Integrated Information Systems

Large organizations dealing with hundreds or thousands of suppliers have a difficult task in

keeping information flowing to the right person at the right time. At one point, Lockheed

Martin Aeronautics, with $$13\mathrm{.}2$ billion in sales $(2010)$ and over $29,000$ employees, was running

$75$ legacy systems, some dating from the $1970$ s$.$ To stay efficient while keeping customers

happy and taking on more aircraft orders, the company decided to implement an Enterprise

Resource Planning system.

Lockheed Martin's final system allows suppliers to handle more of their own transactions by

accessing the new ERP system through an existing secure Web portal. For example, using the

portal, a supplier can now track each step of an order. In addition, the supplier can see the

production trends at Lockheed Martin, and plan its own production to satisfy Lockheed

Martin's needs $-$ in effect, anticipating orders. Through this integration of many systems into

one large ERP system, Lockheed Martin was able to cut costs and connect suppliers worldwide

into its system, enabling the company to become more efficient.

In another industry, Tumi, Inc., the luggage and travel products company, was running several

legacy systems that were written $"$in$-$house," meaning they were programmed by company

staff. The different systems covered processes such as taking an order, running the warehouse,

and completing financial statements. None of the systems were linked; therefore, passing

information from one system to another was a slow and cumbersome process. Tumi could not

fill its orders on time, had excess inventory in the warehouse, and was frequently unable to

meet customers' shipping deadlines. To address these issues $-$ and to better support the

company's expansion plans $-$ Tumi made a conscious effort to make information technology a

business driver, and the company brought in an ERP system to integrate the business functions.

With the new integrated ERP system, Tumi has been able to expand its business, decrease

inventory by $30$ percent, cut its warehouse space by $38$ percent, and increase sales by $25$

percent. Tumi's management believes that one of the company's primary strengths lies in its

integrated systems. Manufacturing is now quick to react when demand increases, and

forecasting is more accurate.

You are required to do the following during this lab:

Using the Internet, research how many suppliers are typically used for manufacturing

large commercial aircraft.

List $5$ such suppliers and what they do$.$

How would an integrated ERP system, such as the one at Lockheed Martin, help

manage all those suppliers?