Case Analysis - CISCO

Submitted By: Section B - Group 5

Madhav Mishra PGP/14/093 Magill Thomas PGP/14/094 Meemansa Vajpayee PGP/14/095 Naveen Murali PGP/14/096 Nidhi Pandey Niketa Narain PGP/14/097 PGP/14/100

Nikhil Almalkar PGP/14/099 Nikhil John Kurien PGP/14/100

Cisco is a networking equipment company founded in 1984 by two Stanford computer scientists. It became publically listed in 1990. By 1998 Ciscos market capitalization was over $100 billion. Cisco was a key infrastructure provider for the internet based economy of the 1990s and enjoyed amazing growth during that time. Cisco consisted of three functional divisions: Order Entry, Finance, and Manufacturing.

Reasons behind going for ERP

Cisco was using a UNIX based software package to support its transactions. But in January 1994 this software system failed dramatically, exposing the shortcomings of the package. After this crash Cisco felt that the existing package could no longer support its growing business. They were using software designed for a 300 million dollar company in a 1 Billion enterprise which had plans to grow to 5 billion. This led Cisco to look for alternatives. Initially each division was tasked with finding its own software solution. But no action was taken in a year as each division was reluctant to replace the legacy system. But as the legacy system started to fail more often the manufacturing division decided to take the lead to implement a companywide ERP implementation.

Partner selection process

Cisco selected KPMG as the integration partner due to the number of experienced people KPMG was willing to commit to this project. Along with KPMG Cisco setup a 20 member team to select a software package. 5 packages were shortlisted in a span of 2 days. After a week of high level evaluation it was narrowed down to 2, Oracle and another major player. These two vendors were given two weeks to respond to the RFP. During this time Cisco and KPMG visited the reference clients given by the vendors. Eventually Oracle was chosen as the vendor. Three main criteria used were: Manufacturing capability Long-term development of functionality of package Flexibility of Oracles being located close to Cisco

Implementation of ERP
While deciding the timeframe for the implementation of the project one of the primary requirements was that the software cannot be brought online in the 4th quarter as the companys books would be audited during that quarter. Based on that it was decided to implement the project in 9 months time. The implementation was broken up into a series of phases called Conference Room Pilots (CRPs):

CRP0 CRP1 CRP2 CRP3 Focused on testing the full system Assessed the readiness to go live by capturing one days worth of actual business data and re-running it on a Saturday 100-person IT department was assembled for this phase This team bore most of the responsibility for the project additions Detailed procedures drawn up for competing each process Realized that a lot of the business processes were not supported by the software. This require modifications 30 developers were needed for 3 months to modify Oracle Since Oracle could not support the after-sales support needs a different package had to be identified for that. Training the team in the Oracle applications Configuring the Oracle package Setting the hundreds of parameters in the applications Realized that changes to the software were needed to support the companys unique requirements

The new ERP system went live on January 30, 1995, but it took two months before it was operating at a reasonable level of quality.

Learning
Support from higher management is crucial for a companywide project like ERP implementation The need to have a core group of highly motivated and well trained individuals to drive the implementation

The implementation team should have members from all divisions of the organization in order to configure the software to suit the needs of the entire organization The hardware should be scalable. It is better to buy the hardware based on capability rather than specifications