ERP AT TEKTRONIX

The Implementation of ERP at Tektronix

The Implementation of ERP at Tektronix

Background and Scope

Tektronix, Inc. is a maker of electronic test equipment, which was founded in 1946. By 1998 the company has grown to a $2 billion manufacturer of electronics tools and devices that are sold in nearly 60 countries. Tektronix, Inc. is divided into three self-directed divisions: Measurement Business Division (MBD); Color Printing and Imaging Division (CPID); and Video and Networking Division (VND). Tektronix is a worldwide leader in oscilloscopes, out performing its nearest competitor by twice the market share. Also, Tektronix is a worldwide leader in television test, measurement, and monitoring equipment, and workgroup color printers.

The MBD had sales of $962.9 million in 1998. The division sales consist of a broad range of instruments for various measurements applications such as: oscilloscope solutions; logic analyzers; instruments on a card; intelligent hand-held tools, and spectrum analyzers. While the CPID had sales of $728.7 million in 1998, the sales consisted of the Phaser™ family of workgroup color printers that are sold in the office, graphic arts, and engineering/scientific markets. Lastly, The VND had sales of $394.2 million in 1998. The VND division sales consists of: video production editing ad transmission products; disk-based storage and playback systems; Windows-based terminals hardware and software solutions for the PC, mainframe, and Unix platforms; and distributed digital multimedia hardware and software and high-speed remote connect protocol solution.

This report has been requested by and prepared for Mr. Carl Neum, chief financial officer (CFO) and Mr. Robert Vance, chief information officer at Tektronix, Inc. Mr. Robert Vance has retained Blue Demons Consulting (BDC) to analyze Tektronix , Inc.'s Global Enterprise Resource Planning (ERP) Implementation and provide recommendations for future major project implementations.

BDC composes this review report by conducting an analysis on the activities surrounding the Global ERP implementation at Tektronix Inc.

Current scenario

Recently, Tektronix, Inc. has successfully implemented a Global Oracle ERP system. The project cost approximately $55 million, which included software, internal and contract labor. However, the team responsible for implementing Oracle ERP system felt that the time, effort, and expense was worth it. Prior to implementing the ERP system, Tektronix had challenges of management and information system, which lacked integration and suffered from years of uncoordinated system expansion. Tektronix was dealing with an increase global competition and poor financial performance.

Neum believed that the company's future success would depend on his ability to simplify and restructure its operations. His first acts as CFO included selling off businesses, changing business processes, and increasing visibility into operations. A key enabler for sustaining these changes was the implementation of improved information technology (IT).

Some of the information technology problems that was facing Tektronix were:

?Impossible for the company to ship “up to the minute” or on a Saturday.

?Need for a sales order to be entered multiple times in different systems as it made its way through the order cycle.

?Vulnerability to order errors due to slow processing through customer service.

?Lack of accurate performance information to manage customer account and credit on ...