Management information systems overview

MIS

Hershey is one of the most well-known producers of chocolate and candy in the world. The company's first manifestation was Hershey, Pennsylvania, which was founded in 1894. A little more than a century later, in 1998, it recorded $4.4 billion in sales. This included variations in sizes and shapes culminated in about 3,300 candy products. Seasonal sales are significant for the company's profits, which includes Halloween, Christmas, Valentine's Day and Easter. Indeed, Halloween an Christmas record about 40% of annual candy sales in total, making these crucial for Hershey. One of the main challenges for Hershey, especially as it entered the 21st century, was the implementation of it into its operations. Because of the nature of its products and sales, the company has not invested large amounts of funding into this section of its operations. At the turn of the century, it therefore implemented a project known as Enterprise 21, which was to provide the company with a better business solution and greater competitive advantage.

Indeed, these were the main goals of the project, in addition to the overriding goal of solving its Year 2000 (Y2K) problems. At the heart of the new implementation was the fact that it would be less costly and troublesome to replace existing systems than fixing the problems within them. The immediate goals of the project were to upgrade and standardize hardware, moving them from a mainframe-based network to a client-server environment. The ultimate goals was to increase the company's competitive edge in terms of the efficiency in its data sharing capabilities.

In short, it was believed that Enterprise 21 would result in a better execution of Hershey's business strategy to focus on its core mass-market candy business. Hence, the core of the plan was to switch over to new SAP system to improve not only the operations of the company, but also its competitive edge.

One of the main risks that was not recognized was the total effects of the new deadline. Instead of 48 months, the company had only 39 months to complete its project. This meant nine months of training and implementation that would just not be possible. This does not appear to have been taken into account by the managers.

External risks include the fact that Hershey's customers would lose their trust in their supplier. This culminated in the loss of significant shelf space, which would be difficult to regain after the crisis had passed. Furthermore, despite promises that Hershey made to supply by Valentine's Day and Easter, this could not be guaranteed. The loss of business and good faith resulting from an inability to properly implement the new system resulted in a loss of reputation for the company as well. This should have been anticipated, particularly with the new deadline.

A significant internal risk was the loss of revenue. Hershey had invested $112 million for the implementation of the whole project. This amount should have merited a proper assessment of possible risks, including the ability of personnel to use and understand the new system. The greatest risk that should have been understood is the new timeline.

Hershey should have approached the implementation differently by investigating similar implementations by other companies. The Leapfrog company, for example, manufacturing educational toys, implemented a new system by relying on the expertise of various people working in the field. The main difference between Leapfrog and Hershey was the fact that Leapfrog did not assume that its employees would automatically understand the new system. Furthermore, a reasonable deadline was implemented, and problems were ironed out before they became major issues.