Identify and discuss the risks in Westinghouse Electric’s Cornerstone project.
- The company decided to update its older system to support new processes, configurations, and functionalities that related to the larger amount of business it was conducting. The company estimated that it would increase in size fourfold over the next few years. The program consisted of 40 different projects, and updating the SAP system was one of the largest. The goals were to convert all existing data that the company wanted to save, as well as add new functionalities that would help the company manage its imminent growth. It planned to add a new general ledger, a new enterprise reporting environment and implement a new Customer Relationship Management system.
Why was change management so important for this project and this company?
- The company ensured that every element of the project was motivated by a particular business driver or goal. It wanted to align three distinct operational regions into a single face in every customer location. The new system had to support the company’s plan to increase global hiring. By associating goals with each element of the project, Westinghouse was able to more precisely control the implementation of the new system.
- Using a change agent helped the company redefine configurations, interactions, job activities, and power relationships of various organizational groups. The change agent was also responsible for ensuring all parties involved accepted the changes created by a new system.
What management, organization, and technology issues had to be addressed by the Westinghouse project team?
- Management: The company was growing too fast for a slow implementation process. It had to release the new systems as soon as possible in order to recoup its return on investment sooner rather than later.
- Organization: A phased approach is much less risky even though it’s more expensive. The whole organization had to be ready to implement the new system as quickly as possible using the “big bang” method technically referred to as the “cutover” method. Power users were recruited from key parts of the organization to help ensure a smooth implementation. Specific project details were discussed with business unit leaders to gain their support for the new system.
- Technology: The supply chain was one of the area’s most likely to endure significant change since the company’s growth would add many new elements to the chain. The company created an automatic call distribution system and email system that routed users across all time zones to the employees ablest to answer their questions. The project team also set up a blog where users could share tips and solutions.
Should other companies use a “big-bang” implementation strategy
- When a new system needs to be implemented in an organization, there are three different ways to adopt this new system. The big bang adoption, phased adoption and parallel adoption. In case of parallel adoption, the old and new system are running parallel, so all the users can get used to the new system, and running parallel, so all the users can get used to the new system, and meanwhile do their work using the old system.
- Phased adoption means that the adoption will happen in several phases, so after each phase the system is a little nearer to be fully adopted. With the big bang adoption, the switch between using the old system and using the new system happens at one single date, the so-called instant changeover of the system. Everybody starts to use the new system at the same date and the old system will not be used anymore from that moment on.
- The big bang adoption type is riskier than other adoption types because there are fewer learning opportunities incorporated in the approach, so quite some preparation is needed to get to the big bang.
