Users are fighting back. Washing machine and white goods manufacturer Whirlpool Corp has blamed SAP AG software for shipping problems that have beset it since R/3 was installed at the beginning of September. Integration difficulties with the software were made worse by a jump in demand, the company said. Worse, Whirlpool is telling those who ask that the US is the sixth country it’s installed R/3 in, and that each time it has encountered similar delays. Whirlpool said that most of the problems had now been solved.
According to The Wall Street Journal, two waste disposal companies, Allied Waste Industries and Waste Management, have either scrapped or are about to scrap major SAP installations. And Peoplesoft Inc is currently facing a lawsuit from WL Gore & Associates (of Gortex fame) claming that failures in its human resource management software damaged Gore’s business.
Last August, SAP a $500m lawsuit was issued against SAP by bankruptcy trustee Bart Brown, claiming that the German enterprise resource planning software vendor was responsible for fraud and negligence which led to the demise of Foxmeyer Corp, a once thriving $5bn wholesale drug distribution company. Brown also sued Andersen Consulting Inc for $500m alleging that its botched SAP installation led to the drug distributors’ downfall (CI No 3,455). SAP is vigorously defending the claim.
That suit alleged that Foxmeyer ended up paying Arthur Andersen $30m to install the software – double the original estimate. Court papers for the action say that FoxMeyer agreed to pay $5m to license SAP’s R/3 software in 1993. The system was to run on Hewlett-Packard Co servers in conjunction with an Oracle Corp database. But when the system was installed, the court papers allege that its volume limitations made it usable at only six of FoxMeyer’s 23 distribution warehouses. This, they say, forced FoxMeyer to revert back to its original Unisys system.
Also last year, SAP was named as one of the factors behind the problems faced by European PC manufacturers over recent years. Winfried Hoffmann, Fujitsu Computer Ltd’s chief operating officer at the time (he’s now the president) went on the record to say that a large percentage of PC manufacturers, including Siemens Nixdorf Informationssysteme AG and all the German companies, had used SAP R/3 for manufacturing, and lost out as a result. Siemens withdrew from PC manufacturing in April 1998, handing the business over to Acer Inc.
