A $900,000 update of a 20-year-old legacy system is returning early business benefits, but Sunny Queen Ltd warns ongoing maintenance costs can smash the new system enchantment.
Sunny Queen Ltd, Queensland's largest supplier of eggs and egg products, spent almost $900,000 on hardware and Oracle software.
Murray Clark, financial controller of Sunny Queen Ltd, said the company looked for a fully integrated software platform to "take us into the current millennium".
Sunny Queen went live with multiple modules of the Oracle E-Business Suite including Advanced Inbound, Advanced Outbound, Financials, Sales Analyzer, and order management, in addition to the Oracle Database using Oracle Consulting.
Clark said implementation began in July 2001 and Sunny Queen went live with inventory and sales in November, and with full financials in December 2001. "The sales analyser has been a huge benefit for us; instead of waiting three weeks for sales results, we can have sales information today," Clark said. However, organisations need to be aware of ongoing costs with such implementations.
"We need ongoing maintenance, which involves spending a few thousand dollars a month maintaining Oracle specialists. Oracle didn't make this clear," Clark said.
Sunny Queen, an unlisted public company, used the rollout to speed the first phase of a national expansion of its distribution network and now provides eggs and egg products to New South Wales and Victoria.
Roger Mychajlyk, Sunny Queen's managing director, said, "Becoming an e-business is critical to Sunny Queen's future success, as our customers, which are supermarket chains, are all headed in this direction.
"The egg industry traditionally has been conservative and a slow adopter of change. For a long time there has been a tendency for suppliers to focus only on the product and production issues.
"At Sunny Queen we think the future is in real-time business intelligence and logistic efficiency and an e-business solution is the only way to get there."
To help prepare the company for this fundamental change, a team of Sunny Queen employees visited the US to review of best practices in the industry at Rose Acre Farms, one of the world's biggest egg companies and another Oracle E-Business Suite customer.
"During our visit to Rose Acre Farms we realised that becoming an e-business would require not just a technology change, but a cultural one as well," Mychajlyk said.
During the visit to Rose Acre Farms, Clark said, "We found it was on an old version of Oracle and we learnt a lot of things not to do. We learnt that we had to do it 100 per cent the Oracle way, without alternations."
While there were a few teething problems, Clark said all is running well now though Sunny Queen had to get software written to interface with a third-party distribution provider.
If the implementation could be done differently, Clark said, the company would probably have chosen not to go live so close to Christmas, as it's Sunny Queen's busiest time of year.
"We did run into service problems with customers, but this wasn't Oracle's fault. Maybe it would have been better to do the implementation in February rather than December."
Clark said of necessity the company had to employ a contract project manager to ensure the project was delivered in the four-month timeframe.
But the business benefits are now being seen, Clark said.
"The main benefit is the efficiencies and processing of orders in the telesales area. We have been able to double the number of orders taken with the same amount of staff. As well as Queensland orders, we can now take orders and distribute for New South Wales and Victoria, which we couldn't do before.