E Business Transitions

Migrating to E Business has become inevitable. All business Organisations have recognised this fact. It has been understood that E Commerce is going to be the sales engine for the future. Understanding and accepting the need to evolve a E Business strategy brings with it more challenges.

The first and foremost challenge that the Organisations face is the question of getting their priorities in order with reference to finances. Capital and funds flow happens to be the backbone and the need for the current ongoing businesses. At the same time huge funds have to be committed on an ongoing basis to take the Organisation through the E Business strategy which is the need for the future. Managements find it easier to chart out an investment plan for managing the E Transition in phased manner. The commitment and involvement of the top management is very crucial for the E Business implementation. The implementation strategy has got to be top driven.

The second challenge for E Business implementation and transition comes from the commitment of the Senior and Middle Management in the Organisation. E Business transition has to be owned by the functional and administrative managers and calls for continuous involvement during deployment. However in most cases Managers are faced with the day to day business realities of having to chase the targets and committing time and effort for transition programs. The question is, do they have the necessary energy and commitment to own the implementation program?. E implementation programs are such that they have to be owned and implemented by the functional owners and cannot be done independently by a third party. Third party specialists would of course be engaged in the project as consultants but the last mile execution involves the actual operations staff on the ground and hence the functional managers become the owners.

Organisational challenges can be many. However the E implementation strategy has got to take all the factors into account and work around the best strategy that can be implemented. As long as the top management is committed and overseas the entire project, it can be implemented successfully. Take the case of Hewlett Packard. HP management bought Compaq and decided to merge both the companies and create synergy. There were commonalities of course in terms of products etc. However the manufacturing and the supply chain processes followed by both the Companies were totally different. HP chose to integrate both Blue {HP} and Red {Compaq} product lines together and chose to implement SAP across the platform. Blue line had products that were bought out as well as built to stock models of printers and consumables. Red line manufactured computers largely for SOHO segment on build to order basis. Both the product lines had different set of markets as well as supply chain processes. It was important for HP to merge both the supply chains and integrate the warehouses, bring visibility of inventory down to the last mile. At the same time the Company had planned to provide Web visibility of the Order and Delivery confirmations to its Customers.

Implementation was carried out in phased manner in most countries. HP did not opt to enable all modules of SAP R|3. Instead they chose to build interface with the third party service provider’s WMS systems for the inventory and warehouse operations. Receipt of goods at a warehouse automatically triggered a message to SAP which enabled the system to drop the orders against the inventory received. Further despatch and delivery tracking was done using the local WMS system. Final Proof of Despatch was uploaded into the HP Website that provided visibility to the end customer. Detailed implementation at country level and across all warehouses in the country called for huge investments into Hardware as well as Software and more importantly in terms of time and cost of the Project teams. With a well organised project workflow that involved senior management involvement at a global level as well as at regional and country level as sponsors, ensured sustained focus, support and resources to the project that spanned over sixteen months in most cases. The commitment to implement and operate through the system drilled down from the top management and superior project planning and implementation skills paved way for success. The end results of the project was that HP gained a lot in terms of leaner resources, faster and flexible processes, visibility of inventory and orders, reduction of lead times for procurement as well as for manufacturing and delivery and lesser cost of production and significant reduction in logistics costs accrued out of higher volumes. Today the teams at HP have forgotten all about the days when they did not have SAP and were managing two supply chains separately. HP has been able to ride the E Commerce wave and ride ahead in the market.