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NIBCO began to reorganize into a cross-functional, matrix structure in January 1996 and initiated a new cross-functional strategic planning process. Gary Wilson was hired as
NIBCO began to reorganize into a cross-functional, matrix structure in January 1996 and initiated a new cross-functional strategic planning process. Gary Wilson was hired as the head of the IS department in May 1995 after managing an IS group in a multi-divisional company and leading four major project implementations. When Gary became the CIO, the IS department had about 30IS specialists, including the technical staff who ran mainframe applications on HP3000 and IBM/MVS platforms. None of them had SAP experience. Jim Davis reengineered strategic planning and had experience with quality management at NIBCO. Scott Beutler, Gary Wilson, and Jim Davis were named as co-leaders of the SAP project by Rex Martin. The team led by the three executives was called the TIGER team, named for Total Information Generating Exceptional Results. The technology aspect was to be led by Gary Wilson; the business coordination led by Scott Beutler; and the change management initiatives led by JimDavis. In SAP implementations, the team structure is based on the SAP modules to be implemented and the business process flow. For example, logistics transactions will be covered by three modules: materials management (MM), production planning (PP), and sales and distribution (SD). At NIBCO, these three modules were split between two groups. The TIGER project team consisted of three business process teams, a technical team, and a change management team. Each business process team had seven or eight people with a primary responsibility for a subset of the SAP R/3 modules: sales/distribution (SD), finance and controlling (FI/CO), and materials management/production planning (MM/PP). Each team had a business review leader, power users, business system analysts, and consultants. The business review leaders were there to make all high-level business process redesign decisions based on their own knowledge and experience and without having to ask for permission from the leadership team. The power users were NIBCO employees who knew the business processes and transactions using the existing legacy systems. Business systems analysts had strong technical abilities with a good knowledge of the business. Each business process analyst was paired with a consultant to implement configurations and transactions for each module. The consultants worked for four days out of the five and almost 12 hours a day. In many SAP implementations, there is a centralization of support teams for SAP programming ABAP, infrastructure, security, and workflow. Moreover, these support teams are multi-sourced across geographies to meet global delivery requirements. There has been a shortage of competent consultants to implement SAP systems.Therefore, finding the right consultants and keeping them through the implementation are major challenges for an organization. The implementation of SAP demands functional, technical, and change management skills. The compensation for skilled SAP consultants is very high, and smaller organizations can get into huge problems implementing SAP. To handle this issue, NIBCO employed IBM as the consulting company. The problem with an SAP package is that it is very generic and needs to be configured to a specific type of business. NIBCO's unique business did not lend itself to SAP's best practices, and, moreover, the project was implemented in the late 1990s. The customization for a particular industry and its unique processes can take a long time depending on the specific requirements of the business. There are thousands and thousands of switches to be set in SAP for each module to make it customizable for a particular business process. The extent of customization determines the length of the implementation, and NIBCO customized only very few of its processes. To implement the SAP system, NIBCO had to dedicate its best employees to the project for more than a year. These internal resources played an important role in the project as they were the ones with the ability to understand the overall needs of the company. NIBCO employees had to be trained, and training is usually costly and a major challenge. Training employees on SAP is complex and can take more than a week for effectiveness. Case Questions 1.What are the three components of the TIGER triad, and how did they interact? 2.How did NIBCO achieve its target goal?How did the "big bang" implementation succeed? 3.Compare it to other forms of implementation
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