Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Computer Engineering Expert

INVACARE STRUGGLES WITH ITS ENTERPRISE SYSTEM IMPLEMENTATION

Invacare headquartered in Elyria, Ohio is the world’s manufacturer and distributor of non-acute health care products, comprising wheel chairs, motorized scooters, home care beds, portable compressed oxygen systems, bath safety products and skin and wound care products. This conducts business over eighty countries, maintaining manufacturing plants in the United States and eleven other nations. Invacare sells its products primarily to over 25,000 home health care and medical equipment provider locations in the United States, Australia, Europe, New Zealand, and Canada, with the remainder of its sales primarily to government agencies and distributors. The company as well distributes medical equipment and related supplies manufactured by other companies.

Invacare does not maintain much inventory. It manufactures most of its products to meet near-term demands and it builds some of its products to order. It is constantly revising and expanding its numerous product lines. In the year 2004, Invacare began working on replacing a collection of home-made legacy systems for purchase to payable processes with modules from Oracle’s 11i E-Business Suite. Invacare had been using Oracle database software and had implemented the financial modules from Oracle E-Business Suite four years earlier. The company experienced no problems implementing and by using the Oracle E-Business financial modules.

Though Invacare ran into problems when it went live with the new order-to-cash modules, which let a company receive an order, allocate supplies to build it, and give customer access to order status. Invacare information systems specialists had tested the software under real-world business conditions and everyone felt the software was ready to be used in real business operations.

When the system went live in October 2005, the software would not perform properly. “Our systems were locking  up,” observed Greg Thompson, Invacare’s Chief Financial Officer. Invacare call centre representatives were not able to answer customer telephone calls in a timely manner. When they did talk with customers, they couldn't find complete information in the system about stock availability and shipment dates for products. The company was not able to ship products to customers in required lead times. Invacare’s management never expected the implementation to be trouble-free but it clearly didn't foresee the magnitude of the problems it experienced with the new systems.

As a result of the manufacturing software, Invacare lost sales and had higher than usual levels of returned goods. It as well incurred extra expenses for expediting product orders and for paying for employee overtime it its manufacturing, distribution and customer service departments. Two months of sales disruptions caused Invacare to cut its fourth-quarter revenue estimates to between $370 million and $380 million, lower than the previous year and well below the 2 percent sales raise the company had previously projected. Losses totalled $30 million for the quarter and extended to the first quarter of 2006.

The new system also changed some of the company’s internal controls over financial reporting and some of such controls didn't function as intended. Throughout the financial quarter of 2005, Invacare had to perform a physical year-end inventory count for its North American operations and take special steps to validate the figures used in financial statements. According to Thompson, Invacare’s problems were not caused by Oracle Software but by the way that Invacare configured the software and integrated its business processes with the new system. He and other Invacare management must have done more testing work. Oracle worked closely with Invacare to resolve the problems and Thompson was pleased by Oracle’s response. “Oracle has been very helpful in working with our teams to resolve the issues we’ve identified,” he said. Thompson anticipated all ordering and invoicing problems to be cleared up by early 2006.

Thompson as well expressed hope that the new ERP system will give adequate value to offset company’s losses from the system. Invacare spent $20 million on its ERP implementation. It’s still too early to tell whether Invacare’s’ ERP system will justify its costs.

Source: Interactive Session: Organizations, Managing The Digital Firm-Laudon & Laudon 10/E
 
a) How did problems implementing the Oracle enterprise software influence Invacare’s business performance?

b) What management, organization and technology factors influenced Invacare’s ERP implementation?

c) If you were Invacare’s management, what steps would you have taken to prevent such problems?

d)  In general, what business value do enterprise systems contribute to organizations?

Computer Engineering, Engineering

  • Category:- Computer Engineering
  • Reference No.:- M96322

Have any Question? 


Related Questions in Computer Engineering

1 some have sounded an apocalyptic voice as far as finding

1. Some have sounded an apocalyptic voice as far as finding solutions to system vulnerabilities. Should we take them seriously? Support your response. 2. What is innovative misuse? What role does it play in the search fo ...

Consider the following binary treea show the order the

Consider the following binary tree (a) Show the order the nodes will be visited in a: (b) Identify all of the leaf nodes. (c) Identify all of the interior nodes. (d) List all of the nodes on level 4. (e) List all of the ...

A company develops a new security product using the extreme

A company develops a new security product using the extreme programming software development methodology. Programmers code, then test, then add more code, then test, and continue this iteration. Every day, they test the ...

The system administrators on the development network

The system administrators on the development network believe that any password can be guessed in 180 days of continuous trial and error. They set the lifetime of each password at a maximum of 90 days. After 90 days, a pa ...

1 evaluate the worst case time-complexity of the sparse

1. Evaluate the worst case time-complexity of the Sparse Matrix ADT implemented in Programming Project 9.7. 2. Provide the code to implement the four basic operations - traversal, search, insertion, deletion - for an uns ...

1 evaluate the map method of your implementation of the

1. Evaluate the map() method of your implementation of the Colormap ADT from the previous question to determine the worst case time-complexity. 2. Colormaps are used in color quantization, which is the process of reducin ...

1 what is security auditing why is it necessary for system

1. What is security auditing? Why is it necessary for system security? 2. What are the differences between security monitoring and auditing? Which is better? 3. What is risk? What is the purpose of calculating risk when ...

1 design and implement a program that compares the use of

1. Design and implement a program that compares the use of linear probing, quadratic probing, and double hashing on a collection of string keys of varying lengths. The program should extract a collection of strings from ...

1 why is it good practice to assign start and end dates

1. Why is it good practice to assign start and end dates sparingly in the early stages of project planning? 2. Who is the best judge of effort estimates for project tasks and action steps? Why? 3. Within project manageme ...

1 provide junit test class taxreturntest with three test

1. Provide JUnit test class TaxReturnTest with three test methods that test different tax situations for the TaxReturn class in Chapter 5. 2. Write methods that show the letters H, E, L, O on the graphics window, where t ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro

Describe what you learned about the impact of economic

Describe what you learned about the impact of economic, social, and demographic trends affecting the US labor environmen