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Supply Chain Information Technology by David L. Olson

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Chapter 5

System Selection

Installing supply chain management (SCM) systems, whether a stand-alone system or as a component of an enterprise resource planning (ERP) system, would seem to be a simple matter. After all, the software, while expensive, has been thoroughly tested by many customers. However, ERP implementations are consistently reported to have failure rates in excess of 60%.1 A business case should be a key part of the process of selecting the form of supply chain software for an organization. This chapter will demonstrate fundamental means of financial analysis and show how other methods can be used to consider other factors describing expected project performance.

Cost-benefit analysis seeks to identify accurate measures of benefits ...

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