Questions:
2.) What type of global business and systems strategy did Nestle adopt?
Nestle adopted a transnational strategy which involved managing nearly all of its value-adding activities from a global perspective without reference to national borders, optimization of sources of supply and demand wherever they appear, and taking advantage of any local competitive advanatages. The globe not the home country is the management frame of reference. Nestle wanted to be the first global enterprise to conduct business as if it were operating in a single country. This meant that it had to choose one system and make all countries conform to that system no matter what local differences there might be and know matter what differences there were in the way they conducted day to day business.
3.) What management, organization, and technology challenges did Nestle have to deal with to standardize its business processes and systems?
Management challenges included convincing all of the market heads around the world to adopt one single set of business processes and systems for procurement, distribution , and sales management. All of the managers felt that their way of doing business was the right way and it was a challenge to get them all on board to give the new system a chance. As a whole organization it was challenging because up to that point each local organization had been allowed to run the business as it saw fit which took into account local conditions and cultures. Standardization of all of the company's systems completely changed the culture of the company. No longer was each global site its own autonomous unit, now everyone was expected to use the same system and do things the same way no matter what part of the world they resided in. The technological challenges that the company faced wsa that Nestle facilities in 14 countries all ran their ERP software differently and used different schemes for formating data and management forms. Also many of the company's core processes were not documented and were passed down by word of mouth. All of these processes needed to be documented so that the best way to run the business could be determined and all sites could use these core processes.
Sunday, June 8, 2008
Article Summary
GET A GRIP
Mary Hayes Weier
InformationWeek; Nov 5, 2007; 1161; ABI/INFORM Global
pg. 41
This article discusses offshore outsourcing and how that it is creating new risks and requiring new strategies to deal with those risks. The article opens with a description on how the CIO from Genworth Financial, a company that provides mortgage and life insurance has had to change his whole routine because of IT outsourcing. He now has to come into work extra early (between 6:00-6:30 A.M.) so that he can spend the first couple of hours of the day dealing with IT teams in India and Europe before the U.S. workday starts. In 10 years Gensworth went from outsourcing just a few IT projects to almost having half of all IT work done outside the U.S. This firm and other firms like it in the U.S. prefer to use the term "globalization" instead.
The article goes on to explain how the techniques for dealing with offshore IT employees and projects is now changing to deal with some of the challenges that come with the territory. For instance, firms that employee outsourcing of their IT functions are trying to have a closer relationship with the vendors that they are employing. This includes doing things like helping improve with employee retention and attempting to treat those problems more like their own inhouse problems. Companies are also trying to hold the providers more accountable for costs and outcomes and also are giving them more critical work. It appears that since more companies are relying on outsourcing as a way to cut costs there is also more of a need to make sure that the investment is really paying off and that means having more involvement in what is going on.
The article also mentions that even though cost cutting is still the main reason for outsourcing, some companies are also depending more on foreign markets for revenue growth. To become successful in those markets these companies are starting to put employees in those markets including IT. Companies are also looking for the latest skills and technology platforms which many see as coming out of India. The hardest lession that has been learned with all the outsourcing in the last decade was the hidden costs associated with it. To avoid these hidden cost companies are now creating outsourcing contracts based less on input andm ore on output (that is generating revenue from new products, meeting systems uptime requirements, ect).
The article ends by discussing the ongoing problem of retaining skilled outsourced employees. Many employees would get burned out at having to work night shifts just to please U.S. customers. Outsourcing companies are trying to change this and make the work environment better to help retain these employees.
This article relates back to what was discussed in the chapter on the challenges of implementing global information systems. It is important to make sure that the benefits outweigh the costs and that companies monitor these types of systems to make sure everything runs smoothly. It can be much harder to fix a problem that is occuring on the other side of the world once it has already happed but close monitoring and adjustments can keep a new global system running smoothly and make it remain profitable. I also have experience with outsourcing at my own company. Recently we began to outsource the production of some of the recombinant proteins that we make to India. This has helped to cut costs for the company but early on there were some challenges. For awhile production levels were much lower than normal as the new team got used to the proccesses. I think one important thing that helped improve the process was that some of the scientists from the India group came to our site for training and to meet everyone. It helped both the India site and our site transition faster to the new arrangement and since then production has been high with few problems.
Mary Hayes Weier
InformationWeek; Nov 5, 2007; 1161; ABI/INFORM Global
pg. 41
This article discusses offshore outsourcing and how that it is creating new risks and requiring new strategies to deal with those risks. The article opens with a description on how the CIO from Genworth Financial, a company that provides mortgage and life insurance has had to change his whole routine because of IT outsourcing. He now has to come into work extra early (between 6:00-6:30 A.M.) so that he can spend the first couple of hours of the day dealing with IT teams in India and Europe before the U.S. workday starts. In 10 years Gensworth went from outsourcing just a few IT projects to almost having half of all IT work done outside the U.S. This firm and other firms like it in the U.S. prefer to use the term "globalization" instead.
The article goes on to explain how the techniques for dealing with offshore IT employees and projects is now changing to deal with some of the challenges that come with the territory. For instance, firms that employee outsourcing of their IT functions are trying to have a closer relationship with the vendors that they are employing. This includes doing things like helping improve with employee retention and attempting to treat those problems more like their own inhouse problems. Companies are also trying to hold the providers more accountable for costs and outcomes and also are giving them more critical work. It appears that since more companies are relying on outsourcing as a way to cut costs there is also more of a need to make sure that the investment is really paying off and that means having more involvement in what is going on.
The article also mentions that even though cost cutting is still the main reason for outsourcing, some companies are also depending more on foreign markets for revenue growth. To become successful in those markets these companies are starting to put employees in those markets including IT. Companies are also looking for the latest skills and technology platforms which many see as coming out of India. The hardest lession that has been learned with all the outsourcing in the last decade was the hidden costs associated with it. To avoid these hidden cost companies are now creating outsourcing contracts based less on input andm ore on output (that is generating revenue from new products, meeting systems uptime requirements, ect).
The article ends by discussing the ongoing problem of retaining skilled outsourced employees. Many employees would get burned out at having to work night shifts just to please U.S. customers. Outsourcing companies are trying to change this and make the work environment better to help retain these employees.
This article relates back to what was discussed in the chapter on the challenges of implementing global information systems. It is important to make sure that the benefits outweigh the costs and that companies monitor these types of systems to make sure everything runs smoothly. It can be much harder to fix a problem that is occuring on the other side of the world once it has already happed but close monitoring and adjustments can keep a new global system running smoothly and make it remain profitable. I also have experience with outsourcing at my own company. Recently we began to outsource the production of some of the recombinant proteins that we make to India. This has helped to cut costs for the company but early on there were some challenges. For awhile production levels were much lower than normal as the new team got used to the proccesses. I think one important thing that helped improve the process was that some of the scientists from the India group came to our site for training and to meet everyone. It helped both the India site and our site transition faster to the new arrangement and since then production has been high with few problems.
Sunday, June 1, 2008
Chapter 13 Case Study
Can the U.S. Army Reserve Pay Soldiers Correctly?
2.) Diagram the Forward Compatible Payroll business process for paying Army reservists. How should this process be improved?
It was supposed to proved a temporary solution until a more complete systems solution could be implemented. It provided more automation for the change in pay that occurred when Army reservists were called to active duty. The pay administrator could use a web browser to review the orders in the system and then access and update the files in the personnel database without any duplicate entries occurring. The system still required a unit commander to approve and sign a hard copy of a mobilization order before the data was transferred to the payroll system so that soldiers could get payed. The problem was still do to human error that caused a lag in information to be updated and the update also was very slow because pay was constantly changing for these soldiers which added more complexity to the system. To improve the system more it will be important to make it even more automatic by getting rid of the need for manual approvals and limit the data entry so it only needs to happen once. Also add a way to check to make sure the data is entered correctly the first time to prevent errors.
3.) Describe the role of end users and technical specialists in analyzing the problem and developing a solution.
The end users are the pay administrators who enter the data and the commanders who approve the pay decisions as well as the soldiers who rely on these systems to get paid correctly. End users can analyze the process to see what parts are redundant or could be eliminated or streamlined to make it more efficient to reduce error and save on time. The technical specialists are the programmers and consultants that will be able to recommend, design and implement the right kind of information system that will solve the problems identified by the end users of the current system.
2.) Diagram the Forward Compatible Payroll business process for paying Army reservists. How should this process be improved?
It was supposed to proved a temporary solution until a more complete systems solution could be implemented. It provided more automation for the change in pay that occurred when Army reservists were called to active duty. The pay administrator could use a web browser to review the orders in the system and then access and update the files in the personnel database without any duplicate entries occurring. The system still required a unit commander to approve and sign a hard copy of a mobilization order before the data was transferred to the payroll system so that soldiers could get payed. The problem was still do to human error that caused a lag in information to be updated and the update also was very slow because pay was constantly changing for these soldiers which added more complexity to the system. To improve the system more it will be important to make it even more automatic by getting rid of the need for manual approvals and limit the data entry so it only needs to happen once. Also add a way to check to make sure the data is entered correctly the first time to prevent errors.
3.) Describe the role of end users and technical specialists in analyzing the problem and developing a solution.
The end users are the pay administrators who enter the data and the commanders who approve the pay decisions as well as the soldiers who rely on these systems to get paid correctly. End users can analyze the process to see what parts are redundant or could be eliminated or streamlined to make it more efficient to reduce error and save on time. The technical specialists are the programmers and consultants that will be able to recommend, design and implement the right kind of information system that will solve the problems identified by the end users of the current system.
Article Summary
Signed, Sealed and Indelible
Nicoe Vaughan-Spickers. Health Management Technology. Altlanta: Mar 2007. Vol. 28, Iss. 3; pg. 22, 3pgs
This article talks about a pharmaceutical company called Ferring Pharmaceuticals which identifies and develops products in the fields of urology, gynecology, fertility, gastroenterology, and endocrinology. It discusses how this company decided in 2004 to change from paper lab notebooks to an Electronic Lab Notebook (ELN). Lab notebooks are essential for creating what is called a " trail of evidence" that protects valuable intellectual property when new products are being developed by R&D groups in the life-science industry as well as other science-based industries. The information contained can contain the record on when a new invention was conceived as reduced to practice. This information is essential for patent protection and patent infringement cases.
The article begins by talking about how important it is in the healthcare, biotechnology, and pharmaceutical industries to bring new products to market more quickly. It greatly increases the opportunity for revenue and company growth. In order to do this these types of companies must constantly look for ways to streamline processes to allow research scientists to spend more time actually producing work and less time documenting their work. In doing this it is important to make sure that these processes continue to adhere to strict quality standards as many products made in these industries are regulated by governmental agencies like the FDA.
The article goes onto discuss how most companies in health care and pharmaceutical industries still rely on paper lab notebooks to protect intellectual property even though there are electronic software versions available. There are problems with paper lab notebooks which include illegible, incomplete or error filled notebooks that can make it impossible to repeat a key experiment. Also, often it can be extremely time consuming to find the right lab notebook since there can be dozens in a single lab. The reason companies have been hesitant to adopt an electronic version despite these issues is a perception that Intellectual Property protection can not be managed by electronic systems, in order to have this protection you need a signature and witness that can only be obtained by using a paper lab notebook.
Ferring Pharmaceuticals took the risk and switched to an ELN with very positive results. They believed by doing this that they would provide a way speed up information retrieval, make it easier to collaborate and share knowledge among its 100 scientists and different sites, and also to speed up documentation and data entry process. The company chose to use a digital time-stamp technology embedded in its Electronic Lab Notebooks so that the notebooks would be able to still be used for Intellectual Property protection. The software was called Surety's AbsoluteProof technology and it allowed for a unique timestamp token or seal to be generated for every electronic document produced in Ferring's ELN's. The timestamp or token was stored off site in a data center that was fully accessible, searchable and verifiable.
The system was easily implemented with a half-day specialized training for scientists. Scientists also had two week time frame to experiment with and test the ELN system before it was implemented. The user acceptance was high and the system has increased the efficiency of scientists by saving countless hours by getting rid of the manual process of documenting experiments in lab notebooks and having them signed and witnessed.
This article relates back to chapter 13 because it illustrates how a successful information system was designed and implemented. It also illustrates how important getting the end user involved is through training and input so that they will accept the new system once it is implemented. Also, it shows how a whole organization can change with the design and implementation of a new system. Ferring got rid of a completely outdated system and successfully implemented a new system that is still not widely accepted by the rest of the industry.
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