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Bombardier Aerospace's ERP Implementation
Transcript of Bombardier Aerospace's ERP Implementation
April 8th, 2013 Implementation of a Large-Scale ERP System @ Bombardier Let's take a look at a quick explanation of ERP systems Video created by Jonar Systems, an ERP company based in Montreal, Canada Risk Management (Chapter 8) Three project dimensions influence inherent implementation risk:
1) Relative Project Size
2) Experience with the Technology
3) Requirements Volatility 2) Facilitate understanding of the inherent risks in ERP implementation and how to manage those risks. 3) Highlight Lessons Learned by Bombardier during their implementation that could be applied to future projects. Let's hear what you have to say! -Why implement an ERP system and what are some of the benefits? -Why did Bombardier decide to implement an ERP system? -What experiences can you share with implementation of ERP systems? Here's what we think..... Why implement ERP?
-cost benefits & inventory level reductions & lower carrying costs
-Lower Procurement costs
-less errors in purchasing / planning / production Why did Bombardier choose to Implement?
-they saw that they couldn't stay competitive without it
-Textbook Silo Organization (lack of integration between legacy systems)
-Low Inventory Visibility
-faster product-to-market times
-Implement "One Company" culture Our experiences with ERP Our thoughts on Project Risk 3: Our thoughts on Project Risk 1: Project Size- -$363 million
-9,500 users in 7 sites
- 63 systems to be integrated
Management of the risk:
-Created an Inclusive Project Team
-All Levels of Management were Assigned Responsibility for Project Vision and Progress Introduction: -Goals of our presentation, a Brief Overview of the Bombardier Case Study and ERP Systems - -General Class discussion of the Case and Experiences with ERP Systems -Group Collaboration (Model 1): Management of Implementation Risk (Chapter 8) -Group Collaboration (Model 2): ERP System Benefits and Challenges (Chapter 5) -Recent Articles related to Implementation of ERP Systems -Concluding Observations Go to Google Documents to begin Group Collaboration #1 Origins of Bombardier Brief History of Bombardier Joseph-Armand Bombardier was a mechanic who dreamed of building a vehicle that could "float on snow". In 1937 he designed and produced his first snowmobile in his small repair shop in Valcourt, Quebec. Requirements Volatility- -Tried to define project vision and detailed functional requirements early on, but made changes throughout the implementation process
-Changed Methods software from HMS to SAP Workbench
Management of the risk:
-The project team tried to create a detailed project blueprint of the system requirements
-Designated certain employees from functional areas to be on Project Team to create a project vision Experience with the Technology- -Past experience with implementation failure = lessons learned
-New hardware? didn't discuss; new software? yes
Management of the risk:
-Built on lessons learned from first implementation attempt
-Contracted SAP consultants to assist (but less than they engaged during the initial launch - 10:1 ratio) Our thoughts on Project Risk 2: Chapter 5 of the text described various benefits and objectives of an ERP solution along with various implementation challenges. Specifically, Chapter 5 includes a series of tables summarizing: 1) Typical Benefits of Using an ERP System; 2) Typical Objectives and Measures of an ERP system; 3) Typical Implementation Decisions; and 4) Typical "People Related" Challenges.
In addition, Bombardier encountered challenges and risks in the cutover process from the legacy system to an ERP system.
We are asking each group to provide the specific benefits, objectives and challenges that Bombardier encountered in its ERP implementation. Go to Google Documents and begin collaboration exercise 2. Current ERP articles in the news --Avantor Chemical Products suing IBM for damages caused by the implementation of an ERP system based on an SAP platform 1937 Bombardier sold 12 snowmobiles
1948 Quebec government passed law requiring all highways to be cleared of snow and snowmobile sales fell.
1959 started selling smaller(1-2 person) snowmobiles-Ski-doo
1969 Bomberdier Limited went public
1970 acquired Lohner-Rotax manufacture of snowmobile engines and tramways and became involved with the rail business
1986 Canadair was acquired and Bombardier entered into the aerospace industry
Followed by addionial acquisitions
-de Havilland Canada from Boeing
2001 British Columbia restricted its load activity Bombardier ERP Case One of Bombardier’s main strategies was to become a global presence and the way they accomplished this was to grow by acquisition.
Bombardier faced challenges from acquiring many companies because during the acquisitions Bombardier inherited the data, processes and systems of each company which created inefficiencies-systems didn’t communicate with each other.
Problems created from this inefficiency were process delays, sequential activities, low inventory turns, supplier proliferation and price inconsistency.
An ERP system was considered by Bombardier as the best way to realize the strategic vision.
The first attempt at implementing ERP was discontinued mid project in 2000 after $130 million had been spent
Failure was attributed to inappropriate business processes, an outdated company vision and weak sponsorship
In 2001 a new project plan was created
The ERP system would have to interface with 63 other systems