IMPLEMENTING SAP

Implementing SAP



Implementing SAP

This company, Super Skateboard Builders, Inc. (SSB, Inc.), is used in a number of courses within the College of Business. The heaviest use of this model company is in Operations Management, Management Information Systems, Accounting and Strategy courses. These courses either utilize the SAP system directly or use the model company for case studies.

The development of SSB, Inc. has provided a valuable teaching resource for these courses. For example, ERP systems are an excellent means of demonstrating business processes and integration within an organization. The use of the SAP system thus complements the conceptual material concerning business processes within the curriculum. An additional, substantial benefit is also made possible. Since students see the same model company from the perspective of different functional areas, they gain a holistic view of the organization.

In order to highlight the opportunities provided by this expanded landscape, it is necessary to provide some of the operational details of the original company. SSB, Inc. is a small skateboard manufacturing company located in Grand Rapids, Michigan. The company manufactures a deluxe skateboard, assembles a standard skateboard from purchased parts, and markets several trading goods, including an entry-level skateboard and a skateboard repair kit.

The manufacture of the deluxe skateboard requires gluing and pressing several plys of wood together, drilling holes, and prepping and painting the skateboard, among other operations.

The complete routing for the deluxe skateboard, and its components, can be seen in Table 1. The manufacturing equipment listed in the routings is only used for this one product, so a simplified accounting approach was used, with all machine costs allocated to the deluxe skateboard.

Table 1 Deluxe Skateboard Routings

The SSB, Inc. facility is 5,000 square feet, with 80% of the space allocated to production and warehousing operations. The company is privately owned, and sells its products solely to wholesalers. The company buys from nine vendors and sells to seven primary customers.

SSB, Inc. uses a Make-to-Stock production strategy and raw materials are released or issued to individual production orders following Material Requirements Planning. Completed production orders are confirmed in the SAP system and the finished goods are placed into inventory with a separate transaction. This configuration effectively illustrates the flow of materials and documents associated with this production environment.

Beyond, SSB, Inc., the expanded business horizon encompasses an additional three model companies: a joint venture in Malaysia, a distribution partner in Hungary, and a domestic supplier. While all ...