Management Systems, Inc. (EMS). Moore had worked as
an engineer with the company for 7 years and then took a
leave for 2 years to get an MBA. The vice president of
manufacturing retired soon after Moore returned, and
Moore was promoted to that management position.
Moore supports the proposal that BMC install the
EMS Time Critical Manufacturing package consisting of
eight modules: shop floor control, EDI integration, inven-
tory management, factory data collection, standard rout-
ings, labor collection, engineered product configurator,
and general ledger. The purchase price of this software
package is $220,000, including documentation, training
by EMS, and consulting help during installation of the
software. The cost of a software maintenance contract is
$55,000 a year, and EMS will make limited changes
requested by BMC at a cost of $60 per hour.
The EMS software will run on several minicomput-
ers, including BMC’s Data General MV. However, addi-
tional computer capacity will be needed whether BMC
purchases the EMS package or builds its own manufac-
turing systems.
Moore’s Views
Moore is relatively new to the manufacturing area, having
taken over that area about a year ago, and was not involved
in the past attempts to purchase scheduling software.
Moore explained to Baxter that BMC should purchase the
EMS package for the following reasons:
We are still fudging our EDI and still scheduling
with a Lotus spreadsheet. The entire industry has
passed us by in our use of the computer in manufac-
turing and we are in danger of losing our reputation
as a world-class parts manufacturer. Both my MBA
studies and our experience with the new inventory
systems that Don has installed have convinced me
that computer systems can significantly enhance
our efficiency and improve our service to our
customers, but we can’t wait another 2 years to
complete home-grown manufacturing systems that
will still need to be upgraded before they are really
first class.
I have had extensive discussions with EMS
manufacturing specialists, read their literature, and
seen the proposed systems demonstrated, and am
convinced that the proposed system will do every-
thing that we will ever want to do. EMS has assured
me that there will be no problem integrating these
manufacturing modules with our existing financial
systems, and that we can be up and running with the
entire system in 6 months.446 Part III • Acquiring Information Systems
“Given that our MIS group is doing a good job de-
veloping new systems,” Baxter asked, “why should we
purchase the EMS package rather than build manufactur-
ing systems in-house?” Moore’s reply was:The time and cost differences between purchasing
and building are too significant to ignore: 6 months
to install this advanced system versus 2 years to
build our own basic system, and a firm $220,000 to
purchase this system versus over $400,000 to build
our own. These costs do not include new hardware,
but we will need to increase our capacity whether we
purchase or build our new systems.
Furthermore, we will get a high-quality
state-of-the-art system instead of a simple “first
try” system. EMS has sold this system to hundreds
of manufacturers, and thus has been able to spend
much more time and money developing it than we
could possibly afford. EMS has a large staff of
more creative and sophisticated programmers than
we can get, and EMS has gone through several
cycles of improvement of this system based upon
the experience of hundreds of users of the earlier
versions of the system.
It is true that the EMS system will not always
do things the way we currently do them. But is the
way we do them better than the way that is based on
the experience of hundreds of manufacturers? We
are always making changes in how we do things, so
it will not be difficult for us to make some changes to
conform to this new software, and I expect that these
changes will improve our operations.“We have not been successful in two tries to use pur-
chased software packages in the manufacturing area,”
Baxter noted. “What makes you think that we would be
successful this time?” Moore replied:There are a number of important differences this
time. First, in the past there was little ownership of
the new system by the factory people, but this time
I am the champion of the new system and my people
will make it work. Second, in the past the conversion
strategy was flawed—BMC tried to install schedul-
ing without having inventory data under control, but
this time we will go at it a module at a time in the
sequence that EMS has been very successful with in
many previous installations. Third, during the previ-
ous attempts we were pushing capacity and no
scheduling system was going to work when we were
having to expedite everything, but today capacity is
not a major problem and things are reasonably calm