Sunday, September 14, 2008

Food for Thought: Is There a Correlation with Good To Great Companies and the Primary ERP System of Record?

From time to time, this question comes up as to what ERP systems are used in the 12 companies listed in Jim Collins, "Good to Great" book. Here's the "official" system of record as gleaned from public sources including press releases, SEC filings, and media quotes. If you work for any of these companies, please let me know if I've got any of these wrong as things may have changed...

* Abbott Laboratories - SAP - Primary. BPCS (Infor) and JD Edwards (Oracle) run at the plant level
* Circuit City - PeopleSoft (Oracle) - Primary. Retek (Oracle) at the retail level.
* Fannie Mae - Custom ERP systems
* Gillette – Oracle (At the time of the book), P&G acquired Gillette and runs SAP
* Kimberly-Clark - SAP - Primary
* Kroger - Custom ERP systems. Retek (Oracle) at the retail level.
* Nucor - Custom ERP systems. IFS and Microsoft Great Plains at some plants
* Philip Morris - SAP - Primary
* Pitney Bowes - Oracle - Primary
* Walgreens - Custom ERP systems
* Wells Fargo - PeopleSoft (Oracle) - Primary

The bottom line.
The final score here is 4 for Custom ERP systems, 4 for SAP, 2 for Oracle, and 2 for PeopleSoft. With such a small sample size and Oracle buying up PeopleSoft, it looks like a 3-way tie for SAP, Oracle, and a custom ERP system. If there's any lesson learned here, technology serves a role as an accelerator and not a change agent. One might want to place bigger bets on people, especially Level 5 leaders, strong management, and self-discipline.

Your turn.
As far as one can tell, there rarely is a correlation with the ERP system and how well a company does, but I'll let you be the judge. Do you think the ERP System of record makes a difference in how a company runs? Share your thoughts here or send me a private email at rwang0@gmail.com.

(The personal contents in this blog do not reflect the opinions, ideas, thoughts, points of view, and any other potential attribution of my current, past, or future employers.)
Copyrighted 2008 by R Wang. All rights reserved

4 comments:

Ian M. said...

Good to great is absolutely rubbish. It's up there with innovation and six sigma projects. Companies are good because they invest in their people, treat them like human beings, and don't use an ERP system to force best practices onto the minions. ERP projects are not about innovation, they are about conformity... and as we all know conformity is the source of all evil.

Esteban R. said...

The list of Collins companies are now all in a mess. Abbott is having significant issues as its SAP system is hampering its ability to innovate. Circuit City is getting crushed by Best Buy and has let go of its competitive advantage - semi knowledgeable sales people; Fannie Mae... let's not start there. Gilette integration is going horribly as P&G is forcing upon it the P&G culture and SAP; Kimberly Clark barely got its SAP implementation up and working; Nucor is struggling against the Koreans, Chinese, and Indians; Philip Morris is facing continued backlash to its way of life...

The only winners so far, Kroger, Pitney Bowes, Walgreens, and Wells Fargo.

Collins does not have a good track record here. Tom Peters is much better.

C. D. said...

I'd say that it is the combination of the right people and the right technology. You can have the strongest leaders in the world but if the technology is not flexible enough, it becomes an inhibitor to change. At the same time if no one understands the technology, then companies are inhibited too.

S G said...

The right people know / learn how and where to bring in the technology as an enabler... so that ultimately it comes back to the right people.