ERP Case Study: B&R Inc.

B&R Inc. is a major manufacturer and distributor of multiple consumer products such as cleaning supplies and health and beauty products. B&R currently produces more than $5 billion in net sales revenue. In order to grow their business B&R is considering implementing an ERP system to conduct more of its business over the internet. This case study will discuss advantages and disadvantages of implementing an ERP system, as well as possible systems and vendors B&R may consider.
Being a large company B&R wisely utilized the services of NCF (National Consulting Firm). Hiring a consultant provides advantages for larger companies. A consultant can help identify special needs of a company through careful analysis and can recommend the best possible ERP solution as well as any customization to the system that the company may need. NCF recommends an electronic commerce interface that allows B&R to sell its products to its business customers over the internet.
B&R can expect many advantages to implementing an ERP. The main advantage already outlined by NFC is the cost savings that B&R can expect to see after implementation. ERP systems help to reduce many different costs within an organization. B&R can expect to see a reduction in inventory carrying costs, employee expenses, supply expenses, and order processing expenses. The basic purpose of an ERP is to link vital systems within an organization to collect data more efficiently and to provide better communication between all users, including customers, internal users, and suppliers. This streamlined system of data and communication will help users to operate more efficiently while keeping operating costs to a minimum, this is called spend management.
One program B&R may consider is QlikView by Qliktech. QlikView was implemented in 2006 by WD-40. WD-40 is also a global consumer products company, manufacturing a variety of household products. Before implementation of QlikView WD-40 was relying on the production of hard copy weekly reports and was calculating customer sales totals each year manually. WD-40 was in need of real-time reports as opposed to hardcopy reports which quickly became outdated. The ERP provided instant access to all of the company’s report figures and were able to generate new reports in minutes as opposed to hours with producing hardcopies. This reduction in access and reporting time has reduced WD-40’s labor time dramatically and has provided more accurate reports for managers to make better informed decisions. The ERP system has helped to improve WD-40 in the area of sales by tracking sales with existing customers as well as finding new selling opportunities. Also in the areas of tracking profit margins, inventory, and pending orders this ERP has proven invaluable to WD-40. Other benefits of QlikView were the two week implementation time and simple training. Qliktech customized WD-40’s sales analysis application and utilized an Excel based program that required little training.
There are many ERP vendors in the market today. The key to finding the right one is to find a vendor that is familiar with your industry and has a history of providing similar services for companies similar to yours. In some instances a company may require more than one vendor. B&R may consider SAP & Oracle. SAP has been working with Proctor & Gamble to create a standardized system across their entire business. P&G, like many other companies including B&R, are seeking ways to cut costs, drive business growth, and innovate more. P&G uses SAP ERP, SCM, financial software, and Oracle database and CRM software. P&G operates shared service centers. The most important objective when looking at ERP vendors is to identify the specific needs of your business and find the vendor that can satisfy those needs.
Besides all the benefits of implementing an ERP there can be some risks and major costs. B&R is expecting the cost of implementing an ERP system to be $100 million, this is not unusual for a company of this size. B&R should expect that the costs will not stop at implementation. After implementation B&R should expect to have regular update and maintenance costs, the cost will be dependent on how much support from their vendor they may require over time. A large-scale implementation can take years, utilizing the skills of an ERP consultant is important, as well as understanding all the costs and benefits associated with an ERP. The most important step in implementing an ERP that B&R should keep in mind is planning. Planning should be about 2/3 of the implementation process where actual implementation should only take up the last 1/3.