Case Study Of Foxmeyer Drug

3416 Words 14 Pages
Register to read the introduction… This was expected to eliminate unnecessary activities, establish appropriate inventory levels and provide responsive customer services. Ideally, with an ERP system, the company would be able to manage ordering, inventory and sales activities in one system which was expected to streamline operations and provide efficient distribution of prescription drugs which is a critical component of the pharmaceutical industry. So FoxMeyer decided to invest in ERP, which has become the Big Business Fix of the 90s. FoxMeyer installed ERP system to process the hundreds of thousands of order requests that the company received each day. The system would manage the packaging and routing of pharmaceuticals from dozens of vendors to thousands of hospitals, clinics, drug stores, and other customers. They anticipated the ERP also to enable them to lower unit costs, and thus allow them to undercut competitors on price. In 1993, FoxMeyer decided to select SAP R/3 system, with Andersen Consulting hired to integrate the $65 billion system

The Selection of SAP
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• Software selection

A project steering committee should possess high level of expertise, both technical and operational in the software selection process. They should compare different softwares, evaluate their pros and cons and identify the one which best fit the business needs. It may be advisable to seek the advice one or more consultants. Tests on the site can be helpful.

• Inclusion of the necessary business process reengineering

ERP cannot be expected to improve profits without the prior accomplishment of improved supply chain planning systems, enterprise optimization systems, customer relations management, transportation and logistics management and warehouse management. Installation an ERP system is not the end process; business processes and systems must always keep pace with changes to enhance competitive advantage.

• Thorough testing

Develop an organized comprehensive testing plan, encourage user participation in the testing, and make sure adequate testing scenarios are conducted to the new system.

• Stakeholders’

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