Enterprise Resource Planning

ByPriyanka Singh Rajneesh Yadav DFT-VI

Index

Introduction
Enterprise resource planning (ERP) is business process management software that allows an organization to use a system of integrated applications to manage the business and automate back office functions. ERP software integrates all facets of an operation, including product planning, development, manufacturing processes, sales and marketing.

Top ERP Trends The ERP field can be slow to change, but the last couple of years have unleashed forces which are fundamentally shifting the entire area. According to Enterprise Apps Today, the following new and continuing trends affect enterprise ERP software:

1. Mobile ERP Mobility continues to be a big trend. Executives and employees want real-time access to information, regardless of where they are. It is expected that businesses will quickly embrace mobile ERP, not just for reports and dashboards, but for conducting key business processes. 2. Cloud ERP The cloud has been advancing steadily into the enterprise for some time, but many ERP users have been reluctant to place data cloud. Those reservations have gradually been evaporating, however, as the advantages of the cloud become apparent. 3. Social ERP There has been much hype around social media and how important or not -- it is to add to ERP systems. Certainly, vendors have been quick to seize the initiative, adding social media packages to their ERP systems with much fanfare. But some wonder if there is really much gain to be had by integrating social media with ERP. 4. Two-tier ERP Enterprises once attempted to build an all-encompassing ERP system to take care of every aspect of organizational systems. But some expensive failures have gradually brought about a change in strategy adopting two tiers of ERP.

CURRENT ERP SOLUTIONS

ERP VENDOR REPORT : INTACCT SOFTWARE FOR ACCOUNTING AND FINANCIAL MANAGEMENT
Intacct is the cloud financial management company. Bringing cloud computing to finance and accounting, Intaccts awardwinning applications are the preferred financial applications for AICPA business solutions. Intacct applications are used by more than 7,300 businesses from startups to public companies and are designed to improve company performance and make finance more productive. Hundreds of leading CPA firms and Value Added Resellers offer Intacct to their clients. The Intacct system includes accounting, contract management, revenue management, project and fund accounting, inventory, purchasing, vendor management, financial consolidation and financial reporting applications, all delivered over the Internet via cloud computing.

The Intacct financial management system includes best of breed applications for core financials and accounting, purchasing, order management and financial reporting and business intelligence. Optional applications include FAS-52 compliant multi-currency support, real-time financial consolidation and multi-entity support, sales tax

management, inventory management, revenue management, project accounting and pre-packaged integration with Salesforce CRM.

Strengths:
Has a strong ecosystem of third party solutions to meet most industry requirements. Customizable dashboards are very impressive, and provide an alternative to standard reports. Full integration between customer relationship management and payroll Supports any number of users, with strong user access control tools Relationship with AICPA/CPA2Biz has yielded integrations with other solutions Works in almost any web browse

Potential Limitations:
Since the product has the sophistication associated with a middle-market solution, it may have more capabilities or options than some small organizations need. Limited capabilities to support manufacturing management More expensive than basic programs.

Best Fit:
Organizations who need the sophistication and power of a mid-market accounting package. Accounting firms and value added resellers who want to run the system for their inhouse general ledger, sell new services, and support their customers on the product. Ideal for businesses in a wide range of industries, although the organization should have an internal accountant or outsourced its accounting to get the most out of this powerful system.

Intacct provides:
Real-time business visibility via easy to create dashboards and reports. Comprehensive financial consolidation, reporting, and analysis across multiple business entities. A streamlined quote-to-cash process that bridges sales and finance and eliminates manual data re-entry. Automated procure-to-pay with custom defined workflows that reduce errors and processing costs. Anywhere, anytime expense report submission, approval, audit, and reimbursement, increasing visibility

into clients company's travel and expense spending patterns.

Benefits
-Best-in-class professional accounting software - the only AICPA preferred cloud-based financial software Real-time business visibility via anywhere, anytime online access to dashboards and reports Comprehensive financial consolidation, reporting and analysis across multiple business entities Out-of-the-box, tailored reports and workflows Easy to extend and integrate to match your precise needs Time-saving automation which accelerates the closing process and reduces errors Superior integration with your existing business solutions Dramatic savings on IT and operating costs Customer success and satisfaction. Each year more than 95% of customers renew their subscriptions Comprehensive ecosystem of partners True cloud computing with world-class operations Dramatic savings on IT and operating costs

Key Features of Intacct

General Ledger Accounts Payable Purchasing Accounts Receivable

 Cash Management Order Management Inventory Management Time and Expense Management Billing Revenue Recognition Project Accounting Fund Accounting Multi-Entity Management Multi-Currency Management

Global Consolidations Salesforce.com Integration Segregation of duties Customizable workflows and transactions Automatic backups, disaster recovery Seamless, automatic upgrades

DETAILS OF MANAGING SYSTEMS OF INTACCT SOFTWARE Intacct General Ledger Accounting

A Build your business on the only best-in-class, multiledger financial foundation available in the cloud today to manage and grow clients organization for years to come. Intacct separates the accounts receivable, accounts payable, and time and expense ledgers from the general ledger. This multi-ledger architecture enables the system to process transactions independentlywithout degrading the performance of

your general ledgerno matter how large transaction volumes grow. Transform clients business with robust multi-ledger architecture Boost organizational efficiencies by automating financial processes. Intacct general ledger accounting software helps client create and revise an unlimited number of budget, plan, and forecast scenarios using powerful tools that easily adapt as your business evolves. Include scenarios in financial reports for comparison and evaluation.

Intacct Accounts Receivable Management

Efficiently collect and process cash, checks, credit cards, and banking transfers. Quickly set up and generate recurring invoices. Create and print or email invoices. Effectively manage cash collection and key customers. Receive and apply regular and advance payments, apply penalties and adjust accounts, make deposits, and deliver statements. Automate data entry by defaulting customer terms, general ledger accounts, billing, and shipping address information. Gain real-time visibility into customer financial information and cash analysis.

Intacct Revenue Management Software

 Reduce revenue leakage, improve deferred revenue management and streamline complex revenue recognition accounting. Manage subscription and contract based financial relationships more effectively with Intacct revenue management software. Intacct helps client automate end-to-end revenue recognition accounting, including billing, forecasting, and renewals, to improve the effectiveness of clients finance organization and lower your cost of complianceeven for the most complex revenue models. Adapt and comply with evolving rules and guidelines, eliminate spreadsheets, and increase productivity using Intacct to automate billing, renewal and revenue recognition software. Plus gain real-time visibility into recognized and deferred revenue streams, project future revenue and renewals, and improve your customer relationshipsall while reducing days sales outstanding (DSO).

Intacct Cash Management

Increase productivity by managing all of clients cash accounts from one centralized location. Automate and simplify bank reconciliations with a streamlined cash management solution.

 Manage cash flow, forecast cash needs, maximize investment returns, and ensure compliance using clients organizations cash handling processes.

Intacct Reporting and dashboards

Accelerate business decision-making using built-in financial reporting and analysis. Drive business performance and make better decisions with real-time, actionable, and tailored financial and operational information.

Multicurrency management
Cut the time required to process complicated multicurrency accounting transactions by 50%. Reduce the cost and complexity of running clients business in multiple currencies. Improve productivity whether client manage complex international operations or simply need to do business with clients or vendors in multiple currencies. Gain visibility into clients business using unlimited base, transaction, and reporting currencies. Save hours and eliminate currency exchange errors with automated exchange rate updates, real-time rates, currency revaluations, and automatic calculation of realized and unrealized gains and losses.

 Reduce the cost of compliance by automating financial controls for major regulatory requirements, including GAAP, SOX, IFRS, FAS52, FAS141R, and EITF 87-12.

Intacct Global Consolidations

Manage complex, multi-entity or multinational operations in real time. Automate and control global financial consolidations and close processes, while improving visibility with real-time intelligence to drive better business decision making. Enable your company to expand rapidly into both local and international markets. Manage complex financial processes with ease by supporting the structure that best represents your business, including minority and partial ownership. Easily represent fractional ownership when consolidating global financials.

Intacct Order Management Software

Bridge the gap between sales and finance. Save thousands of dollars every year by automating customer order workflows.Configure the quote-tocash process to match your business. Automate and streamline the order fulfillment process.

 Create sophisticated pricing structures. Measure all Salesforce order management activity with comprehensive reporting and dashboards. Streamline the end-to-end selling process with builtin Salesforce order management integration

Salesforce integration
Eliminate manual data re-entry by deploying automated, integrated quote-to-cash process. Intacct's Salesforce integration helps clients sales team manage customer relationships more costeffectively. Streamline cross-departmental workflows. Maximize renewal revenues. With Salesforce integration, finance teams can automatically update their Salesforce system with the latest billing and payment information. Manage your professional services business more efficiently by creating, tracking, and synchronizing Projects and Tasks in both Salesforce and Intacct Project Accounting. Easily manage orders from multiple business entities with built-in integration to Intacct Global Consolidations.

Intacct Project Accounting

o Streamline and automate the capture of all billable and non-billable time and expenses. o Reduce revenue leakage, maximize billable hours, gain control over current project costs and margins, and forecast more accurately for future projects. o Speed up and maximize cash collection and revenue recognition for improved cash flow. o Proactively manage project revenue, costs, and margins for improved profitability. o Gain real time visibility into backlogs, and their impact on recognized and deferred revenue. o Ensure that bids reflect the true cost of implementation and include adequate margins. o Gain insight into project and customer profitability.

Intacct Time and Expense Management Software

o Provide anywhere, anytime access to time and expense entry and approvals to improve the timeliness and accuracy of the collection of billable and non-billable time and expenses. o Provide finance with real time visibility into expense commitments made by employees to better track committed funds. o Enter and check the status of timesheets and expense reports at any time with automated workflow that emails notifications to supervisors

for reviews and approvals, speeding up the process of collecting information needed for invoicing. o Easily capture billable and non-billable time and expenses related to client projects when used with Intacct Project Accounting, for real-time visibility into project status and project profitability. o Streamline and automate online approval workflows, making it easier to enforce companyprescribed policies and internal controls, and improve cashflow. o Increase employee satisfaction by expediting the expense reimbursement process using an online expense reporting system, reducing employee wait time for reimbursement of out-of-pocket expenses.

Intacct Accounts Payable

o Manage, track, and report payments with flexible advanced payment functionality. o Strengthen internal controls by configuring your payment process to support clients business rules. o Keep clients financials up-to-date with real-time integration.Increase productivity by automating standard workflows and processes and strengthening vendor management. o Simplify tax preparation with 1099 support.

Intacct Purchase Order Software

o Cut your management and transaction processing cycles by 2-3 times using a seamless chain of transactions with smooth integration between Intacct Purchasing and Intacct General Ledger, Intacct Order Entry, Intacct Accounts Payable, and Intacct Accounts Receivable. o Intacct purchase order software lets client tailor purchasing to fit clients established business processes using configurable best practice templates. o Reduce overall purchasing costs using automatic quantity price breaks and economic order quantities. o Transform clients finance organization by giving them the purchase order management software they need to effectively analyze business informationinstead of just collecting it. o Automate purchasing transactions and make it easy for staff to monitor and manage merchandise and services acquisitions..

Intacct Inventory Management

o Configure inventory workflows and model transactions to best suit clients inventory management needs. o Create custom documents and transactions using best practice templates or build clients own.

o Gain business visibility by creating inventory management reports and centralized business dashboards that reflect the real-time performance of clients company. o Dig in to the data behind inventory reports with comprehensive drill-down capabilities

QUICK OVERVIEW OF FAILURE CASE STUDY : HERSHEY FOOD COOPERATION

One of the leading chocolate manufacturer across world. Large chunk of sales from Valentines Day, Easter, back to school, Halloween and Christmas 40% of profit. Need of an efficient and reliable logistics system to cater to these large no of seasonal requirements . Reliable product availability is critical.

Existing system
A network of 19 manufacturing plants, eight contract manufacturers and more than 20 co-packers. The company was running on legacy systems, and with the impending Y2K problems, it chose to replace those systems and shift to client/server environment To tackle Y2K problem Hershey decided to replace existing legacy systems.

IT partners
A $112 million worth of combination of softwares for CRM, ERP and forecasting. Replace existing mainframe based legacy systems by SAP R3 Accenture.

 Production forecasting, scheduling and transportation management Manugistics Group Inc. Managing customer relations and tracking effectiveness of marketing activities Siebel CRM.

Implementation Plan FOR Enterprise 21

Jan 1996-Roll out of the plan
Tackle Y2K issue by Jan 2000
Replace Mainframe with SAP R/3 Advanced final date to April 1999

Jan 1997
Replaced 5000 desktop computers Installed new TCP/IP network hardware

April 1999

Enterprise 21 went live Expected Benefits

Fine-tune deliveries to suppliers. Upgrade and standardize companies business processes. Efficient customer driven processes managing changing customer needs. capable of

Reduce order cycle times and boost inventory accuracy.

 Reduce inventory costs.

Actual scenario
Unable to deliver $100 million worth of Kisses and Jolly Ranchers for Halloween in 1999. Stock price down 35% Earnings drop 18% Order fulfillment time doubled to 12 days! Lost prominent shelf space for the season!!! Several consignments were shipped behind schedule, and even among those, several deliveries were incomplete.

What went wrong?

Squeezed Deadlines Wrong Timing Big-Bang Approach Un-entered Data

Learning
The evolutionary way Test each module before release

Go Slow

Data is King

Data migration is important. Discipline in inventory.

Oversight Matters

Management should keep a close watch. Work for a common goal.

A New Challenge
To restore confidence in distribution systems following the 1999 breakdown; to extract additional efficiencies from the supply chain.

The Turnaround

 Hershey made sure to take the time and resources to thoroughly test the computer systems. Testing included putting bar codes on empty pallets and going through the motions of loading them onto trucks so that any kinks would be worked out before the distribution center opened for business. Began work on the upgrade to mySAP in July 2001. Hershey Foods said it had completed an upgrade to mySAP.com completed in 11 months, 20% under budget Hershey now has an inventory location accuracy of 99.96 % and can turn orders within 24 to 48 hours of receiving an order as opposed to the previous 10-plus days that it took. Eastern distribution center, EDC III Opened in 2000, to help custom pack some products at its distribution centers, removing co-packers from the chain. To strengthen infrastructure. the overloaded physical logistics

To help with errors in forecasting. Enabled by WMS from Mc Hugh DM+.

 In its few short months of operations, EDC III nearly has halved the companys order-cycle times of a year ago while dramatically boosting inventory accuracy.

Hersheys Today
Revenues of nearly $5 billion and almost 13,000 employees worldwide. In 2005 & 2006, Hershey acquired the Berkeley, California-based boutique chocolate-maker Scharffen Berger, Joseph Schmidt Confections, the San Franciscobased chocolatier and Dagoba Organic Chocolate, a boutique chocolate maker in Oregon. Markets Hershey's, Reese's, Hershey's Kisses, Kit Kat, Twizzlers, and Ice Breakers.

DETAIL REPORT
In the third quarter of 2000, Hershey Foods Corporation3 (Hershey), the US based manufacturer of chocolates and sugar confectionary, announced that its revenues increased to US$ l l97 billion as compared to US$ 1.097 billion in the third quarter of 1999 During the same period, profits increased by 23% from US$ 87.6 million to US$ 107.4 million. The company's management and shareholders were pleased at this announcement, as Hershey's revenues and profits for the third quarter of 1999 as well as for the year 1999 as a whole had been adversely affected due to problems related to ERP systems implementation in the company. Hershey had started revamping its hardware and software infrastructure in 1997. In 1999,Hershey faltered during the final leg of the ERP implementation. Hershey had selected theservices of three vendors SAP AGs (SAP), Siebel Systemsu lsiebell and ManugisticsT for the project, and some of the modules were implemented as per the schedule by the company in January 1999. However, the remaining modules which were to be implemented by April 1999 were delayed and were implemented only in July 1999. This overlapped with the time when thecompany usually started receiving huge orders for the impending Halloween and Christmas seasons. In order to quicken the implementation process, Hershey opted for Big Bang implementation, where several modules

were implemented simultaneously. Some of them could not be tested properly due to lack of time. This led to several problems related to order management and fulfillment, and orders from many retailers and distributors could not be fulfilled, even though Hershey had the finished product stocked in its warehouses. The adverse affects of failed ERP implementation were immediate, with a significant drop in the revenues for third quarter of 1999. However, Hershey was quick to rebound and implemented mySAP.com by September 2002, much before the schedule and below the estimated budget. IMPLEMENTING ERP Hershey priced its products low, and to achieve sales of almost US$ 5 billion, huge quantities of the products needed to be sold. This called for highly efficient logistics and supply chain systems duly supported by information technology (IT). In the early 1990s, the spending on IT in the food and beverage industry was among the lowest. During this period, Hershey, like most of the other companies in the industry used legacy systems. It functioned through several mainframe legacy systems, which were used for different functions ranging from human resources to order processing. During late 1996, the management of Hershey gave its approval to a project named Enterprise 21, which aimed at modernizing the hardware and software used by the company. At the turn of the

century, Y2K problems were expected to crop up in the company's legacy systems. Hershey chose to replace the systems, rather than spending huge amounts on solving the date related problems in the legacy systems. The main goals of Enterprise project were to upgrade and standardize the hardware, shift to clienserver environment from the existing mainframe based environment, move to TCP/IPIa network, etc. At around the same time, there was growing demand from the retailers that suppliers like Hershey should share their data about product deliveries so that the retailers could maintain optimum inventory levels and reduce costs. By implementing new software, Hershey aimed at better coordinated deliveries of its products, helping retailers maintain low inventory and reduce inventory holding costs, and on the whole, providing better customer service. Hershey's information systems division wanted to switch over to the ERP system by April 1999. The new ERP software was expected to help Hershey reorganize its business processes. For this purpose, Hershey selected SAP AG's R/3 Enterprise Resource Planning suite, along with companion software from two vendors Manugistics and Siebel. Software from SAP included modules for finance, purchasing, materials management, warehousing, order processing, and billing.

Manugistics would provide software for transport management, production, forecasting and scheduling. The software from Siebel was to support Hershey in managing customer relations and in tracking the effectiveness of the company's marketing through a pricing promotions module. Hershey had used software from Manugistics earlier in its mainframes. After switching over to the ERP system, Hershey was to have a client-server version of the same software. IBM Global Services was chosen to integrate the software provided by the three different vendors. The aim of the project was to put all the systems on a single integrated platform. Overall, the project was expected to cost the company US$ I l0 million. As a part of Enterprise project, Hershey installed bar coding systems across its products and plants in the US. Through bar coding, Hershey aimed to reduce production costs, track the inflow and outflow of the materials, and improve the overall management of logistics. According to the initial plan of the project, Hershey would be able to shift to the new system by April 1999, when the annual sales of confectionary companies were usually lower, compared to other times of the year. For confectionary companies, sales were mostly seasonal - with the Christmas. The project which would otherwise take around four years to complete, had to be finished in a span of just over thirty

months. Another reason why Hershey wanted to finish the project at a quick pace was because of the impending Y2K problem. By January 1999, some of the modules like SAP financial, materials management, purchasing, and warehousing had been implemented. However, other modules like the critical order processing and billing systems modules from SAP, the pricing and promotions package from SieUet and planning and scheduling modules from Manugistics were behind schedule. Though Hershey planned to switch over to the new systems during April 1999, which was a lean season for confettionery sales, these modules were added on only in July 1999 - three months behind schedule. At that time, Hershey was under pressure and was not in a position to extend the implementation schedule, as the Y2K problem was looming large. That was the time that orders from retailers for Halloween started pouring in' Hershey then decided on a Big Bang approach to ERP implementation. In this approach, the software was to be implemented at one go, instead of a phased approach of implementing one module at a time, testing it, and then taking up the next module. The phased approach allowed a company to find and correct bugs before moving on to the next phase. However, Hershey was of the view that the Big Bang approach would enable it to meet all its Halloween orders.

THE PROBLEMS
Initially, the rollout appeared to be smooth. But slowly, problems pertaining to order fulfillment, pro.eriing and shipping started to arise. Several consignments were shipped behind schedule, and even u-otrg thse, several deliveries were incomplete. However, it was too late for Hershey to respond to this problem. The old logistics system that had been in place was pulled down, making way for the new one, which could not function as required. Without any data about the products in its hands, Hershey was often forced to call up customers and inquire about the details of the quantity they received and ordered. In July 1999, when Hershey opted for the Big Bang approach to ERP implementation, it had supplies for around eight days - this was higher than usual. Hershey maintained more supplies to address any problems that might occur during the implementation. But three weeks after the implementation of the new system, it was evident that Hershey would not be able to meet its deadlines as the shipments were delayed. As against the usual five days, that it took to deliver the products, Hershey asked distributors for around twelve days to deliver their orders.

However, Hershey missed that deadline too. By August 1999,the company was 15 days behind schedule in fulfilling orders. Several of Hershey's distributors who had ordered the products could not supply them to the retailers in time, and hence lost their credibility in the market. The retailers complained that the problems with regular supplies from Hershey had been persisting since summer and they were looking at other alternative . Customers began switching to products of competitors like Nestl and Mars. Retailers opined that not only short term sales but long term sales of Hershey too would also be affected. On the one hand, Hershey was unable to send the consignments on time due to problems in order entry, processing and, fulfilment; on the other, the warehouses were piled up with products ready to be shipped, as the manufacturing process was running smoothly. Product inventory started to pile up and by the end of September 2000; the inventories were more than the inventories during the previous year. Hershey missed out on the deliveries, in spite of having enough products at its warehouses. This confusion surprised market observers and Hershey on its part did not disclose the details of

SAP R/3 ERP implementation required all the data pertaining to the location of the inventory and its details. Hershey used to ensure peak-season inflow of products from its manufacturing units by placing the products wherever the space was available; this was not always the distribution center or the warehouse. Sometimes, it rented temporary space and products were even stored in unused rooms in its factories. The temporary facilities where products were stored were not identified as storage points as far as SAP R/3 ERP software was concerned, and so many such storage locations were simply not taken into account. In order to fulfill customers' orders, the SAP initially checked the inventory available at each of the locations mentioned in Hershey's official records. However, the products stocked in informal locations were not checked, which SAP R/3 software did not consider. The main reason for the gap was the lack of coordination between the technical personnel implementing the system and the people involved in operations, who did not update those implementing the software solution. Without a database of the entire inventory of the company, the orders could not be processed on time. Hershey had planned to have all the systems up and running by Spring 1999, with the Y2K problem in the vicinity. As a result, there was hardly any buffer left for the systems to be tested.

The deadlines Hershey had set to implement the ERP suite were unrealistic. Hershey was unable to stick to the deadlines and some of the important processes like transportation and warehouse management got shifted into the third quarter. Another reason was that Hershey implemented ERP during the peak season, and did not have time to rectify the mistakes arising out of problems pertaining to the implementation. According to analysts, ERP implementation was a complex process and many glitches could occur. Hershey's mistake was in going ahead and implementing ERP during its busiest season. Had it done this in an off-peak period, the company could have successfully addressed the lapses arising in the software. According to experts in the field, anything between three to six weeks was required after implementation to identiff problems and fix them. If Hershey had completed the project on time, and implemented it by April, implementation and conection would have been completed before the peak season. Some experts were of the opinion that there were problems integrating SAP R/3 with the CRM software from Siebel and supply chain software from Manugistics. These three needed to work in tandem to process orders and schedule shipments. Inputs from consulting firms with experience in SAP-Manugistics integration could have helped Hershey avoid the catastrophe

Another reason cited for the debacle was Hershey's lack of experience in implementing software solutions of this magnitude. Hershey had earlier implemented a few customized systems, but they were on a much smaller scale. The top management did not conduct enough groundwork before going ahead with implementation of this companywide ERP solution. Since the groundwork was inadequate, the top management also fell short in guiding the company's technical and business managers. These two levels of management were working towards different goals. The employees at Hershey were required to follow and understand how different business processes were built, in SAP R/3. They needed to be trained in how the system functioned and also how different modules interacted with one another. The employees were overloaded, as they had to learn the intricacies of not one, but three new systems, and bring out the required revisions in their activities. Further, this happened at the peak season, when they were very busy with little time to spare for the new endeavors. Analysts were of the view that though some, though not all, of the problems could have been avoided if there had been more focus on training. During ERP implementation, Hershey did not have right processes in place to keep its senior management regularly informed about how implementation was proceeding. The consultants who were brought in subsequently said that the

top management had really failed to understand the scope of the project.

BOUNCING BACK
After the debacle, Hershey made efforts to stabilize SAP and other systems. The company appointed a CIO, George Davis from Computer Sciences Corporation. Under his leadership, a rigorous software testing program was implemented. By September-October 2000, Hershey announced that most of the initial problems with the ERP systems were fixed. In 2000, Hershey was in a position to fulfil orders for Easter. The next peak season, Halloween-Christmas also passed smoothly. By the year 2000, Hershey was back on track with sales reaching US$ 4.2 billion (Refer Exhibit III for Hershey's sales and income during 1997 to 2000). In July 2001, Hershey redesigned the process and began working with SAP N3 4.6, which was a part of SAP's mysap.com products. Within 1l months, the system was implemented successfully - ahead of schedule and with 20% less costs as compared to the budget estimates. Hershey also began using SAP for marketing analysis and brand management, order management, etc. The company announced that within 60 days of implementation, major improvements were made to processes like invoice verification, credit processing, etc. Hershey was using SAP's business analysis tools to measure the impact of sales and marketing programs. Hershey ensured that the mistakes

committed earlier were not repeated by thoroughly testing the software before implementing it and by providing adequate training to employees. Hershey's distribution system, which included several regional warehouses, some of which were operated by third parties, was one of the primary reasons for the problems pertaining to the first major ERP at Hershey. In order to address this issue, Hershey built a 1.2 million sq. ft. distribution centre, to align its distribution function with the new ERP system. With the new distribution centre, Hershey was able to reduce its order cycle times by half. After putting this new facility in place, Hershey closed several warehouse In mid-2001, with the ERP system started running successfully.

REFERENCES
e2benterprise.com us.intacct.com jmtconsulting.com www.webopedia.com facweb.cs.depaul.edu www.cpapracticeadvisor.com http://www.pemeco.com