Enterprise Resource Planning

Enterprise Resource planning

MIS

1Management Information System

Why Enterprise Resource planning?

In order to manage information, in order to deliver high quality information to the decision-makers at the right time, in order to deliver high quality information to the decision-makers at the right time, in order to automate the process of data collection, collation and refinement, organizations have to make IT an ally, harness its full potential and use it in the best possible way.

For any organization to succeed, all business units or departments should work towards this common goal. At the organizational level, IT should assist in specifying objectives and strategies of the organization. At the departmental level, IT must ensure a smooth flow of information across departments, and should guide organizations to adopt the most viable business practices.

As the departments are large, they remain closed except at the top level, unless a common system is implemented.

Management Information System 2

ERP

An Enterprise is a group of people with a common goal, which has certain resources at its disposal to achieve that goal. Resources included are money, material, man-power and all other things that are required to run the enterprise. Planning is done to ensure that nothing goes wrong. Thus Enterprise Resource planning is a method of effective planning of all the resources in an organization.


ERP• ERP is primarily an enterprise-wide system, which

encompasses corporate mission, objectives, attitudes, beliefs, values, operating style, and people who make the organization.

• ERP covers the techniques and concepts employed for the integrated management of businesses as a whole, from the viewpoint of the effective use of management resources, to improve the efficiency of an enterprise. It is a mirror image of the major business processes of an organization, such as customer order fulfillment and manufacturing. Its set of generic processes, produce the dramatic improvements they are capable of only, when used to connect parts of an organization and integrate its various processes seamlessly.


Reasons for the growth of the ERP market

• To enable improved business performance through reduces cycle time, increased business agility, inventory reduction, order fulfillment improvement

• To support business growth requirements through new product lines, new customers, meeting global requirements

• To provide flexibility, integrated, real-time decision support through improved responsiveness across the organization

• To eliminate limitation in legacy systems of century dating , fragmentation of data, inflexibility to change etc

• To take advantage of the untapped mid-market by increasing functionality at a reasonable cost, vertical market solutions etc.


The advantages of ERP

• Business Integration through automatic data updations

• Flexibility to adapt to global differences• Better analysis and Planning capabilities by

utilizing many types of support systems• Use of latest technology to sustain growth.


Why do many ERP implementations fail?

• Wrong product• Incompetent and hazardous implementation.• Lack of training fr employees


ERP Modules

• Finance– Financial Accounting e.g. General Ledger, Accounts

receivable and payable, Asset accounting, legal consolidation, controlling, overhead cost controlling, cost centre accounting, overhead orders, activity based costing, product cost controlling, cost object controlling, profitability analysis

– Investment Management e.g. Investment Planning – Controlling e.g. Overhead cost Control– Treasury e.g. Cash Management, treasury management,

market risk management, funds management– Enterprise Controlling e.g. EIS– Profit Centre Accounting


ERP Modules

• Manufacturing– Material and Capacity Planning– Shop Floor Control– Quality Management– JIT/ Repetitive Manufacturing– Cost management– Engineering Data Management– Engineering Change Control– Configuration Management– Serialization/ Lot Control– Tooling


ERP Modules

• Sales and Distribution– Master Data Management– Order management e.g. Sales Order Management, Purchase

Order Management, – Warehouse Management includes inventory planning, inventory

handling, intelligent location, inventory reporting, inventory analysis, lot control, distribution data collection, etc.

– Shipping– Billing– Pricing– Sales Support– Transportation– Foreign Trade


ERP Modules

• Plant Maintenance– Preventive Maintenance Control– Equipment Tracking– Component Tracking– Plant Maintenance Calibration Tracking– Plant Maintenance Warranty Claims Tracking


ERP Modules

• Quality Management– Quality planning– Quality inspection– Quality control

• Materials Management– Pre-purchase Activities– Purchasing– Vendor Evaluation– Inventory management– Invoice verification and material inspection


ERP Modules

• Human Resources– Personnel Management includes personnel

administration, employee master data, recruitment management, travel management, benefits administration, salary administration

– Organizational Management includes payroll accounting

– Payroll Accounting– Time Management includes shift planning– Personnel Development includes training and event

management


ERP MarketERP Market consists of the big 5 vendors (Sap, Oracle,

Peoplesoft, Baan, JD Edwards) and others. The big 5 account for 61% of the market share.

SAP (Systems, Applications and products in Data Processing)SAP ERP packages come in two versions: the mainframe

version (SAP R/2) and the client/server version (SAP R/3)SAP products feature a sophistication and robustness

unmatched by other business software solutions. SAP has developed an extensive library of more than 80 predefined business processes, spanning each functional software requirement.


R/3 Overview

The 3-tier architecture separates a system into three functional layers, each structured to support the demands of its functions.

The database layer resides on central servers or mainframe host computersThe application layer holds the processing logic of the system, preparing and

formatting data for individual offices or departments.The presentation layer typically on personal computers, handles all the tasks

related to the presentation of data, including user interfaces that enable easy access to complex applications and data.

SAP also incorporated And integrated the intranet and internet technologies

into business solutions for its customers.Although designed as an integrated system, R/3’s modules can also be used

individuallySAP has recently come out with BAPIs (Business application programming

interface) which helps SAP interact with third party applications


Bann

The Baan series-based product family includes Baan Enterprise Resource Planning (Baan ERP), Baan Front Office, Baan Corporate Office Solutions, Baan Supply Chain Solutions etc.

Baan serves a number of industries like Aerospace & Defense and Automative.

The Baan ERP modules include the following• Manufacturing• Finance• Project• Distribution•


Oracle

Oracle’s Warehouse Technology Initiative provides customers with a complete data warehousing solution.

Oracle’s Integrated Business Intelligence Solutions deliver powerful capabilities to users anywhere in the enterprise, at any time. Products include Oracle Reports, Oracle’s Enterprise Reporting Tool, Oracle Discoverer, Oracle’s Query and Analysis tool etc.

Oracle Applications is a leading provider of packaged and integrated front office and ERP solutions for the enterprise. It follows internet computing model.

Oracle has 45+ modules divided into following categories• Oracle Financials• Oracle Human Resource• Oracle Projects• Oracle Manufacturing• Oracle Supply Chain• Oracle Front Office•


Peoplesoft

It provides industry specific enterprise solutions to customers in select markets, including communications, financial services, healthcare, manufacturing, higher education.

Its applications can be implemented as a single application, or a complete enterprise-wide solution

Peoplesoft tools include several tools for reporting, customization and workflow.

Peoplesoft implementation toolkit has a modular application structure, which lends itself to the use of phasing-an incremental process. It has four phasing strategies:

• Geographical: Applicable when business practices and processes in various locations are independent to justify separate implementations.

• Departmental: Your initial phase is focused on full implementation for a given department, additional departments incremented later.

• Core and then support processes • No phasing required in some situations.


JD Edwards

JD Edwards WorldVision is a thin client bridge that provides the Graphical User Interface (GUI) with a look and feel common to the PC, while protecting your investment in WorldSoftware and the AS/400. The different product modules available from JD Edwards are:

• Foundation Suite• Financial Suite• Logistics/Distribution Suite• Services Suite• Manufacturing Suite• Architecture, Engineering, Construction, Mining and Real Estate Suite• Energy and Chemical Suite• Payroll Suite• Human Resource Suite• Customer Service Management Suite• Government, Education, and Not-for-profit Solutions• Utility and Energy Solutions


ERP Implementation lifecycle


Pre-selection screening

Package Evaluation

Implementation team building

ConfigurationGAP Analysis Reengineering

Testing

Go-Live

Post Implementation Phase

End User Training

Project Planning

Examples of ERPE-Business Suite 12 by Oracle (Overview)• Founded in 1977, Oracle Corporation (NASDAQ: ORCL) supplies software for information

management. With annual revenues of more than $10.9 billion (USD), the company offers its database, tools, and application products, along with related consulting, education, and support services, in more than 145 countries around the world.

• Headquartered in Redwood Shores, California (US), Oracle develops and deploys Internet-enabled enterprise software across its entire product line, which includes database, server, enterprise business applications and application development, and decision support tools. Oracle offers e-business solutions that extend from front-office customer relationship management (CRM), to back-office operational applications, to platform infrastructure.

• Oracle E-Business Suite is a fully integrated suite of business applications. Depending on the users’ needs for enterprise resource planning (ERP) for services (non-manufacturing), the suite can be split into one module, multiple modules, or a complete suite. Incorporating best practices and industry-specific capabilities, E-Business Suite helps businesses protect their existing investments, extend the value of their applications, and evolve to the next generation of business applications. E-Business Suite also supports Oracle’s Fusion Middleware, which extend processes, secure information, and enhance decision-making capabilities with solutions that include business integration, business intelligence, master data management, and identity management.

• For more information, visit the company's web site http://www.oracle.com/

SAP Business ByDesign by SAP (Overview)• Founded in 1972, SAP provides collaborative e-business solutions for a variety of

industries and markets. SAP is a worldwide provider of e-business software solutions. With subsidiaries in over fifty countries, the company is listed on several exchanges, including the Frankfurt stock exchange and the New York Stock Exchange (NYSE) under the symbol SAP. Headquartered in Walldorf, Germany, SAP is a large inter-enterprise software company, and the world's third-largest independent software supplier overall. SAP employs over 28,909 people in more than 50 countries. Today, more than 17,000 companies in over 120 countries run more than 44,500 installations of SAP software.

• SAP Business ByDesign is an ERP system geared towards small and midsized businesses. SAP Business ByDesign supports common business processes across multiple industries and is available as an on-demand deployment. It is an integrated business solution that supports financials, customer relationship management, human resource management, supply chain management, project management, supplier relationship management, compliance management, and executive management support.

• For more information visit company's web site http://www.sap.com/usa/index.epx

Enterprise Resource Planning

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