1 Rolls-Royce is one of the world’s largest manufacturers of gas turbines. Their complex products typically have around 25,000 parts and hundreds of sub-assemblies, and their production is equally complex, with over 600 external suppliers. This makes planning a complex task, which is why Rolls-

Royce was one of the earliest users of ERP to help with the task. Up to that point, the company had developed its own software, which had become increasingly expensive. It was also risky because customised and complex software could be difficult to update and often could not exchange or share data. So, the company decided to implement a standard ERP system from SAP. Because it was a

‘commercial’ off-the-shelf system it would force the company to adopt a standardised approach.

Also, it would fully integrate all the company’s systems, and updates would be made available by SAP. Finally, it would be able to use a single database, whose modules included product information, resource information, inventory, external suppliers, order processing information and external sales.

Yet the company knew that many ERP implementations had been expensive disasters and was determined to ensure that this did not happen in Rolls-Royce. The project was too important. It was the largest single element within its strategic plan. So, it had a core technical team that led the design of the systems, and a large implementation team that was spread around the businesses. The result was a significant reduction in inventory, improved customer service, and substantially improved business information and controls.11 What decisions did Rolls-Royce take in adopting its ERP system?