Sunburst Facts Operate in 16 states Revenue of $105 Million in 2003 Includes hotel chains such as –Comfort Inns and Suites –Best Western –Holiday Inn Express –Clarion

Sunburst System Obstacles Wanted to use the ERP similar to the one used by its parent company Would cost $1.5 Million to get operational –Hardware and Software were most costly Needed skilled staff to run and maintain network –This could cost another $500,000 –Such a staff would be hard to assemble

Possible System Solutions Install and maintain their own software –Choice hotels had faced the same problem a year earlier –Pleased with software but implementing it was a disaster Outsource the ERP system –Use an ASP (Application Service Provider)

Benefits of an ASP ASP maintains ownership of hardware and the software Sunburst would operate the system as though it owned it Would not have maintain an IT staff Quicker implementation of the system Can slowly add options if desired

Risks of an ASP Security –Afraid information flowing back and forth could be intercepted Companies may be locked into their vendor

ERP SYSTEM? Needed a way to keep information synchronized between all locations Easy way to share information between hotels

WHY OUTSOURCE? Cost Required Technical Skills Speed to production

Implementation? Management would have to be trained to use and operate the new system Organization would have to absorb a large upfront cost if they did not use an ASP Keeping and well staffed crew after implementing the system.

OUTSOURCE ERP TO ASP? Security Transferability Will the ASP be able to survive?

QUESTIONS?