Riordan Manufacturing

Paper Summary:

This paper discusses the information technology (IT) budget for Riordan Manufacturing. It discusses what strategies can be used for off-setting the company's increase in IT spending and then describes ways that it can make its budget more realistic. The paper suggests that the IT budget at Riordan Manufacturing is very unbalanced and in need of a major re-negotiation of software licensing and maintenance. The paper also suggests that Riordan Manufacturing must re-evaluate its assumptions regarding employee-related expenses.

Table of Contents:
Strategies for Offsetting Increased IT Spending
Making the Budget More Realistic
Summary

From the Paper:

"Riordan Manufacturing has a budget that is very unbalanced and in need of major re-negotiation of software licensing, maintenance, and must re-evaluate their assumptions regarding employee-related expenses. Riordan needs to investigate the cost reductions possible in licensing using SaaS as an alternative integration and application platform. Ironically the escalating software licenses could be used to drastically reduce the total IT budget through the use of SaaS-based applications, integrated across a common platform. For Riordan the future must include the ability to gain greater negotiating leverage with their software providers and regain control of the largest IT expense categories. As the IT staff will be asked to make major changes to the processes by which they use to do their jobs, Salaries and wages, benefits, and bonuses should not be touched as enough change is on the way for them without modifying these expenses."

Sample of Sources Used:

• Computer Business Review Online (2006) - Gaining Value from Software As A Service. Computer Business Review Online Angela Eager. June 7, 2006. http://www.cbronline.com/article_cbr.asp?guid=8B4B1CF1-D83A-45A5-856C-C391F2BD69F4
• Sweeney (2006) - Software as a Service in the ERP World. AMR Research. Boston, MA. June 22, 2006http://www.amrresearch.com/Content/View.asp?pmillid=19553

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