Case Study: Kennametal, Haworth, Dana Holding, and Others: ERPs get the second lease on life

Kennametal’s chief information officer complains that they “Paid maintenance for nothing.” Who do you think is responsible for that state of affairs? Kennametal, the ERP vendor, or both? Justify your answer.

When software systems are developed, they are always in a process to get more sophisticated for which the buyers bay a periodic fee. ERP is an application that is related to how resources are planned in an organization. Due to increased improvement in the organizational process as a result of researches going on in the business sphere, ERP also kept updating. Kennametal was paying the maintenance fee which also brought upgrades to their ERP system. I think that Kennametal relied heavily on the automated upgrades by the vendor and did not give enough attention the flexibility of the system that allowed them to customize their ERP system according to their needs. This is the main reason for the dissatisfaction of Kennametal. If they had assigned their staff member to learn ERP system operations, they might have less issues with the system and could have ended up as satisfied customers. They could have asked for help from their ERP vendors to better understand the system.

Answer 2

I believe that both Kennametal and the ERP vendor are responsible for this state of affair. Kennametal claims that they “paid for nothing” but the ERP vendor did deliver their service to Kennametal. It is just that the service they received did not completely satisfy their wants. In this case, Kennametal should have listed what type of service they would like to receive before they started working with the ERP vendor. Or the ERP vendor at the beginning should have told the Kennametal company that they can’t provide that service. When the Kennametal company just “stops payments” it is not fair to the ERP vendor because if you already had a prior agreement you should not just stop all payments or just stop the relationship that has been continuing for many years. Sometimes it is better to resolve the issue in better way rather than trying to fight to resolve it.