Enterprise Resource Planning (ERP) System for ACL

Catherine recently introduced a new enterprise resource planning (ERP) system for ACL. This system will provide a single database, operating across the whole division, to replace systems which have been built up in each function around Andamans basic website. The functions, for example, purchasing, warehousing and logistic, and sales and marketing, will now all work on a common technology platform. Her plan is to move more decision making to individual managers of cross-functional teams who will work on all aspects of a given selection of product lines, such as womens or sports clothing. For example, purchasing will now liaise more closely with sales and marketing in order to ensure that the best possible and most profitable product range is available. It is hoped that this will flatten the organisational hierarchy, hence improving the operational efficiency and reducing non-value-added activities.

Andaman Microchips Ltd (AML)

In 2018, Andaman set up a microchip manufacturing company, Andaman Microchips Ltd (AML) in partnership with Die Spitze AG (Spitze), a renounced microchip manufacturer from Germany. The objective was to reach out to some of Spitzes key customers in the country, with shorter delivery time and better customer support. The management of Spitze feel that this move was necessary as many microchip manufacturers have either relocated their plants from other South East Asian countries to Malaysia or setting up a new plant in Malaysia. Andaman saw this as an opportunity to venture into high-tech industry. This could be a form of diversification. As Spitze has years of experience in the microchip manufacturing, Andaman has copied Spitzes quality control systems into its plant. The objective was to accelerate the attainment of quality standards in order to remain competitive. Andaman manufactures microchips based on the product specifications from its customers. These customers are manufacturers of computers and handphones. Although there are different brands, the structure of the microchips for products, e.g., handphones, laptops, etc, could be substantially similar.

Regarding the implementation of ERP system, discuss the objectives of any ERP systems and explain how Andaman could benefit from it. You need to draw some relevant examples from the case to demonstrate your answers and make any needed assumptions.