Boeing?s Corinth, Texas plant has ditched Baan?s Enterprise Resource Planning (ERP) software, the Dutch software supplier confirmed today - but blamed rival Computer Associates for playing up the story.
The company issued a statement saying: ?The project was in the early stages when the decision was made and it was scheduled to go live in the second half of 1998. An analyst at AMR learned of Boeing?s decision through a competing vendor, which we now understand was Computer Associates. It spun a negative story of Baan being pushed out of Boeing. [We are] following up with the analyst to make sure he understands the facts of the issue and to ensure no negative publicity comes from this.?
It may be too late for damage limitation, with reports spreading that both Boeing - Baan's flagship customer, which uses the software in other sites besides Corinth - and Ford Motor are unhappy with the ERP system. European software analyst Dennis Keeling, said: ?This will have a significant impact on Baan, because its reputation is based on the Boeing deal.?
He calculates that the Boeing deal represented $110.27 million in revenue over the past three years, between 10 and 24 per cent of the total, and believes it was key to Baan?s listing on the Nasdaq stock exchange.
Baan?s executive vice president of customer initiatives, Doug Fredericks, commented: ?Boeing decided to stop any implementation until the merger with McDonnell Douglas is complete, and that means all business and technology systems are being reviewed and merged. As for Ford Motor Company, I don?t think we have any problems there. ERP implementation often reflects the pace of business.?
Boeing?s merger with McDonnell Douglas, along with high implementation costs, may well have forced Boeing to scrap the ERP project at its Defence and Space division, based in Corinth. An earlier implementation at its Irvine, Texas plant is reported to have taken 21 months, three times longer than planned, and cost three times more than the original $4 million budget.
Another factor may be that Western Data Systems, an ERP competitor, is a long time supplier of McDonnell Douglas, and Boeing in Australia uses Western Data software.
Baan said: ?This decision does not impact the Baan implementation at Boeing Commercial Airplane. Boeing is not choosing another vendor in place of Baan... and there are no current plans to restart any implementations of any ERP systems.?
More specifically, it added: ?The reason for the stoppage was that Corinth, a part of Boeing Defense and Space Group, was a pilot site for the new Baan DOD functionality. Much of their output goes to Boeing Commercial Airplanes so the facility did not require the specialised DOD functionality... Boeing is currently trying to determine the future of sites like Corinth, and is not in a position to go forward with the implementation.?
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