What Went WrongBy David F. Carr | Posted 2002-12-16 Print
The confectioner's holiday sales melted when it switched software in 1999. Now, a second try is succeeding. Here are the lessons learned.#3: No Leadership">
What Went Wrong #3: No Leadership
Before Hershey hired CIO George Davis, a former Computer Sciences Corp. consultant, the highest ranking information technology executive at the company was a vice president a couple of levels down. Yet the people involved say the lack of a CIO wasn't necessarily the issue in 1999 so much as a lack of management understanding of how much effort, both in systems development and organizational change, would be required for success.
Penn State's Sawyer believes many of the pitfalls of enterprise systems implementation revolve around governance issues. At Hershey, he suspects that business and technology managers aligned with different parts of the business were pulling in different directions, and no one at the top pulled these demands together to guide the creation of a system that would work for the whole business. That's very typical, Sawyer says: "You get 100 little committees, with no oversight."
Often, the people within the company charged with project management are so overwhelmed by the number of details that must be addressed that they wind up leaving the definition of basic business processes to consultants who lack the necessary inside knowledge of their business, Sawyer says.
Lesson Learned: Oversight Matters
If Hershey didn't understand the importance of systems project oversight before Halloween 1999, it certainly did afterward. In the distribution center modernization, because top management was determined that nothing go wrong, "we wound up with a very high-powered steering committee," Miesemer said in his speech. "We had the CEO himself involved."
By all accounts, Hershey has put significantly more emphasis on close executive oversight of systems projects ever since. And it's for that reason that Sawyer suspects that Hershey may have benefited, in a perverse way, from its suffering. Many enterprise systems can use a fundamental redesign after their initial implementation, and they don't often get that opportunity, he says. "In other words, most corporations don't fail so dramatically the first time, so their repair is never so good."
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