03/10/2006

Implementation of the
Adaptive ERP System
Gediminas Vedrickas
Principal Consultant / Research & Innovation
2
Agenda
Overview of ERP Systems
o What is ERP?
o Disadvantages of current ERP systems
o Requirements for ERP Systems
Framework for the Adaptive Enterprise Engineering
Business Process Definition
o Semantics of Business Process
o Semantics of Business Rule
o Weaving Business Rules to Business Processes
Business Process Automation
o Mapping Business Processes to Application Components
o Application Component Framework (ACF)
Case Study from Customs Domain
o Import Declaration Assessment Business Process automation
o ACF implementation based on SAP Workflow
Conclusions
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What is ERP?
Enterprise Resource Planning (ERP) is an industry term for integrated, multi-
module application software packages that are designed to serve and support
multiple business functions
ERP system can include software for manufacturing, order entry, accounts
receivable and payable, general ledger, purchasing, warehousing, transportation
and human resources
Market leaders: SAP, Oracle Corporation, Microsoft
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Disadvantages of Current ERP Systems
Main disadvantages of current ERP systems from our experience:
o Customizing process is very complex and time consuming activity that requires extensive
system level knowledge
o Rules that govern system behaviour are encoded in system vendor-specific way (program
code, configuration tables, etc.)
o Interfaces of different application components, especially if these components own modular
implementations, have very poor (or not at all) documentation
o Application components of ERP system form integrated platform with code based
embedded business processes
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Disadvantages of Current ERP Systems (continued)
Survey of 100 global or pan-European companies by PMP Research about ERP
system deployments
o 5% of those polled said they were using their ERP software to its full extent, 32% of
respondents said large portions of their enterprise software was not used at all, and 41%
said that a small portion of the software's functionality was left unexplored
o Most users customize the software, with only 12% installing ERP packages "out of the box
o More than 50% of companies said that once installed it was hard to make changes to ERP
software in order to meet any changes in business processes or requirements
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Business requirements (business analyst team perspective):
o Highly adaptive ERP systems that allow to make changes reflecting up-to-date business
processes with less effort and in as possible shorter time
o Ability to influence systems behaviour by business workers themselves without coding
o Ability to restore the behavioural system state at the specified point of time (i.e. ability to
restore business rules that were effective at that time)
o Ability to manage, track, verify and validate the business knowledge
Requirements for ERP Systems
Implementation requirements (functional team perspective)
o Ability to customize systems behaviour without coding
o Ability to maximize the reuse of artefacts delivered during requirement analysis phase as
much as possible in the systems customizing phase
o Unified customizing environment across different application components
Implementation requirements (technical team perspective)
o Integrated development environment with full support of Open Standards
o Unified methodology and program APIs for development of new highly configurable
Application Components or changing existing ones
o Support for RAD tools that speed up development process
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Framework for the Adaptive Enterprise Engineering
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Semantics of Business Process
A Business Process is a repeatable set of activities taken to produce a result that
achieves a specific business purpose for one or more stakeholders*
Business Process Definition Metamodel**
0..1
-sub-process
0..*
-generates OR receives
11..*
Compensation
Task Process
Event Entity
-produces OR concumes
-identifies
0..1
Constrainable Rule
0..* 0..*
Role Party
-performed by
0..* 0..*
-performed by
0..1
0..*
Transaction
-compensating task 0..1
Worker Organization
Automated
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Semantics of Business Rule
Business Rule is
o a statement that defines or constrains some aspect of the business. It is intended to
assert business structure or to control or influence the behaviour of the business
(Business Rules ~ What Are They Really?, Business Rules Group)
o an element of guidance that introduces an obligation or necessity (Semantics of
Business Vocabulary and Rules, OMG)
o a directive intended to influence or guide business behaviour (Ron Ross, Business Rule
Solutions)
There are two types of Business Rules
o Structural (something true by definition)
It is necessary that currency amount of each tax liability is calculated in local currency
o Operative (obligation or prohibition)
It is obligatory that each tax payer who submits an import declaration holds an account
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Weaving Business Rules into Business Process
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Business Rules Integration Points
Notification event
State transition event
Decision point
Assertion point
e
m
e
i
e
j
e
k
e
n
dp
u
ap
v
Transaction
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Mapping Business Process to Application
Components
Business
Process
Process
Task
Business
Activity
Operation
Business
Function
1 1..*
implements
0..1
0..*
0..*
0..*
0..1
*
1 1..*
0..*
1
Business Model
System Model
interface
Application
Service
interface
Enterprise
Service
implements
0..*
0..*
1 1..*
interface
Service
component
Application
Component
0..1
0..*
{OR}
{Operation is part of
Enterprise Service}
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Application Component Framework
-
xAP1
xDP1
xAP2
yAP1
yDP1
yDP2
HRS1 v.1
RS1 v.1
HRS2 v.1
RS3 v.1
HRS1 v.2
RS1 v.1
HRS2 v.2
RS3 v.1
HRS2 v.1
RS4 v.1
RS5 v.1
RS6 v.1
HRS2 v.2
RS4 v.1
RS5 v.2
RS6 v.2
Decision/Assertion points
(place holders for
business rule sets)
Hierarchical Business
Rule Set Instances
Appl. Comp1
Appl. Comp2
HRS1 v.2 + context
HRS2 v.2 + context
Rule Service
Component
JSR 94
Business Rules
Repository
Business
Rules Engine
Actual Business Rule Set
+ context
Application Component
Framework
Business Rules Technology
Business
Rules
Framework
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Business Process of Import Declaration Assessment
[assessment]
[reassessment]
Assess
declaration
Determine declaration
processing scenario
Peform tax control
Perform tax control
(reassessment case)
[failure]
[success]
Create
tax liabilities
Notify Customs
Officer
Assess declaration Post tax liabilities
Post created
tax liabilities
[success]
[failure]
Notify Customs
Officer
[first version]
Assess new
version of declaration
[new version]
Notify Customs
Officer
[incorrect version]
Send success
message to
Customs Officer
Register declaration
[there are created tax liabilities]
Clear tax liabilities
[payed in advanced]
[deferred payment ]
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ACF Implementation based on SAP Workflow
ACF prototype was developed on a basis of one of the main business processes of
Customs and has the following features
o Developed framework enables to build Application Components based on Component
Based Development (CBD) paradigm using SAP ABAP technology
o ACF implements component behaviour as well as business process customization
mechanism based on Business Rules Technology
o ACF utilizes SAP Webflow Engine enabling graphical design of business process
implementation
o ACF implements concept of process wide fact base which itself consists of
Persistent fact base
Transient fact base
Business Rules implementation is done using BRF
o Developed BRF prototype utilizes our self implemented ABAP version of Business Rules
Engine
o Business Rules specified using SBVR style during requirements phase are expressed as
corresponding rule records in SAP database at implementation level
o Integration of JSR-94 capable and rule service oriented Business Rules Management
System is under development
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Process Definition using SAP Workflow
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Process Task Implementation
Each Process Task is implemented
as Application Component Service
All Process Tasks have access to
process wide Fact Base
Hierarchical Rule Set is derived
using specified rule set and
available facts in the process wide
Fact Base
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Process Execution
Process wide Fact Base is realized by
SAP Workflow Container
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Conclusions
ERP systems implementation as well as maintenance process is enhanced greatly
by application of Business Rules Approach
Developed Business Rules Based Application Component Framework facilitates the
integration of Business Rules Technology into mySAP ERP implementation process
making implemented system more transparent and more adaptive
Only highly adaptive ERP systems will be acceptable as a business enablers that
are capable to manage required changes to system behaviour with the same speed
as the business change
The new approach of enhancing and further evolving ERP systems results in
benefit of high added value for customers
The new approach brings new opportunities for delivering out-of-the-box solutions
empowered by Business Rules Technology
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Related Information
Introduction to Business Rules Approach
http://www.erp.eu/en/research_insights/infocus/bra
The Principles of Rule Independence
http://www.businessrulesgroup.org/brmanifesto.htm
The Business Motivation Model
http://www.businessrulesgroup.org/bmm.shtml
Semantics of Business Vocabulary and Business Rules (SBVR)
http://www.omg.org/docs/dtc/06-03-02.pdf
Object Management Group
http://www.omg.org/
Business Rules Group
http://www.businessrulesgroup.org
Business Rules Community
http://www.brcommunity.com/
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Thank you for your attention!
???
Questions?
Gediminas Vedrickas
g.vedrickas@erp.eu
http://www.erp.eu