ERP Implementation Failure at Hershey Foods

 

Case Study: ERP Implementation Failure at Hershey Foods

Examples of Projects in the ERP Implementation

In the context of the ERP implementation at Hershey Foods, several projects can be identified based on the definition of a project as a sequence of finite dependent activities aimed at delivering expected business value:

1. System Selection Project

– Description: This project involved evaluating different ERP vendors and selecting the most suitable system for Hershey’s needs. It included activities such as requirements gathering, vendor demonstrations, and final decision-making.
– Expected Business Value: Ensuring that the organization selects an ERP solution that aligns with its operational needs and strategic goals.

2. Data Migration Project

– Description: This project focused on transferring data from legacy systems to the new ERP system. It included activities such as data mapping, cleansing, and validation.
– Expected Business Value: Ensuring that accurate and complete data is available in the new system to support decision-making and operational efficiency.

3. User Training Project

– Description: This project aimed to train employees on how to use the new ERP system effectively. It included creating training materials, conducting workshops, and providing ongoing support.
– Expected Business Value: Enhancing user adoption and proficiency with the new system, leading to improved operational performance.

Examples of Programs in the ERP Implementation

Programs consist of related projects that share a common goal or purpose. In the case of Hershey Foods, the following programs can be identified:

1. ERP System Implementation Program

– Description: This program encompasses all projects related to the implementation of the ERP system, including system selection, data migration, and user training.
– Common Goal: To successfully implement an ERP system that enhances operational efficiency and integrates various business functions.

2. Change Management Program

– Description: This program includes projects focused on managing the organizational change associated with the ERP implementation, such as communication strategies, stakeholder engagement, and resistance management.
– Common Goal: To facilitate a smooth transition to the new ERP system by gaining buy-in from employees and minimizing resistance.

Examples of Portfolios in the ERP Implementation

Portfolios are collections of projects that share some common link. In the context of Hershey Foods’ ERP implementation, potential portfolios include:

1. Technology Portfolio

– Description: This portfolio includes all technology-related projects within Hershey Foods, encompassing the ERP implementation, system upgrades, and IT infrastructure improvements.
– Common Link: All projects aim to enhance the technological capabilities of the organization.

2. Operational Efficiency Portfolio

– Description: This portfolio consists of projects aimed at improving operational efficiency across various departments, including supply chain optimization, production improvements, and ERP implementation.
– Common Link: Each project contributes to the overarching goal of enhancing operational effectiveness within the organization.

Managing Constraints for Successful Project Outcomes

As a project manager on the ERP project at Hershey Foods, managing constraints such as scope, quality, cost, time, and resources is crucial for achieving a more successful outcome. Here’s how I would have approached each constraint:

1. Scope

– Management Strategy: Clearly define project scope at the outset and involve stakeholders in scope discussions to ensure alignment. Implement a change control process to manage scope creep effectively.
– Outcome: By maintaining a clearly defined scope, we could focus on delivering essential functionalities first, thereby reducing complexity.

2. Quality

– Management Strategy: Establish quality standards early in the project and implement regular quality assurance checks throughout each phase. Gather feedback from end-users during testing phases to ensure the system meets operational needs.
– Outcome: By prioritizing quality control, we could enhance user satisfaction and reduce post-implementation issues.

3. Cost

– Management Strategy: Develop a comprehensive budget that includes not only direct costs but also potential hidden costs (like training and support). Monitor expenditures closely and adjust as necessary while communicating any changes to stakeholders.
– Outcome: Effective cost management could prevent budget overruns and ensure that resources are allocated efficiently.

4. Time

– Management Strategy: Create a realistic timeline with buffer periods for potential delays. Use project management tools to track progress against milestones and hold regular status meetings to address any delays proactively.
– Outcome: By managing time effectively, we could maintain project momentum and reduce the risk of deadline-related stress.

5. Resources

– Management Strategy: Assess resource availability upfront and allocate team members based on their skills and experience. Provide necessary training to ensure that all team members are equipped to contribute effectively.
– Outcome: Optimizing resource management would lead to improved team performance and better project outcomes.

Conclusion

By understanding the distinctions between projects, programs, and portfolios within the context of Hershey Foods’ ERP implementation failure, it becomes clearer how structured management practices can positively impact project success. Effective management of constraints such as scope, quality, cost, time, and resources is vital for achieving desired outcomes. Through careful planning and continuous stakeholder engagement, organizations can enhance their chances of successful ERP implementation and avoid pitfalls experienced in past initiatives.