WMBA 6030 Week 2 Enterprise Platform Evaluation Example

A Rental Platform Over a General ERP, Switched in January: Evaluating Two Enterprise Options Against an Event Rental Company's Six Requirements, With a Price, a Twelve-Week Window and What Breaks During the Cutover

Student Name

Walden University

WMBA 6030: Managing Business Information Systems

Instructor Name

Month Day, Year

A Rental Platform Over a General ERP, Switched in January: Evaluating Two Enterprise Options Against an Event Rental Company's Six Requirements, With a Price, a Twelve-Week Window and What Breaks During the Cutover

What the Business Needs

Harwood, the fictional tent and event rental firm from Week 1, runs on rental software installed eleven years ago. The system still tracks availability adequately, but it cannot quote a complex event, does not connect to accounting and runs on a single server in the Kansas City office. As the company moves toward large corporate and wedding events, its operations team has written six requirements a replacement must meet. They are listed in order of importance.

First, date-based availability across three warehouses, including items rented in from other companies for peak weekends. Second, quoting for complex events: tents with flooring, lighting and power, priced from a site layout rather than item by item. Third, delivery and crew scheduling, since a large tent may need eight people for six hours to install. Fourth, condition tracking at check-in, so damage and loss are recorded against the order that caused them. Fifth, a direct connection to the general ledger, to end the monthly re-keying of invoices. Sixth, a portal where corporate clients can review quotes, sign contracts and pay deposits.

The Options

Two options were evaluated in detail, and a third, staying on the current system, was kept as a baseline. Option A is a cloud platform built for the rental industry, sold by subscription. Option B is a general mid-market enterprise resource planning system with a rental add-on from a third-party partner. Vendor names are withheld, and prices are illustrative figures based on quotes of the kind such vendors provide.

Table 1

Two Options Rated Against Six Requirements

Ratings reflect demonstrations and reference calls; vendor names are withheld and prices are illustrative.

Option A meets the first, second, fourth and sixth requirements strongly, the four most connected to the company's strategy. Option B is stronger on scheduling and accounting, but its weakness in quoting and the client portal falls on the two capabilities the corporate strategy depends on most.

Cost

Option A costs about $86,000 a year in subscriptions for 45 users, plus about $55,000 for implementation and data migration, for a three-year cost of roughly $313,000. Option B costs about $140,000 in licenses and partner fees in the first year, plus about $160,000 for implementation over nine months, and about $45,000 a year in support, for a three-year cost of roughly $390,000. Staying on the current system costs about $25,000 a year in support and a server replacement due next year, but it carries the cost of quotes that take two days to build and invoices re-keyed by hand.

Recommendation

Harwood should adopt Option A. It is cheaper over three years, faster to implement and stronger on the capabilities the strategy needs. Its weaker scheduling can be supplemented by the routing tools crews already use, and the general ledger connector is adequate for a company of this size.

The implementation window matters as much as the choice. Event rental is seasonal: the company's busiest months run from May to October, and December and January are quietest. The switch should run over twelve weeks beginning in early January, with cutover in late March, before the first spring weddings.

What Breaks During the Switch

An honest evaluation has to say what will go wrong. Three things will.

The most serious is future reservations. By January the company will hold about 2,000 confirmed bookings for the coming season, each with items, dates and deposits. Every one must move correctly to the new system. A single tent double-booked on a June Saturday would cost far more than the software. The plan therefore runs both systems in parallel for three weeks after cutover, with every new booking entered in both, and a manual check of all bookings for May and June before the old system is retired.

Second, damage history will not transfer cleanly. The old system records damage in free-text notes, so the new system will start with no reliable history of which items fail most often. Managers should expect a year before condition data become useful.

Third, crews will be slower for the first month as they learn tablet check-in. Markus et al. (2000) found that problems in enterprise system projects often arose early and went unnoticed until later phases, and that success measured at go-live was only loosely related to success later. Measuring the switch only by whether it happened on time would miss what matters.

Conditions for Success

Research on enterprise implementations has identified recurring success factors, including clear goals, committed leadership, accurate data and adequate training (Umble et al., 2003). For Harwood, the factor most at risk is data accuracy, because the migration of future bookings is the step with the least margin for error. The project should have one owner, the director of operations, and the cutover should not proceed until a test migration of all bookings has matched the old system exactly. Davenport (2000) argued that enterprise systems succeed when companies treat them as changes to how the business works, not as software installations, and the six requirements above were written with that in mind.

Contract Terms Worth Negotiating

Three terms in the subscription contract deserve attention before signing, because each becomes harder to change once the company depends on the platform. The first is data export. Harwood should be able to download all of its bookings, customers, items and condition records in a standard format at any time and at the end of the contract, without a fee; otherwise leaving the vendor later would mean losing the history the platform was bought to build. The second is renewal pricing. Subscription prices often rise at renewal, and a cap on annual increases, for example no more than five percent a year for the first three years, protects the three-year cost estimate above. The third is service availability during the season. The contract should state the vendor's uptime commitment and the credit owed if the system is unavailable on a weekend between May and October, when an outage would do the most harm.

References

Davenport, T. H. (2000). Mission critical: Realizing the promise of enterprise systems. Harvard Business School Press.

Markus, M. L., Axline, S., Petrie, D., & Tanis, C. (2000). Learning from adopters' experiences with ERP: Problems encountered and success achieved. Journal of Information Technology, 15(4), 245-265. https://doi.org/10.1080/02683960010008944

Umble, E. J., Haft, R. R., & Umble, M. M. (2003). Enterprise resource planning: Implementation procedures and critical success factors. European Journal of Operational Research, 146(2), 241-257. https://doi.org/10.1016/S0377-2217(02)00547-7