There are many compelling reasons to pursue deployment of an IT infrastructure in the business world today. Most enterprises already have a IT infrastructure in place, and are now taking the lessons they've learned from previous efforts to remedy problematic areas like data quality and infrastructure standardization. At the same time, many enterprises are also moving toward the next steps in the evolution of IT infrastructure and are adopting new technologies and approaches such as data management and computerized controls. Riordan Manufacturing would benefit tremendously by the implementation of an IT infrastructure. Currently, Riordan Manufacturing is suffering from corporate inefficiency that is detrimental to revenue and long term financial goals. An IT infrastructure would solve many of these problems. Cost savings are represented through the reduction of duplicated efforts and service offerings across the corporation, lower maintenance support because of consistent hardware and software applications, and structured communication channels between departments and a newly formed corporate IT department (CIT). A CIO will provide technical leadership for IT related issues and Cost Centers would be created at each installation to adhere to strict purchasing guidelines. In addition, the CIO will establish Riordan Manufacturing’s online presence with an emphasis on streamlining processes, such as manufacturing and distribution, so they can do business more efficiently with their resellers and suppliers. While short-term financial goals will be impacted by this sizable project, the long-term health of the company will benefit from this necessary and important step.
“As an organization grows, demand for information grows with it. Bottlenecks become more apparent, and the strains on financial management increase. According to a study of cloud accounting by Vital Analysis, on average eight to ten percent of the financial accounting software market turns over annually. Approximately four percent of the market requires a new solution because the company has experienced extraordinary growth (or in some cases, contraction). The change in business size often requires new solutions to reflect the increased business and functional requirements of the organization.” (France M.)
Riordan Manufacturing strives for continued profits and market share for the year 2006. A 50 million dollar sales revenue figure is an approachable goal. However, the company needs to streamline processes, as short and long-term goals will be increasingly difficult to achieve using current standards. The problem analysis will focus on streamlining finance and accounting departments, employing sales and marketing upgrades, and overall, information technology implementation in all departments.
The financial and accounting need alone drives Rirodan’s requirement for an implemented enterprise IT system. Riordan is not the only business that suffers from accounting and financial errors due to multiple software platforms at each location. Using different types of software at each location makes it difficult to integrate the information. Because the information formatted differently and stored in different formats, errors occur during the integration process. For example, the company might need to consolidate all of their past due accounts that need payment. The information needs to be consolidated and sent to corporate level attorneys to begin legal action for collection. However, some of the accounts from the mid-west region are using a different platform and their information failed to integrate correctly. These accounts have slipped through the cracks and serious loss of profit just occurred. This is just hypothetical scenario and only represents single instances in which their outdated IT system lost Riordan money.
Because accounting and financing affect the company’s overall profits and investor relations Riordan’s decision makers will align and show
