Yongxin Paper Co., Ltd. 157Copyright © 2005, Idea Group Inc. Copying or distributing in print or electronic forms without writtenSETTING THE STAGE
ERP Implementation in China
As IT and world economy globalization continues to grow, China has gradually
become the world manufacturing center. Currently, one can find products made in China
all over the world. However, market competition is also becoming more and more fierce:
customer demands are constantly changing; the life span of products is becoming
shorter and shorter; technology innovation is accruing exceedingly; and the pressure
of globalization is increasing quickly (Chen & Zhou, 2002).
To compete, Chinese manufacturers need to find and implement modern manage-
ment skills to improve their level of management performance. Fortunately, the Chinese
government is aware of and has considerable concerns with the need to improve
enterprise information management. However, while ERP systems are a popular solution
to managing enterprise information, ERPs may not be the best choice for the Chinese
manufacturers to win the global markets. China has 20 years of experience with MRP¢ò/
ERP since Shenyang Machine Tool Co., Ltd bought the first MRP¢ò software from the
German Engineering Association (Xu, 2003). Unfortunately, ERP implementation results
have not met expectations. Many companies do not know the principles of ERP, which
leads to the huge waste of human resources, materials, and money. According to the
statistics from Andersen, about 1,000 projects have brought in the MRP¢ò/ERP system
since 1991 (Fritch & Cromwell, 2001). However, half of them have failed completely; about
30% to 40% have not attained systems integration; and only 10% to 20% have accom-
plished the expected objectives. Most of these projects were accomplished with invest-
ment from foreign funds.
ERP Implementation in Yongxin
As more and more Chinese manufacturers bring in foreign management skills,
Yongxin gradually recognized the importance of enterprise information management to
the future of the company. The general director, Zhang Wei, considered an innovative
and perspicacious person, was appointed to lead the management team to investigate,
select, and implement an ERP into the ensemble strategy accounts. Yongxin formed a
multisystem integrated management system, which is based on the computer webs and
ERP principles. The implementation of the system accelerated the coordination of the
business flow, cash flow, and information flow, and has enhanced Yongxin’s ensemble
management performance.
The general manager, Yin Jicai, is one of the main directors of ERP projects and has
participated in the whole process of ERP implementation. He graduated from the School
of Management in Jilin University of Technology in 1990, and then served in a variety
of positions: clerk in the Enterprise Management office, deputy director, and then
director in the branch factory of Yongxin. In 1997, he was appointed as the leader of the
Asset Management department. Then he was promoted to vice-general manager of
Yongxin Group in 2000. Finally, he became the general manager of Yongxin in 2003. As
one of the ERP system initiators, Mr. Yin has led top management in studying ERP
principles and knowledge since 1998. Additionally, he guided them in obtaining experi-