ENTERPRISE RESOURCE PLANNING

business network is defined as a structure of interdependent relationships between the activities of a given firm and those of other firm in the competitive environment, which influence each others strategies. success depends on how well the entire business network delivers value to its ultimate customers compared to competing business network. Packaged solutions like SCM, CRM, ERP are used to establish business networking systems.

Competitive

The Current Scenario

Difficult

to get timely and accurate information Heterogeneous hardware and software platforms and practices . Poor connectivity between different organizational locations. Sticking with obsolete technology Resist to change Lack of proven man-power to develop integrated software.

What is ERP?
ERP is a solution, which ERP integrate all data and processes of an organization

into a unified system. A typical ERP system will use multiple component hardware and software to achieve the integration. database to store data for various system modules

A key ingredient of most ERP systems is the use of unified

ERP-Definition
Software solution that addresses the enterprise
needs, taking a process view of the overall organization to meet the goals, by tightly integrating all functions and under a common software platform.

What does ERP integrates

Database Applications Interfaces Tools BPR

Evolution of ERP
In

1960s-systems just for inventory control In 1970s MRP-material requirement planning (inventory with material planning and procurement) 1980s-MRPII-manufacturing resources planning. (extended MRP to shop floor and distribution management) Mid 1990s ERP-covering all the activities of an enterprise. 2000 onwards-ERPII-collaborative commerce extending ERP to external business entities)

Why ERP?
Complete

integration of a systems across the departments in a company as well across the enterprise as a whole. Only solution for better project management Better customer service Automatic introduction of latest technologies. Expertise database.

ERP-Expectations
Integrating

all the functions Integrating the systems running in all the locations Transparency of information using a single data resource across the organization. Software must be responsive , flexible, easy to add functionalities and provide growth path.

ERP Selection
Check

whether all functional aspects of business are duly covered. Check whether all the business functions and processes are fully integrated. Check weather all the latest IT trends have been covered. Check weather the vendor has customizing and implementing capabilities. Calculate ROI.

Importance of ERP

Operational benefits reduced processing cycle access to multi dimensional information Empowerment of employees to become a decision maker Effective cost control through use of cost data for business decisions Increase in resource productivity. Business benefits higher profits and improved ROI due to cost saving Improved working capital management due to reduced inventory and receivables. Higher utilization of resources reducing the cost production per unit. Higher customer satisfaction due to prompt deliveries. Management benefits Change management easy due t configurable feature of the ERP product. Strategic information about sales, production , resource usage. Secured information access to authorized users. Cost of business reduced.

What does drive ERP approach

Business: Customer Satisfaction Business Development Ability to face competition Efficient processes required to push the company to gear.

ERP implementation
Cost

analysis Blue printining of business processes Staff training Integration Data conversion Going live with ERP

ERP Advantages
Integration

among different functional areas to ensure proper communication, productivity and efficiency. Design engineering Order tracking from acceptable through fulfillment. Tracking the three way match between purchase orders, inventory receipts and costing. Eliminates the problem of synchronizing changes between multiple systems.

 Permits

control of business processes that cross functional boundaries. Reduces loss of risk of sensitive data.

Disadvantages
Customization

of ERP software is limited. ERP systems can be very expensive Resistance in sharing sensitive internal information between departments can reduce the effectives of the software. The system may be too complex measured against the actual needs of the customer. ERP systems centralize the data in one place so the risk of increasing th4e sensitive data.

Problems tackled by ERP system

Material

shortages Productivity enhancement Customer service Cash management Inventory problems Quality problems

Applications
Sales,

marketing, distribution Manufacturing Stores management Finance Personnel Maintenance Purchase, inventory Planning and control