Enterprise Resource Planning Applications

Enterprise Resource Planning (ERP) Applications Enterprise Application Development IFS Training IFS Applications 2003

Page #What is an ERP?Enterprise Resource Planning (ERP) is a company-wide computer software system used to manage and coordinate all the resources, information, and functions of a business from shared data stores.ERP attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments particular needs.

Page 2Enterprise Resource Planning Applications2Page #What is an ERP?...Automates the tasks involved in performing a business processIf installed correctly, it can have tremendous paybackPage 3Enterprise Resource Planning Applications3Page #

Company ABCTECHNICAL

(Manufacturing)FINANCE

(Accounts)COMMERCIAL

(Purchasing,

Storing and Distribution)HUMAN

RESOURCES

(Personnel)SALES

&

MARKETINGBusiness OverviewProductionQuality AssuranceMaintenanceFinancial AccountingCost AccountingPurchasing WarehousingDistributionPersonnel RecruitmentPersonnel TrainingMarketingSalesDepartmentsPage 4Enterprise Resource Planning ApplicationsOrganization

Cost AccountingAccountsFinancial AccountingCost AccountantFinancial AccountantFinancial ControllerTechnicalPlant ManagerProduction Dept.Maintenance Dept.Plant EngineerProduction ManagerQA Dept.QA Manager

Human Resource Personnel ManagerSales & MarketingMarketing DeptSales Dept

Sales ManagerMarketing Manager

Purchasing DeptCommercialPlannerLogisticsCommercial ManagerDevelopmentStores & warehousingBuyerDistributionSupplier

SupervisorPurchasingPage 5Enterprise Resource Planning ApplicationsSales & Marketing Department

Inventory (Stores) Purchasing Department

Manufacturing

Example of a Business Process

SupplierCustomerPage 6 Supply Chain and ManufacturingEnterprise Resource Planning ApplicationsBusiness Process (Detailed)Customer OrderPurchasingInventoryPurchase RequisitionDirect DeliveryCustomer OrderDeliveryPurchase OrderReceiptManufacturingPurchase RequisitionReceipt

ReservationPickingPurchase Requisition (Components)RequisitionReceipt (Finish Goods)Receipt (Components)Material IssueSupplierCustomerPage 7Enterprise Resource Planning Applications

Example: Order fulfillmentBefore ERPProblems:Delays, lost orders, keying into different computer systems invites errorsPage 8Enterprise Resource Planning Applications

Example: Order fulfillment...With ERPFront Office Functions Back Office FunctionsPage 9Enterprise Resource Planning ApplicationsERP Evaluation1960-70sMRP (Material Resource Planning)Inventory and process time reduction with newproduction planning systems1980sMRP IIGreater reductions due to the integration withaccounting and human resources system1990sERPFocused on clients. Real time transactions. Asset management2000sERP Extended or ERP IIFocused on clients, optimizing the whole business network; including supplier and clientsPage 10Enterprise Resource Planning ApplicationsMRP (material requirements planning)Page #ERP Evaluation...Integrate systems that covers the firms entire value chainIndustry oriented (specialized)Transition from an internal view of the firm to business network vision within the industry

Electronic commerceDeveloping web interfaces for the internet and intranetSupporting complete commercial transactions

Applications with an object-oriented structureTransition from an highly integrated structure to modules with higher complementarilyPlug and play facilities Component based.Page 11Enterprise Resource Planning Applications

ERP Evaluation...Source: Gartner group, 2001Page 12Enterprise Resource Planning ApplicationsAdvantages of ERPA Totally integrated systemThe ability to streamline different processes and workflowsThe ability to easily share data across various departments in an organizationImproved efficiency and productivity levelsBetter tracking and forecastingLower costsImproved customer servicePage 13Enterprise Resource Planning ApplicationsDisadvantages of ERPCustomization in many situations is limitedThe need to re-engineer business processesERP systems can be cost prohibitive to install and runTrainingIntegrationData Analysis and ConversionTechnical support can be sloppySecurity IssuesERP's may be too rigid for specific organizations that are either new or want to move in a new direction in the near future.Page 14Enterprise Resource Planning ApplicationsERP Building BlocksFinancialsAccounts payable, accounts receivable, fixed assets, general ledger and cash management, etc.ManufacturingEngineering, capacity, workflow management, quality control, bills of material, manufacturing process, material planning etc.Supply Chain ManagementInventory, supply chain planning, supplier scheduling, claim processing, order entry, purchasing, etc.Human ResourcesBenefits, training, payroll, time and attendance, etcPage 15Enterprise Resource Planning ApplicationsERP Building Blocks...ProjectsCosting, billing, activity management, time and expense, etc.Customer Relationship Management sales and marketing, service, commissions, customer contact, calls center support, etc.Data Warehouse Usually this is a module that can be accessed by an organizations customers, suppliers and employees.Page 16Enterprise Resource Planning ApplicationsIndustry FocusTraditional (Manufacturing)AutomotiveChemicalPharmaceuticalConsumer GoodsOil and GasAerospace & Defense

Page 17Enterprise Resource Planning ApplicationsIndustry Focus...New AdditionsBanking and InsuranceHealthcarePublic AdministrationEducationRetailUtilitiesTelecommunication

Page 18Enterprise Resource Planning ApplicationsNew Developments In ERPAvailability of web-based and wireless ERP systemsAdoption of easy-to-install ERP systemsLinkage to other software systems, e.g., supply chain management system, e-commerce, customer relationship management systemEnterprise Resource Planning ApplicationsERP Software Market SharePage 20

http://www.forbes.com/sites/louiscolumbus/2013/05/12/2013-erp-market-share-update-sap-solidifies-market-leadership/

Enterprise Resource Planning ApplicationsGartner Magic Quadrant for ERPPage 21

Enterprise Resource Planning ApplicationsPage 22Enterprise Resource Planning Applications