\"rearm oppnrnmities are always aeeomrnanied by challenges.\" esclaimed the CED cf Duanisun. She then went on to explain why you, a consultant, were hired. Dennison started business in the city of Waterloo in 1951 as a manufac- turer of televisions and electrical products. Television manufacturing was discontinued in the lWs. Dennison remained in the electrical products business, which over time required it to enter many new markets. New products had to be constantly developed to maintain growth. The life of many of those products was short, and thus many produces were exited after a few years. In addition, competition and the need to be cost effec- tive obliged Dennison to locate new plants in China and India, and to enter into outsourcing arrangements. Along the way, Dennison also acquired about 3!] small manufacturing plants. The result has been that Dennison now has 36 plants worldwide. Systems integration attempts were a constant challenge because of acquisi- tions, outsourcing arrangements, and new product implementations. If there had been a. uniform enterprise resource planning {HEP} system, the CED said, there would have been fewer problems for you to remhre. Sung, one of the older, larger divisions, has been subject to a series of problems, which the division's general manager and his controller have not been able to resolve. The EEG introduced you to the general manager and the controller. They explained that the sales have been lagging behind capectaiions, with the reeendy completed year being typical of the last three. A bigger prob- ltan has been that for the first year in decades. actual prots have become neg- ative. You are shown the operating statement in Exhibit '1. After a quiclt review of the operating statements, you asked if there have been any changes to me manufacturing process. You were mid that the only change has been the use of a new supplier for the major components. The new supplier, EL- Manufacturing, was an acquisition by Dennison that occurred late in the previous year. The acquisition was premised largely on EL being able to replace most of Sung's existing suppliers. The components from EL have defects, whereas die precious suppliers presided defect free onmportmtts. lDon- 1