What’s thought to be the biggest information technology deal of the year is expected to be decided on by the Dairy Board in the next few weeks.
The board is planning to adopt a supply chain model —colloquially referred to as “cow to customer” — rather than install Oracle financials as the next step in its GISP (global information strategy programme) project which has been progressively rolled out worldwide over several years.
Key to the supply chain strategy is the commitment of the major dairy exporters buying into an industry-wide consumer strategy based on IT. Given the current political debate on the future of producer boards, it’s a neat option that shows the politicians that a board and its exporters can work closely together.
New Zealand Dairy Group, the largest exporter, is closely involved in the proposed project. The idea is to tie the farmers, dairy companies and export customers into the common system.
Oracle doesn’t miss out. The board is most likely to use its consumer packaged goods strategy.
“We’ve been looking at CPG for the past three to four months,” says board finance and IS general manager Peter Schuyt. “As a solution, it’s a good fit with part of our business. But we haven’t signed or committed to Oracle yet.”
The board currently uses an Oracle solution that includes some logistical and financial software. Hewlett-Packard provides the Unix servers.
Schuyt points out that not all of the board’s business is consumer-related. “We’re still working through the process.”
That has involved executives from the board, the dairy exporting companies, and offshore companies which the board owns or holds equity in. There are more than 60 of these around the world which are affected by the board’s information systems.
Schuyt says that, till now, the offshore companies have made individual IT decisions to buy what fitted them at the time for consumer products. All this will be brought together under the globalisation plan.
A strategy has been put in place to address year 2000 issues, given the disparate systems at the offshore companies.
Schuyt wasn’t prepared to comment on the cost of the project, which will include upgraded telecommunications. It has been suggested by industry sources that as much as $50 million might be involved.
“The board must fund its own investment as will each dairy company,” he says.