Hasbro Develops a Global System Strategy
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Hasbro, a large toy manufacturer, wants to implement a new global ERP system to standardize processes across its many international operations. Its existing SAP R/3 system led to inefficient processes across 27 countries with different business rules. The new SAP ECC6 and SAP Business One systems will allow Hasbro to better integrate systems, comply with regulations, and position itself for continued global growth in a standardized way.
Hasbro Develops a Global System Strategy
- 1. Hasbro Develops a Global System Strategy Kristian, Benli & Jansen
- 2. Hasbro One of the largest toy manufacturers in the world Operating in North America, Latin America, South America, Asia Pacific and Europe $4 billion revenue (2010) 5,800 employees (2010) They want a new ERP system to compliment their global strategy
- 3. Introduction to ERP System Integrating business processes into a single software system Allows data flow to be automatic and more efficient Accessible through departments and corporation ERP System Customer Relationship Management Financial Management Supply Chain Management Manufacturing Resource Planning Human Resource Management
- 4. SAP/R3 Implemented in 1998 Big bang adoption Expanded to 27 different countries Easy customization
- 5. Key Problem 1: Inefficient ERP System 27 different countries 27 different business processes Different terminologies Unnecessary steps Needless forms or process division Resulted in very inefficient business processes
- 6. Key Problem 2: Can’t maximize opportunities in foreign operations Current system was not standardized and centralized Finance & accounting, HR, and strategic management need to be centralized Migrating to a multinational company Hasbro are expanding to new regions of the world Revenue will grow larger outside the United States New ERP system needs to be integrated quickly and efficiently to maximize growth
- 7. Solution: SAP ECC6 Successor of SAP R/3 For mature markets Long implementation time Complex SAP Business One Immediate need For emerging markets Move to bigger ERP infrastructure when markets are mature The result is a larger SAP enterprise infrastructure supporting Hasbro’s global strategy
- 8. Reasons for implementing ERP 15% 14% 12% 11% 11% 10% 8% 8% 5% 4% 3% 0% 2% 4% 6% 8% 10% 12% 14% 16% To improve business performance To better integrate system across multiple locations To better serve customers To ensure reporting / regulatory compliance To replace an old ERP or legacy system To position the company for growth To make employee jobs easier To standardize global business operations To reduce working capital To appease the parent company or other stakeholders Because other companies have ERP Source: Panorama Consulting’s 2014 ERP Report
- 9. Justification of solution Improving decision-making Shared service structure Individualized support to local units Quick accessing and analyzing of trends and sales data Improve analysis of point-of-sale data Improvement in operations Flexibility and scalability Integrates business processes Reduce operating costs Data consistency Results in a unified vision for the future
- 10. Type of Benefits Realized 14% 11% 10% 9% 9% 8% 7% 7% 7% 6% 5% 4% 2% 0% 2% 4% 6% 8% 10% 12% 14% 16% Source: Panorama Consulting’s 2014 ERP Report
- 11. ERP Project Duration 36% 25% 15% 15% 7% 2% Over schedule by 25% or less On schedule Over schedule by 26%-50% Over schedule by more than 76% Over schedule by 51% to 75% Earlier than scheduled Source: Panorama Consulting’s 2014 ERP Report
- 12. ERP Implementation Costs 37% 32% 12% 9% 6% 4% On budget Over budget by 25% or less 26% - 50% over budget Under budget Over budget by more than 76% 51% - 75% over budget Source: Panorama Consulting’s 2014 ERP Report
- 13. Potential issues for the implementation Complexity might be underestimated Less focus on business and lower efficiency The needs and benefits may be overestimated Inconsistency with existing business processes Political laws, speed, reliability, standards, personnel, social expectations, and culture differences
Editor's Notes
- #14: Since it’s such a big change Hasbro needs to be committed to spend the money necessary for training and change management activities Since the project affects all Hasbro’s business units Encourage staffs throughout the enterprise to adopt the new information system It could become an IT project rather than a business transformation project. Leaving Hasbro wasting unnecessary expenses to launch this system upgrade project.