ADMS 2511 Chapter 8: ADMS 2511 Session 8 PQ Case 8.2.doc

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10 Feb 2015
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ADMS 2511 Session 8, "Case 8.2 Difficulties in Managing Enterprise Resource Planning
Systems" page. 244) Answer Sheet.
Read Closing Case 8.2 Difficulties in Managing Enterprise Resource Planning Systems"
page. 244
A) Describe what it means for an ERP system to be inflexible. 2 marks
An ERP system is inflexible if it does not allow for a great degree of customization, meaning
the system does not support customer changes to the core SAP code. This makes it difficult
and costly to upgrade customized ERP systems and the company cannot take advantage of
any new capabilities and improvements of the SAP software.
B) Explain the advantages of installing a generic version of an ERP such Kennametal’s
as described in the case. 4 marks
Installing a generic version is beneficial because it is more efficient in the long run to change
the company’s internal processes to fit the way the SAP software works rather than spend a
large amount of money hiring consultants and other specialists to modify the SAP software to
match the company’s businesses processes. Hence, the overall cost of the system is reduced
and there will be fewer issues when installing upgrades etc.
C) The following are two disadvantages of ERP systems. For each one explain what the
company could do to overcome it. (2 marks)
Inflexible: To overcome inflexible ERP systems, software tools such as iRise can be used to
provide a simulation and visual layout of the finished SAP system so that employees can adapt to
the changes.
Complexity: Complex ERP systems require high maintenance payments to the vendor who
provides technical support. To avoid these fees, support for the ERP system has to come from
other sources, such as online user forums, books and consultants. Overall, the company’s IT
group needs to be informed enough about the ERP system to be able to fix any problems that
might occur.
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