i

Linnaeus University

Informatics/ DFM Date of delivery 2013-03-19

Program: Information systems in manufacturing companies

Revision no. and date:19/03/2013

Title: Parrot Case Company

Author(s): Serkan Alan,

Ludovic Mathieu,

Fatih Topaloglu,

Mikael Sonesson

Course: 1SE004

Teacher:/tutor: Ia Williamsson

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Acknowledgement

We would like to thank our teachers Ia Williamsson, Anders Ingwald and Mirka Kans

who helped and supported us during we were writing this report. Moreover they gave us

necessary information in lectures.

Summary

In this paper we define IT system for big company. During this definition first we

decided requirements for IT system by using empirical findings about The Parrot

Manufacturing Corporation. Then we did the research about theories that we were

planning to use. In analyzing part we motivate our suggestions to the company

according to theories. We support how IT system can help and make easy to run and

control a company. Especially we focused on advantages of IT systems in big

companies because The Parrot Manufacturing Corporation is a worldwide company. For

motivate theories, we used functions of IT systems and described their useful ways for

companies.

In result part we compare our theory and empirical findings then present our solutions

for The Parrot Manufacturing Corporation. We support our suggestions with different

management levels and Porter’s Value Chain. In conclusion part we discuss our solution

with positive and negative ways.

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Table of content

1 Introduction ................................................................................ 1

1.1 Background .......................................................................................... 1 1.2 Task/Problem ........................................................................................ 1

1.3 Case Company ...................................................................................... 1

2 Method ....................................................................................... 2

3 Theory ........................................................................................ 2

3.1 Enterprise Resource Planning ................................................................. 2

3.2 Material Requirements Planning ............................................................. 3

3.3 Customer relationship management ......................................................... 4

3.4 Human Resource Management ............................................................... 4

3.5 Decision Support System ....................................................................... 4

3.6 Electronic Data Interchange .................................................................... 4 3.7 Computer Aided Design/ Computer Assisted Machining ........................... 5 3.8 Security ................................................................................................ 5

3.9 Intranet................................................................................................. 6 3.10 Network ............................................................................................... 6

3.11 Porters Value Chain ............................................................................... 6

4 Empirical Findings ...................................................................... 7

5 Analysis ...................................................................................... 7

5.1 IT Requirements for Company ................................................................ 7 5.2 ERP ..................................................................................................... 7

5.3 MRP .................................................................................................... 8

5.4 CRM .................................................................................................... 8

5.5 HRM ................................................................................................... 8

5.6 DSS ..................................................................................................... 8

5.7 EDI ...................................................................................................... 8

5.8 CAD/CAM ........................................................................................... 9 5.9 Security ................................................................................................ 9

5.10 Intranet................................................................................................. 9

5.11 Network ............................................................................................... 9

6 Results ...................................................................................... 10

7 Conclusion ................................................................................ 10

References ...................................................................................... 11

Appendix ........................................................................................ 12

Appendix – 1 Empirical Findings .................................................................... 12 Appendix – 2 Company Locations Map ........................................................... 14

1

1 Introduction

Under introduction topic we will present background of the report and report’s task.

1.1 Background

The purpose of this report is to understand the importance of IT systems for companies

especially for worldwide companies. We will show you how IT systems make easier

controlling and running a company. IT system is important for companies. As mentioned

below IT systems are useful and it helps to race with their competitors.

Internal strategic integration requires that all employees have access to an integrated

information system, which has a number of functions and different locations. To solve this is

a company wide ERP often used that can link internal groups through a single integrated

system. External integration refers to the systems that link external suppliers and customers to

the focal company. In this a case can external integration allows all supply chain members to

share critical information. It could be a forecast demand or maybe an actual order. Supply

chain systems like advanced planning systems, Internet linkages, network communications,

and Electronic Data Interchange (EDI) are used to integrate users.

1.2 Task/Problem

Our task for this report is according to provided company information, describe the IT system

for The Parrot Manufacturing Cooperation and motivate why we choose this IT system.

Furthermore, describe IT system for strategic advantages. We have three main questions for

guiding us during the report, which are;

Describe IT systems we will establish, including communication systems and

networks. We will try to make reader understand why we propose these IT systems to

Parrot Corporation.

Describe IT security in Parrot Corporation; how they deal with security threats.

Describe how IT can be used in the Parrot Corporation to gain competitive advantages

and motivate this.

1.3 Case Company

The Parrot Manufacturing Corporation was originally a family owned, small-sized company.

It is founded in 1899 as a screwdriver factory with only five employees. They always focused

on improving their selves. They began to produce metal balls for rolling bearings which were

used in the bicycle industry in 1910. They got leading position of the worldwide market with

these rolling bearings. To meet customer demands in the 1970s they expanded their

production which includes shackles for padlocks. In the late 1980s, the Parrot Manufacturing

Corporation expanded a second time with a new line of bolts for padlocks. In 2000 they

expanded again to the complete range of padlocks.

Today Parrot has more than 20000 employees worldwide and market leader offering

consistent value throughout their entire line. They are devoted to work closely with

development industry to follow new technology and provide a full range of products to meet

their needs.

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2 Method

We used information provided by our teachers. For collecting theories we done some research

on related books and databases on the internet to find related scientific articles which were we

used to create our theory.

3 Theory

3.1 Enterprise Resource Planning

Enterprise Resource Planning (ERP) systems are computer based systems which are

integrated and have the ability of agile reconfiguration to adapt the changes to customer

response. According to Wang and Zhan (2006), ERP is a powerful tool which supports daily

management activities and also ERP is not simple software, it is integrated software systems

which is oriented with data and with other software. The aim of ERP is mainly making easy

the information flow between almost all business functions also managing the stakeholders

and customers. Daniel (2007) identified usual ERP system characteristics which are presented

below.

ERP systems are packaged software which is designed for the customer environment.

ERP systems integrate with business process dynamics.

The ERP systems process has mainly included almost whole organization’s

transactions.

Enterprise-wide database is used by ERP systems

ERP systems allow the access and edit information in real time.

ERP systems mainly support the multiple languages which is mainly important for

multinational companies.

Support for specific and different industries.

Most of them have ability to be customized without programming.

Brief History of ERP

In the 1960’s cost was one of the most important subjects for companies because

manufacturing strategies are based on high-volume production and cost minimization.

According to Jacobs (2007), companies used computerized reorder point (ROP) systems

including order quantity of satisfied basic manufacturing planning control needs. ERP was

born in late 1960’s by the help of J.I Case and IBM partnership. Jacobs (2007) claims that in

the 1970’s initial MRP solutions were big but expensive and also they required large technical

staff to support computers. At that time “database” were not in the vocabulary. In the mid

1970’s SAP (System analyze und Programmentwicklung) was born in Germany and became

key ERP vendor later. In the 1980’s the term of MRP use of the phrase manufacturing

resource planning rather than material requirements planning. The term enterprise resource

planning (ERP) was coined in the early 1990’s by Gartner Group (Wylie, 1990) but the first

ERP systems do not include the automatic interfaces between operational activities and the

accounting transactions. Jacobs (2007) argue that today ERP systems are more integrated and

support many modules rather than before. Also there are so many ERP vendors.

Enterprise Resource Planning systems can include so many functions. These functions are

usually gathered in software application which includes modules. ERP software can consist of

very different modules and packages. Common functions are in the same modules.

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Figure 3.1 Order management process (Daniel, 2007, p.36).

A figure of SAP’s order management process is presented above. As you can see some

modules of SAP are integrated with each other. Only one process of companies can need three

or more modules and different functions. The order management process needs sales and

distribution, production planning, materials management, financial functions. Integrated

software makes transactions easier.

3.2 Material Requirements Planning

Material Requirements Planning (MRP) is a tool for calculations of net requirements of raw

materials or components to be manufactured or purchased. It is a tool for long-term planning

to manage automatically production orders launches or control.

Table 3.1 Example of MP table (own picture).

This tool is in the form of a table with multiple lines. Here is an example:

- The first line is just to count units of time that we use.

- Gross requirement is the quantity of the product you need for each unit of time.

- Project available balance is the quantity of the product that you have before starting the

production.

- Stock is the quantity of the product that you have in stock at the end of each unit of time.

- Net requirement is the quantity of the product that you need based on your stock, the project

available balance and the gross requirement.

(Net requirement = Stockn-1 + Project available balance – Gross requirement)

- Reception is the quantity of a product you receive after an order.

- Planed order released is the beginning of the production in order for you to receive this

production in time.

1 2 3

Stock

Week

Gross requirement

Project available balance

Net requirement

Reception

Planed order released

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MRP is one of the most important tools for companies who have some production line

because it allows to plan the product order based on the demand, and to minimize inventory

costs.

3.3 Customer relationship management

Customer relationship management (CRM) is a model for managing a company’s interactions

with current and future customers who intends to provide technological solutions which could

make it possible to strengthen the communication between the company and the client. It

involves developing technology to organize and synchronize sales, marketing, customer

service and technical support in order to improve the relation with the client through an

atomization of the different components of this relation.

3.4 Human Resource Management

Human Resource Management (HRM) is a key function for the proper functioning of a

company. It takes care of the human aspect of a company by focusing on recruitment,

management and providing direction for the people who work in the organization. For that,

people who work in HRM deals with issues related to people such as safety, compensation,

hiring and wellness of the employees, communication, benefits, employee motivation,

administration and training.

HRM is also a comprehensive and strategic approach to managing people in the workplace.

An effective HRM system should be able to make employees contribute productively and

effectively to the overall company direction and the accomplishment of the organization's

goals and objectives.

3.5 Decision Support System

Decision Support System (DSS) should provide computerized support complex non-routine

and in part structured decisions. Because of the complexity of a supply chain will the

development of DSS be able to assist decision-makers when designing operations of

integrated supply chain. DSS can aid management to find opportunities for improvements

across the supply chain. DSS will also let peoples to look at relationships and performance

crosswise of the supply chain and to include “suppliers, manufacturing plants, distribution

centers, transportation options, product demand, relationships among product families, and a

host of other factors to optimize supply chain performance” (Handfield and Nichols, 2007,

p.108).

3.6 Electronic Data Interchange

Electronic data interchange (EDI) could be seen as intercompany trading, specifically the

exchange of business documents. EDI technology needs a third party (a value-added network

supplier or VANS) in order for information flow to happen, it can reduce costs and make so

that business partners can exchange business documents like orders, invoices and price lists.

(Handfield and Nichols, 2007). In the following figure we can see strategic information

systems and the context they are in and where the role of IS/IT is changing.

• Traditional EDI is about different standards and often is the outcome an expensive “hard-

coded” technology driven by the consumer goods industry; where partners either will

participate or not.

• The EDI can be seen as secure, but due to that there are many different versions of the

software it can happen that transmission errors will occur.

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Table 3.2 The information system management environment (Handfield and Nichols, 2007,

p.34).

3.7 Computer Aided Design/ Computer Assisted Machining

CAD/CAM is an acronym for (C)omputer (A)ided (D)esign / (C)omputer (A)ssisted

(M)achining. One use computers aiding the design of objects in real space. Tasks will be

faster than normally compared to when using paper, pencil, or a calculator, CAD was from

the beginning used to take care of the following issues:

1. Increase the precision of the drawings.

2. Reduce the man hours involved with design.

3. Reduce the cost of drawing blueprints.

The acronym CAM stands for (Computer Assisted Machining) used in a number of

manufacturing companies, but it can also be used in auto mechanics and even in food

processing plants. One of its features is the performance of making no mistakes and the

elimination of almost all errors made by humans (Jean Larrivee Guitar Inc, 2009). “CAM

software systems promote many product features, like high-speed machining technologies,

multi-axis machining, collision detection and simulation tools” (Alan, 2006). CAD/CAM can

increased productivity and reduce Lead times (MoldMaking Technology, 2012)

3.8 Security

In a big company like Parrot who is leader on the market and active in a lot of countries

around the world, having a security system is absolutely mandatory. Reasons are simple: they

receive orders from different customers every day and these orders include a lot of sensitive

and private data about the customers saved in database. That's why protecting information

about customers is necessary. For that, hackers often try to insert some virus in databases.

That's why a firewall protection and a virus detection system are required to prevent

accidental or malicious damage. To prevent all the internal or external threats they face, a big

company like Parrot have to protect their IT on the physical, technical and organizational

level to keep their data and server safe. And for an optimal protection, which each of these

levels should support at least these 4 aspects of a protection: Preventing, Discovering,

Limiting and Restoring. Preventing is about preventing that a problem happens, not correct it.

All is done in order to stop a threat before it damages your system or your data.

Discovering is about finding that there is a problem, an intrusion or anything like that and

then prevents it. These kinds of systems are implemented to detect any intrusion or threat and

avert you in order to preserve your systems. It discovers the threat and advert you before any

damage.

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Limiting a threat is when despite all the protection implemented, some virus or anything else

comes to penetrate your system. Then you have to protect as much data as possible and limit

the impact of this virus. These kinds of systems are developed in order to minimize the impact

of a threat on your IT-system. Restoring is to restore your data, correct any problem and

recover as much data as possible after a threat happens. Your system has to be run again just

like it was before the threat happens.

3.9 Intranet

An intranet will involve an organization using internet technology. If an organization is using

an Intranet then it should actually lower costs that are connected to printing and paper

handling and which should increase organizational capacity independently from external

reason. Normally is an intranet connected to the Internet through a firewall and is supported

by a LAN or a WAN and is run as a private network (Beynon-Davies, 2002). Intranet can be

seen as an important today much due to the interest of B2B and its evolution (Handfield and

Nichols, 2007).

3.10 Network

In a network there are computers that are connected in a system and they are sharing

information and resources such as data, programs and results. Either a connection could be a

peer-to-peer or client/server based. In a network one could enhance important features for

business like: Response time, Decision-making, Strategic alliances and Safety security

(FunctionX, 2012; Williamsson, 2013.).

Figure 3.2 Network connections ( own picture)

3.11 Porters Value Chain

Porter’s value chain is template which focused on customers and also includes organisation’s

key processes. In Porter’s value chain organizations are defined as social institutions which

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deliver value to customers through defined activities. These activities separated in two groups

which are product and service. Group’s subtitles presented below in figure 5.

Figure 3.3 Firms’s value chain (Beynon-Davies, 2002, p.248)

4 Empirical Findings

Empirical findings about The Parrot Manufacturing Corporation are presented in appendix 1.

5 Analysis

5.1 IT Requirements for Company

The Parrot Manufacturing Corporation is a big company which is found all around the world.

Communication and data transfer is some of the most important requirements. According to

the IT system for this company, the IT system needs some requirements which are presented

below.

First and most important requirement is strong communications among the users. Because the

company is worldwide which means they have lots of offices with long distances. Secondly

the Parrot is a manufacturing company. It means they need an all-inclusive IT system about

manufacturing. This system has to support material requirement planning, supply chain

management, product management system, support preventive maintenance and product

development support functions. Supply chain management has to include warehouse

management, purchase management, and logistics activities. Besides the manufacturing

requirements, the company needs financial activities, customer relationship management,

human resources functions, decision support systems (DSS) and security for company data to

provide continuance for the company. Financial activities have to include mainly billing,

purchasing and accounting. Customer relationship management has to include sales contract

management, marketing management and also integration with customer contacts.

5.2 ERP

According to theory part which is written above, ERP is the main IT system for big

companies. That is why we choose ERP as a main IT system. ERP software consists of

different modules which each of them have so many different functions such as warehouse

management, shipping and receiving, manufacturing scheduling, marketing management,

purchasing. These functions help us to control daily management activities.

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We decided to use same ERP system in all company offices. This gives the company some

advantages like that when they use same ERP system, everyone can see and edit real time

data. Also everyone can see other’s inventory level which provides the unnecessary orders.

5.3 MRP

MRP is one of the most important tools for companies who have some production line

because it allows to plan the product order based on the demand, and to minimize inventory

costs.

The Parrot company products have been developed over the years. At the beginning, they

only made metal balls for rolling bearings but today their production is expanded and they

produce complete padlocks which include shackles and bolts. Moreover, they are leader on

their market. To meet demand of their customers, production consists of small series and mass

production at the same time which requires a flexible production system.

That's why an MRP system is essential for this company, to plan and manage all their

production line, minimize the cost to stay competitive and dominate the market, and adapt

their production to the demand as fast as possible.

5.4 CRM

The Parrot brand name and what it stands for has assumed a growing role in distinguishing

Parrot from its competitors. For this, and to stay leader on the market, Parrot provides an

exceptional service for each customer.

In order to respect this commitment, continue to expand and keep his notoriety, Parrot has to

provide themselves with a CRM system who should be as efficient as possible.

5.5 HRM

The Parrot Company started their activities with only 5 employees but today, they have more

than 20 000 employees worldwide and they are continually expanding.

Managing more than 20 000 employees cannot be done without an appropriate HRM system.

Moreover, Parrot has many skilled workers and takes care of their innovative education. To

manage and use these information as efficiently as possible especially for their global

educational program, the HRM system that they use has to be really efficient and complete.

5.6 DSS

DSS is needed in the company because it will support decision making made by top

management in Stockholm. When using DSS managers will get the big picture about the

company from the DSS system which brings together all important information in one place.

This will make it easier for decision makers to overlook and make important decisions about

where to go by judging from the information available by the DSS. As we can see in the

strategic part DSS application will support both external- and internal integration. Further will

DSS be important in the company because the different locations are wide spread and can be

found on different continents. Using DSS as support are important in globalized world for

pursuit of cost effective strategic management.

5.7 EDI

EDI is an expensive solution but it can improve communication in the supply channel. One

issue when it comes to EDI is that there are different standards but this has been much

improved during the past decades. There are cheaper solutions like Web EDI if a supplier

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can’t afford a full EDI. The best features with EDI are that it will be much easier to take care

of orders, making it more probably to deliver just in time (JIT). Other functions involved in

EDI that should be used in the company are features involving invoices, stock, delivery and

orders.

5.8 CAD/CAM

The Parrot is a company that has an innovative characteristic. They always want to develop

their products. They also have a special research and development (R&D) center in Toronto.

CAD has a big role to product development because it makes design process faster. Designers

do not have to draw their designs by hand, instead they make their design on computer,

almost without any calculations CAD software makes calculations automatically. Developing

process is not just about drawings it also includes prototypes. CAM software makes program

for auto machines which is used to produce prototypes. CAM system can also be used in

normal production instead of just product development, to make it faster.

5.9 Security

As we said a big company like Parrot, leader on the market and active worldwide, must have a

very powerful security system, this is absolutely mandatory. Parrot is a worldwide group who

receives orders from different customer every day. These orders include a lot of sensitive and

private data about the company and the customer who are saved in database. In order to

maintain mutual trust between clients and themselves, they have to do their best to keep all

information secure. Moreover, Parrot is an innovative company. They invest a lot in R&D to

develop new products or new technologies. Keeping secure all this research should be a

priority otherwise it might be a huge waste of money.

To improve the security of their IT systems and databases, Parrot could establish some

solutions that could provide better safety. To prevent that a problem happens, discover a

problem or a threat, limit their impact and restore all the data loose, there are some solution

that could be used like give to each employees who are using a computer a login and a

password, and maybe change the password every month. In this way, company could monitor

each employee’s activity and have a better protection of everyone's work. And then IT

department could manage to use encryption and block some important file to non-qualified

employees, and communicate only the useful information to people who needs it. In this way,

everybody is responsible for the information s/he uses and the work s/he does. Moreover,

even with this kind of protection people could still make some errors and problem could

happen that's why using a strong antivirus is required in this case. And a good firewall have to

be used because we choose to use an intranet and to intercept and examine each message

packet passing between the external and the internal networks, and then reject any

unauthorized messages, a firewall is required. In this case, data can't go out from the intranet.

5.10 Intranet

An Intranet is used in the company for reasons such as enhancing collaboration and

innovation. An intranet is also an assist if management wants to share or spread information

fast within the company. Information could be an annual report or weekly reports about the

company. It will also provide easy access and information about employees. Further it can

improve relationship with clients like suppliers having limited access to the intranet.

5.11 Network

In the network of this company a wide variety of different systems are used in an effort of

satisfying customer’s needs. Further will the company amongst others be able to enhance

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communication if using and integrated network. The Parrot will be able to satisfy customer

needs and requirements in a much faster way. Control of inventory and reports can be spread

among different stakeholders. Further connection to suppliers can be established through EDI

or other forms of connective systems. If succeeding in integrating all the systems as a whole

taking advantage of the network the organization could excel in the market and be in the front

of competitors.

6 Results

As a result, we define IT system for The Parrot according to combine theory and empirical

findings. In the analyze part we motivated our theories to define IT system which meets needs

of The Parrot. We suggested using an IT system to The Parrot because IT system has some

positive impact like to be more efficient and to be more effective. Efficiency provides a

company the opportunity to get more output with same resources or same output with fewer

resources. To be more effectiveness provides company to do right things.

For The Parrot we suggested integrated IT system with all modules. During the analyze we

considered all three levels of organization which are strategic level, tactical level and

operational level. These levels help to consider the whole organization. We suggested using

integrated ERP system as the main IT system to connect all three levels. Strategic level

includes ERP, MRP, CRM and HRM. Tactical level includes DSS and operational level

includes EDI, CAD-CAM. When we discuss about analyze part, we got ideas from Porter’s

Value Chain figure which focus on customers and formulates the whole picture of the

organization in a clear way.

7 Conclusion

Throughout the report, many suggestions have made. It is important to notice that all

suggestions are motivated in analyze part. Integrated ERP is suggested for The Parrot

manufacturing company, this IT system can make it easier communication and almost whole

transactions of company. Also an IT infrastructure supports its business strategy. IT provides

24x7 network visibility. The Parrot is worldwide company and there are time differences

between factories and head office. Thanks to IT The Parrot can always reach the data in real

time. The most important disadvantage of using IT is the costs it can be so expensive and

cause more money loss during its usage like maintenance costs. But The Parrot is big

company and can afford the costs of using and buying an IT system also getting used to using

IT system can take time. The advantage of using IT outweighs the disadvantages. In order to

facilitate the supply chain the Parrot Company is also using both Web EDI and a more

advanced EDI so that communication and information could be taken care of supporting Just

In Time (JIT). There is an effort off being in the frontline in the market place. Thus The

Parrot has also incorporated DSS so that management could make decisions accordingly. As

in all organisations are communication also an important part at The Parrot. To strengthen the

social relationship amongst workers within the entire organisation an Intranet is used. An

Intranet can enhance collaboration and innovation, making it easier for management to reach

out to all employees of the organisation.

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References

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cad-cam>[Accessed 14 March 2013].

Beynon-Davies, P. 2002. Information Systems An introduction to Informatics in Organization.

New York: Palgrave Macmillan.

Handfield, R.B. and Nichols Jr, E.L., 2007. Supply Chain Redesign – Transforming Supply

Chains Into Integrated Value System. Upper Saddle River: Prentice Hall PTR.

FunctionX, 2012. Computer Networking. [online] Available at:<

http://www.functionx.com/networking/index.htm>[Accessed 14 March 2012].

Jacobs, F. R., 2007. Enterprise resource planning (erp) – A briefly history. United States:

Kelley School of Business, Indiana University,

Jean Larrivee Guitar Inc, 2009. EDUCATION. [online] Available

at:<http://www.larrivee.com/features/cadcam.php>[Accessed 24 January 2013].

MoldMaking Technology, 2012, [online] Available at:< http://www.moldmakingtechnology.com/products/cadcam-for-increased-

productivity-reduced-leadtimes>[Accessed 14 March 2013].

O’Leary, D. E., 2007. Enterprise Resource Planning Systems. New York: Cambridge

University Press.

Wang, Z, Xu, X, and Zhan, D 2006, Component reuse based agile reconfiguration for

Enterprise Resource Planning (ERP) systems in manufacturing enterprises.

International Journal of Production Research. Vol. 44, No. 23, 2006, pp. 5107-

5129.

Williamsson, I., 2013. Lecture2 Networks 1SE004. Linnaeus University, unpublished.

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Appendix

Appendix – 1 Empirical Findings

Tradition of Innovation

Since they founded they always care about innovation. They always try to improve their

selves with following new technology. They have their own design and testing departments

and they call themselves state-of-the-art. Innovative design is only one part of a successful

new product equation. Parrot’s management has committed the necessary resources to ensure

that manufacturing equipment and process are also state-of-the-art

Parrot sells parrot products to satisfied customers

The Parrot as a brand name has assumed a growing role in distinguishing compare to their

competitors. The Parrot as a brand also say their customers to what they can expect such as

innovative products, solid value and exceptional service for each customer.

Parrot Location

Today Parrot has more than 20000 employees all around the world. These employees work

different countries. Parrot’s head office is located in Stockholm-Sweden. In head office;

managers executive the company, make strategic and tactic decisions. They have factories in

different countries such as Stockholm-Sweden, Toronto-Canada, Odense-Denmark and Lima-

Peru. They have one special office to connect each factory. Each factory has high

technological equipment for manufacturing and for managing the administrative work. When

they are working on new product, they make design and testing adjacent building of Toronto

factory. They do not have any manufacturing in USA but their main storage is located in

Baltimore-USA with small office.

Parrot Quality Policy

Everyone at Parrot works together as a team to achieve company goals which are be the best

in manufacturing and marketing and be chosen supplier by customers. Parrot Manufacturing

Corporation must be certain of that the products;

Are designed for their intended purpose

Are correctly made

Are of the highest quality

Are readily available so that their customers’ orders can be shipped promptly

Quality Assurance for the Future

In 1998, Parrot was certified to the ISO-9001 Quality System standard. The significance of

ISO certifications; first, documentation of the operating procedures has to provide the

operations to be more efficient. Second, certification give guarantee to all customers that the

quality standards are among the best in the world. To keep these quality standards, Parrot has

three auditors who are certified ISO-9001 Quality Management System, on staff. Also they

have semi-annual independent audits.

Distribution

Parrot use JIT (Just In Time) for their most important customers. Also The Parrot

Manufacturing Corporation has their own logistics management. They do not have any

agreement with any logistic companies, they carries out the logistics management themselves.

The main storage is located in Baltimore-USA and has an automated high-storage.

Production

They need flexible production system because of their production consists of small series and

mass production at the same time. Parrot cares about maintenance to keep production

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continuance. Also they have skilled workers. By using information and communication

techniques, Parrot can run a global education program with this program Parrot gives

innovative education to all workers. Moreover, Parrot has on-line monitoring to support

preventive maintenance. With on-line monitoring they can see possible problems and fix them

before they occur.

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Appendix – 2 Company Locations Map

Head office

There is one office in connection to each factory.

Stockholm, Sweden – executives make strategic and tactical decisions.

Factories

Stockholm, Sweden

Toronto, Canada: The design and testing and development of new products are mainly

done in a building of the Toronto factory.

Odense, Denmark

Lima, Peru.

The main storage

Baltimore, USA, but there is no manufacturing in the country, just a small office.