Runner--
>>>So Hershey Foods spends 112 million dollars to fix their Y-2K problem, and since July their salesman can't even tell if stores are getting candy, much less how much.<<<
Yeah, I thought the above situation speaks volumes as to just how screwed-up this thing is.
From the article:
>>>>>>INFORMATION, PLEASE
And John Moser, candy-category manager for Dallas-based 7-Eleven Inc., says a Hershey sales representative is calling him weekly, instead of monthly as usual, to ask what 7-Eleven has received because, among other things, Hershey itself can't tell what the chain has received.<<<
msnbc.com
Also notice Hershey began the installation back in 1996...Should have been plenty of time...This does not bode well.
>>>Hershey embarked on its computer project in 1996, partly to satisfy retailers who are demanding increasingly that suppliers fine-tune deliveries so that they can keep inventories — and thus costs — down. The company also faced year-2000 problems with its old computer system.
The project called for 5,000 personal computers, as well as network hubs and servers and several different vendors. Under the new system, software from Siebel Systems Inc., San Mateo, Calif., Manugistics Group Inc., Rockville, Md., and SAP AG, Walldorf, Germany, is used by Hershey's 1,200-person sales force and other departments for handling every step in the process, from original placement of an order to final delivery. It also runs the company's fundamental accounting and touches nearly every operation; tracking raw ingredients; scheduling production; measuring the effectiveness of promotional campaigns; setting prices; and even deciding how products ought to be stacked inside trucks. International Business Machines Corp. was hired to pull it all together.
BIG-BANG APPROACH
New technology that came on line in July has gummed up its ordering-and-distribution system, leaving many stores nationwide reporting spot shortages of Kisses, Kit Kats, Twizzlers and other stalwarts of the trick-or-treating season.
Despite the complexity of the system, Hershey decided to go on line with a huge piece of it all at once — a so-called big bang that computer experts say is rare and dangerous. Initially, the confectioner planned to start up in April, a slow period. But development and testing weren't complete, and the date was pushed to July, when Halloween orders begin to come in. Retailers say, and Hershey confirms, that the problem is in getting customer orders into the system and transmitting the details of those orders to warehouses for fulfillment.
But no one is taking responsibility. Kevin McKay, chief executive officer and president of SAP's U.S. unit, says the system itself isn't at fault. “If it was a system issue, I'd point directly to a system issue,” he says. Mr. McKay says he is in touch with Hershey executives almost daily, and he points out that the companies successfully installed an SAP system in Hershey's Canadian operation last year, though that operation is a tiny fraction of the size of the U.S. operation. IBM spokesman Brian Doyle says the company continues to help Hershey address “its business challenges,” adding that “the business process transformation under way at Hershey is an enormously complex undertaking.”
Siebel executives say that Hershey officials told them the problem wasn't with their software. “It may have turned out with the big bang kind of installation, they were maxed out there,” says Paul Wahl, Siebel's president.<<<
So it appears they got an early start, then fell behind due to developing and testing, so they went on-line big bang style in July and KERBLOOEY!
Computer experts say big bang is rare and dangerous. You wonder how many Hersheys are out there...companies that got an early start only to fall behind and blow-up.
(B.K. Myers--any thoughts?)
If nothing else it speaks volumes re: the fragile state of JIT systems:
>>>Hershey embarked on its computer project in 1996, partly to satisfy retailers who are demanding increasingly that suppliers fine-tune deliveries so that they can keep inventories — and thus costs — down. The company also faced year-2000 problems with its old computer system.
The project called for 5,000 personal computers, as well as network hubs and servers and several different vendors. Under the new system, software from Siebel Systems Inc., San Mateo, Calif., Manugistics Group Inc., Rockville, Md., and SAP AG, Walldorf, Germany, is used by Hershey's 1,200-person sales force and other departments for handling every step in the process, from original placement of an order to final delivery. It also runs the company's fundamental accounting and touches nearly every operation; tracking raw ingredients; scheduling production; measuring the effectiveness of promotional campaigns; setting prices; and even deciding how products ought to be stacked inside trucks. International Business Machines Corp. was hired to pull it all together.<<<
I'm glad it's only candy here and not pharmaceuticals of one variety or another.
But you're right Runner...Say, "It's only candy" to the shareholders and employees.
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