Metalco is a large Australian mining company. It has a rocky history in terms of its effective use of information systems (IS), and there is widespread dissatisfaction in the company concerning IS and the IS department. A recent resignation of the chief information officer led to the decentralization of the IS function, to move it closer to the operating departments. At the same time, one of the division heads has proposed that the company buy the SAP enterprise-wide system, to replace an earlier internal system which had been poorly received. The price tag for SAP is very high, $23 million. Implementing it would also require substantial changes in company processes. In light of its history, recent IS decentralization, and the high SAP price tag, the company is faced with making the decision of whether to go ahead with SAP. An appendix in the case provides extensive information on the procedure used to evaluate SAP, and results thereof.
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