Summary: Riordan Manufacturing

Running Head: RIORDAN MANUFACTURING INC MANAGEMENT REPORT

Riordan Manufacturing, Inc.
Management Report
University of Phoenix
Systems Analysis and Development CMGT/555
April 27, 2009

History and Background
Riordan Manufacturing, Inc. (Riordan) was founded by Dr. Riordan, a professor of chemistry, who had obtained several patents relative to processing polymers into high tensile strength plastic substrates. Sensing the commercial applications for his patents, Dr. Riordan started Riordan Plastics, Inc. in 1991. Initially, the company's focus was on research and development and the licensing of its existing patents. (Apollo Group, 2006) However, in early 1992, Dr. Riordan, faced with high demand and short supply for the patented
plastic substrates and desiring to lower unit costs, decided to expand into manufacturing. Therefore, by end of first quarter in 1992, Dr. Riordan secured venture capital; which he used to purchase a fan manufacturing plant in Pontiac, Michigan. (Apollo Group, 2006)
On May 31, 1992, operations had a turning point and the new Michigan plant was at 100% capacity.
Demand continued to increase for the plastic substrates while fixed unit costs began to decline, prompting Dr. Riordan to break ground for a plant expansion. Further, the State of Michigan started experiencing soaring unemployment rates due to the state’s largest industry, automobiles, which began laying off thousands of skilled plant workers.
Therefore, Michigan decided to offer a million dollar tax incentive to other industries to expand employment and lower the state’s unemployment rate. Riordan Plastics, Inc. was one of the first companies to be awarded the full million dollar tax incentive prompting the June 30, 1992 filing of articles of incorporation in the state of Michigan and legally changing the corporate name from Riordan Plastics, Inc. to Riordan Manufacturing,
Inc.

In 1993, the company expanded into the production of plastic beverage containers when it acquired a manufacturing plant in Albany, Georgia. In 2000, Riordan expanded when it opened its operations in China. At that time, the entire fan manufacturing operation was moved from Michigan to China and the Pontiac, Michigan facility was retooled for the manufacture of custom plastic parts.” (Apollo Group, 2006)
The Riordan of 2006 is a global plastics manufacturer employing 550 people with projected annual earnings of $46 million. The company is wholly owned by Riordan Industries, a Fortune 1000 enterprise with revenues in excess of $1 billion. The company’s products include plastic beverage containers produced at its plant in Albany, Georgia, custom plastic parts produced at its plant in Pontiac, Michigan and plastic fan parts produced at its facilities in Hangzhou, China. The company's research and development is done at the corporate headquarters in San Jose, California. Riordan's major customers are automotive parts manufacturers, aircraft manufacturers, the Department of Defense, beverage makers, bottlers, and appliance manufacturers.
(Apollo Group, 2006) Recently, Riordan’s leadership held a strategic planning retreat. As a result of this retreat strengths, weaknesses, opportunities, and threats (SWOT) analysis were reported as follows:

SWOT Analysis
Strengths Weaknesses
Strong consumer demand Departmental (marketing, human resources, operations, and finance) system incompatibility
Internet technology Compliance with new government reporting
Patents on exclusive plastics products Labor intensive data entry of accounting information
Leader in plastics manufacturing industry Financials are not issued until 15-20 days after the end of the month
Strength in capital spending Weak labor market
Opportunities Threats
New finance and accounting system network Department of Defense spending with competitors
Reduce labor intensive data entry United States dollar exchange rates, reduction in economic growth
Financial statements issued 10 days after the end of the month Safety compliance (OSHA)
Exporter's cooperation to keep market share Tax increases

As a result of the SWOT analysis and the weaknesses found in departmental information systems the following service request (SR-rm-004) was ordered by Hugh McCauley, COO, to analyze the human resources (HR) system:
Description of Request
Analyze the HR system to integrate the existing variety of tools in use today into a single integrated application.
Background of Request Riordan would like to take advantage of a more sophisticated, state-of-the-art, information systems technology in Riordan’s Human Resources Department.
Expected Results and Impact When Completed Define the business requirements for the development of an HR system to support the objective of this request. Create a detailed project plan that provides a list of all the tasks, resources, schedule and budget required to complete the project. The project should be completed in approximately six months, so the new system will be used in the second quarter of next year. (Apollo Group, 2006)
Therefore, Team B Consulting Firm of Jamie Webster and associates, here in after referred to as “Team B” have been hired to complete the service request (SR-rm-004) to analyze the HR system.
Executive Summary
Team B will analyze the current human resource information system for Riordan’s HR department, and company as a whole.
Team B will be recommending ways to integrate the existing variety of tools used today into a single integrated application. The executive staff would like to take advantage of a more sophisticated, state-of-the-art information technology system for the human resources department. The catalyst for the system improvement at Riordan Manufacturing is to manage effectively the human resource department. The business requirements for the HR system are to create a detailed project plan that will describe information-gathering techniques and design methods. This project will list all the tasks, resources, schedule, and budget requirements for project completion. From start to finish, the project is estimated to be completed in approximately six months in order to use in the second quarter of the next year. The stockholders of this project will include the project sponsor, project manager, representatives from human resources, information technology (IT), and accounting. The project sponsor will review and approve the completion of each phase of the project. Interviewing stakeholders is by far the most effective way to understand business function and business rules (Satzinger, 2004)

Human Information System (HRIS) Research and Review
Analysis of Riordan’s current HRIS system shows that it was originally installed in 1992. The HRIS is part of the financial systems
package and keeps track of the following employee information:
1. Personal information such as name, address, marital status, and dependents.
2. Pay rate
3. Personal exemptions for tax purposes
4. Hire date
5. Seniority date
6. Organizational information

7. Vacation hours (for non-exempt employees)
Other findings include changes to employee timesheet information are submitted in writing, on special forms. The timesheet and special form information is then entered into the system by the payroll clerk. Training and development records are kept in an Excel worksheet by the training and development specialist. Each recruiter maintains applicant information for open positions. Résumés are filed in a central storage area, and an Excel spreadsheet is used to track the status of applicants. Workers’ compensation is managed by a third-party provider, which keeps its own records separate from Riordan’s HRIS system. Employee files are kept by individual managers as no central employee file area exists. Managers are also responsible for tracking Family Medical Leave Act (FMLA) absences and any requests for accommodation under the ADA. The compensation manager keeps an Excel spreadsheet with the results of job analysis, salary surveys and individual compensation decisions. (Apollo Group, 2006)
The results will be documented by activity diagrams and workflow diagrams. The following diagram will allow an effective way to capture the information needed:

Management

Human Resource Specialists

Accounting

Figure 1.1 Human Resources Current Information Flow

Requirements
1. Define Issues (11 days) - the business case and proposed solution are examined to verify that they are appropriately defined as well as address the organizational requirements and needs.
2. Feasibility Study (6 days) – a feasibility study will be performed by the project team. A Schedule, Economic, Technical and Operational assessment report will be produced from this study.
3. Current System Assessment (16 days) – the project management team will examine the existing HR system
4. Prepare a Budget (2 days) – the proposed budget will be prepared by the project management team and provided to the project sponsor for approval
5. Requirement Approval (3 days) – the initial concept of the project is approved by the project sponsor. Three days are given for the approval process so that any adjustments to the proposed schedule, budget, or scope can be re-evaluated and corrected.
6. Funding Approval (1 day) – Project Sponsor reviews any funding changes. Approves presented funding for project
7. Design Solution – this phase will build on the work performed during the project planning and problem definition phases. It will result in the functional requirements into a complete technical solution. The completion of the system design marks the point in the project at which the specification document and approval plan an be used for all future project phases.
8. Implementation and Testing (30 days) – this phase will build on the work performed during the phases preceding. These tasks focus on system validation by those who will ultimately use the system to execute their daily processes. In addition to confirming the system meets functional expectations; the implementation phase validate all aspects of development, testing, data conversion, and installation of the system in a production mode. 14 days will be allotted to the software team to completely analyze and check source code for errors. All possible scenarios will be explored. All significant errors will be documented and reported to the project manager team for corrective action. Actions include adding to the post-installation modification list and immediate correction by the software team.
Design Approval – Chief Operations Officer
1. Deliverables – Detail design report, revised requirement report,(includes changes to technical, cost and benefit, and project plan), user procedures, implementation report, sample system prototypes (includes testing site, database, input interfaces, and desired output), installation plan, and training plan.
2. Document system (approximately 2 months) – this task starts in conjunction with the user interface task and continues through the entire implementation phase.
3. Installation system (2 days) – unlike upgrades and modifying exist systems, the new system does not require installation. Although, data cutoff, final conversion, and entry of queued work will occur.

Implementation Approval – Chief Operations Officer
1. Deliverables – Documented programs, user procedure manual, training and operations manual (including sections on data capture, data validation, system audit trails, verification of analysis, computer operating instructions, backup procedures and security procedures), testing results and implementation report.
2. Train users (3 days) – the training sessions are divided into three days so that the users being trained cannot be scheduled to negatively impact the current workload. Presentation methods using Microsoft PowerPoint will be the primary method of training. Electronic copies of the user manual will be emailed to each participant prior to the designated training session.
3. Support – the final phase includes training and transition of application ownership from the project team to Riordan manufacturing’s IT department.
4. Maintain system (10 days) – 10 days are allocated to discover any errors not discovered during the testing phase.
5. Reviews (21 days) – three weeks are allocated for any proposed changes and improvements to the system. The Project Management team will review them and recommend approval or rejection to the software development team. If approved, then proposals will be performed outside the scope of this project.
Implementation-Chief Information Officer
1. Deliverables – Evaluation report, help desk incident tickets, enhancement following the project plan a new HR system will be created that can schedule, design and install will be up and running by the second week of November. This will meet the schedule requirements.
2. Train Help Desk Technicians (5 days) – one week prior to the requirement for providing help desk support, a support team will be assembled. The training will provide complete user and internal documentation, the process to log incidents and requests, and information on how to handle questions not covered in training.
3. Provide Help Desk (30 days) – start user training sessions by having a staff of trained technicians available to answer any questions about the installation of the system and document incidents. After approximately six weeks all shortcomings should be resolved. Specifically, the help desk set up for this project will be available to answer any user questions and to track software incidents. The help desk will be accessible starting at the time of user training, through the installation of the system. The help desk will monitor the system until the implementation issue reporting has concluded. After the 30 day timeframe initial set, all support will be provided by the Riordan Manufacturing IT department.
Human Resources Information System Recommendations
The service request (SR-rm-004) identifies the requirements of the HR system for Riordan Manufacturing Company. The goal is to design a more sophisticated, state-of-the-art, information systems technology for the HR department (Apollo Group, 2006).
Riordan currently uses several processes such as manual timesheets, outside vendors, Microsoft Excel spreadsheets, databases, tables, and systems to keep track of information.
The new HR system will integrate all functions of HR into one system. personnel records will be updated electronically rather than manually. The HR system will be installed as part of the payroll/financial systems package to track employee’s personal information. The HR system will be integrated with the already existing payroll/financial system. The system will update and track employees from date hired to date terminated. The HR system for Riordan will be modified to fit the current system.
The HR system will be updated to prevent future problems with maintaining personnel records. The system will connect the entire organization through secured self-service, real-time access to information, and allow employees to make paperless changes on forms created from one or more of the following Microsoft Software products: Word or Excel. The system will gather time and attendance information from the timekeeping equipment and transfer the information to the payroll system. The administrative workload will be tremendously reduced by giving employees and supervisors’ access to maintain HR records on the system.
The HR system will be custom developed and will support the internal and external interfaces of the payroll/personnel reporting system. A complete inventory of the hardware platform and software applications that will be used to successfully administer the service will be provided. The system will run in both Windows and Web-based platforms and can serve as an electronic file cabinet. Transactions are recorded on electronic forms or other software applications by employees, managers, and HR. At the same time posted electronically to computerized electronic records. Access codes will be added for security purposes.
Once the HR system has been integrated into the existing system, the HR system will need to be tested to determine how reliable the HR system functions. Users and HR staff will be trained on how to use self-service functionality. The cost to implement the system will be minimal as compared to the future savings. Integrating the HR software system with payroll will save time by preventing double entry into two or more programs. Integrating the HR systems will simplify operations. The project should be completed in approximately six months, so the new system will be in the second quarter of next year. (Apollo Group, 2006)
Team B recommends a customized Enterprise Resource Planning (ERP) software package from the selected Application Software Provider (ASP) as the human resource system for all Riordan Manufacturing operation site. Under ERP system, HRIS tracks employee records, job application, background checks, job description, OSHA and worker’s compensation, training development and skills sets. All these function will be retrieved from the Database Management System (DBMS) via application software, SQL, XM and Local Area Network (LAN). On the implementation phase, software testing and installation are very crucial to ensure the system able to perform HRIS daily processes and function. Therefore, system needs to be configured and integrated with accounting department’s system. Proposed HRIS is required intensive commitment from in-house system user, manager and personals who will be working with ERP vendor on the system implementation.
Internal and external proposed new ERP system will be performing rigorous testing for 14 days. First of all, project team will conduct unit testing within HRIS module, example, on how DBMS interacts with job application module via SQL. Programmers will identify and eliminate execution error that could cause the program to terminate abnormally. During unit testing, programmers will test the programs that will interact with DBMS before these programs integrated into the systems. A comprehensive testing plan will be conducted in order to prepare upfront for any possible situation the program would encounter. Prior to integration testing, system analyst and developers need to ensure that all units testing perform as needed. After completion of unit testing, integration testing and overall system testing will be performed. Integration testing involves testing for the two or more independent programs that will interact with each other and send information to the DBMS and accounts department’s system. In example, when the human resource Clerk updates employee record into HRIS, the output of the employee record program will be an input for worker compensation and other programs such as training and refresh job description in the system. After worker compensation program received the input, the program will send two signals or outputs, to DBMS and accounting department. To ensure the integration of the system, ASP vendor and internal system analyst will perform test data that will stimulate actual condition of the system and overall system integration. The last portion of software testing will be overall system testing that will be conducted by in-house and external IT expertise. During system testing, respective HRIS user s and managers, in-house system analysts and developers will make sure all specifications have been included in the new system. Therefore, typical users will ensure the interaction with system as required. For any error that occurs, the users need to address it to the project manager for post installation modification and immediate corrective action from software provider team.
After completing system testing for approximately 30 days, the remaining system implementation will be preparing a separate operational and test environmental, system changeover, post-implementation evaluation of the system, training for users, managers and IT staffs as well as final reports to the management. Since HRIS will be using Local Area Network (LAN) connectivity therefore, network capability, specification and performance are critically important and must test the platform rigorously prior to installation processes. Riordan’s in-house project team and external software team will conduct operational test in separate test area to maintain system security, integrity and protect the operational environment. Operation environment testing is including hardware and software configuration and setting, system utilities, networking, telecommunication that may affect system performance. Besides that, test environment will be performed by in-house IT staffs and external vendors on all programs, procedures and data files. IT staffs will perform acceptance test repeatedly for several times after any modification.
Proper training is crucial to ensure the success of the new system deployment. Prior to training sessions, project team leader will distribute electronics copies and hardcopies embedded with Microsoft PowerPoint format to the users, managers and IT staffs. Training will be conducted in 3 days and divided into 6 sessions. First day of training with two sessions for the HRIS users on the Graphic User Interface (GUI) module such as main menu, start up and close system, icons, shortcut keys, help, preference and a complete system overview. For the next day, two sessions will be conducted for managers on the cost benefit analysis, IT focal point list, crucial report, require their support for new system’s goals and their users training package. On the last two sessions of the training will be allocated for IT Staffs on how resolving problems, user and management training, system documentation, system architecture and typical users question and appropriate feedback. Further, there will 5 days for help desk operators and technicians who involve directly resolving problem arise time to time at the operation environment level.
The entire ERP will cost $1,350,000 and will group traditional company and management functions such as accounting, human resources, manufacturing management, and customer relationships into one manageable system. We would also like to recommend that you take full advantage of ERP’s ability to consolidate all departmental systems and networking, and update your standard operating policy to maintain human resource processes and history at the San Jose corporate location. (Apollo Group, 2006)

Conclusion Riordan’s management team faces many challenges to remain competitive in the plastics market, improve investment potential, and strengthen overall financial performance. Fortunately, our research and analysis of the technological advancements made in recent years, such as ERP integration with HRIS we recommended, will effectively position Riordan Manufacturing, Inc., to become the future plastics industry leader.

References
Apollo Group, Inc. (2006). Virtual Organization: Riordan Manufacturing, Inc., https://ecampus.phoenix.edu/secure/aapd/cist/vop/Business/Riordan/RioMfgHome002.htm. Retrieved on April 1, 2009.

Satzinger, J.W., Jackson, R.B., Burg, S.D., & Johnson, R. (2004). Systems Analysis and Design in a Changing World. Retrieved April 3, 2009 from University of Phoenix, https://ecampus.phoenix.edu/content/eBookLibrary/ content/eReader.h?assetid=edb90735-3878-47aa-95fb-6a26bfb8cfe7&assetmetaid=4b0efa61-48f5-4272-a367-b38224337302#

Shelly, Gary B. and Cashman Thomas, J. (2003). “Systems Analysis and Design.” 5th Edition.

Technology Evaluation Centers, Inc. (2008) Engineer-to-order (ETO) Enterprise Resource Planning (ERP) Evaluation Center, Retrieved April 1, 2009, from http://erp.technologyevaluation.com/engineer-to-order/