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Cisco Systems Inc.: Implementing Erp

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Table of Contents

Introduction 2

ERP Implementation Process 3

Implementation Obstacles 8

Implementation Success Level Analysis 9

Suggestions for Improvement 10

Conclusion 10

References 12

Appendix 14


To be successful in today's competitive and continuous evolving information technology (IT) market companies must be able to utilise their skills, information and knowledge to the highest efficiency level possible. Utilisation of and control over these factors will aid companies in acquiring and maintaining competitive advantages over others operating in the same competitive IT market. The implementation of an Enterprise Resource Planning (ERP) system would be perfect to suit a business' need for integration of skills, information and knowledge, which reside within the firm. The implementation of an ERP system will increase the speed with which information flows through the company, as a result of the integration of all of an organisation's information system computing (Davenport, 1998).

This case study will discuss the implementation of an ERP system within Cisco's business environment. "Cisco was founded in 1984 by a small group of computer scientists from Stanford University. Their hardware, software, and service offerings are used to create the Internet solutions that make networks possible-providing easy access to information anywhere, at any time" (Cisco, 2008). The company soon became a dominant player in the markets in which it operated. By 1993 the company's new CIO, Pete Solvik, recognised that the company's significant growth perspectives would require the company to change their UNIX-based software package, that supported their core transaction processing, as it would not be able to support Cisco's anticipated growth in core transaction processing.

This paper will continue first with explaining the most important elements in the process through which Cisco decided to choose for an ERP system implementation to efficiently deal with their future growth transaction processing problems. Related to this is a discussion about the theoretical approach for the ERP implementation and the fit between the implementation and Cisco's (business) objectives. Secondly the study will discuss several of the obstacles and several of the success factors that Cisco faced during the implementation phase. Thirdly, the level of ERP implementation success will be analysed and related to success levels of other ERP implementations. At the end, some suggestions for improvement (when needed) will be given together with an assessment of whether this approach will be successful again in the future for Cisco as well as for other companies.

ERP Implementation Process

Significant growth expectations were the main driver for change within Cisco's business processes. Cisco originally utilized an UNIX-based software package, which functional areas included financial, manufacturing and order entry systems. This specific software package would give rise to scalability issues, as Cisco is already by far the largest customer of this specific software vendor and it is planning to grow even larger. The software package will simply not provide the degree of redundancy, reliability and maintainability that is needed to accommodate Cisco's growth (Cotteleer, 1998). Customisation was seen a possible solution, but customisation was already used up to its maximum. Even more customisation would not result in a fit to Cisco's business needs. The other solution, an upgraded system version, which the software vendor provided was also not seen as a good solution as this would result in scalability issues as well; the vendor is too small to deal effectively with the $ +5 billion company that Cisco wants to grow into.

Cisco needed a good and fast solution to its scalability problems, as more business interruptions started to take place, which would not have a good effect on the future growth expectations. However, Cisco's new CIO at first decided against the implementation of an ERP system. His main argument was that these projects are too immense to be performed at Cisco within a critical short time span. The CIO might also have been influenced by the IT productivity paradox, which states that little or no performance effects are associated with

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