SALES AND DISTRIBUTION MODULE

Today’s business world is extremely competitive; the technology is changing everyday; product life is
becoming shorter; new competitions push the companies. In such conditions to maintain competitive edge the
company must adopt new technologies, they also anticipate and respond quickly to changing conditions. T o
maintain the pace, the companies need integrated and flexible system that supports all business activities. This
innovative solution should upgrade effortlessly and interface easily with the third party applications, incorporate
the existing systems and reach the Internet and e commerce.
To survive in a highly competitive environment, the companies must streamline business processes, focus
o core competencies and should have closer partnership with supply chain. To improve profit margin and customer
service efficient sales and distribution becomes essentials.
Thus the sales and distribution module of ERP contains a comprehensive set of best order and logistic
management; many systems are tightly integrated with wit the Distribution, Requirement Planning engine of the
JIT deliveries which enables mapping and supply of single site or multi-site organizations and company’s internal
supply chain. This system also develops precise logistic planning and can generate replenishment orders by using
defined warehouse requirements.
The sales related business transactions are as follows-
 Sales queries- inquires and quotations
 Sales orders
 Outline agreement like contracts and scheduling agreements
 Delivery/Shipment
 Invoicing/Billing
 After sales support.
 Sales order processing involves following functions
 Inquiry handling.
 Quotations preparation and processing.
 Contracts and contract management.
 Monitoring the sales transactions
 Checking the availability
 Transferring the requirements to material planning.
 Scheduling the delivery.
 Calculating the prices and taxes.
 Checking the credit limit
 Invoicing/Billing.
 Creating printed or electronically transmitted documents.

Depending on the system of a particular company all the above functions can be partially or completely
automated. The data is stored in the system and can be displayed or changed manually during processing. The
sales and distribution module actively interacts with Material Management and Finance and Accounting module.

The sales and distribution module contain the following subsystems-

 1. Master Data Management
2. Order Management
3. Warehouse Management
4. Shipping
5. Billing
6. Pricing
7. Sales Support
8. Transportation
9. Foreign Trade.

Master Data Management-

Master Data Management module keeps information about the products /services, customers, raw
material requirements and suppliers and other business partners of the company and makes it available
to the decision makers, automatically generates reports, contracts, invoices, etc. In addition to sales and
distribution other departments like accounting or material management also use this data.

Order Management-

This includes Sales Order Management and Purchase Order Management and supports the entire sales
and purchase process from start to finish.

Sales Order Management-

This is the most important point of contact with the customers. This application allows the company -

 To manage sales operations quickly and efficiently.

 It also provides comprehensive solutions for the management of quotes, orders, contracts, prices and
customer discounts.
 The system can stream line order entry procedures for all types of products (complex, standard stocked
items, engineered –to- order), to the specific requirements of individual business and its customers.
 It also includes intelligent pricing and discount strategies, simulation capabilities to support ‘what-if’
scenarios, and multi- currency environments.

On-line Available-to–promise calculations ensure sufficient product availability for a specific customer and when
and where the product is available.
Built – in contract and release management system evaluates whether or not customer contract agreements are
being met with, it incorporates multilevel customer credit reviews and substantial order blocking facility.
The extensive report capabilities helps to get current and past information concerning orders, cancellations,
budget and revenues.
Rebate and commission enables the automatic calculation of employee and supplier commissions, rewards for
achieving targets, customer bonuses, rebates or rewards to customers for purchasing certain quantities.
EDP streamlines communication throughout the company’s supply –chain, from customer to supplier.
The system also supports general information like project information and product specification.
A good system also has tools for Sales Force Automation and customer service.
Purchase Order Management-

This module helps the company to make corrects purchase decisions about the price and quality (supply lead time
and the product itself). It includes –
- Online requisitioning,
- Centralized contract management
- Just- in- time schedule
- Vendor management

It offers access to the approved suppliers list so that purchase quotation can be sent to multiple suppliers.
It enables the purchase department people to get the purchase contract information. This helps them to decide on
the supplier who will be able to provide supplies with right specifications and in shortest time.
The system also generates purchase contracts.
One of the functions in purchase is purchase requisition. It allows the companies to enter non-system- planned
requirements for various types of items. Requisition can be linked to workflow for authorization purpose and to
approve suppliers.

Schedules can be used instead of orders to provide detailed purchase and delivery information. Schedules are
generated in contracts in which customer service, in- time delivery and cost reduction; all are included (just- in-
environment). These can be sent to supply chain and are linked with other modules.

Vendor management tools helps in checking the reliability and performance of the vendors wit subjective as well
as objective criteria. Objective criteria (information About receipts, quality approval, invoicing and purchase order
confirmation) is automatically traced by the system where a subjective criteria is determined by the user. Together
this helps the company to make right decisions about quality, price and delivery.

Purchase order analysis enables the use of historical as well as statistical data for analysis of purchase activities.

Warehouse Management-

 This module provides real time information about inventory levels across the enterprise and tools to
manage the daily operational needs of single site or multiple-site warehouses. Functioning of warehouses
is closely related with the functioning with the other departments of the organization like production,
sales office and purchase office. The internal supply chain of a single site or multi- site organization can be
managed effectively with the help of Distribution Requirements Planning. The actual transfer of good s
can be handled with Warehouse Management application.
 The various components of a good Warehouse Management application are designed to meet the
warehousing needs like mapping of internal goods flow, or monitoring inventory transactions.
 These components are centralized for areas that include production, sales, purchase projects, and service.
 It also helps to inform the customers where the goods are located, the no. of goods on hand, current
storage conditions and projected delivery schedules. I t also offers expanded capabilities like cross
docking, rule based inventory replenishment, multilevel packaging and consigned goods management,
which allows easy integration with financial tools and provides greater enterprise wide insight into costs.
Good Warehouse Management Application has following components-
1) Inventory Planning-This covers all planned inventory movements, which helps in accurate forecasting of
trends, safety stocks, handling of specific customer order, etc.
2) Inventory Handling-It monitors receipts, issue and transfer of inventory. The functions are cross docking,
rule based inventory replenishment, multilevel packaging and consigned goods management. It also
includes EDI (Electronic Data Interchange) facility that enables shipments to be received and allocated
ahead of time.
3) Intelligent Location Assignment-It creates intelligent storage put away lists allowing storage of goods that
can be automatically inspected, it dedicates location by criteria like item, storage conditions, size
restrictions, packaging definitions, and location availability.
4) Inventory Reporting- It permits full visibility of inventory at a single or multiple sites and provides a tool to
give accurate delivery dates. The extensive reporting capabilities of system enable consigned goods
management.
5) Inventory Analysis- This module analyses the information of warehouse activities and feedback in process
optimization. It also supports inventory forecasting, inventory evaluation, ABC analysis and slow moving
analysis.
6) Lot Control-This facility tracks and traces raw materials and finished goods. It helps to store product
quality data and meet ISO9001 certification standers.
7) Distribution Data Collection-In paperless warehousing, this element provides communication links
between storage and shipping systems and warehousing equipment like bar coding scanners.

Shipping

This module supports-

- Monitoring dates of orders due for delivery

- Creating and processing delivery
- Planning and monitoring work lists for shipping activities
- Monitoring material availability and processing outstanding orders
- Picking
- Packing delivery
- Information support for transportation planning
- Support for foreign trades requirements
- Printing and sending shipping output
- Data upgrade in goods issue.
The delivery note is a central shipping document. It record the data generated during shipping processes. It can
refer to sales order, or to a transportation order. It can be created manually or automatically. The monitoring
function allows monitoring created deliveries and outstanding sales activities.

Billing

The ERP systems supports billing functions like issuing of invoices, credit-debit memos, canceling billing
transactions, transferring billing data to Financial Accounting, Purchasing and so on. This system is
integrated with other modules so that the documents are automatically generated.
Pricing

 Pricing-Pricing describes calculations of prices for customers and vendors

 And costs for internal processes. The pricing module keeps information about the prices of various items,
the details about the quantity discounts, discounts for different customer categories; it also enables to
generate documents like quotations, delivery notes, invoices, etc. It also helps the sales people for better
decision-making thus improving performance.

Sales Support

 It helps the sales and marketing department to support the existing customers and develop new business.
The field and office staff personnel can contribute and access information about customers, sales
prospects, competitors and their products and contact people.
 To develop new business and to consolidate the existing customer base, it can create a direct mailing tool
with the help of address lists of the customers and prospects.

Transportation

 One of the important elements in logistic chain is transportation; it covers inward and outward movement
of goods. Effective transportation planning ensures the timely arrival and dispatch of shipments,
determines price of a product. Minimum transportation costs helps in keeping the prices at a competitive
rates. The system provides functions like transportation planning and processing, freight calculations and
settlements, customer freight calculations, customer freight invoicing and functions for service agent
selections.
 It covers both inbound and outbound shipments One can control and monitor the entire transportation
process from planning stage to dispatch of goods from shipping point or vendor location and their arrival
at customer location or your plant.

Foreign Trade

It supports the foreign trade activities right from import of raw material, finished and unfinished goods to
the sale of goods and transferring the data to Material Management and Financial accounts, as per the
rules and regulations and laws of different countries.
 MANUFACTURING MODULE

Manufacturing applications range from customer to a supplier, cover the entire enterprise and are a
center point in supply chain. It encompasses full integration of resource management and allows easier exchange
of information throughout the enterprise. It helps the company to deliver customer specific products with the
lead-time of standard, off the shelf product. The manufacturing module freedom to change the manufacturing and
planning methods as per the need, combine the operations to choose the best method for a specific product tat
each stage of life cycle. In addition for this control and visibility no functionality needs to be sacrificed. Only one
system can take care of al operations. It helps in planning engineer – to – order products; it’s forecasting and
distribution features handles make- to stock items and its advanced features can help in planning of assembled- to-
order products. All demands can be aggregated into user- definable plans which can flow into consolidated
production schedule and material and capacity plans and can be tracked through shop floor control systems.

How does Manufacturing respond to customers?

 The customers are not interested in knowing the internal or external operations of the enterprise. What a
customer wants is a quick response to their demands. The manufacturers should be able to do this
efficiently and cost effectively to remain profitable and competitive. The two fundamental ways to
respond to customer demands are ‘make- to – order’ and ‘make- to –stock’.
 Manufacturing system centers on its integrated planning, business processes and execution capabilities.
Strategically, effective planning results in improve inventory turns, increased productivity, and improved
returns on assets. Tactically, effective business provides improved customer satisfaction, reduced time to
market and increased market share. Effective execution provides short cycle time, quality assurance,
continuous improvement and quick response to process variability.

Some of the major subsystems of the Manufacturing modules are as follows-

Material and Capacity Planning-

 Today the manufacturers need to have effective production plan to manage material and capacity. The
customer wants accurate shipment dates. The Planning system provides this responsiveness. The planners
can simulate alternate plans, can gain information to decide which parts to buy, to assemble or to make;
some package even generate recommendations for purchase and production; can recommend changes in
current plans if there is over utilization of capacity or material; exception based planning features run
continuously and provide real time visibility of changing plans.
 Planners can create unlimited no. of simulations, can customize the planning process; planned orders can
be confirmed and converted into production and purchase orders; the graphical reporting makes helps in
identifying problems.
 It gives full control with flexible scheduling and sophisticated shop floe functionality. Production can be
scheduled by using work order, for repetitive orders, Just- In- Time can be used. Both internal and
external operations are considered by the system before creating a production plan and assigning
priorities. The Electronic Planning Board provides a graphical production management tool, which shows
all scheduled production, current production status, utilization of materials, and capacity available.
Shop Floor Control-

 Shop Floor activities need to be evaluated to reduce manufacturing time. Management needs timely,
accurate information, and ability to manage shop floor by exception. There is a need to reduce material
travel time, need to search for process improvement. Shop Floor Control system is a user friendly, flexible
system which provides visibility necessary to manage lead-time, control the amount of work- in- process
and timely release of production orders. It also helps reengineering efforts and reduces waste.
 A shop order can be reprinted at any time for reallocation of material, to duplicate the copy for splitting
the order in operators, for new material allocation to correct the previous shortages.
 A shop order can be maintained through its life; it allows the user to evaluate and adjust operation steps
and components; it also allows backward or forward rescheduling of orders.

Quality Management-
 The product quality is the most important issue in present scenario. Thus all manufacturing systems allow
a wide variety of characteristics and parameters to improve product quality. There is a need to eliminate
defects in standers product design, production methods, before and during the process.
 Quality Management Systems support the bench- marking and use of optimal product design, process
engineering and quality assurance data which helps in root cause analysis, and improves manufacturing
methods. It also supports in manufacturers conformance to ISO9000, Good Manufacturing Practices
worldwide and MIL-Q 9858 in USA and other country specific quality standers. The sample types sample
rules and testing levels are user defined and easy with maximum flexibility. Cyclic, repeat and subsequent
testing options are available. Redundant specifications are eliminated from the database. Original
manufacturers and vendors are defined independently for quality control.
 Material Inspection Subsystem offers process supervision and control. These are fully integrated with
other modules like purchasing, inventory management and shop floor control. On line maintenance of
product specification is possible with the help of production specifications, methods, customers, sample
requests, quality performance analysis, etc. It also has features like statistical process control, Material
Disposition Production reporting system. These are fully integrated with Shop Floor Control, Cost
Accounting and Control.

Just- In- Time/Repetitive Manufacturing-

 Many systems provide high volume repetitive manufacturing functionality by allowing the use of
repetitive scheduling even for the products that are nit rate-based.. This transition capability enables
production facilities to adopt process engineering, setup reduction programs, employee empowerment
work teams, etc.
 It includes strong analytical capabilities which shows current day, month–to-date, and year –to – date
results; a purchase/ production plan shows current on-hand quantity; you also get cumulative production
report a down time analysis report quality control/reject analysis report, yield analysis report, cumulative
purchasing, an item allocation report reports, etc.
 The JIT work list tool identifies discrepancies based upon actual performance .so that production rates
and/or daily output goals can be adjusted and monitored.
Cost Management-

 This tool provides extensive cost information at several levels that helps to identify cost drivers and
reduces product cost From the multiple inventory valuation methods (standard, Last In First Out, First In
First Out,) the company can chose the method which suits the best to its business.

Engineering Data Management-

 It reduces data transfer time, and errors and increases design productivity. It can be integrated with CAD
packages.

Engineering Change Control-

 It controls engineering change orders, which is automatically implemented in the production database.

Configuration management-

 It reduces order cycle time by eliminating lengthy engineering reviews.

 The knowledge base contains product attributes and variables in the form of option matrix. The analytic
engine interprets the knowledge base in conjunction with user selection to ensure customer specific
products can be built and sold.

Other modules include Tooling and Lot Control.

 HUMAN RESOURCE MODULE

HR management is an imp. factor of any organization. HR mangers need to review their work continuously. HR
module of ERP offers company wide solutions for HR department and is integrated wit other modules. It must be
adaptable to company specific requirements and should grow with the growing requirements of the company. It
should cover all the functions required in business practices. It should be flexible .The system should support the
organizations international needs with country- specific versions of the HR components. A flexible structure
enables quick and easy customization of the system to suit your requirements.
The different ERP systems offer many different subsystems as follows –

Personnel Management-

These soft ware components allow dealing with human resource tasks more quickly, efficiently and accurately. It
can be a part of ERP system or a stand- alone system. It covers following functionalities-

Personnel Administration-Today the entire organization share same information. This reduces duplication, error in
data entry and improves accuracy. HR module provides a global, fully integrated data structure for enterprise
without losing control over individual segments.

Employee Master Data-HR module has a centralized database for employee processing information. It stores the
desired information about employees. It can scan original documents for optical storage; can display graphical
information like organizational charts; can produce standard &/or customer defined charts and reports.

Recruitment Management-

- Recruitment Management is an effective automation of the entire recruitment process.

- It helps in hiring the right people with right skills at the right time and at the right place. It manages open
position /requisition, applicant screening, selection and hiring, correspondence, reporting and cost-
analysis.
- It also allows direct access to other components of HR like Personnel Administration, Pay role and
Personnel planning. This eliminates duplication and improves productivity. It also ha information about
job descriptions, skill and education requirement which can be used for internal posting, advertisement,
etc.
- It generates standard applicant letters. Some systems have the facility of e-mail messages.
- Many systems analyze cost incurred during advertising and interviewing.
- It helps in efficiently and effectively managing job openings, applications and applicant data, costs and the
hiring process. After the selection, the collected data becomes new hire information.
Travel management-

This module processes the travel expenses of a business trip from start to finish in several. This includes
subsequent corrections and retroactive accounting requirements currencies and formats. It is integrated
with other modules to ensure correct posting, taxation and payment of trip costs. The entry of travel
request generates a workflow. Business employee and country specific trip provisions can be
implemented. It automatically calculates tax, processes credit card transactions, and the receipt can be
entered in any currency. Travel costs can be divided into various levels; expenses can be posted to
numerous account assignment objects. Costs can be reimbursed. It generates reports in native currency.
Travel Expense Accounting provides self-explanatory forms, statements and an electronic approval
process to improve communication.

Benefits administration-
 Benefits administration capability and flexibility to effectively manage benefit programs for different types
of employees. It allows t add new program s at any time. It can maintain unlimited number of benefit
types and individual plans. Different benefit groups can be established on the basis of specific employee
demographics. It also has option of enrolling employees for benefit programs. It furnishes real time
processing, prepares employee specific enrollment forms; you can define eligibility groups and rules. You
can determine variables, rules and cost formula for various programs. The cost can be automatically
calculated to give consistent and accurate results. After the plan is selected the Administrative component
provides the framework to administer them efficiently.
 Benefits administration component can maintain unlimited number of saving plans with differed and non-
differed options, with employee matched and unmatched contributions. The system can track employee
changes and investment histories. I can create standard reports and respond to requests quickly. The
employees can have direct access to their individual benefit information.
Salary administration-

It simplifies the process of rewarding the employees. It plays an important role during review process by
considering standard salary changes.

Organizational Management -

This module maintains the accurate picture of organizational structure , it reviews any moves, additions or
changes in employee positions; it creates simulations for making adjustments for making changes in
employee positions; Planning features include graphical organizational charts, staffing schedules, job
descriptions, planning scenarios, personal cost planning, which helps them in making informed decisions.

Pay roll Accounting

Pay roll Accounting fulfills payroll requirements from a global point-of-view. It allows centralizing payroll
processing and decentralizing the data based on country’s legal entities. It can establish business rules
without modifying the existing payroll. After completion of a process the built-in audit trail date stamps
the record for future reference. It can adapt to policy or legislative changes. The entire information is
 maintained in a master file, which can be shared by the entire organization. There are country specific
versions, which fulfill language, currency and regulatory requirements of global business.

Time management-

This module helps administering and evaluating data related with employee work hours. It manages shift
planning, work schedules as per requirement. It allows daily processing of time recording, can create
flexible work hours. It helps in individual and group piecework calculations to decide incentives. It
determines overtime and other time related data including absence .The Time Evaluation component
stores business rules and automatically validates work hours and wage types. The result is shown on time
sheet.

Shift Planning-

It helps to plan work force requirement taking into consideration all criteria including absence. It also
informs about staff excess or deficit. The plans can be checked against rules at any given time. The data is
centrally administered. It helps in short time changes and temporary assignment of employees to other
units.

Personnel development-

This is an advanced tool, which automates the process of matching the internal job requirements with
qualified candidates. It creates the profile of a task or position and compares it with the profile of a
candidate. It ensures the goal of an organization and individual are in harmony. It improves employee
performance, staff quality, working climate and employee morale. It also models suitable career and
succession planning and additional training determination, Training and event management.

Training And Event Management-

This module helps in planning, managing and analyzing scheduled seminars, training courses and business
events. It also creates event catalogues. It maintains information about organizers, objectives, content,
time schedule prices, locations; etc the reporting feature provides measurement for education & training
performance.
 PLANT MAINTENANCE MODULE

This module includes the entire family of products covering all aspects of plant/equipments maintenance, which
will help in process improvement. The sub modules are –

Preventive Maintenance Control-

Equipment lubrication, component replacement and safety inspection can be planned, scheduled and
monitored with the help of this module. Maintenance tasks can be tracked for each machine, equipment
or part by user defined modes or by calendar days, by using criteria like hours of operation, units
produced fuel consumed, etc .It lowers the repair costs, avoids downtime, machine breakage and process
variability. It improves machine reliability and tolerance control; and yields higher production.

Equipment Tracking-
Equipment is an asset. It needs monitoring and protecting or it can cause great expenditure for the
organization. The information regarding acquisition and disposition of equipments their operational
interdependencies are stored. Equipment specifications are created which help in equipment operations,
maintenance and transportation control.
Component Tracking-

Components are subsets of larger equipments and need the same cost controlling scrutiny. This module
helps in identifying components with chronic repair problem, determine whether to repair or replace by
warranty before failure occurs. It reduces unscheduled equipment downtime. This also includes repair/
exchange history and component service life.

Plant Maintenance Calibration Tracking-

It provides equipment calibration in support of ISO9000 requirements.

Plant Maintenance Warranty Claim Tracking-

It is an administrating system controlling all items covering manufacturers and vendors warranty. It
maintains the complete history for each item covered by warranty.

QUALITY MANAGEMENT MODULE

The functions and elements of Quality Management system are defined by ISO 9000 series. It covers all the
processes of the organization. The task priorities may shift from production to product development to sales and
distribution.
Today rather than using CAQ (computer aided quality management) the CIQ (computer integrated quality
management) is used because the isolated CAQ cannot carry out comprehensive quality management. The quality
management system is integrated into affected applications themselves.
The quality management module fulfills the following functions-

1. Quality planning- It manages the basic data for quality & inspection planning & material specifications.

2. Quality inspections-It triggers inspections helps in inspection plan selection & sample calculation, prints
shop papers for sampling & inspection, records results & defects, makes the usage decisions & triggers
follow up actions.

3. Quality control- It determines the sample, applies statistical process control techniques using quality
control charts etc.

4. Computer integrated quality management-

Quality management is integrated in ERP systems thus it supports all the elements as per ISO9000
standards. The integration influences all processes within a company & affects the entire product life
cycle.

CIQ is integrated with materials management, production, sales & distribution & cost accounting. It is also
integrated with master data & thus it supports exchange of data with other application preventing
recording & storing of redundant data.

MATERIALS MANAGEMENT MODULE

This module optimizes all purchasing purchases & enables automated supplier evaluation lowers procurement &
lowers warehousing cost & integrates invoice verification. The main modules are as follows-
Pre-purchasing activity-
 This system supports the complete cycle of requirement calculation, inviting quotations, evaluating
quotations & vendors, selecting vendors & acceptance of services. It maintains a service master data base
& keeps separate sets of service specifications. Set of service specifications includes items with services &
materials. This reduces the manual entry effort.
 Entry of service specification can be planned or unplanned. In both cases prices & quantities can be
stipulated. It also checks adherence to sub limits & overall limits.
Purchasing-
 Purchasing communicates with other system in the module to ensure constant flow of information. It
works side by side with following modules- cost accounting system, financial accounting, sales &
distribution.
 It performs tasks like procurement of services & materials, determines the possible source of supply for a
requirement, monitoring of delivery & payment to vendors.
Vendor evaluation-
 This model is completely integrated in the material management module. The system supports the
optimization of the procurement process. It helps to select source of supply & monitoring of existing
supply. It also provides information on price, terms of payment & delivery. It helps in improving
competitiveness of the company. It determines the reliability of the vendor.
 Most systems offer point based evaluation system on the basis of predetermined criteria or user defined
criteria. However the main criteria’s are price, quality, service, support, replacement of returns.
Inventory management-
 It allows to manage stocks on a quantity & value basis, plan enter & check goods movement & carry out
physical inventory. It can give an overview of the current stocks of any given material.
 The quantity & value can be updated automatically. Goods movement includes external & internal
movement. With every movement receipt & issue slips are printed & the adjustments between the
physical stock & the book inventory are carried out automatically. It uses various methods like periodic
inventory, continuous inventory, inventory sampling & cycle counting.
Invoice verification & material inspection-
 Invoice verification is a link between materials management component & financial accounting,
controlling & asset accounting component. It serves following purposes-It completes materials
procurement process; it processes the invoices that do not originate in material procurement & allows
credit memos to be processed.
 Each invoice contains various items of information. It may refer to an existing transaction or to a purchase
order. If there are differences in the purchase orders or goods receipts & invoice the warning is issued on
the screen.
 When the invoice is entered there is automatic posting for sales tax, cash discounts & price variances.
Before posting the invoice the balance should equal to zero. This completes invoice verification. This data
is contained in the system, which is used by the accounting department to make appropriate payments
with the aid of financial accounting component.