A 34.2 billion yen core-system replacement, and seven months without chilled shipments (2024)

What stopped was the very joint it was trying to connect

At the centre of this decision was a task hard to avoid in itself: binding back into one mechanism the operations that a merger had left running separately. The plan to carry everything from procurement to finance on a single system pointed toward eliminating the seams that had been filled by hand, and $243.4M (¥34bn) is a sum commensurate with that ambition. But the wider the range being connected, the more processes have to move at once on the day of the switch. That what stopped was shipping from the distribution centres — the very knot it was trying to tie — says something about the character of this migration.

What remains is the figures recorded in the accounts and a cause never stated. The 6.4 billion yen extraordinary loss and the 7.5 billion yen fall in operating profit are on the record in the annual securities report, and the auditors wrote up verification of the migration as a key audit matter. What exactly failed, and how, stays inside the company and has not been put into a form that competitors could learn from. Everyone remembers that the pudding vanished from the shelves; only the reason for it goes unpublished, while the company’s name circulates as the industry’s cautionary tale.

The 34.2 billion yen was also a figure that had grown along with the delay to go-live. Had a second postponement been chosen, the cost would have risen further; not choosing it brought seven months of halted shipments. With a price attached to either road, Glico chose to go forward.