Enterprise resource planning (ERP) is business management softwareusually a suite of integrated applicationsthat a company can use to store and manage data from every stage of business, including:

Product planning, cost and development

Manufacturing

Marketing and sales

Inventory management

Shipping and payment

Functions of ERP :

ERP provides an integrated real-time view of core business processes, using common databases maintained by a database management system. ERP systems track business resources

• cash, raw materials, production capacityand the status of business commitments: orders, purchase orders, and payroll.
• The applications that make up the system share data across the various departments (manufacturing, purchasing, sales, accounting, etc.) that entered the data.
• ERP facilitates information flow between all business functions,

ERP Implementation

Success

Company Background

• Cadbury is a British multinational confectionery company owned by Mondelz International.
• It is the second largest confectionery brand in the world after Wrigley's.
• Founder: John Cadbury
• Founded in: 1824, B Currently, Cadbury India operates in four categories viz. Chocolate Confectionery, Milk Food Drinks, Candy and Gum category. In the Chocolate IIBM Institute of Business Management Examination Paper of Enterprise Resource Planning Confectionery business, Cadbury has maintained its undisputed leadership over the years. ERP Implementation Cadbury turns out, in recent years, Kraft implemented SAP ERP 6.0 (System Analysis and Program Development) in what SAP called one of its largest global

ERP implementations.

Kraft credited ERP with reducing operational costs. 11,000 employees were sending data to the company's SAP solution and it was linked to 1,750 applications by 2008. That same year, Kraft also added SAP's master data management solution, Net Weaver, with an eye toward integrating legacy systems.

Cadbury was left with a glut of chocolate products at the start of the year, after the installation of a new SAP-based enterprise resource planning (ERP) system led to an excess of chocolate bars building up at the end of 2005.

The new U.K. computer system is part of a five-year IT transformation project, called "Probe", aimed at integrating the Cadbury Schweppes' supply chain, purchasing, manufacturing, distribution, sales and marketing systems on a global, SAP-based

ERP platform

Cadbury Schweppes is aiming for an ultimate savings from the Probe project, but its implementation has been far from smooth. The project was beset by problems and delays when it was first introduced in Australia in 2002.

Benefits of ERP

Cadbury was on a fast paced growth and could not continue with the existing systems and the pace was too slow due to added inefficiencies. ERP added efficiency and guided the led all the issues fast paced growth.

The implementation of ERP brought in a new way of warehouse management system and brought in structure to branch offices and the depots.

While implementing the ERP systems, the company has built it upon the past strengths of the company thereby not losing out on its competitive

The initial implementation took time and then the successive implementations took lesser time and cost and there is a huge advantage in saving cost while in the implementation phase itself.

The reaction from competition does not matter in this because this is not a change that was advertised to the market. This is an internal process restructuring and was a welcome change within the company which badly needed the change.

The company also has built in a robust regular feedback system to monitor the changes and check if they go according to the initial plan. The entire implementation is cross functional and hence it is important that there is a high increase in the efficiency. The ERP vendor was also selected from among the best in class vendors which helped the process occur in a streamlined fashion and avoided any possible chances of hiccups during the initial

implementation phase.

The system has also been deployed up to the vendors. They have a portal called vendor connect where they can see their inventory movement and make plans accordingly. Hence the restructuring happens not only internally but also across to the supplier which will add on to the benefits that are accrued. It was considered at low cost and high result implementation which by itself highlights the success and the benefits.

Questions 1. Why did the Big Bang approach fail for The Hershey Company ?