Cisco Erp Case Study
Cisco Erp Case Study
Cisco Erp Case Study
Cisco designs, manufactures, and sells Internet protocol (IP)-based networking and other
products related to the communications and information technology (IT).
One day, the legacy system corrupted and shut down for 2 days.
This made the company realize that the system is brink of total failure.
QUESTION 1:
How was the decision made to implement
ERP?
System replacement approach that they adopt is not sufficient to solve the problem
Virtual shut down for 2 days, brink of system failure
QUESTION 2:
Evaluate the analysis made to recommend
ERP to the Board, and the quality of the
justification.
In their CIO point of view, Cisco had little choice but to move on.
Two very important critical questions was answered with critical analysis
approach
The duration of the project and the cost associated with the project
We committed to do it in 9 months for $15 million for the whole thing - Solvik , CIO
You know, careers are lost over much less money than this - Morgridge, CEO
The board ended up approving the project.
QUESTION 3:
What were the key factors that enabled the
team to implement ERP in 9 months at
Cisco?
QUESTION 4 :
How did Cisco build their I-Net to
electronically connect with the customer?
Identify the benefits that were enabled by
this initiative.
1. Answer question diagnosed network problems and provide solutions and expert
assistance world wide.
2. Primary vehicle for delivering responsive around the clock customer support and
improve customer satisfaction.
3. Customers express higher satisfaction and enjoy a lower cost of doing a business.
4. Orders could be placed via internet from anywhere in the world
5. Customer could use the application to check their order status.
QUESTION 5:
Identify the main benefits of the strategic INet at Cisco, and estimate the range and
type of benefits you think that they
achieved.
3.
Single Enterprise
New Product Introduction (NPI)
Autotest
Direct Fulfillment
Dynamic Replenishment
Financial Results
FY 1995
FY 1996
FY 1997
FY 1998
2,232,652,000.00
4,096,007,000.00
6,440,171,000.00
8,458,777,000.00
Net Income
456,489,000.00
913,324,000.00
1,048,679,000.00
1,350,072,000.00
Total Assets
1,991,949,000.00
3,630,232,000.00
5,451,984,000.00
8,916,705,000.00
No of Employee
4,086
8,782
11,000
15,000
Sales Growth
105%
83%
57%
31%
24%
100%
15%
29%
Asset Growth
93%
82%
50%
64%
Net Sales
Conclusion
Why Cisco ERP implementation was successful?
Implementing an ERP system was the top priority in 1994
Best People was put into this project
Strong partners KMPG and ORACLE
Very Timely and Less Costly
After implementation of ERP, Cisco saved around USD 500 million on overheads per year.
Cisco also managed a write-off of USD 2.5 billion on parts and inventory in its warehouses
Thank you..