hershey_articles - Failed ERP Gamble Haunts Hershey -...

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IDG Network: Login Register Computerworld Failed ERP Gamble Haunts Hershey Candy maker bites off more than it can chew and 'Kisses' big Halloween sales goodbye News Story by Craig Stedman NOVEMBER 01, 1999 - A $112 million ERP project has blown up in the face of Hershey Foods Corp., which last week said it's still struggling to fix order- processing problems that are hampering its ability to ship candy and other products to retailers. Analysts and sources in the industry said the Hershey, Pa., manufacturer appears to have lost a gamble when it installed a wide swath of SAP AG's R/3 enterprise resource planning applications, plus companion packages from two other vendors, simultaneously during one of its busiest shipping seasons. The sources said Hershey squeezed what was originally envisioned as a four-year project into just 30 months before going live with the full ERP system in July. That's when retailers begin ordering large amounts of candy for back-to-school and Halloween sales. But the company said in mid-September that it was having trouble pushing orders through the new system, resulting in shipment delays and deliveries of incomplete orders. Last week, when Hershey announced a 19% drop in third-quarter profits, Page 1 of 3 Failed ERP Gamble Haunts Hershey - Computerworld 10/3/2005 http://www.computerworld.com/printthis/1999/0,4814,37464,00.html
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CEO Kenneth Wolfe said the system fixes are taking longer than expected and are requiring more extensive changes. When the difficulties first came to light, Hershey vowed to get shipments back to normal by this week. But during a conference call with financial analysts, Wolfe said he now doesn't expect that to happen until the end of the year, if not later. "This is a difficult bear that we have here," he said. The company recently spent two days reviewing the new system. It developed a list of changes that need to be made to improve things such as the view of product inventories that end users get and the way information flows between different applications, Wolfe said. "But they need to be tested before we put them in, and we can't get that done [right away]," he added. Hershey wouldn't specify whether the problems stem from its configuration of the
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This note was uploaded on 04/20/2010 for the course BEM 251 taught by Professor Lewis during the Spring '10 term at Wake Forest.

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hershey_articles - Failed ERP Gamble Haunts Hershey -...

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