Case Sudy: Hershey foods.

Essay by rooneypanUniversity, Bachelor's October 2005

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Case Study: Chapter 1 Hershey Foods, p.39


All over the world, organizations are to be seen planning, developing, designing, testing, installing, maintaining, upgrading and, ultimately, using software systems. In turn, consultants, strategists, authors, and computer magazine journalists, among others, analyze these systems and write up progress reports on the system project. And what is being suggested in most of these reports is that the systems are ineffective, are not timely, and are usually far from profitable. Just like the case of Hershey Foods. To put another way, the system development industry has consistently got it wrong and often do not succeed as planned. What implied problem? At the simplest level, the problem can be summed up by the following four phases in building and maintenance systems in Hershey Foods business processes:

(1) Four Phases of Building and Maintaining Systems


1996: Hershey Foods started to embark the project.

Objective: To satisfy retailers who wanted to keep their own costs down by receiving deliveries when they are really needed.

Aim: To use the new information system in the sales force and other departments for handling every step in the process, from original placement of an order to final delivery.


1999 April: System expected to be completed.

Project Software: Combination of SAP's R/3 Enterprise software with software from Manugistics Group and Siebel Systems.

System Integrator: IBM

Work System: Company's fundamental accounting, tracking raw ingredients, scheduling production, measuring the effectiveness of promotional campaigns, setting prices, and how products ought to be stacked inside trucks.


1999 April: System expected to be completed but delayed

1999 July: Gone live with a new $112 million information system

1999 July: Customers started to receive incomplete shipments

1999 September: Announced turnaround time for orders would double to 12 days and would miss third-quarter earnings...