Case Questions 1. Using the information in this section, write a project plan for NIBCO. Why is change management so important for NIBCO? 3. Use the WBS and start a project plan using Microsoft Project. 4. Write a rationale for each of the cost summary items
CASE STUDY: INFORMATION SYSTEMS SAP Project at NIBCO, Inc. The roadmap to SAP implementation is shown below ensure the project's success. The principal elements in Figure 5-5. The key functions include project prep- that will determine how the project will be accom- aration, business blueprint, project realization, and plished are established as well. These activities set go-live. The purpose of the project preparation activ- the basic foundation for project kickoff and provide ity is to start detailed planning for the project. There an information baseline that may be used as a refer- are basic issues to be resolved at this early stage to ence throughout the implementation of the project. Project Success Realization Business Blueprint Go-Live Project Preparation FIGURE 5-5 Roadmap to SAP Implementation Case Study 1 (1).pdf Q Done bt:9Change Business Management Process Consulting Consulting People Business Process Technology Technology Consulting FIGURE 5-6 Project Management at NIBCO provide services in order to implement SAP: peo- project is to manage the application and infra- ple, business process, and technology (as shown structure changes as part of an integrated project in Figure 5-6). The people solution was to assist plan. They wanted to correctly identify the roles NIBCO in preparing the staff effectively to under- and responsibilities of each team as early in the stand their role in the organizational change and project lifespan as possible, thus mitigating po- add value through their active participation. To tential schedule overruns. assist NIBCO to take advantage of SAP's business The organizational change plan consisted solutions, business processes were designed. The of four components: managing communications, technology part of the integrated solution was to building teams, securing organizational commit- assist NIBCO in setting up the SAP infrastructure ment to change, and transferring skills. These in order to satisfy business requirements. IBM's four working components were geared toward view of the project was to have a balanced formal facilitating the development of a sustainable or- project methodology approach between the new ganization, the business process, and technol- technology and the new organizational change. ogy changes. A training and education plan was IBM recommended that NIBCO's core team assist also developed to provide ongoing educational IBM in the SAP implementation. The project was reinforcement to the core, IT, functional, and ex- planned to be built in two phases: tended staff. . Phase 1 (approximately 6 weeks' duration): The initial WBS was broken into an initial Preparation: Initial scoping and definition; and scoping and definition phase as well as an imple- . Phase 2 (approximately 13 weeks' duration): mentation phase. The final project budget was Analysis, design, and implementation. estimated to be about $17 million, 30 percent higher than the previous estimate. One of the Infrastructure and change management consul- major reasons for the increase was the inclusion tants were to build the transition to SAP R/3. of change management costs including train- Both training and organizational change man- ing. About one-third of the final budget was for agement were planned to continue through the technology infrastructure costs, including the two phases. IBMS's philosophy toward the proj- R/3 software. The cost summary and budget are ect planning was that the key to a successful SAP shown in Table 5-7. Chapter 5 . Planning 233 NIBCO established all project standards and from policies, procedures, organizational charts, procedures to make sure that project team members financial information, survey data, and existing operate in an effective manner during the implement re-engineering work products. They conducted tation. Project planning continues during the entire interviews, gathered key business processes, and implementation and should be constantly refined. reviewed business issues and information technol- NIBCO also defined end-user training methods and ogy applications in the company to define initial documentation along with the overall implementa- scope and definition. The initial scope and defi- tion strategy. The SAP planning process at NIBCO nition took about 2 weeks. The management at resulted in: NIBCO reviewed and accepted the scope. Once Case Study 1 (1).pdf Q Done 6:44NIBCO established all project standards and from policies, procedures, organizational charts, procedures to make sure that project team members financial information, survey data, and existing operate in an effective manner during the implement re-engineering work products. They conducted tation. Project planning continues during the entire interviews, gathered key business processes, and implementation and should be constantly refined. reviewed business issues and information technol- NIBCO also defined end-user training methods and ogy applications in the company to define initial documentation along with the overall implementa- scope and definition. The initial scope and defi- tion strategy. The SAP planning process at NIBCO nition took about 2 weeks. The management at resulted in: NIBCO reviewed and accepted the scope. Once . Project plan; the scope was approved, the team performed a . Project management standards and gap analysis to identify the areas of fit and non-fit procedures; between existing business processes and SAP. The . Implementation strategy; gap analysis focused on technology and process . Project organization; fits and developed the functional solutions for all . Configuration standards; non-fit processes. This activity took place for nearly . End-user training and documentation strategy; 3 weeks. The last activity was to refine the project Testing strategy; plan and team structure as required, which took a . Post-implementation support strategy; week. NIBCO management approved this process. . Design of the company's system landscape, The project plan consisted of the following: including its setup and maintenance strategy; . Detailed project plan; . Official start of the project, presentation of the . Risk management plan; input mentioned above, and explanation for . Migration plan; any issues or questions about the project from . Communication plan; and the kickoff meeting participants; . Change management plan. . All project team members trained in introduc- tion to SAP, navigation skills, and knowledge NIBCO's project plan was aligned to its of major integration points of the system; and strategy. The project scope as well as the project . The formal sign-off of Phase 1. plan reflected the strategy, and the organization wase very much focused on achieving its strategic objectives: PROJECT PLAN The NIBCO team selected an implementation part- . Increase product development capability; ner, a third-party consulting firm that can support . Transition from exporter to global organization; NIBCO's decision to implement a "big bang" ap- . Become a customer responsive organization; proach that is viewed in the industry as high risk. and NIBCO chose IBM and Cap Gemini as the two final- . Develop supply and demand chain capabilities. ists after considering several potential consulting The project focus was to implement SAP R/3 partners. NIBCO picked IBM as its SAP implement in a big bang approach with a target completion tation partner. IBM was also chosen because of its time of 15 months. NIBCO was to utilize predefined strengths in technology and infrastructure consult- business processes in R/3 as a "good enough" busi- ing. "When we hired IBM, we hired them with the ness model. NIBCO was to engage the SAP consult- agreement that they were going to help us to do a ing group of IBM to work with the NIBCO process big bang in the timeframe we wanted. As far as I team in a collaborative manner to maintain good know, IBM had not done a successful big bang up to chemistry with, coach, and mentor NIBCO staff. that point," said Jim Davis, project co-lead, Change The expected result was skill and knowledge trans- Management. 14 fer to NIBCO employees so as to enable NIBCO to A project plan was completed by a team reach its strategic objectives. composed of NIBCO employees and IBM project IBM's consulting practice for NIBCO con- leaders. The joint team collected and reviewed data sisted of three major solutions integrated to (continued) Case Study 1 (1).pdf Q Done 6:44
