Bombardier’s ERP Implementation

Bombardier is a key player in the transportation industry. Not only is the company successful with their rail transportation but also their ventures into the aerospace industry. Bombardier even diversified into manufacturing civil and military aircraft and acquiring large organizations like Havilland Company from Boeing over its lifetime. Throughout the company’s existence, they have been committed to updating their legacy information system, the Bombardier Manufacturing System (BMS), which is based on a MACPAC platform. Although the system satisfied their business needs it was not evolving to changes and faced many challenges that needed improvement. The Vice-President of Operations and Project Sponsor had a vision of ingratiating the organization into one, “One Company.” The system, which was more of a business transformation than a technology implementation would share common data across sites and products using a single set of unified systems and processes. The transition became known as the BMIS Project which entailed an Enterprise Resource Planning (ERP) system. Bombardier’s first implementation failed and was discontinued mid-project in 2000 after $130 million was spent. The reasons that contributed to the first implementations failure were:

1. Focusing the implementation on inappropriate business processes
2. An outdated company vision
3. A weak sponsorship model
4. Insufficient involvement of internal employees
5. Too many third-party consultants

2001, one year after the first failed attempt of the ERP system implementation, a group of senior managers from Bombardier Aerospace’s Irish facilities established a new integrated manufacturing system. This project focused on a wider ERP strategy and the vision of “One Company,” an integrated organization. The system planned to support Bombardier’s Aerospace operation and focus on the processes that support manufacturing, procurement, finance and the engineering data required to support these processes. $363 million was the budgeted amount to implement the BMIS system across all facilities and it would support 9,500 users over seven sites. This implementation would require 400 people but if successful would result in $1.171 billion in savings for Bombardier and a one-time reduction of $219 million in material inventory. One primary objective for the BMIS implementation was that manual tasks would give their jobs a more analytical focus as it would reduce clerical tasks performed by the employees. This implementation would also reduce the amount of paper used which was an ultimate goal, being a paperless workplace.

The BMIS implementation was not seamless and contained challenges that could certainly aid the company in future implementations. For starters, an original thought during this implementation was the “to-be” processes designed by the project team that were presented to the relevant functional councils for approval. The intent for this was that the project would be organized according to processes but this was abandoned during the blueprint phase and was reverted to a functional organization. Learning from the past allows the company to not waste time on trial and error when for example, they already know the implementation would not be affective if organized according to processes. Other challenges that could be identified from the BMIS implementation and not repeated for any future implementations are:

1. Lack of communication as some managers made no effort to ensure employees were informed of the implantation progress even though the Senior Project Manager emphasized to the Business Process Managers that communication was 80% of their job during this implementation
2. Design workshops were held during the design phase to assist in the implantation of the ERP system but managers were unable to attend due to scheduling difficulties and pressure in the business environment (unrelated to the project)- this caused issued for the project team in confirming the appropriateness of their design decisions
3. Reluctance to take ownership during the design phase- managers were not committed 100% of the time
4. Absence of strong business employees who constancy had to go back to the business in order to validate their decisions
5. Hazy answers were received from the BMIS team when they were asked to provide documentation illustrating the high-level processes included in the system
6. Overlapping of the realization and integration testing activities because the design phase ran over schedule
7. Total acquisition costs not being considered when making purchasing decisions
8. Training
1. training material did not reflect an understanding of the business
2. not user friendly
3. descriptions and exercises were too detailed and difficult to follow
9. Going Live
1. ensured the August 4^th, 2004 deadline was not pushed back sacrificed the deployment as they were not ready
2. focusing on new roles and responsibilities rather than how to complete transactions
3. power users stayed on site temporarily however challenges began to surface months after implementation, after power users left the site
4. frustrated users when support staff could not solve their problems
5. continued use of legacy system
6. technical issues- Finance employees were making manual corrections to the general ledger if materials were issued incorrectly
7. delays in Bill of Materials
8. managers failed to use reporting functionality that was available in the system

Success factors and ideas of the ERP implementation that should be repeated for any future implementations are:

1. Implementing one plant at a time
2. A “vanilla” approach system design- minimal modifications or enhancement be made to processes in SAP
3. Procurement function- moving toward a policy of global strategic sourcing, eliminate all clerical activities, automate as many processes as possible and improve supplier compliance
4. Power users and super users made significant efforts to adapt the training material in order to bring it to satisfactory standard
1. internal training supplements
2. additional courses and training material provided
3. information focused on roles
5. After going live, at least one power user should always be available on site to act as a link between the business and technical support staff
6. Not disrupting production schedules

The BMIS implementation contributed to a reduction in inventories of $1.2 billion across Bombardier Aerospace less than one year after the Go Live. This demonstrates that even with a large amount of challenges the implementation can still be successful including the facts that the deadline was met, the project was below budget and the Bombardier Aerospace delivered one more plane than scheduled during the implementation process of BMIS. Executing the same ideas, applying the best practices and critiquing the challenges the company faced with the Mirabel implementation of BMIS, Bombardier can be even more effective in their next implementation.