ERP Implementation Failure at HPERP Implementation Failure at HP

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About the HP caseAbout the HP case

About Hewlett PackardAbout Hewlett‐Packard

• Founded in 1938 by Bill Hewlett and David Packard ‐as an electronic instructments company

• The customers were engineers and scientists• HP launched its first minicomputers in 1974HP launched its first minicomputers in 1974• First Personal Computer in 1981• HP as the second largest comp ter man fact rer in• HP was the second largest computer manufacturer in 2001

What did HP try to achieve by implementing an ERP system?

The 90’s: SAP R/3• Shorter lead and delivery time• A global distribution system• A global distribution system• Cost savings

What did HP try to achieve by implementing an ERP system?

The 00’s: MySAP• Handle complex orders• Handle complex orders• Faster shipping and operational efficiency• Reduce IT costs• Reduce IT costs• Increased transparency• Improve forecasting• Improve forecasting• Embrace new business models fast• Reduce complex infrastructureReduce complex infrastructure• Unite HP and Compaq systems

What were the implementation issuesrelated to the ERP implementation?

• Project Team Constitutionj• Data Integration Problems• Demand Forecasting Problems• Demand Forecasting Problems• Poor Planning and Improper Testing• Inadequate Implementation Support/Training

Were there any benefits obtained by implementing the ERP system?

E bili i f lli i d B2C• E‐commercecapabilities for sellingcustomized B2C products (1998)F t f ti• Faster forecasting

• Improvedforecastingaccuracyl b l b d h• Maximumavailabilitycombinedwith minimum 

stocklevelsB tt t i t l i• Bettercustomerrequirementsplanning

• Optimizedresource management• Betterresponse to requirements of localmarkets• Weaknesses in organisation exposed (lessonlearned?)

How could HP prevent some of the implementation issues from repeating themselves when implementing 

the ERP system for their PC business division?

What is a good ERP‐implementation procedure?

• Defining the requirements• Developing a plan• Implementation of technologyp gy• Usertraining

Final commentsFinal comments