This analysis is based on the Bottler Company Caselet.

Question: Identify the key stakeholder groups for this project. Identify why each stakeholder group is important, their perspective and their potential impact on the project. Give specific recommendations for dealing with each of the stakeholder groups you identify. (Bottler Company LLC).

Bottler Company LLC Profile

Large corporation that consists of approximately 25,000 employees and contractors

Publicly held company that went public two years ago, after a long tradition and its foundation in 1935.

Background What We Do

Largest independent bottler in the soft drink industry

Knows that canning and bottling technology could make or break the bottom line and it maintains the best and most high-tech equipment

On the other hand, information technology was something that had been swept under the rug for some time and not kept current.

Since 1935, the bottler has been acquiring territory and expanding the business. As a result, the need for better information grew.

Background Financials

Bottler Company has been profitable ever since its inception.

Last year, its gross revenue was US $180 million dollars, with a profit margin of slightly less than 2 percent, while it was expecting a 10 percent profit margin.

Bottler Company could charge more for bottling and canning and raise its profit margin, but its competitive advantage would decrease and would affect its general growth.

The cost of establishing new products is the main reason profit has still been quite appreciable, but executive management has made the decision to slow expansion.

Territorial growth was not a real consideration at the time, but addition of new products is a main concern.

Reducing product development will be bad for the business.

Background Org. Structure

The board of directors:

Is composed of members from Bottler Company and from other organisations, with outsiders comprising the majority. Most board members have had some experience working within the industry and are, for the most part, aware of the methods of operation.

Has low risk tolerance, although the business risk comfort level of some members was exceeded by the past initiative to concentrate on expansion rather than products.

Has a president who is also the CEO.

The executive committee

Consists of:

Chief executive officer (CEO)/president

Chief financial officer (CFO)

Chief operating officer (COO)

Vice president (VP) of business

Vice president (VP) of administration

Has a low risk tolerance, like the board?

Has an excellent reputation for hiring top talent, giving broad guidelines and goals to key individuals, and then later determining how well each person met the goals.

Has a current major goal of becoming more profitable and competitive to keep to the innovation edge over the competition.

Background Operational

Financial management is the responsibility of the CFO:

It consists of financial operations, which, amongst other things, handles contracts, procurement and disbursements, accounting, and audit.

The CFO is under pressure to cut costs to increase profitability.

Further, the information recovered from actual IT systems does not give a real-time view of the state of affairs.

Operations management is the responsibility of COO:

It consists of plant and facility operations, physical security, logistics (including transportation), IT and a few other smaller functions.

IT management is the domain of the chief information officer (CIO) and is not one of the four major functions within the enterprise:

The CIO oversees the IT systems and other ad hoc IT systems by department and has no overall view of the system. Most of the work is carried out by outside external consultants on a needs basis.

The CIO is not on par with the other C-level executives. He reports to the COO.

The CIO is there to run the day-to-day systems of the company and does not have any strategic view in terms of long- or short-term strategy all together.

To keep up with company growth, new computer systems were added in different departments as the need grew.

As it grew, the different stand-alone systems became more mismatched and the need for integrated systems became apparent.

To keep up with company growth, new computer systems were added in different departments as the need grew.

As it grew, the different stand-alone systems became more mismatched and the need for integrated systems became apparent.

Background Competition

Bottler Company is more focused on innovative product development than its competitors.

It has organised and expanded massively in North and South America. This enables Bottler Company to have constant, reliable fixed costs.

This cost savings is, in part, passed on to its main customers, thereby making them the provider with the lowest prices and quality products in the Americas.

The product development and innovative focus plus a slight inclination to expansion has given them the edge on quality and knowing exactly what the market desires, and it has kept them abreast of everyone in the industry.

Consumers are always demanding more, and Bottler Company needed and wanted to be prepared.

Background Business Goals

The number one business goal is to become more profitable, because it is now a public company, and avalue company for its consumers, who are always demanding more.

Proposing new product lines was important, but executives of the company had continuously expressed their desire for timelier financial information and decision-making tools from the different departments.

The Problems

The existing systems were unable to handle requests such as decision making or timelier financial and other important information.

Any customized reporting was developed from a multitude of sources and compiled manually.

ERP gained recognition over the years. It became the topic of discussion as alternatives were contemplated and the company tried to formulate a solution that would meet the needs of the individual departments, be compatible companywide and facilitate the integrated communication that was desperately needed.

These issues were significant enough to warrant an overall re-engineering of business practices, and the bottler decided to start researching viable options.

A great deal of time and money was spent to research options, outline necessary attributes, and perform feasibility studies. Employees spent several months completing a study to justify expenditures for the new system, and this, along with the inherent need for a new, integrated system, led to the decision to implement ERP.

After a great deal of research and discussion, an executive steering committee, with the guidance of outside consultants and the COO with the indirect help of the CIO/IT Department, decided to implement an ERP system.

The idea was that the new system would be capable of handling company growth, communicating between departments and producing customizable robust reports.

The ERP vendor was slicing and dicing capabilities for reporting that accompanied the software.

The ERP vendor offered other features that were very attractive to the bottler. The financial module, with its abilities to track profit, forecast sales and manage cash flow, was also a feature the executives liked.

They also liked the fact that the human resources and payroll modules would feed benefits and compensation and time and labor information as much as manufacturing and distribution information to the profit reports.

Management appreciated the fact that production scheduling, cost of goods and inventory would all automatically update to the income statement.

Once sold on the overall package, the executive committee gave a green light to go ahead with ERP implementation.

Although the ERP product seemed to be the solution to its problems, the bottler still had an enormous amount of work to do. No matter the size of the company, implementing an ERP system is not a trivial project.

The bottler chose not to take the advice of the independent consultants it hired during the ERP product evaluation and recommendation phase, and instead chose its own path for the implementation effort.

This lack of faith in the consultants advice made the implementation process even more challenging.

With a young, inexperienced professional staff and a very limited IT staff, the undertaking was more than everyone bargained for.

Too much time-consuming and technical work was assigned to employees who did not have ERP expertise or the proper training.

In addition to this lack of expertise, employees were not provided assistance when it came to keeping up with their regular job duties.

The bottler had a history of a do-it-yourself philosophy for all projects undertaken.

Due to enormous workload of the ERP implementation effort, a great deal of strain was placed on the employees involved in the project.

Communications problems increased. Roles and responsibilities that had not been defined clearly started posing a problem, and the CIO had to take the drivers seat without the right support to steer the project.

Communication issues, including employee encouragement concerns, also added to the burden of the human resources problem. Due to breakdowns in the channel of communication and the lack of management support, many constituents, including high-level employees, resigned. Some were voluntary; many others were not.

With already-looming challenges, the project was off to a shaky start. Choosing the proper project team and planning its involvement would be the next major issue at hand.

Your Role

Your position: CIO

Experience: Worked in the IT arena for more than 10 years.

Training: Completed the Bottler Company LLC internal management training program within three months of starting your position, and you plan to enroll in IT management and financial courses soon.

Your team: The information technology department consists of two technical staff members and an assistant who report to you.

The teams role: They deal with change requests, configuration management, and day-to-day report building and IT support issues, amongst other duties.

The previous contractor/consultant in the recommendation phase suggested part-time help be provided to your IT department and other departmental employees in the project, which was ignored by the executives because of the do-it-yourself philosophy.

Notes

Many enterprises choose to acquire an ERP system to serve as a common system for their wide range of daily operations.

Various business benefits can be realized from ERP investments due to operational performance improvements. For instance, ERP systems embed industry best practice processes, which enterprises can leverage to achieve a discontinuous improvement in performance.

However, many ERP investments fail to deliver on their promised benefits due to deficient ERP investment appraisals caused by inflated expected benefits and underestimated cost and risk.

QUESTIONS

7. Identify the most critical elements in managing organizational change that are required to sustain value over time