Move to Single Global ERP System No Easy Task

Users who plan to follow Oracle Corp.'s new road map for centralizing their global enterprise resource planning (ERP) systems on a single database server may have a lot of prep work to do first.

Just ask Millipore Corp.

The maker of water-filtration devices is one of the first users to sign on to install a single global ERP system that's supposed to be made possible by an Oracle application upgrade in the next few months.

The US$700 million manufacturer shifted its European operations from its own ERP server to one at company headquarters in Bedford, Massachusetts, two months ago, leaving only its Japanese unit on a separate system. Millipore executives this week said putting everything on the U.S. server should reduce data center costs and give end-users a unified view of the company's business.

But getting there won't be a simple task.

Proceeding With Caution

Millipore has already done heavy lifting on both the business and technology sides, and there's plenty more that needs to be done before the unified system can become a reality late this year.

The project team plans to tread carefully to try to make sure "that we're not selling something we can't deliver," said Michael Dapcic, manufacturing business systems manager at Millipore. "We have a very sensitive user base, and they're very unforgiving when it comes to response times."

Steps the company has already taken include a six-month effort to create a common accounting structure for Millipore's business units and an overhaul of the company's network infrastructure that was completed last month.

Still to come, Dapcic said, is a database upgrade, a switch from Oracle's green-screen applications to its Web-based software and heavy amounts of testing to gauge how well the centralized system will be able to handle end-user workloads.

Millipore has also assigned more than a half-dozen employees to spend 12 weeks helping Oracle's developers debug a new order management module that's part of the application upgrade needed to run a single global system.

"We're hoping we can get a much cleaner product than we usually do when it comes off the production line (at Oracle)," Dapcic said.

Inherent Risk

Millipore's goal is to test the unified system in the summer and go live with it by October, he said. The company wouldn't disclose how much the whole project is expected to cost.

The order management software is due in May, and the rest of Oracle's Release 11i upgrade is supposed to ship next month. Oracle originally promised the new ERP release would be ready last fall but then ran into delays.

Oracle last week said an 18-month project to put all of its internal operations on one Release 11i-based global system remains on track for completion by the end of this year.

But Lance Travis, an analyst at AMR Research Inc. in Boston, said he's skeptical that many users will follow Oracle's lead. "In theory, it sounds like a great idea," Travis said. "But there's a lot of risk."

For example, users with a single global system "can't take a sort of backwater operation and install new technology there to see if it works," he added. "It's all or nothing."

That's one of the reasons Millipore plans to move ahead cautiously, Dapcic said. Another big concern is how much its systems will be strained by switching to Oracle's graphical user interface, which is required with Release 11i.

Millipore beefed up its networks by installing new 3Com Corp. switches and doubling or even tripling much of its wide-area bandwidth. But the Web-based graphical interface "may change the picture again," said Ram Prabhu, Millipore's corporate telecommunications manager. "We don't have a good understanding of (its) bandwidth requirements."

To try to get a better idea, Millipore is taking yet another step: giving about one-third of the 300 heavy-duty ERP users in its manufacturing operations a Windows-based version of Oracle's software to start performance testing before Release 11i is available.

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