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September 24, 1998

HAS SAP’S R/3 HARMED THE EUROPEAN PC INDUSTRY?

By CBR Staff Writer

Has an over dependence on SAP AG’s enterprise resource planning software been one of the factors behind the problems faced by European PC manufacturers over recent years? Winfried Hoffmann, Fujitsu Computer Ltd’s chief operating officer thinks so. Hoffmann pointed out to ComputerWire that a large percentage of PC manufacturers, including Siemens Nixdorf Informationssysteme AG and all the German companies, have used SAP R/3 for manufacturing, and lost out as a result. Siemens withdrew from PC manufacturing back in April, handing the business over to Acer Inc. SAP for PC production is the slowest, because if you make a small change you have to bring in new article codes and material codes, which is very slow says Hoffmann. If you produce the same product for six months or so, like the car industry, you can use a system like SAP. Dutch PC manufacturer Tulip NV (currently restructuring), Peacock Systems GmbH (acquired by Vobis) and Vobis Microcomputer AG itself (which is being acquired by CHS Electronics Inc) all use or used SAP, according to Hoffmann. He’s admittedly biased, as Fujitsu itself uses the Glovia ERP system, sold by the Glovia International LLC joint venture between Fujitsu and MDIS Plc. UK company MDIS acquired the package as Chess from Xerox Corp back in 1994. Fujitsu also uses Glovia for its high volume disk drive plants in Asia – though its Microelectronics semiconductor division is still an R/3 customer. Fujitsu claims to be the world’s second largest PC manufacturer, and Europe’s fastest growing indirect PC manufacturer. But Fujitsu is not the only PC manufacturer to turn to Glovia. Dell Computer Corp, the third largest PC maker, made the decision to replace its existing SAP installation with Glovia software earlier this year, after evaluating SAP, Baan NV and Oracle Corp alternatives. It is installing Glovia at its Austin Texas plant, and will follow that with installations in Malaysia and Ireland. The software will be integrated with supply chain planning software from i2 Technologies Inc. The order represents Los Angeles, California-based Glovia’s largest this year. SAP is currently fighting a $500m lawsuit from Foxmeyer Corp, a once thriving $5bn wholesale drug distribution company now facing liquidation. Foxmeyer blamed volume limitations in R/3 that made it usable at only six of its 23 distribution warehouses, forcing it to revert back to its older Unisys-based system.

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