined in the areas where they operate. They should be integrated so that The rationale for the new information system To reduce the long process of opening files, writing the files, updating and reporting to the administrators, Global Bike Inc. will need to install an integrated information system that will be used to get all the processes from system (Young-Hoon, 2005). This way, they will be able to have one view of the systems of all the existing and potential branches that will either be acquired of created from scratch in future. The new system will help Global Bike Inc. to achieve the processes that are outlined below: Coming up with a database (this would make it easier and faster to track the updates of the various instances that the client will have with both the staff and the administrators). The database will be used to handle the transactions which will be done in the organization. There will be the creation of a one client encounter management system where all the encounters that the client will have with the company personnel will be handled. This will be possible with the use of smart cards. These cards will contain the information of existing clients and that every time they make an inquiry, they will use the profile already created in the system. This will help the organization better understand the various needs of the various clients. It is a requirement so that better customer data can be achieved which help the organization will learn more about it. All the Global Bike Inc. branches will have one system where the client management will be handled anywhere the patient feels they are comfortable visiting. Reducing the failing rate as the failure in receiving reports by the administrators will come to an end. There will be the reduction of costs that have been brought about by printing, buying files and sending emails to administrators. Reducing paperwork. Potential of the current infrastructure The current system has its own potential. Given the distance of the two branches, it is impossible to have a local area network for the two branches. Although this is the case, each branch will have to implement the ERP system in their own locations. The current systems which have been installed have the potential of speeding up the transactions which are done by the staff on a daily basis. Recommendations for ERP system Global Bike Inc. envisions to be recognised globally while being committed locally, the company’s mission is to achieve maximum shareholder value through sustainable utilization of resources. The company has several objectives such as strengthening safety performance, cultivating talent, attaining operational excellence, energizing the work environment and optimizing domestic and International Portfolios (Ryals, & Knox, 2001). There are many ERP systems which are found in the market today. Given the nature of the organizations, there will be need to have an online system which will be used by the two branches. The distance separated by the two companies does not allow one system to be used in the company. This therefore requires that the choice of the ERP system be made with a lot of considerations. The recommended ERP system is that of SAP. The SAP Enterprise Resource Planning implemented at Global Bike Inc. is expected to serve all the company’s sections in the finance and plant departments (Chaudhury, Abhijit 2002). The implementation of SAP Enterprise Resource Planning will impact the entire company; there will be need to train the employees located in the two branches. The system focuses on connecting all the departments and offering the same information base. The departments to be connected are the accounting departments, marketing, and procurement, training department, training and development sections. As at present however, the production processes have not been connected entirely to the system, but plans are ongoing (Evangelou, & Karacapilidis, 2005). The implementation of Enterprise Resource Planning at Global Bike Inc. will be of great importance to the company. The growth of the company means that the legendary systems previously in place cannot hold the expanded computing requirements. Previously, Global Bike Inc. used Oracle Financials for accounting and purchasing combined with in-house solutions, which are costly since several challenges such as incompatibilities exist. In addition, the changing technology means that the traditional systems in place are slowly becoming outdated, therefore the company has to scout for a new product and SAP ERP application and Oracle software are the most probable alternatives. Since functionality is the most important metric in choosing the Enterprise Resource Planning, SAP ERP application is chosen (Fowler, & Worthen, 2009). ERP impact and Business Process Reengineering Implementing the SAP Enterprise Resource Planning will impact on the organization’s processes, as presented by Trent, (2007). The departmental reporting structures at Global Bike Inc. will have to change to accommodate the changes. Initially, every section has been considered autonomous since they work independently; with the Enterprise Resource Planning however, all departments’ source and store data in a centralised database (Reynolds, 2004). The Enterprise Resource Planning will also impact on decision making process. Decision making, which is defined as the process of reaching a decision by searching, identifying, analyzing and assimilating data through communication and drawing inferences, has had to change at Global Bike Inc. For decision making to be effective, it demands timeliness & currency, accuracy & precision, conciseness, cost-effectiveness, completeness, good presentation and relevance. The implementation of the Enterprise Resource Planning will foster decision making due to several associated benefits including decrease of communication barriers, noised and uncertainty which has regulated decision making process (Earl, & Babbi, 2010). Furthermore, the business processes will be altered. The sales process in the company has been linked to the production, therefore the company has been able to implement a customer focused sales. The Enterprise Resource Planning will also enable the firm to predict the future demand for its products. The company’s production will therefore be altered to suit the envisioned demand to avoid instances of too much or too little production (Kristin, & Carol, 2002). Implementation of ERP Enterprise Resource planning implementation at Global Bike Inc. will not be a single isolated activity, but will rather be a process. To effectively complete the Enterprise Resource Planning implementation within the nine months period, the first phase will be the Project assessment stage which will be combined with initiation stage (Bidgoli, 2002). This foremost phase is concerned with delineating the business problem or opportunity, in this in this phase that the company will define a business case and sought various optional solutions, and as well defined the purpose and scope of the project. The first phase will essentially be concerned with justifying the initiation of the project after the assessment and the expected solution (Beckett-Camarata, Camarata, & Barker, 1998). This will be followed by the planning phase which involves setting out the path for the project by creating plans such as project plan, monetary and resource plan, quality assurance plan and communications plan. A project plan is used to direct project control and project execution, as well as documenting diverse concerns to assist communication among stakeholders (Schneider, 2009). Monetary and resource plan is used to compute the resources needed and includes financial resources in terms of budget estimates (Federico, & Rajola, 2003). The implementation will also enter the Design phase which will be an amalgamation and combination of several steps, which are further categorized as Preliminary design and Final design. Design phase involved reports, SAP Enterprise Resource Planning customization, and accurate costing and schedule. Preliminary design involves all blueprint constructs in the ERP project (Gerhard, 2008). The Project Execution phase will involve constructing the deliverables which will be delivered from the SAP Company to Global Bike Inc. This phase involves controlling the project delivery, suppliers, change, customer’s scope, costs, quality, risks and issues concerned in the project. Project closing stage will be concerned with winding-down the project by giving the deliverable to the Global Bike Inc. users, releasing the human resource and effecting post implementation review. This phase is made up of Project close and contract closure. The maintenance phase is required to ensure that the project is maintained in case of unforeseen challenges or changes as presented by Castells, (2003). Management issues The senior management will play a leading role from the initiation to the completion of Enterprise Resource Planning implementation. During the initiation stage, the senior management will assist in defining the project scope and the boundaries. The management also informs all the stakeholders of the need to implement the Enterprise Resource Planning and determine the methodology to be used as well as the expected outputs. The senior management will also appoint the project management team and the project manager (Ralph, Reynolds, 2008). The management also plays a leading role in the planning phase, where it identifies the possible tasks that exist in the project and allocates targets to the project management team. At this stage, the senior management will also explore and agree on the probable communication channels (Atul, & Jagdish, & Sheth, 2000). During the execution and controlling stage, senior management will be tasked with availing funds for purchasing and implementing the Enterprise Resource Planning, before the closure, the senior management will approve the system, that it could perform the desired functions. The senior management will also facilitate the training of employees to be conversant with the system; this fosters acceptance of the system as argued by Smith, & Seifert, (2005). Conclusion It is touted that implementation of Enterprise Resource Planning at Global Bike Inc. will be a success story. Whereas the implementation will take a relatively a shorter time, the several benefits which have been offered by the system will increase user satisfaction. All users involved in the Enterprise Resource Planning implementation, at the critical success factors and failure factors will have to be considered in advance. References Bruch, M, & Vinnichenko, S 2007, Comparative Analysis of Enterprise Resource Planning Systems in Russia and Sweden, Cengage Learning, London. Castells, M 2003, The galaxy of the internet: reflections on the Internet, business, and ERP system, Oxford University Press, London. Papadopoulos, A. et al. 2009, Information Systems Development: towards a Service Provision Society, Cengage Learning, London. Smith, S, & Seifert, W 2005, The reality of the Internet: an overview of key technology policy issues affecting its use and growth, Nova Publishers, Illinois. Trent, R 2007, Strategic Supply Management: Creating the Next Source of Competitive Advantage, Ross Publishing, Conyers. 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