Bombardier ERP

Developing and following a best practices list for the implementation of an ERP system is critical to success.  Companies must recognize, anticipate and plan for the affects that an ERP system will have on functional business departments, individual workers, stakeholders and business processes.  Below I’ve identified 6 practice areas relative to ERP implementation and measured Bombardier’s performance in each.

1.       Define Clear ERP Goals & Objectives:

a.       The overall simplistic goal of Bombardier’s EPR system was the “one company” initiative.  The one company initiative sought to increase the visibility of inventory and improve the communication of cross functional business departments.   Bombardier correctly identified the goals of the ERP system and used vision teams to transform the vision into a working plan.

2.       Choose the Correct Software:

a.       SAP was the software Bombardier chose to use for their ERP.  The case does not disclose much information as to why Bombardier selected SAP over other ERP systems.

3.       Prepare for Business Transformation:

a.       ERP systems cause business processes and staff roles to change.  Bombardier recognized this and attempted to inform employees of the impending role changes.  However, Bombardier’s performance in this area was subpar.  Many employees were not informed of the impending changes and those who were received the news on short notice.  An implementation team dedicated to informing employees of upcoming role changes should have been used to transmit the EPR plans throughout the company.

4.       Provide Initial Training & Implementation Support:

a.       Bombardier developed a strong plan to provide training through power and super uses as well as help desk support.  However power users felt the information they were given was inadequate to prepare themselves to train others and they often found themselves seeking information and new processes themselves.  In addition to power users third party consultants were hired to conduct training but more often than not the consultants lacked an intimate understanding of the business.  More focus should have been placed on ensuring the power users and consultants were educated properly so they could effectively train the end users.  The timing of training sessions was also an issue as many trainees were informed of training sessions at the last minute.  Training sessions should have been scheduled weeks in advance and trainees should have been provided a briefing on what they were being trained for.  Lastly, after the ERP went live support was too heavy during the first week and too light during subsequent weeks.  Mangers said that problems are not found during the first week of implementation they are found 3, 4 and 5 weeks later.  A better balance of post implementation support should have been utilized.

5.       Develop a Clear Implementation Timeline:

a.       Bombardier excelled in creating an implementation timeline.  Upper level management held firm and met the implementation deadline of August 4^th.  As a whole the ERP implementation was a success, it was delivered on time, under budget and met its monetary goal as evidenced by the inventory reduction of $1.2 billion.

6.       Develop a Budget & Allocate Necessary Resources:

a.       Bombardier developed an initial budget for the project of $363 million and estimated it would take 400 people to facilitate the implementation.    The firm also analyzed the cost savings of the ERP system and estimated the savings to be $1.171 billion.  As can be seen from these figures Bombardier conducted significant research and developed a clear budget for the project which included an estimation of required manpower.  Once the budget was developed the firm appointed Senior Project Managers, Project Sponsors, Functional Councils and project teams to facilitate implementation of the ERP system.  Bombardier’s budgeting process and allocation of necessary resources was satisfactory to complete implementation.

PMO Implementation Reflection

Fellow C Levels,

In accordance with the consultant’s presentation and our internal discussions I offer the following recommendation for our PMO system.  The mission and purpose of our PMO is to standardize project management methodologies by developing project level organizational structure through the use of PMO generated and administered documents and tools which work collaboratively and cross functionally to support project initiatives resulting in enhanced project efficiencies and success.

As were all aware the PMO challenges and obstacles we’re facing include balancing the allocation of company resources, overcoming cultural resistance to new project management techniques, determining the governance model for the PMO system and identifying the scale at which to implement the program.  The consulting team brought forward ideas that I had not previously considered such as beginning with PMO light and allowing the staffs acceptance of the PMO program to drive the implementation timeline.  My preference is to drive the PMO implementation from the top down starting with John Strider.  John must identify a key individual who has extensive project management experience to oversee the implementation process.  This individual will report directly to John and act as the liaison between John and the managers of each department.  Specific implementation goals including deadlines will be established.  Studies have shown that having a target date for any project increases the probability that the project will be completed within the desired timeframe.  To this end if we miss the target date we’re more likely to miss by a smaller margin than we would if we allow the implementation schedule to be driven by staff acceptance.  Since we are all truly committed to implementing a PMO program we must commit company resources to the process.  This will entail hiring managers for each department who are responsible for the departments PMO implementation process.  We need to review each department’s staff and determine if there is an individual who can be promoted into a management level role to oversee the implementation of the PMO.  If no one in a department meets our requirements we need to look outside our firm for experts.  These experts can be contract workers brought in to manage the PMO process.  My preference is to select key employees in each department to oversee the process rather than hire outside consultants.  In addition staff level participation will be encouraged by incentivizing departmental PMO implementation milestones.  Developing an implementation plan that focuses on top down implementation while encouraging staff acceptance through incentives will enable us to create a PMO system that satisfies our needs and maintains our unique corporate culture.

Zara Reflection

Fellow C Levels,

Subsequent to the consultant’s presentation and our internal meetings I recommend we keep our current legacy information system.  As evidenced by our expanding retail footprint and continuous revenue growth our current IT system has served us well.  Our approach to retail sales is based upon providing a unique customer focused shopping experience and I’m not confident we have discovered a means to convert out POS system without compromising the shopping experience.  

It’s worth noting that we will need to upgrade our POS system in the future and we must continue to research our options and develop a concise transformation plan.  One specific item that we should consider is upgrading our POS and operations system to an enterprise resource system.   It’s undeniable that upgrading our POS will alter the way we conduct business.  To harness all the value of upgrading we should completely transform our IT system.  The costs associated with such an upgrade will be substantial however my preliminary costs estimates indicate that a 2.631% increase in net income will cover the costs of such an upgrade.  Let schedule a meeting next Tuesday to discuss this matter further.

AtekPC - PMO

The mission and purpose of a PMO is to standardize project management methodologies by developing project level organizational structure through the use of PMO generated and administered documents and tools which work collaboratively and cross functionally to support project initiatives resulting in enhanced project efficiencies and success.

The PMO challenges and obstacles AtekPC is facing include balancing the allocation of company resources, overcoming cultural resistance to new project management techniques, determining the governance model for the PMO system and identifying the scale at which to implement the program.

There are multiple governance and structural mechanisms that are critical to effective PMO implementation.  From a governance standpoint the organizational level of accountability should bear on a senior level manager.  Accountability for the PMO program must flow from the top down. 

Addressing the structural mechanism of the PMO , full time project managers should be used to manage each project.  Project mangers will be responsible to handle multiple projects at any given time.  Staff level support teams will provide administrative support to the project managers.  All new projects should be routed through the PMO.

Below is a blueprint for the successful implementation of the PMO at AtekPC.

Goal – To implement a PMO system that is supported by company culture, standardizes project management methodologies, increases project efficiency and success without allocating company resources in a manner which adversely affects other business activities.

Strategy – The first step to successfully implement the PMO is to determine the governance of the program.  The CIO should identify a senior level manager who possess project management experience and bestow upon the manager accountability for the successful implementation of the program.  The senior level manager will be a direct report to the CIO and the CIO will update fellow C-Levels of the PMO progress.  Implementation of the PMO must follow a top down priority.  The CIO, all managers and staff level workers must be aware of the priority of the initiative.  Once a defined governance model is developed a meeting must be organized between all functional department managers, the PMO senior manager and the CIO.  During this meeting functional department managers should be made aware of the PMO initiative and goals.  Subsequent to this meeting the functional department managers must conduct staff meetings and educate the staff of the PMO program.  Meeting should be held monthly to update everyone of the PMO progress and open discussion should be conducted to allow staff members to provide input.  This approach will encourage organizational support and enable the PMO program to be embedded in the company culture. 

The PMO program should be staffed with 1 project manger per function group.  This can only be accomplished if individuals are promoted to project manager positions or new project managers are hired.  In either case this will result in additional labor costs.  The effectiveness of the PMO program will generate adequate cost savings to offset the additional labor costs.  Each functional department project manager will be responsible for all requests of their assigned department.  Project managers will be expected to work on multiple projects simultaneous.  Clerical support for project managers will come from staff level positions in each department. 

Implementation of this strategy resembles a blend of PMO heavy and PMO light as discussed during our internal meetings.  The cross functional, top down delivery and hiring of additional project managers follows the PMO heavy strategy.  The PMO light strategy is evidenced by hosting meetings with staff level workers and incorporating their recommendations into the PMO process.  This implementation strategy will foster a company culture which understands the goals of the PMO program and encourage support for the program.  Utilizing the approach outlined above AtekPC will be able to successfully implement PMO program.