Riordan Systems: Evaluation And Recommendation

Riordan Systems: Evaluation and Recommendation

Riordan Manufacturing has been and will continue to be a leader in the manufacturing of plastics using polymer injection molding. We will continue to maintain this standard of excellence by maintaining our ISO 9000 certification and providing continuing excellence in quality assurance and innovation. Over the next two years, a plan to increase our revenue from $46 million to $50 million will be implemented. To achieve this goal, existing business systems have been reviewed and changes have been made where needed. We have taken into account the recommendations made by each department in establishing these changes and feel that each department will benefit from these changes.

Sales and Marketing Department

All of the sales to past customers have been annotated using written methods. Riordan has requested that all past sales records, made up of diverse databases, paper files and microfiche be inputted into a Customer Relationship Management (CRM) system. The information recorded in these records is largely made up of information that can easily be entered into a CRM database for easy distribution and reproduction between departments. The CRM package will also benefit Riordan by providing the customers access to a front end server (extranet), to be able to create accounts, check account status, pay bills and place orders. Having a single CRM database will provide sales personnel or customer service representatives with the ability to quickly check customer accounting information without having to search through various paper work, microfiche and out of date or inadequate databases. Internally, employees will be able to keep track of various vendors who have a proven track record of discounts, reliable shipping and product innovation.

In the past, individual sales employees have managed customer records, and no standard of data recording has been established. Operating in this manner doesn't allow for a cohesive sales team, which is going to be critical for the new team selling approach being implemented by Riordan. A standardization and consolidation of customer records needs to be implemented for the sales team to be more successful in the future. The CRM will consolidate the sales team into one unit rather than individuals servicing specific accounts. Customer relations will be proficient due to the ability of multiple sales personnel being able to acquire and update account information rather than a single person maintaining individual account records. Not to mention when a sales person is not available due to health, personal issues or vacation, another employee will be able to provide information and support for the customer.

To implement this CRM system many files will have to be scanned or manually entered into the database. There has been a recommendation made to hire a part-time college student to scan these documents ("Sales", 2005). The implementation of the CRM system is being treated as time sensitive to take full advantage of the sales plan for 2007. There are two disadvantages to hiring a college student to fulfill this task. First, college students maintain a schedule that does not allow for predictable work patterns due to course work and social activities. Being that this project is of a time sensitive nature, allocating personnel from another department is a preferred method to accomplish this task. Second, the information contained in these documents is of a sensitive nature and proprietary to Riordan Manufacturing. Unless the employee signs a non disclosure act and is fully aware of the consequences of using the information contained in these documents outside the company, the company is at risk of compromising proprietary information contained in these documents.

Finance and Accounting Department

There are currently three locations Albany, Georgia, San Jose, California and Pontiac, Michigan that contribute to the finance and accounting of Riordan Manufacturing. All three of these locations have different methods and platforms for reporting that are incompatible with one another. According to Riordan internal website, "San Jose [, California] has a license for a fully integrated Windows based [Enterprise Resource Planning] ERP manufacturing, distribution and financial management software application specifically designed for plastics processors and process and assembly manufacturers. The license does not include application source code" ("Finance", 2005). The Pontiac, Michigan and Albany, Georgia sites are using outdated systems and unsupported software. For example, Pontiac, Michigan is using terminals to connect to Virtual Memory Systems (VMS), as well as, VAX400 servers that were widely used in the early 1980's. Using these systems has led to a waste of resources in time and money by re-entering and converting data so that Finance and Accounting can create their reports at the corporate office in San Jose.

Riordan will migrate into using the newest system contained in all three sites. In this case Pontiac, Michigan and Albany, Georgia will incorporate San Jose's ERP software as well as upgrade to windows systems. Since the source code is needed in the Pontiac, Michigan and Albany, Georgia sites, our recommendation is for Riordan to purchase the source code for San Jose's ERP software to incorporate changes needed at these two locations. In some cases a modern UNIX system will be used for development by installing Exceed, a terminal X software that will allow windows based systems the ability to log into UNIX systems remotely. This will help Riordan incorporate ISO 9000 needs and move the company into the future. Not to mention that the ERP software will allow easier business management in finance and accounting due to merging data company-wide. Managers will be able to quickly glance at accounting information, such as sale trends and base executive decisions based on these choices.

Government compliance is a top priority for the Finance and Accounting department and as such, Riordan needs to adhere to the new reporting requirements within a timely manner. Along with meeting the requirements for the government and monthly audits, the F & A department is having difficulty meeting the needs of the corporation due to a lack of time and personnel. This problem is the result of valuable time spent needlessly compiling and re-entering data that could be avoided if all three locations had the same F & A reporting system and procedures.

A new software suite is recommended to establish a common output of data that can be easily transferred and recorded at the corporate office. There is currently a plan for a complete system upgrade that will cost $1,350,000 to be paid over a