Introduction
In the contemporary business setting, the integration of technology systems is viewed as one of the necessary approaches to fostering efficiency. As such, companies in the entire industry seek to streamline their operations by engaging in B2B-managed services to automate different processes (Ha et al. 2014). Particularly, various technology systems have been integrated into the supply chain management (SCM) element of business processes to bolster efficiency. Over the last few years, several organizations have identified the incorporation of electronic resource planning (ERP) systems is crucial for improving the functionality of SCM. Essentially, ERP systems concentrate on the management of an organization’s information (Schwalbe 2015). By so doing, ERP frameworks provide the industry with a comprehensive outlook of the diverse aspects of the corporation, including procurement, stock management, and product/service allocation. The introduction of ERP software to the SCM element of business fosters the management of information about the required raw materials or inputs that facilitate the delivery of products or services to the targeted consumers. Therefore, this paper maps the beverage industry while identifying the specific needs that a beverage company would meet through the integration of an ERP system in its SCM before addressing the project management elements associated with the incorporation of the technology.
Mapping the Industry
Companies in the beverage industry concentrate on the production of drinks. The ready-to-drink beverages may either be alcoholic or non-alcoholic beverages. The case of the prevailing company focuses on the production and distribution of non-alcoholic beverages in various countries globally to become a leading competitor. The SCM feature of the company is an integral one since it needs to guarantee a steady flow of inputs, as well as products, as per the prevailing supply and demand patterns (Grimm, Hofstetter & Sarkis 2014). Therefore, various external and internal factors influence the need for incorporating an ERP system. In this regard, exploring the external and internal influences that affect the performance of the beverage company in the highly competitive industry is relevant.
External Factors
Firstly, the SCM of a company in the beverage industry strives to ensure that the business produces ready-to-drink products that find their way to the consumer in the shortest way possible. Further, the SCM structure at the global level also ensures that the beverage product finds its way to the fridge of the consumer. For this reason, competitors such as The Coca-Cola Company facilitate the delivery of their beverages to retail shelves within 48 hours. The supply chain structure in the beverage industry constitutes the provision of ingredients, packaging, manufacturing, distribution, refrigeration, and recycling services (Ha et al. 2014). The sourcing of incidents is crucial since the company needs them to produce a variety of products under its brand name. The packaging is also important since it fosters the brand identity while at the same time containing the product before consumption. The manufacturing entails various factory processes that facilitate the production of ready-to-drink products. Global players in the beverage industry have wide distribution networks that enhance the accessibility of their brands in different geographical locations. Further, most beverage companies, including Coca-Cola and Pepsi, have refrigerators with their brand names to boost the supply of their products. Moreover, the need to focus on environmental sustainability and cutting production costs call for players in the industry to develop recycling plants for their packaging aspect of supply chains (Grimm, Hofstetter & Sarkis 2014). Importantly, efficiency and sustainability form the core of the supply chain structure in the beverage industry.
Secondly, most players in the beverage industry focus on a global orientation rather than emphasizing solely the local market. In this light, the SCM management approach to the beverages industry concentrates on managing information from different suppliers and distributors located in diverse regions of the globe. The fact people require drinks for refreshment justifies the need to employ a global approach to SCM. Notably, the leading competitor, Coca-Cola, has embraced a global orientation to its SCM that enables it to penetrate every corner of the global market, thus offering competition to the local beverage players besides its international rivals.
Thirdly, the embracement of digital technology in consumer-packaged goods has seen the global brands flourish amid the stiff competition in the market. Currently, most players in the beverage industry provide comprehensive information regarding their drinks by using various platforms such as the internet. Notably, consumers want to have information about the products of their interest in a matter of seconds before they can make decisions regarding any purchase (Wang et al. 2016). For instance, customers need to acquire information regarding the nutritional benefits of the beverage products offered by different companies in the market. Thus, the entire industry has seen the digitalization of customer service (Huang & Handfield 2015). As such, the digital divide in the beverages industry is quite narrow, owing to the integration of new technologies in different aspects of operations.
Lastly, the beverages sector has seen a considerable integration of technological advancements geared towards bolstering efficiency. The notable technologies include the construction of store-friendly pallets, the integration of robotics in the manufacturing plants, the incorporation of the warehouse management system (WMS), and the use of RFDI technology (Schwalbe 2015). As such, the beverage sector is constantly moving towards the automation of its processes to bolster productivity.
Internal Factors
The supply chain processes in the organization focus on the effective flow of information and materials. The information flow starts from the customers to the retailers, to the assemblers, to the manufacturers, and finally to the suppliers. The stakeholders constantly communicate to streamline the flow of information. On the other hand, the materials proceed to the manufacturer of the part, to the product assembly and the sales department before the beverages reach the consumer. The SCM processes ensure that every aspect of logistics is streamlined to meet the expectations of the consumer and the goals of the company.
Secondly, the individuals qualified to assume the various roles and responsibilities of a supply chain manager need to have a minimum of a Bachelor’s degree in Supply Chain Management, Industrial Engineering, or any other relevant qualification. The company strives to recruit talented professionals to foster the realization of organizational goals. Employees also undergo regular training to match industry trends. For instance, the introduction of decision support systems (DSS) has seen the company train its employees regularly.
Analysis of the Success Factors for the ERP Project
According to Tian and Xin (2015), the successful integration of an ERP system in the SCM aspect of the organization requires the consideration of the key aspects of project management. In this case, the company needs to consider an array of SCM success factors before implementing the ERP system. Notably, the organization has a clearly defined process flow chart. Importantly, maintaining a clear process flow-chart specifies the chains of command for each functional unit to underline responsibility and/or support collaboration.
Further, training the staff is important to enhance the skills required to promote the effectiveness of a company’s SCM (Walker & Jones 2012). In this light, the company trains its employees regularly to meet the trends in the beverages industry. For instance, the training offered to employees on how to use systems such as DSS is relevant in line with the embracement of technology developments.
The allocation and alignment of the necessary resources required to streamline the supply chains of the organization is a success factor that influences the competitiveness of the beverage company. Notably, the company is ready to align financial resources that would see the incorporation of technology in the supply chain department (Ha et al. 2014). As such, the acquisition of an ERP system is not likely to face financial constraints. The easy deployment of a supply chain management project would be influenced by the available infrastructures in the organization.
Additionally, the company needs to understand the benefits of implementing an ERP system to its SCM. Importantly, an organization needs to be aware of the potential return on investment (ROI) that is associated with the implementation of a particular project (Talib & Hamid 2014). Understanding the ROI that is realized by a particular project reinforces the commitment of the stakeholders.
Besides the success factors, the different aspects of project management include time administration, risk management, and quality supervision. The completion of a project in a timely way is important since it has a bearing on the cost aspects of the undertaking. As such, determining the timeframe required to implement the ERP software will require the project team to consult the vendor, as well as the relevant experts (Sykes 2015). The time management element will consider aspects such as the plan, schedule, and definition of activities.
Risk management is one of the crucial knowledge areas that project managers need to consider (Wu & Pagell 2012). As such, the beverage company needs to consider the possibility of negative or positive outcomes triggered by uncertain events. For instance, changes in supply and demand patterns can alter the flow of inputs and outputs in the company, thus either positively or negatively affecting the success of integrating the ERP system.
Moreover, the success of the project seeking to improve the SCM processes of the beverages company relies considerably on the approach to project quality management. The company needs to ensure that the designing, planning, and implementation phases of the project observe the necessary quality standards. Notably, one of the goals is to engage in quality processes that result in the delivery of quality products to consumers. Thus, reinforcing this aspect of operations is vital when it comes to fostering the success of the project.
The Project Management Activities
Typically, the project management phases entail initiation, planning, execution, and closure (Kerzner 2013). As such, the company needs to select its preferred ERP software before adopting it for implementation in its SCM. Therefore, the company needs to consider the relevant project management activities required for the successful implementation of the undertaking.
Project Methodology
The deployment of the ERP system in the organization would embrace the agile project management methodology. The agile methodology applies values that enhance the collaboration of the stakeholders involved in the project. The methodology is characterized by short-term delivery cycles and the engagement of a dynamic cultural team (Meredith & Mantel 2012). It also underlines the importance of real-time communication.
The frameworks of the methodology guarantee the clarity of the objectives. The methodology requires the implementation team to work in iterative cycles where evaluation is done after completing every step of the project. As Wiengarten, Bhakoo, and Gimenez (2015) reveal, the evaluation gives room for an alteration of the final deliverables to meet the stakeholders’ expectations. Overall, the methodology underlines the essence of unceasing collaboration among the team members, as well as the concerned stakeholders.
Needs Analysis
The ERP system integrated into the company should meet the SCM needs of the company to facilitate its success in the highly competitive industry (Ince et al. 2013). Undoubtedly, the company needs to improve the efficiency of its supply chain processes while at the same lowering the associated costs to bolster productivity. As such, the project will be geared towards enhancing the overall performance of the company by introducing a technology system that fosters the flow of information and materials. The need to offer quality beverages to consumers is also the aim of the project. In this light, improving the management of information regarding the necessary ingredients is essential in promoting the improvement of products offered by the company. The need also seeks to focus customer retention and thus, enhance the sales of the company.
The need to manage resources effectively also calls for the implementation of the project (Meredith & Mantel 2012). Notably, the incorporation of an automated workflow would streamline the management of resources in the beverage company and thus, improve its collaboration with suppliers. Further, leveraging IT with the resources of the company is crucial for speeding up the completion of tasks thereby increasing the production of beverages.
Risk Minimisation Actions
Undoubtedly, risk management is a crucial aspect that influences the success of a project. As such, creating an inventory of the project situation to identify the entire risks that threaten the success of the undertaking is an action of priority (Schmidt, Lyytinen & Keil 2013). The inventory allows the project managers to pinpoint the internal and external factors that predispose the project to jeopardy that would undermine the realization of its deliverables (Kerzner 2013). An evaluation of the identified risks would also be a priority action in managing the project. Importantly, the evaluation would focus on the probability of the risks, the possible impacts, and duration of impact (Lopez & Salmeron 2014). Amid the involvement of guesses at the evaluation phase of risk management, the process prepares the project team for any possible uncertainties.
After an evaluation of the risks, prioritization is crucial for safeguarding the future of the project (Kerzner 2013). Therefore, the project team would shift its concern on specific risks that threaten the successful integration of the ERP system in the SCM aspect of the company. By so doing, the project stakeholders will accept the uncontrollable risks and put efforts towards mitigating the controllable threats. An identification of the controllable risks during the early stages of the project improves the mitigation efforts, thus minimizing the chances of project failure (Ince et al. 2013).
Criteria for Implementing the Measures
A criterion for assessing the success of the project is essential. Important to note, the success of the project depends on the minimization of the risks. Therefore, the criteria for evaluating the successful mitigation of risks would be based on the extent to which the interventions facilitate the realization of the company’s needs. In this regard, the ERP system should lead to the enhancement of the company’s productivity.
The ERP system also needs to bolster the quality of SCM processes in the company. For this reason, the success of the measures implemented to mitigate risks will depend on the quality of communication among the stakeholders involved in the company’s supply chain processes (Talib & Hamid 2014). An improvement in the quality of information and material flows in the company affects the quality of the beverage products it offers to customers. Thus, such improvement is a criterion for risk assessment. Further, risk management measures need to maintain the project within the estimated costs (Meredith & Mantel 2012). The need to utilize the resources allocated to the project is integral in safeguarding the financial health of the company. The resources of the beverage company need to be focused on improving its competitiveness rather than driving it on a downward trend.
Conclusion
The integration of technology in SCM calls for the beverage company to select, adapt, and implement a successful ERP system to manage the flow of information and materials. For this reason, the effective management of the project is crucial for sustaining the organization in the highly competitive sector. As such, the organization project management has adopted an agile methodology to guide the activities of the project team. Notably, the company seeks to integrate the ERP system for the sake of enhancing its productivity, facilitating the effective management of resources, and improving the quality of its beverage brands. As such, the risk management aspect of the project proves integral in guaranteeing the success of the undertaking.
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