1. How was the organization prepared for the change? Whirlpool thought they were ready to go live with SAP until September 18, 1999. Whirlpool seemed to be making all the right moves, like dispatcher assignment, having centralized pricing, and vendor interfacing. Even the best laid plans don’t always work. Everything seemed to be going smoothly at first because there were only 1000 system users, once 4,000 users were on the system, performance deteriorated which lead to 4-8 weeks delivery delays to which some customer cancelled their order and went with a competitor.
Whirlpool should never have gone live until they realized what impact the red flags meant. 2. Was the problem with employees, whose jobs had changed, dealt with properly? Whirlpools values are: respect, integrity, teamwork, learning to lead and spirit of winning, Whirlpool did not show any of qualities to their employees when requiring unreasonable timelines and insufficient or improper training. No employees were not dealt with properly, because where is the incentive for the service technicians who now need to add additional routes to their areas as well as handling more calls per day leading to unreasonable timelines.
Also the call center workers who are now going to be required to answer more challenging questions with no training will lead to inexperienced or incompetent consultants. 3. How were the customers and vendors communicated with about the changed procedures for interfacing in various transactions with Whirlpool? Whirlpool started with four small and midsize vendors who were to use Easy EDI first then continued on to the 300 largest vendors.
As stated by Best Buy who had no issues with filling their orders because they placed a large order in the summer to avoid getting snared in the computer conversion ¹ 4. How were IT employees prepared for interfacing with external consultants? They weren’t. Whirlpool should never have gone live due to lack of insufficient testing. Once they were informed that there were red flags, even though some companies go live with red flags, they needed to do further testing. The interfaces was too complex and there was a lack of management participation 5.
Evaluate the steps that were taken in the ERP activities. Which were done well and which could be improved? The dispatcher assignment –the fact that Whirlpool will consolidated 22 field offices into one hub, even though it takes away the intimate knowledge, it still saves money. Centralized Pricing – no wonder it takes 110 days to reprice its entire product line, when you are trying to manage an 180,000 line report. The centralized pricing will make Whirlpool more competitive in its 170 countries worldwide.
Very smart move. Vendor interface – the fact that Whirlpool will save $600,000 a year to move to Easy EDI is a no brainer. It will also allow the customer to have accurate data on their orders along with better customer satisfaction. Remember the best customer is a return customer. 6. Do you think SAP should be held accountable for any of the problems faced by Whirlpool? Why? Yes I think SAP should be held responsible, after all it is their systems and name that were on the line.
If they knew that there were Red Flags, why would they allow Whirlpool to make the decision to go-live? Even though SAP said that many companies have multiple Red Flags and hundreds of little problems, when compared to just two that Whirlpool had, SAP should have stated its reason why the go-live was a bad idea since it was SAPs programs that were on the line. Bibliography “Whirlpool Hits Shipping Delays over Glitch in SAP Software” Wall Street Journal, December 3, 1999, http://online. wsj. com/article/SB941595437640862948. djm. html
Cite this Whirlpool Corporation – Giving ERP a Spin
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