What are the current challenges facing Bombardier?
Bombardier has grown substantially via acquisitions since 1989. These acquisitions allowed Bombardier to expand operations, however, in doing so they inherited multiple different information systems, processes and business practices. Bombardier, had become a textbook silo company. Bombardier quickly realized that their aggressive acquisition strategy had become a much more expensive endeavor. By creating a silo environment, they created inefficiencies throughout the entire supply chain. Systems did not communicate, creating process delays, low inventory turnovers, price inconsistencies, and multiple bills of materials.
They also had to hire personal to maintain multiple legacy systems.
To what extent is Bombardier an integrated company?
Until October 2001, Bombardier information systems where being maintained by the Bombardier Manufacturing System (BMS). The system had been put in place in early 1990 and had done a very good job of doing so. However, with the ever changing landscape of the aerospace industry and vision of Bombardier, it was widely agreed that the BMS was limited and was showing signs of aging.
One of the major problems Bombardier was facing were stand-alone, user-developed databases throughout the company which catered to specific operations and their functions. Employees were not aware that by fostering such an environment they were actually putting future initiatives at risk, and ultimately the company’s own future.
Management realized that in order to move forward and make their future visions a reality, they needed to act. For the past 12 years, they were trying to counter the inefficiencies by implementing common roles, responsibilities, values and by using six sigma tools to fine tune common processes. The Vice President of Operations had a vision of an integrated organization, where data would be shared across all sites with a single, unified information system. This vision lead to the Bombardier Manufacturing
Information System (BMIS) project.
What are the challenges associated with integration?
Bombardier has no easy task! In order for the integration to be successful, they need to integrate 63 systems. This would be a major undertaking as most sites had established their own information systems and databases. Ensuring that all the databases are merged into 1 global data warehouse will be a major feat. In order for SAP to function as intended, they will need to redesign their database architecture as well as endure the rigors of data cleansing and preparation.
Another challenge will be the need to redesign processes, this will involve the need to find points where processes cross functional boundaries. This is an extremely important aspect as this will change their current processes and departments from silos to horizontal processes.
However, the largest hurdle that most companies face during the implementation/integration of a new system or process are the users. It is normal to encounter resistance by users, they perceive change as a potential threat to their jobs, and removes them from their routine and/or comfort zone.
What are the benefits expected from integration?
Bombardier expects to save a substantial amount by integrating all their systems. They estimate that they will save approx. 1.171 billion including a one-time reduction in material inventory of 219 billion. They estimate that material acquisition accounts for 75% of their total costs.
By integrating all of their systems, they could move towards global strategic purchasing, where it is estimated that they could save approximately 7.1 million per year in procurement overhead.
What were the strong points in the implementation process for the Mirabel
Bombardier created a BMIS team which was comprised of both business and IT employees. The employees were relocated so they could all work under the same roof. All of their prior work assignments were reassigned so that they could dedicate 100% of their time to the ERP implementation.
Bombardier also recognized the need to review their processes across all functions and create functional councils at each of the company’s main facilities. The functional councils where; Methods, Quality, Production, Work and Material Planning, and procurement. By creating these functional councils, all of the main facilities had a say in the project and which was deemed as a very important step in creating inclusivity so that the project could not be labelled as a Montreal only project.
The councils were task with undertaking a visioning process in which the different functions could propose their prospective form in an ERP environment and outline the benefits expected from the BMIS implementation. This would outline the KPI’s required to successfully run the business and also set the skill requirements for each function to meet their proposed benefits.
The Vice-President of Operations and Project Sponsor also took an active role in promoting the project. He would communicate the overall vision of the BMIS via road-show presentations at each facility. Messages promoting the One-Company vision were also included in company newsletters, broadcasted in emails and posted on the company’s Intranet.
What points needed improvement?
While the VP of Operations and Project Sponsor continued to show support for the project, the plant manager at Mirabel did not agree with the scope of the project and some internal managers and users felt that the system was being forced upon them. They were not as eager to implement which showed as attendance at meetings was being delegated downwards towards employees who
could not make quick decisions on key topics.
Management of business units were instructed to pass information down regarding the project vision. While some managers held regular meetings with employees, some made no effort to pass along the information which frustrated the BMIS team as well as employees.
Due to the lack on interested from plant and department managers, some employees showed up at the training sessions having no idea why they were there. The Mirabel plant felt that they had insufficient training, too far away from the implementation. When it came time for implementation they could not remember everything they had learned during training. Users also felt that support left too soon after implementation. Management at the Mirabel plant noted that issues may not arise within the first few weeks of implementation, but rather several weeks or even months later (at this point there was no support staff on the premises – other than power users).
How was the project team managed?
During the implementation, the VP of Operations showed strong support but had little visibility in the project other than a monthly meeting. There was not a strong message projected to the management staff which caused numerous problems with directors and managers for the duties that they should have been responsible for, ranging from non-participation to delegating to lower levels,. This had a severe negative impact on the implementation.
So when new processes required approval from the department Manager, the representative did not have the required knowledge or authority to make the required decision.
The Senior Project Manager had each of the five functional councils at Mirabel reviewing processes to determine their respective KPI’s. However most Managers were not involved in the project, and only became interested in the KPI’s after the implementation was completed.
Cite this Bombardier: Successfully Navigating the Turbulent Skies of a Large-Scale ERP
Bombardier: Successfully Navigating the Turbulent Skies of a Large-Scale ERP. (2016, Sep 02). Retrieved from https://graduateway.com/bombardier-successfully-navigating-the-turbulent-skies-of-a-large-scale-erp/