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ACCA Applied Knowledge · Business and Technology · Financial systems and technology

A manufacturer is introducing a new ERP system. Management plans to implement it in the Spanish subsidiary only for six months before rolling it out to the other subsidiaries. Which is the main advantage of this approach?

The main advantage is that problems can be found and fixed on a small scale before the wider rollout. Using one subsidiary as a pilot limits the business impact of any faults and lets lessons be applied to later subsidiaries, although training and data conversion are still required.

  1. AIt removes the need for staff training in later subsidiaries
  2. BProblems can be identified and resolved on a limited scale before wider rolloutCorrect
  3. CIt guarantees the new system is cheaper than parallel running
  4. DIt avoids the need to convert any existing data

Explanation

This is pilot implementation: one unit uses the system first, so errors and design flaws are found where the impact is limited. Training and data conversion are still needed elsewhere, and cost savings are not guaranteed. The key benefit is risk containment and learning.

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