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Boeing Australia Limited: Assessing the Merits of Implementing a Sophisticated e-Procurement System    
 
Product Ref: 03/170C Company: Boeing Australia Limited

Product Type: Case Industry: Capital Goods

Related Product(s): Teaching Note
Formed in late 1996, Boeing Australia Limited (BAL) was a relatively new company and a global extension of the US firm, The Boeing Company. BAL developed capabilities in the areas of space and communications, site management, and the upgrade and maintenance of military aircraft and equipment. As BAL grew, so did the legacy information system it used for both internal communications and external dealings with customers. BAL, however, faced difficult decisions as it sought to upgrade its procurement systems and processes to improve operations. In early 1999, BAL recruited a new National Procurement Manager, Russell Menere, whose immediate task was to look for gains in productivity by improving procurement processes, either through cost savings or by reduced processing time. To meet this objective, Russell initiated a number of short-term improvements. These included the rationalisation of a large number of BAL's suppliers, improving BAL's relationships with its key suppliers, the introduction of a credit-card purchasing system for low-value, large-volume consumables, and the adoption of electronic ordering processes with BAL's larger suppliers. In 2002, with new opportunities available through e-business technology, Russell needed to decide what BAL's next step should be. Should BAL invest in a new system that would simplify the procurement process across different divisions and support complex interfaces with suppliers? Alternatively, should Russell recommend that BAL continue to sit on the fence and seek short-term improvement tools for integration with its existing legacy systems? Could BAL afford to wait, given that the main requirement of its major customer, the Australian Defence Force (ADF), was timely information in support of military readiness and the national security of Australia?
Functional Area : Accounting & Control
Management of Information Systems

Issues: e-Procurement Strategy, Partners' Relationships, Upgrading Internal Systems, Reverse Auctions in Market Place
Length: 15 pages Country: Australia

Pub. Year: 2003 Level of Difficulty: 1
         
This product type is available in the following language(s):      English   Simplified Chinese   Spanish
         
Related Information: http://www.boeing.com.au
 
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