Nestle Usa Installs Sap Article Only

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Date Submitted: 02/06/2015 10:33 PM

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A good example of a company that used ERP packages to reorganize their business processes is provided by the U.S. subsidiary of Nestle USA, a Swiss food conglomerate. Nestle USA was created in the late 1980s and early 1990s via acquisitions. In 2002 it included seven divisions which collectively sold such popular brands as Alpo, Baby Ruth, Carnation Instant Breakfast, Coffee-Mate, Nescafe, Nestle Toll House, Power-Bar, Stouffer's Lean Cuisine, SweeTarts, and Taster's Choice. In 2002, the company employed some 16,000 employees and earned about $8 billion in revenues. In the mid-1990s the various companies that make up Nestle USA were all operating as independent units. In 1997 a team studying the various company systems concluded that, collectively, the companies were paying 29 different prices for vanilla, which they all purchased from the same vendor. The study wasn't easy, since each company had a different number or name for vanilla and purchased it via completely different processes. Just isolating vanilla and then determining a common unit price required a considerable effort. In 1997, Nestle USA decided that it would standardize all of the major software systems in all of its divisions. A key stakeholder team was set up to manage the entire process. By March 1998, the team had its plan. It decided it would standardize on five SAP modules, purchasing, financials, sales and distribution, accounts payable, and accounts receivable. In addition, the stakeholder team decided to implement Manugistics' supply chain module. The team considered SAP's supply chaining module, Advance Planner and Optimizer (APO), but it was brand-new in 1997, and they decided to go with the better-known Manugistics module that was specifically designed to work with SAP modules. Before even beginning to implement SAP modules, people from the divisions were gathered and spent 18 months examining data names and agreeing on a common set of names. Vanilla, for example, would henceforth be code...