Madras Cements, Ltd.

by: C.K. Prahalad, M.S. Krishnan

Publication Date: July 11, 2014
Length: 24 pages
Product ID#: 1-428-925

Core Disciplines: Information - Technology & Management, Strategy & Management

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Teaching Note

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A leading cement producer in southern India, Madras Cement is having trouble controlling costs due to its disorganized reporting processes. This case documents the company’s two attempts to resolve these issues with the implementation of an Enterprise Resource Planning (ERP) system. The company’s first attempt fails. After a company leader takes the bold step of admitting he made mistakes during this effort, Madras is ready to dig in and make the necessary changes to make the second attempt a success. The case initially seems to be about software implementation, but it is really a story about change management, transformation through transparency, business centric approaches, and the creation of a new social architecture. The company uses innovation to develop new processes that can ultimately be applied to other organizations, allowing the merger and acquisition process to begin.

Teaching Objectives

After reading and discussing the material, students should:

  • Identify the problems that organizations generally encounter during an ERP system implementation.
  • Indicate what went wrong with the first ERP implementation and explain how the company was successful in its second ERP attempt.
  • Develop strategies for getting employees on board with a new system that creates transparency into everything they do.
  • Explain how getting senior management buy-in is essential in a change management process.
  • Explore how getting buy-in from some middle managers creates acceptance in others.