ERP stands for Enterprise Resource Planning.

ERP is a way to integrate the data

and processes of an organization into one single system. Usually ERP systems will
have many components including hardware and software, in order to achieve
integration, most ERP systems use a unified database to store data for various
functions found throughout the organization.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.

An ERP system has a service-oriented architecture with modular hardware and software units or
"services" that communicate on a local area network. The modular design allows a business to add or
reconfigure modules (perhaps from different vendors) while preserving data integrity in one shared
database that may be centralized or distributed.

The term ERP originally referred to how a large organization planned to use organizational wide
resources. In the past, ERP systems were used in larger more industrial types of companies. However,
the use of ERP has changed and is extremely comprehensive, today the term can refer to any type of
company, no matter what industry it falls in. In fact, ERP systems are used in almost any type of
organization - large or small.

In order for a software system to be considered ERP, it must provide an organization with functionality
for two or more systems. While some ERP packages exist that only cover two functions for an
organization (QuickBooks: Payroll & Accounting), most ERP systems cover several functions.

Today's ERP systems can cover a wide range of functions and integrate them into one unified
database. For instance, functions such as Human Resources, Supply Chain Management, Customer
Relations Management, Financials, Manufacturing functions and Warehouse Management functions
were all once stand alone software applications, usually housed with their own database and network,
today, they can all fit under one umbrella - the ERP system

ERP Benefits: Myth or Reality

Many industry leaders have believed on the evasive nature of ERP benefits. But
how real is the issue of ERP benefits realization? To find out, it helps to look into
some key statistics from our ongoing ERP benchmark study. The study, which
focuses on companies across the globe that have implemented or are in the
process of implementing various ERP packages, reveals some interesting points:

 30% of those surveyed did not realize any sort of staff reductions after go-live
 18% did not measure benefits after go-live
 28% had some type of problem or operational stoppage after go-live

Surprisingly, only 18% of companies did not measure post-go-live benefits (in other words, 82% did
indeed measure). Besides almost 100% of the companies that have implemented ERP, does not
measure post-implementation benefits.

Second, the fact that 28% experienced stoppages seems somewhat alarming. It does highlight that at
least 1 in 4 companies have operational problems and/or stoppages because of the disruptions caused
by ERP.

So what does this all mean? First, the results show that ERP benefits are by no means guaranteed.
Second, the risk of ERP disrupting an organization's core operations is a significant business risk.
These factors are clearly areas that will affect the ROI of the investment in ERP and should be
carefully managed as part of an overall ERP Benefits Realization plan.
The Advantages and Disadvantages of ERP

There are a number of powerful advantages to Enterprise Resource Planning. It

has been used to solve a number of problems that have plagued large
organizations in the past. At the same time, it is not without a number of
disadvantages. Being able to weigh the two will allow a company to decide if this
solution will properly meet their needs.

Advantages of ERP:

In the absence of an ERP system, a large manufacturer may find itself with many software
applications that do not talk to each other and do not effectively interface. Tasks that need to
interface with one another may involve:

 design engineering (how to best make the product)

 order tracking from acceptance through fulfillment
 the revenue cycle from invoice through cash receipt
 managing interdependencies of complex Bill of Materials
 tracking the 3-way match between Purchase orders (what was ordered), Inventory receipts
(what arrived), and costing(what the vendor invoiced)
 the Accounting for all of these tasks, tracking the Revenue, Cost and Profit on a granular level.

Change how a product is made, in the engineering details, and that is how it will now be made.
Effective dates can be used to control when the switch over will occur from an old version to the next
one, both the date that some ingredients go into effect, and date that some are discontinued. Part of
the change can include labeling to identify version numbers.

Computer security is included within an ERP to protect against both outsider crime, such as industrial
espionage, and insider crime, such as embezzlement. A data tampering scenario might involve a
terrorist altering a Bill of Materials so as to put poison in food products, or other sabotage. ERP
security helps to prevent abuse as well.

Disadvantages of ERP:

Many problems organizations have with ERP systems are due to inadequate investment in ongoing
training for involved personnel, including those implementing and testing changes, as well as a lack of
corporate policy protecting the integrity of the data in the ERP systems and how it is used.

Limitations of ERP include:

 Personnel turnover; companies can employ new managers lacking education in the company's
ERP system, proposing changes in business practices that are out of synchronization with the
best utilization of the company's selected ERP.
 Customization of the ERP software is limited. Some customization may involve changing of the
ERP software structure which is usually not allowed.
 Re-engineering of business processes to fit the "industry standard" prescribed by the ERP
system may lead to a loss of competitive advantage.
 ERP systems can be very expensive to install often ranging from 30,000 to 500,000,000 for
multinational companies.
 ERP vendors can charge sums of money for annual license renewal that is unrelated to the size
of the company using the ERP or its profitability.
 Technical support personnel often give replies to callers that are inappropriate for the caller's
corporate structure. Computer security concerns arise, for example when telling a non-
programmer how to change a database on the fly, at a company that requires an audit trail of
changes so as to meet some regulatory standards.
  ERPs are often seen as too rigid and too difficult to adapt to the specific workflow and business
process of some companies—this is cited as one of the main causes of their failure.
 Systems can be difficult to use.
 Systems are too restrictive and do not allow much flexibility in implementation and usage.
 The system can suffer from the "weakest link" problem—an inefficiency in one department or
at one of the partners may affect other participants.
 Many of the integrated links need high accuracy in other applications to work effectively. A
company can achieve minimum standards, then over time "dirty data" will reduce the
reliability of some applications.
 Once a system is established, switching costs are very high for any one of the partners
(reducing flexibility and strategic control at the corporate level).
 The blurring of company boundaries can cause problems in accountability, lines of
responsibility, and employee morale.
 Resistance in sharing sensitive internal information between departments can reduce the
effectiveness of the software.
 There are frequent compatibility problems with the various legacy systems of the partners.
 The system may be over-engineered relative to the actual needs of the customer.

Conclusion:
The success of the system is fully dependent on how the workers utilize it. This means they must be
properly trained, and a number of companies have attempted to save money by reducing the cost of
training. Even if a company has enough money to implement ERP, they may not be able to
successfully use it if they do not have enough money to train their workers on the process of using it.
One of the biggest problems with ERP is that it is hard to customize. Very few companies can
effectively use ERP right out of the box. It must be modified to suit their needs, and this process can
be both expensive and tedious. Even when a company does begin changing the system, they are
limited in what they can do.

Introduction to Enterprise Resource Planning

Enterprise Resource Planning is the latest high end solution, information

technology has lent to business application. The ERP solutions seek to streamline
and integrate operation processes and information flows in the company to
synergise the resources of an organisation namely men, material, money and
machine through information. Initially implementation of an ERP package was
possible only for very large Multi National Companies and Infrastructure
Companies due to high cost involved. Today many companies in India have gone in
for implementation of ERP and it is expected in the near future that 60% of the
companies will be implementing one or the other ERP packages since this will
become a must for gaining competitive advantage

Most organizations across the world have realized that in a rapidly changing environment, it is
impossible to create and maintain a custom designed software package which will cater to all their
requirements and also be completely up-to-date. Realizing the requirement of user organizations
some of the leading software companies have designed Enterprise Resource Planning software which
will offer an integrated software solution to all the functions of an organisation. 

It was introduced by research and analysis firm Gartner in 1990. ERP systems now attempt to cover
all core functions of an enterprise, regardless of the organization's business or charter. These systems
can now be found in non-manufacturing businesses, non-profit organizations and governments. 
To be considered an ERP system, a software package must provide the function of at least two
systems. For example, a software package that provides both payroll and accounting functions could
technically be considered an ERP software package
  
Enterprise Resource Planning

Some organizations — typically those with sufficient in-house IT skills to integrate multiple software
products — choose to implement only portions of an ERP system and develop an external interface to
other ERP or stand-alone systems for their other application needs. For example, one may choose to
use human resource management system from one vendor, and the financial systems from another,
and perform the integration between the systems themselves.

This is common to retailers, where even a mid-sized retailer will have a discrete Point-of-Sale (POS)
product and financials application, then a series of specialized applications to handle business
requirements such as warehouse management, staff rostering, merchandising and logistics. 
Ideally, ERP delivers a single database that contains all data for the software modules, which would
include:

Manufacturing 
Engineering, bills of material, scheduling, capacity, workflow management, quality control, cost
management, manufacturing process, manufacturing projects, manufacturing flow

Supply chain management 

Order to cash, inventory, order entry, purchasing, product configurator, supply chain planning,
supplier scheduling, inspection of goods, claim processing, commission calculation

Financials 
General ledger, cash management, accounts payable, accounts receivable, fixed assets

Project management 
Costing, billing, time and expense, performance units, activity management

Human resources 
Human resources, payroll, training, time and attendance, rostering, benefits

Customer relationship management 

Sales and marketing, commissions, service, customer contact and call center support

Data warehouse and various self-service interfaces for customers, suppliers, and employees

Access control - user privilege as per authority levels for process execution

Customization - to meet the extension, addition, change in process flow

Enterprise resource planning is a term originally derived from manufacturing resource planning (MRP
II) that followed material requirements planning (MRP). MRP evolved into ERP when "routings"
became a major part of the software architecture and a company's capacity planning activity also
became a part of the standard software activity. ERP systems typically handle the manufacturing,
logistics, distribution, inventory, shipping, invoicing, and accounting for a company. ERP software can
aid in the control of many business activities, including sales, marketing, delivery, billing, production,
inventory management, quality management and human resource management.

ERP systems saw a large boost in sales in the 1990s as companies faced the Y2K problem in their
legacy systems. Many companies took this opportunity to replace their legacy information systems
with ERP systems. This rapid growth in sales was followed by a slump in 1999, at which time most
companies had already implemented their Y2K solution.

ERPs are often incorrectly called back office systems indicating that customers and the general public
are not directly involved. This is contrasted with front office systems like customer relationship
management (CRM) systems that deal directly with the customers, or the eBusiness systems such as
eCommerce, eGovernment, eTelecom, and eFinance, or supplier relationship management (SRM)
systems. 
ERPs are cross-functional and enterprise wide. All functional departments that are involved in
operations or production are integrated in one system. In addition to manufacturing, warehousing,
logistics, and information technology, this would include accounting, human resources, marketing and
strategic management.

Understanding ERP
ERP covers a multitude of topics, all integral parts of a very expansive and
comprehensive process. In learning what it’s about and how it works, there are
some central features one must understand.

 Business process reengineering:

ERP is about leveraging a company’s information, as well as the information resources of
partner companies, in the pursuit of more efficient ways of doing business. In general, a
company’s business processes already leverage existing resources and information availability
optimally in order to achieve the most efficient operation possible. But by reconfiguring
information resources, combining and extending applications, and partnering with other
companies in the sharing of information, new possibilities emerge in terms of how business
processes (such as manufacturing, order processing, and inventory control) may be
implemented. Making business systems better is a central ERP objective.
 Database integration:
Most traditional businesses store information by business function. Financial information is in
an accounting database, customer data is in a customer database, and so on. ERP calls for the
integration of databases into a super-database that enables logical links between records that
traditional applications would not require but that process-oriented ERP applications do
require. Often, ERP platform software simply creates convenient and easily maintained bridges
between existing databases rather than requiring the awkward generation of new databases
from old.
 Enhanced user interfaces:
ERP applications, in general, cease to be stand-alone and become steps in a process. Often, a
user interface will initiate down-line processes, in addition to its primary function, in highly
efficient ways (such as the triggering of updates in down-line databases when a record is
changed in the database the user interface is using). It is also often the case that ERP-
integrated databases offer wider reporting options via application interfaces than conventional
systems do. It is important to learn what options are useful and how this extended reporting
may be enabled.
 Data transport between companies:
As the Internet continues to blossom, the sharing of strategic information between partner
companies and logistical data between companies partnered in supply chains is increasingly
important. The enhanced databases and interfaces of an ERP-based company are made all the
more valuable if partner companies are invited to the party. So a broad and detailed
knowledge of the various data communication options is essential to an ERP designer.
 Extended and distributed applications:
What exactly does it mean to extend an application or to share in a distributed application?
Basically, a conventional information system is much like a farm covered with ponds: you go
to a particular pond and scoop out a bucket of water in order to water your plants. In an ERP
environment, the ponds are all converted into an irrigation system: the water is routed to the
section of the farm where it’s needed. And this includes sharing water with neighboring farms.
An extended application has ancillary functions; a distributed application accommodates many
users—even if the users have different needs and are all making use of different portions of
database records. It is essential to understand how to facilitate this varied use of common
data and to familiarize yourself with how a particular development environment can enable it.

How To Combine ERP With CRM

Being able to blend together ERP with CRM is important. Being able to combine
your ERP and customer data is what will ensure the myriad of data points across a
variety of business processes are tracked and turned from raw data into
intelligence. Being able to plot the inventory cycles of your product combined with
data on all your customers needs and preferences will help you maximize nuances
of inventory and customer repeat purchases
Enterprise Resource Applications (ERP) is what mainly mid to larger sized businesses use and need to
manage their business operations. This includes, logistics, shipping, inventory, receiving and sales.
ERP lets you know that shipment of shoes has left the dock, when it arrives in your warehouse, when
it ships to your retail stores and many more.

Customer Relationship Management (CRM) is also critically important as it is the intelligent glue that
ensures you know what your customers want and that you can deliver it to them, when they want it
and how they want it.

Enterprise Resource Applications (ERP) is what mainly mid to larger sized businesses use and need to
manage their business operations. This includes, logistics, shipping, inventory, receiving and sales.
ERP lets you know that your shipment of shoes has left the dock in China. Lets you know when it
arrives in your warehouse. Let's you know when it ships to your retail stores and more.

Customer Relationship Management (CRM) is also critically important as it is the intelligent glue that
ensures you know what your customers want and that you can deliver it to them, when they want it
and how they want it. It tells you that Mary and 100 other customers travel 15 miles every week to
shop at your store. It tells you that Ted calls up every Mother's day to order pink orthopedic shoes for
his Mom. Take a look at how Amazon.com tries to "know you" this what CRM is all about.

Being able to blend together ERP with CRM is important and this is what Sage has done with its new
Sage Accpac Extended Enterprise Suite consisting of Sage Accpac ERP version 5.5 with integrated
CRM. 
Being able to combine your ERP and customer data is what will ensure the myriad of data points
across a variety of business processes are tracked and turned from raw data into intelligence. Being
able to plot the inventory cycles of your product combined with data on all your customers needs and
preferences will help you maximize nuances of inventory and customer repeat purchases.

How To Make ERP Complement Business

The smart and aggressive organizations are finding that ERP and CRM solutions
can be an effective way to weather the economic storm and better position
themselves in the coming days.

Business is all about taking risks. But intelligent managers know how to manage risks, thus preventing
accidental losses as well as other operational, financial, and strategic risks - including fraud. To
manage business risks by using technology, we must first understand and prioritize the risks a specific
business faces, and then understand how Information Technology (IT) can help that business. Then
we can come to understand how those risks intersect with the IT systems a business might already
have in place. Indeed, intelligent use of an ERP system can not only help ensure compliance with legal
requirements and accounting rules, but it can also help prevent fraud. An Enterprise Resource
Planning (ERP) application and its user permissions settings can prevent theft.

Becoming Lean has been a goal of most companies over the last few years. Lean delivers what
companies really need in today’s highly competitive world — shorter lead times, improved quality,
reduced cost, increased profit, improved productivity and better customer service. To become Lean, a
company must take a hard look at processes and practices to identify those things that truly add value
for the customer and eliminate those that do not. The continuous pursuit of waste elimination is the
essence of Lean, and ERP (enterprise resource planning) can help in a Lean initiative.

Below are a benefits and results of implementing ERP to make it complement the business

 Reduce total cost of ownership

 Increase revenues
 Increase productivity
  Improve business process efficiency
 Ability to choose from multiple ERP delivery options
 Scale for growth and economic recovery
 Leverage available resources
 Prepare for mergers and acquisitions
 Force management to focus on benefits realization
 Increase rationalization of ERP investments

ERP projects needs to be implemented for overall improvement of business operations and systems.

ERP in Small and Midsize Businesses

Despite aggressive cost cutting, middle-market enterprises still consider pressure

to reduce operating costs as key to their business strategies. Yet these businesses
are in the market for new technology — specifically customer relationship
management (CRM), an area in which either slight increases or significant
investment over the next two years is most often designated.

ERP for small business calls for voluminous investments. The amount was fairly affordable to small
business entities. There is no doubt or two say about its benefits. But the question that kept ringing in
the market was can everyone afford it. The answer was a stubborn no initially but not anymore. ERP
outsourcing, Open Source ERP's and ERP applications designed for S.M.E.'s (Small and medium
Enterprises) have successfully overcome the above said limitations.

Enterprise Resource planning was a term restricted purely to elite class. This scene was witnessed in
the IT market for some long time ever since ERP was introduced. The large organizations went ahead
with ERP process unmindful of negative consequences, not to forget mentioning the fact that they took
every proactive measure to curb the same. Needles to say firms were interested in serving such large
players. So the fate of Small and Medium enterprises remained unanswered. ERP for S.M.E's remained
a mere dream. 
It so happened that the number of larger companies without ERP turned out to be nil. Thanks to the
awareness created by vendors and IT researchers. No doubt companies were initially hesitant lot and
apprehensive on just hearing the word ERP. However the industry proved them otherwise. Then came
a stage where a company could not exist but without ERP. Even if their performance was satisfactory
they were not able to gain any competitive advantages. 
This explanation of how goliaths adapted to ERP has lot of significance in studying their intervention
with S.M.E. These bigger companies were not providing the required business to ERP vendors. Even
though there are many big companies the number of vendors was always greater in multiples. This
means only the best could strike deals and there was no possibility for mediocre or average vendors
(in terms of performance).The best players also found that they had none to serve after a point of
time because almost every company in the market successfully established ERP (whether on the first
or further attempts).

SO they had to naturally look for greener and fresher pastures. S.M.E.'S was the only answer. The
next question was how to provide best services at an affordable cost and still make profit. In this case
the vendors had to be worried only about the number of sales they could make and not the quantum
of profits because the number of vendors was few and far between when compared with the number
of S.M.E.'S choosing to go for ERP. As the saying goes "necessity is the mother of Invention" vendors
had to devise cost effective applications to meet the demands of the Small and Medium enterprises.
This was the origin of ERP for S.M.E.'S. This benefited them in terms of business .On the other hand
the firms enjoyed greater benefits by making use of this application. Hence ERP and S.M.E. was
weighed on the same scale.

The key things driving small businesses to ERP seems to be 1) growth of the small business sector,
and 2) more focus on the small business market from ERP software vendors. Most of our small
business clients are considering or implementing ERP because of their rapid growth and the
corresponding strain it puts on their legacy systems. In addition, large ERP vendors that typically
focused solely on the Fortune 500 market are now developing lower-cost solutions with more
appropriate functionality for smaller businesses.

A third and final possible reason is because many niche ERP players have entered the marketplace to
provide functional solutions for specific industries. Open technologies such as .net have reduced
barriers to entry into the ERP market, so many smaller, industry-specific niche players are able to fill
the voids left by the big ERP comapnies at a lower cost.

Although this increasing focus on small business is good for companies with limited capital budgets, it
also poses additional risks. Now, there are more choices than ever, and some vendors' products are
much more proven than others. So small businesses should be especially thorough when evaluating
and selecting an ERP package. They should engage in a vendor selection process that ensures they
choose a solid software package that provides a strong ROI to the company.

S.M.E.'s are becoming the popular choice of ERP vendors. There is an increasing awareness of ERP in
S.M.E. market. It has practically helped to unravel the myth that ERP is exclusively meant to business
empires. ERP and S.M.E have become important part of enterprise studies.

How To Extend the Capabilities of ERP

To be and remain competitive, today’s businesses require the ability to have a full
and up-to-date view of their business—whenever they need it. To achieve this, you
need an integrated business environment and automated processes that can
consolidate the data from your ERP and CRM systems with your other business
applications, quickly and simply.

Integrating your ERP with your CRM, and integrating ERP and CRM with your company’s other internal
systems and with systems external to your business may help you to extend functionality by
automating business processes such as:

 Automating manual communication with your trading partners

 Connecting your eCommerce site to your ERP
 Handling service requests via the Web
 Allowing your customers to submit their orders via the Web
 Facilitating EDI transactions
 Sharing data across systems and/or combining processes
 Consolidating a chart of accounts
 Synchronizing your company’s data across multiple sites
 Logging your incoming email

Increase Profits With ERP

Many manufacturers' information technology (IT) budgets are skewed toward

maintenance and integration activities. This can prevent strategic investment in
the systems the company really needs and restricts the organization's ability to
grow and remain profitable. It becomes even more confining as the demands of
the industry change, requiring new information.

A core problem is that while many IT shops can tell you about the frugality of their budget and
targeted project ROI, few can explain IT's impact on productivity or profitability.
A litmus test for IT budgets is comparing IT operating expense to IT capital investment. A good rule of
thumb suggests numbers should be in the range of 70 percent for operating expenses to 30 percent in
capital investment. This tells us that systems are being invested in and renewed and that IT is
continually addressing new business problems with technology.

If you compare the cash outflow of the IT budget to employee productivity you'll find some interesting
things. 
Is productivity improving or slowly deteriorating over time? Depending upon the level of detail
available here, the answer shows up in high indirect to direct employee ratios in manufacturing and
often in high SG&A numbers for the overall company. The implication we can draw is that the systems
may no longer be helping the firm succeed. 
How so? Look for disconnected processes and systems that hamper communication and see if you find
lots of workarounds. It's likely these prevent employees from doing the right things—slowing down
decisions and customer response times while pushing up overhead—or they are doing the right things,
but by spending far too much effort. The cost, ultimately, is profitability. 
There a several areas that today's ERP systems can make a substantial difference.

Gain visibility into all aspects of the supply chain

Benchmarking studies have shown that one of the keys to supply chain success is forecast accuracy. A
better forecast helps you make better decisions throughout your operations. For example, smoothing
production plans uses labor and your manufacturing assets more effectively. And accurate
procurement from your suppliers minimizes inventory. More efficient operation leads to more efficient
customer response. And it's worth it. Supply chain benchmarking done by AMR Research has shown
that improving sales forecast accuracy by as little as 1 percent can improve profitability by 2 percent. 
To determine whether an ERP system would optimize your supply chain, assess forecasting and
demand management systems. Look at how analytics systems reveal true performance. If there's
room for improvement, consider how today's ERP systems provide the capabilities to access
information through familiar desktop tools, so that employees can make rapid decisions informed by
real-time, accurate data.

Get new products to market faster

New product development and launch is improved when good information and collaboration tools are
available. Companies must quickly assess projects, pick the right ones, and manage intellectual
property. Collaboration extends beyond coordinating the project and engineers, now it embraces
marketing, sales, and all supply chain activity, both internally and externally.

Streamline manufacturing processes

While most manufacturers agree that lean manufacturing improves customer-response time and
reduces costs, many organizations run their lean processes with manual systems, spreadsheets, and
standalone personal computer applications rather than with enterprise-class applications. The
challenge is to make data available to everyone. But this is difficult, laborious, and costly when
sharing information with staff, customers, vendors, and partners must be done manually.

Increase collaboration and customer satisfaction

In most industries, supply-chain transparency is essential to success. Manufacturers need to be tightly

integrated with their suppliers and to provide critical product, price, availability, and shipment
information to their customers. This is especially true in a global supply network. Responding to
changing demands rapidly requires visibility across the entire supply chain and accurate information
about the supplier's capacity. 
Yet capabilities, such as inventory visibility, vendor-managed inventories, electronic Kanban
replenishment signals, or working with new suppliers, are often done manually or not at all. So, the
supply chain is difficult to manage efficiently. To increase efficiency, many companies invest heavily in
integrating data from their customers and suppliers into their ERP systems. And they're adding
customer portals to reduce order-taking costs, speed fulfillment, and increase customer satisfaction.

Ensure compliance with regulations

There is probably no sector of the manufacturing industry that is not concerned with new regulatory
compliances. Simply put, regulatory compliance means collecting critical data and ensuring that
production and the resulting products meet the constantly evolving required safety and quality
standards. For far too many manufacturers, collecting and compiling this data is an offline task that
consumes valuable employee time and reduces profit margins. Compliance can't be ignored, but it can
be done more efficiently when data is captured by a current ERP system.

Implement integrated information systems—from making do to moving on

Just because a business doesn't request an integrated system doesn't mean they don't need it. People
have an amazing ability to accept what they have. When they need data, people go to great lengths to
get it – even if it means re-keying data into spreadsheets and other applications. But when they do, it
can add to overhead costs and slow down business processes—especially those critical to bringing new
products to market or are customer facing. 
Integrated systems can speed time-to-market, improve customer delivery performance, and provide
the data executives need to make the right cost and investment decisions as markets and products
change.
Succeeding in today's fast-moving manufacturing world requires a combination of exciting new
products, collaborativedevelopment, partnerships, and acquisitions. Integrated ERP systems have
already embedded the best practices for many state-of-the-art global business processes. And, with
powerful and familiar desktop tools integrated to the corporate data source, ERP systems give real-
time, accurate visibility to the specific information needed to make decisions and move your
organization forward.

Enterprise Resource Planning

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.
An ERP system has a service-oriented architecture with modular hardware and software units or
"services" that communicate on a local area network. The modular design allows a business to add or
reconfigure modules (perhaps from different vendors) while preserving data integrity in one shared
database that may be centralized or distributed.

There are many different systems in a large company's "back office," including planning,
manufacturing, distribution, shipping, and accounting.Enterprise resource planning (ERP) is a system
that integrates all of these functions into a single system, designed to serve the needs of each
different department within the enterprise. ERP is more of a methodology than a piece of software,
although it does incorporate several software applications, brought together under a single, integrated
interface.

An ERP system spans multiple departments in a corporation, and in some cases an ERP will also
transcend the corporate boundary to incorporate systems of partners and suppliers as well, to bring in
additional functions like supply chain management. Because it is so vast and all-encompassing, the
ERP system goes far beyond being just a simple piece of software. Each implementation is unique and
is designed to correspond to the implementer's various business processes. An ERP implementation
can cost millions of dollars to create, and may take several years to complete.

An ERP system likely represents a company's largest IT investment, so some companies prefer to
implement ERP in a more incremental fashion rather than all at once. Some ERP vendors provide
modular software units together with a unified interface to allow for this gradual approach.
Some organizations — typically those with sufficient in-house IT skills to integrate multiple software
products — choose to implement only portions of an ERP system and develop an external interface to
other ERP or stand-alone systems for their other application needs. For example, one may choose to
use human resource management system from one vendor, and the financial systems from another,
and perform the integration between the systems themselves.

This is common to retailers, where even a mid-sized retailer will have a discrete Point-of-Sale (POS)
product and financials application, then a series of specialized applications to handle business
requirements such as warehouse management, staff rostering, merchandising and logistics.

Ideally, ERP delivers a single database that contains all data for the software modules, which would
include:

 Manufacturing
Engineering, bills of material, scheduling, capacity, workflow management, quality control,
cost management, manufacturing process, manufacturing projects, manufacturing flow
 Supply chain management 
Order to cash, inventory, order entry, purchasing, product configurator, supply chain planning,
supplier scheduling, inspection of goods, claim processing, commission calculation
 Financials 
General ledger, cash management, accounts payable, accounts receivable, fixed assets
 Project management 
Costing, billing, time and expense, performance units, activity management
 Human resources 
Human resources, payroll, training, time and attendance, rostering, benefits
 Customer relationship management 
Sales and marketing, commissions, service, customer contact and call center support
 Data warehouse and various self-service interfaces
for customers, suppliers, and employees
 Access control
user privilege as per authority levels for process execution
 Customization 
to meet the extension, addition, change in process flow

ERP Analysis

ERP calls for different operations and applications in different industries. Each
industry has their own drawbacks and plus points in dealing with the enterprise
applications. A comparative study will help in analyzing them precisely.

Enterprise resource planning (ERP) software helps integrate management, staff, and equipment,
combining all aspects of the business into one system in order to facilitate every element of the
manufacturing process. ERP groups traditional company and management functions (such as
accounting, human resources [HR], manufacturing management, and customer relationship
management [CRM]) into a coherent whole. Manufacturing management also includes inventory,
purchasing, and quality and sales management.

ERP systems aid in the control and communication of business activities, such as:

 efficient handling of order processing and production scheduling

 management and analyses of business processes within an interactive environment
 synchronization of departmental activities (e.g., within human resources or finances) with the
needs and output from production facilities
 monitoring, sharing, and tracking of information throughout the organization
Enterprise Resource Planning Evaluation helps in

 Examine how each solution addresses your management and manufacturing requirements.
 Compare systems to see if they offer the functions critical to your industry.
 Analyze each solution's capacity to support your company's growth and operations over time.

Some of the well known beneficiaries include the following sectors:

 Manufacturing
ERP has helped to increase the efficiency and quality of the manufacturing process. The
manufacturing process experienced slumps quiet often because of improper communication,
miscommunication, wrong communication and even lack of communication. ERP provided
solutions to those troubles by coordinating the actions of supply chains, ware house and
logistics.
It also helped greatly in functions like tracking down the status of the product. Formerly
customers were made to run from pillar to post to enquire the status of product or for
enquiring a technical problem. The customer service representative would not be in a position
to directly reply to these queries. On the contrary he would ask the person from the concerned
department. The person would check the details and get back to him be it the status of a
product or technical issue. This seemed to be time-consuming and meaningless. The longer
the chains of communication greater are the chances of mistakes. CSC erp finance is a
software meant for accounting purposes.
 Software
The manufacturing sector has been rated as the largest beneficiary. This sector can be rated
as the one who uses ERP easily because it is a product from their species. This does not
undermine ERP'S use in Software sector because it becomes easy to manage projects with
acute deadlines. ERP industry paper will also reveal that it is easy to train and make people
work in this sector than anywhere else.
 Insurance
Enterprise Resource planning has played a vital role in this business by covering three vital
areas. Firstly it has provided a common platform for insurers and his agents. This has helped
in easing the transactions and keeping an eye on the performance of the agent. This has
addressed the difficulties of both the agents and insurers and thus facilitated coordination in
the better interests of the business. 
Secondly it has helped in curbing procedural delays and inefficiencies for which the sector is
famous for. This statement can turn out to be truer if the sector is owned and controlled by
the government either fully or partially. Of course bureaucracy and redtapism are inborn
features in a state's set up but their presence in an insurance industry can do more harm
because it calls for dispensing immediate information during lawsuits and pending claims. IBM
erp Insurance is a famous player in this sector.
 Healthcare
The sharing of databases among hospitals seemed to be a great advantage for doctors and
patients. This even makes one to exaggerate that a person need not maintain a collection of
his medical problems provided that his/her choice of hospital/hospitals has a database of
patient records(or commonly shares them by any other means).Even though it is not practical
to follow those practices ERP has been a lifesaving measure to patients who are admitted in a
hospital in an emergency condition irrespective of the fact that the doctor in charge is aware
of his medical history as ERP provides everything. ERP industry analysis here will reveal that
confidentiality is affected but the life of a person is to be given the utmost priority.
 Hospitality
ERP has helped a lot in bringing down the operational costs and coordinating the acts of
individual departments. Hotels are well known for the segregation of functions. One can find
many small departments like house keeping beverage supply room service etc. Even though
these segregations sound small they have a large impact on the organizational structure. ERP
offers a common medium to coordinate their actions. The entire action can be controlled in the
reception desk. ERP industry paper points the exact benefit as per ERP industry analysis.
Besides this textile erp insurance is equally famous.
  How ERP Vendors Operate

 Success of an ERP system depends on it's capability of successfully

integrating manufacturing with the other processes of a company. Keeping
this in mind, a number of vendors are adding a wide variety of tools to their
products. One example of such value added product is the integration of
sales automation with supply chain maintenance. This have become some of
the most important areas of development.

PeopleSoft became the market leader in human resources ERP software in the late 1980s. As a
measure of market expansion they moved to software programs that dealt with finance. The company
continued to maintain a high level of dominance in this market also. Yet for complete success in ERP
market PeopleSoft integrated other software tools in their ERP System.

While it is possible to specialize in certain things, tailoring your products towards multiple industries
can allow you to gain a great deal of success. A number of ERP suppliers are now offering their
products in two basic types, and these are business solutions and industry solutions. The industry
products are designed for people who are working in specific industries. An example of this could be
finance, communications, education, or healthcare.

ERP Vendors are offering various powerful tools ranging from manufacturing to human resources to
finance.The finance tools allow companies to successfully maintain their financial information like
assets, accounts, budgets, and cash. A company that uses ERP financial products can save a great
deal of money over the long term becuase the productivity of the organization improves over the
period. It can assist a company in managing internal as well as external factors. Enterprise Resource
Planning is instrumental in getting rid of time consuming things such as paper management. Besides
the ERP implementations help companies take crucial and important decision on time.

The business solutions are designed for companies that work in a wide variety of different areas. For
instance, while industry solutions are specific to certain industries, business solutions will be much
more diverse. They will combine a large number of different elements into a single unit. A number of
ERP vendors have offered what are called "suites." These suites will often be comprised of modules
that a client can purchase in groups or a single unit.

The key to success for companies in the global market today is to properly measure their
performance. Enterprise Resource Planning has made things considerable easier. A company is now
able to study their processes, earnings, and performance by merging their operational information
with their financial information. Once this information is integrated, competitiveness and and
productivity of the company increases. Synergy is an important part of ERP solutions. The concept of
combining multiple processes into a single whole helps the company to become successful in the long
term.

Materials Management is yet another area of the company where ERP Vendors are offering end-to-end
solutions. Enterprise Resource Planning allows a company to successfully automate the process of
buying materials and maintaining them. It is possible for a company to predict the demand of the
market based on history, economic statistics, and data from their employees. They can decide when a
product should be producted, and they can do this based on the raw material that is available. The
modules in Materials Management keeps track of the supplies that are purchased and make
calculations about how these materials should be distributed.

Through real time planning, it is possible for a company to decrease their inventory and improve the
processes of their goods and supplies. Another powerful aspect of Enterprise Resource Planning is that
it can give companies a high level of accuracy. Their orders and shipments can have a much higher
level of precision. ERP vendor to remain competitive in the market should always focus on these
aspects and take necessary steps.

The Importance of Enterprise Resource Planning

ERP is a Rising Need of Enterprises. is a strategic tool helping an organization to

gain and edge over its competitors by helping in successfully integrating its key
business operations, synchronizing, planning and optimizing the resources
available in the existing extremely competitive environment.

Its use has a much broader scope in today's world rather than of just planning the use of the
enterprise resources. 
Organizations (especially those which are borderless) face many difficulties in quickly making out the
information required. The integration of the business processes improves coordination between
bodies, streamlines workflows and processes and benefits them in terms of retaining and satisfying
customers by delivering their orders "just-in-time" and keeping them well informed about their orders'
current status rather than keeping them waiting for just a small piece of information. ERP has the
effect of making an enterprise more time-sensitive. Another benefit is of better marketing
opportunities. ERP penetrates one segment after the other and addresses solutions to many debacles
existing in an enterprise.

Different ERP systems have been made to facilitate organizations in Enterprise Resource Planning.
Leading ERP giants making ERP systems are Microsoft, Oracle, PeopleSoft and JD Edwards, SAP AG
etc. These systems link the order, inventory, sales, purchase, manufacturing, supply chain and
warehouse management modules in an enterprise for better, fast and accurate information availability
to every single person which is its 'primary objective' because every single operation and action taken
at any place by any person depends on consistent and updated information availability. Whatever a
person needs can be immediately accessed by him subject to the delegated authority. ERP function
has thus helped individuals.

They also enhance management decision making by making future projections about sales during a
certain period of a certain product. Management would then be able to make decisions whether to
increase/decrease production of that particular product which in turn would help save resources from
being wasted which could be used for other purposes e.g for making other products. They also help
managers make decisions about introducing some new value added features to an existing 'hot-
demand' product to enhance sales further. This is how product quality is also enhanced. Inventory
costs reduction must be given a great importance in every organization. ERP helps reduce inventory
costs by better planning and forecasting of requirements. ERP system helps getting higher return on
investments (ROI) in a fast manner.

While there are absolute benefits, an ERP system also poses significant challenges in the areas of
information security and business continuity planning. Above mentioned things point to a very critical
step, the right choice of an ERP for your enterprise! Off all the ERP systems exiting in the market, all
seem to be performing the same function but the one best suiting your requirements needs to be
picked up in order to achieve required results. The choice depends upon the structure and type of the
organization e.g financial, manufacturing etc. This is why some organizations experience higher
benefits as compared to others because they've made the right choice and are able to make the right
use of their system.

One of the most powerful advantages to ERP is the implementation of software. Even though Y2K
didn't become the disaster that many people expected, it gave rise to the concept of making sure
software was properly implemented. In addition to dealing with software issues, ERP can also help
companies integrate their operations. At the same time, it is important to realize that there are a
number of challenges involved with utilizing ERP. Perhaps one of the greatest of these challenges is
cost. Enterprise Resource Planning tools are outside the price range of many organizations.
It is important to understand that ERP tools must be customized to meet the needs of the company.
In most cases, it will not be useful when it first purchased. Each company has unique needs, and ERP
tools must be able to meet them. A number of companies run into problems when they attempt to
customize the software.

To summarize, ERP has a great importance and ERP systems have become the biggest need of today's
organizations to survive. They provide tremendous benefits provided the Critical Success Factors of
ERP system implementation are kept in mind.

ERP systems and ADC Tools

Enterprise Resource Planning (ERP) integrated application software systems and

Automated Data Collection (ADC) tools are experiencing a resurgence. Existing
users are expanding their use of existing functionality, and new users are
acquiring one or both applications to meet business requirements. This increased
interest has been driven by customer requirements

ERP systems are a well-established IT application in today's medium to large multi-national

organizations. They have evolved into fully integrated supply chain tools, including customer
relationship management (CRM), business-to-business transaction support, vendor-managed
inventory tools and customer self-service interfaces and portals.

Automated Data Collection, or ADC/barcoding tools, employ fixed and portable barcode scanners that
read labels as products pass through the production cycle, so that transactional and product data is
wirelessly transmitted via a wireless network to radio antennae, which seamlessly update the ERP
system.

Often a secondary implementation to an ERP installation, ADC/barcoding tools effectively leverage the
existing capabilities of ERP systems. While these tools are also not a new development (the first
barcode was actually scanned in 1972), there is now an increased demand for them, particularly now
that they may include radio frequency identification (RFID) tags, which provide an efficient solution for
regulatory and customer food/product security requirements, particularly in high volume
environments.

With RFID, portals can be positioned so that a forklift driver could pass through with a full pallet of
mixed items, and all of the RFID labels could be read simultaneously and discretely.

Large organizations like Wal-Mart and the U.S. Department of Defense, which deal with millions of
pallets of material a year, foresee large savings in labour and increased data accuracy, by employing
RFID technology. Driven backwards through the supply chain, primarily by large retailers, RFID will
eventually become a universal, entrenched part of the physical buyer/seller transactions in industries
where large volume transactions exist, in addition to a regulatory environment where issues of
food/product security, lot traceability and real-time data accuracy are paramount. The rela-tively high
cost of RFID labels and the lack of standardization of the format are still obstacles, but RFID will
become a standard in these industries over time.

Shifting paradigm

The impact of this evolution on accounting and management information systems (MIS) has been
substantial, even revolutionary. However, the impact hasn't been limited to these areas. All areas of
the organization have had to evolve with changing organizational paradigms.

One of the fundamental organizational changes that ERP systems have created is a demand for more
strategic staff and fewer clerical staff. Given the inherent integration of transaction processes
connected to ERP systems, users need to understand at least one step before and one step after their
own job functions, both inside and outside the ERP system. ERP systems are configured around key
business processes outside the system itself, which means users have to understand these
connections and work with them to create an efficient organization.

Optimal ERP system configuration and transactional processing requires that the implementation
integrate business processes and train the users in the integrated transactional processes of the
system. This process creates an expanded organizational knowledge and greater functional capabilities
for the system users.

The rigorous requirements that ERP systems place on their users is evident in the people focus of the
implementation models and methodology of IT consulting firms. Many of these firms consider the
relative importance of resource allocation and effort as follows: people--50%, process--35%,
technology--15%. Hence training with, and user understanding of, the ERP system is paramount.

These considerations have obvious impacts on the HR function. An ERP system implementation is a
large scale change management initiative. Organizational processes are reviewed, documented and
rationalized, often in a "current state/future state" analysis, or as part of a business process re-
engineering plan. Management must manage the change efficiently and effectively. HR must work
closely with management, the project manager and any external consultants, to ensure these
considerations are addressed.

In the same manner that ERP systems can be viewed as leveraging the human capital of an
organization, ADC tools have leveraged the inherent capabilities of ERP systems, which are often
described as integrated, "real-time" systems. The reality is that while ERP systems are capable of real-
time reporting for an organization's MIS, data capture often isn't automated. ADC tools form the last
link in this information chain, turning "real time" into "real, real time." Thus the accounting assertion
that there need be a trade-off between relevance (timeliness) and reliability (accuracy) of financial
information is no longer the case.

These developments have also enhanced quality assurance (QA) capabilities and compliance
effectiveness. With the timely and accurate tracking of supplier and customer lots in real time,
efficient and effective lot tracking and mock recall protocols are also possible. This is a major boost for
the product and process components of any food/product security program, for instance.

It's interesting to note that in the same manner that inventory items are barcoded and scanned by
ADC tools, so too can employee ID badges, as the employee moves within the plant or work centre.
Not only does this enhance the people and plant components of a security program, but it can be
interfaced with the ERP system to produce additional labour reports. In many labour-intensive plants,
accurate labour reporting is difficult to attain. With this tool, labour variances can be analyzed.

Selecting the right system

To derive the benefits of an ERP implementation, a number of considerations must be evaluated.

These include considering:

 both the current and future/growth business requirements (scalability);

 the appropriate trade-off between application software complexity and related user needs
(usually a mid-market vs. high-end software application acquisition decision);
 an assessment of the "time-to-benefit" for key business processes in the organization's
strategic plans;
 the key metrics that indicate relative application software complexity and time to benefit, such
as the historical ratio of consulting dollars to initial license fees (the application software
vendor and/or consulting firm can provide this);
 the software version of the application being selected (leading edge vs. bleeding edge);
 the stability of the software vendor;
  the ability of the organization to devote sufficient resources (people, amount of dedicated
project time per person, minimum funding) over time;
 the involvement of key users in the planning process (when key players "plan the battle" they
don't "battle the plan");
 producing a specific, measurable, achievable, realistic, time-oriented project plan and budget;
and
 selecting application software certified implementation consultants with relevant industry
experience.

Given that each application is provided by a different software vendor, it's crucial that the ERP system
and its integrated ADC tool have significant, successful implementation history together.

A second important proviso is that the appropriate procedures and controls must exist both inside and
outside the system, including appropriate levels of user training and system familiarity, with the ERP
system, the ADC tool, and their integration. With a tight integration of these applications there are
fewer change management challenges when, for instance, implementing an ADC solution subsequent
to the initial ERP implementation (the standard sequence of events).

The substantial benefit to accounting and MIS of ERP systems, ADC tools, and more recently RFID, will
continue to be simultaneously relevant and reliable data. At the same time, organizations will be able
to devote more of their human resources to strategic challenges.

ERP Suppliers

In looking at the ERP value proposition from a market research perspective,

functionality, market penetration, industry orientation, and partnership strategy
are the keys. IT managers and staffs look at these same characteristics from their
perspective, sometimes after first making an architectural or platform decision,
but most often “Functionality rules!” By “ERP Value Proposition,” IT Investment
Research refers to the advantages of a single database for all business information
being updated in real time from consistent user interfaces such that it is
theoretically the only piece of business software the enterprise needs.

End users such as plant managers and budget planners assume all software offers this value and
become very frustrated when they find that standalone application software does not.

The characteristics are important to IT staffs for a variety of reasons. For example, a higher market
penetration translates to an increasing likelihood that you will find references in your specific industry
and size of company classification. The supplier’s partnership strategy also helps in terms of industry
centricity. Infor, Microsoft, Oracle and SAP are the leading suppliers of ERP software.

Delivery methods such as software-as-a-service or availability in a hosting arrangement are important

also, but all the leading suppliers offer all the leading methods, so the differences are less relevant.

The suppliers’ visions for the future are equally important but since enterprises still tend to turn over
their ERP applications only once per decade, you can be pretty sure your supplier will be where you
need it by the time you are ready to move.

Of the characteristics considered in ERP product research and the value proposition IT is looking for,
IT Investment Research thinks industry centricity is the most important to users. And of course,
functionality rules.

The Building Blocks of ERP

ERP software solutions are developed after in depth analysis of the needs and
requirements of the construction and buildings business owners to increase the
efficiency of the entire system.

The Building Blocks of ERP can be categorised into the following layers:

 Layer 0:
"Layer 0" is the name for the bundle of all basic building blocks that always have to be
installed when you want to install one (or more or all) ERP scenarios. "Layer 0" contains the
following building blocks: B32, J02, N69, N70, N71, J05, J04, J30 and J15.
 Layer 1:
o J06 - Production Planning and Control:This building block contains all the necessary
activities and settings required for production and implementation of the master data
for the Production Planning and Control System.
The building block contains the major activities within the production area and the
following functions are provided to support the Production Planning and Control
building block
o J18 – Product Cost Planning:This building block provides all the settings that are
required to create a standard cost estimate, that is, a standard price calculation for
materials without relation to a specific production scenario, which can then be updated
as standard price in the material master. 
building block J18 provides functionalities like Costing sheet, Cost component
structure, Valuation variant, Costing variant, Cross-company costing.
o J17 - Profitability Analysis:This building block is used to set up Profitability Analysis.
The building block provides functionality to plan, organize and evaluate the
effectiveness of sales by calculating contribution margins. The Profitability Analysis
Building Block (J17) provides functionalities such as Master Data and Structures,
Valuation of Sales, Planning,Transfer of Billing Documents and Actual Flows,
Information System. 
With the help of this building block Profitability Analysis is set up. This can be used for
valuation of sales and the transfer of billing documents. Planning processes can be
performed. This building block can also be used to perform period-end closing and
reporting in Profitability Analysis.
 BW Building Blocks : 
o BI Connectivity:This building block contains all settings that are necessary to connect
all the relevant source systems with SAP BW. If only some source systems are
relevant for the installation, the building block activities can be reduced without any
effect on other source systems. An installation role for each component is provided to
access all transactions relevant for the installation.
o General Settings for BI Integration:This building block describes all the activities that
must be performed for BI Integration for each system involved regardless of the
analysis that is going to be performed.
o General Settings for BI Integration:This building block describes all the activities that
must be performed for BI Integration for each system involved regardless of the
analysis that is going to be performed.
o CO-PA Analysis:CO-PA is an application that generates data but does not deliver any
structures or tables. These structures and tables are only defined when the customer-
specific operating concern. To ensure that CO-PA data is analyzed correctly in SAP BW,
the structure of the InfoCube should correspond to that of the appropriate operating
concern. This InfoCube allows to perform a results analysis that is specific to the CO-
PA of Baseline Package. The InfoCube is compatible with the operating concern, which
is delivered in the Baseline Package.
o Accounts Receivable Analysis:The building block contains the configuration that is
required for the use of the following Business Content InfoCubes. This building block
provides Source system configuration, Installation of Business Content, Data upload.
o Capacity Load Utilization:The building block contains the configuration that is required
if the InfoCube Capacity Load Utilization is used for reporting. This InfoCube enables
 to view information about available capacity from ERP such as a comparison of the
available capacity with the target capacity requirements.
 E-Commerce for mySAP ERP Building Block :
o E-Commerce for mySAP ERP:With SAP E-Commerce for mySAP ERP, new, attractive
sales channels can be rapidly created . Organization can increase the productivity of
its sales representatives while ensuring that business partners and customers receive
a highly personalized experience. It guarantees consistency, effectiveness, and
predictability, to make the most promising leads become the most profitable
customers.
 ERP Building Blocks : 
o Enterprise Portal 7.0 Installation
o Connectivity
o General Settings

The Current State of Enterprise Resource Planning

ERP evolved from manufacturing resource planning (which originated from

material resource planning).The functioning of ERP has gained much prominence
and utility with the intervention of web enabled and open source technologies.ERP
II the latest advancement in ERP software deserves special mention.

ERP has a significant impact right from the time it is conceived in the organization. It paves way for
restructuring which would not have otherwise happened in organizations sticking to traditional and
conventional values. ERP is an eye-opener for organizations because they get to realize the fine
distinction involved in modifying the business processes. Organizations now disclose vital information
in the public domain, which was otherwise, considered confidential and not meant for dissemination.  
ERP has undoubtedly become an important business application to all industries. It has almost become
a must for all organizations irrespective of the type of business manufacturing or service .If companies
feel that coordination and enterprise communication are their only problems they don't have any other
alternative but to go for ERP, provided they want to make profits and remove the existing setbacks.  
Needles to say ERP has helped companies in monetary and nonmonetary aspects if they are keen in
utilizing it to the core and take the necessary steps to overcome the setbacks. However ERP needs lot
of improvement (this statement included the latest versions also).ERP is an effective application. It will
be great if one can bring an ERP system that id devoid of the drawbacks from the existing ones. The
latest intrusions namely open source and web enabled technologies has increased the effectiveness of
the application. However they are not enough (technically speaking).ERP applications should be
designed to make the maximum use of internet so that the user can access data from any part of the
world just by a click of the mouse. This has further deepened the future of ERP. ERP's future is yet to
reach saturation.

According to a research on predominantly Fortune 1000 companies, some startling results have been
revealed. About 48 per cent reported that returns from their ERP project were lower than expected
while only 17 per cent reported gains which exceeded expectations. However, 76 per cent of all
respondents report not having done a business case for their ERP projects. 
According to the research, following is the current situation of ERP:

 Over 42 per cent indicated that additional user training, better skilled people, and/or change
management are required to fully leverage ERP;
 32 per cent indicated that changing or standardizing processes, organizing differently,
changing the work culture, or "adapting to the power of ERP" are necessary to leverage ERP;
 32 per cent indicated that full implementation, better integration, or economies of scale are
necessary.

Formerly ERP was purely restricted to fortune 500 companies, in the sense only they could afford to
invest on them. This put the small and Medium Industries at a large disadvantage. They were not able
to make use of the application to gain the necessary benefits. ERP's future seemed to be dooming on
them.

However this drawback has been removed after the intervention of open source facilities. The concept
of outsourcing has helped in removing the difficulties faced by small and medium enterprises. Hence a
large potential for ERP still exists in the S.M.E. market.

The ERP vendors are targeting this market effectively. However both the vendor and the companies in
this segment have to remember that there are lot of competition in this sector and one is not likely to
succeed unless he serves the best product.

ERP has thrown open opportunities for many companies to trade with foreign counter parts in the
name of outsourcing, implementation and deployment of the existing ones. It has contributed lot to
the economy .Academics also boast its own share of ERP relations.

It has promoted lot of employment and educational opportunities. India happens to be a key
beneficiary in this aspect.

The Effect of ERP on Organisations

ERP (Enterprise Resource Planning) systems are used in the organizations for
information integration and aligning & streamlining their processes for delivering
high value to the customers. Through its very use, it influences manager's jobs
and the organization structure as well.

ERP has significant impact on the organizations and has tremendously changed the way of manager's
job and organization structures.ERP implementation on five dimensions of Manager's job (autonomy,
use of power, delegation, people skills and privileged information), five dimensions of organizational
structure (specialization, formalization, centralization, standardization and complexity of work flow)
and on the flexibility of organization has been effected by the use of ERP in organisations of all levels.

ERP systems have become the system of choice for the majority of publicly traded companies and
have radically changed the way accounting information is processed, analyzed, audited, and
disseminated. In this study, we examine whether ERP system implementations have impacted the
decision usefulness of accounting information. We find that ERP adoptions lead to a trade-off between
increased information relevancy and decreased information reliability for external users of financial
statements. After implementing the system, firms concurrently experience both a decrease in
reporting lag and an increase in the level of discretionary accruals. Contrary to expectations, adopting
more ERP modules did not augment these effects. These results should be of interest to financial
statement preparers initially adopting or implementing new versions of ERP applications, auditors
serving clients with ERP systems, and regulators overseeing the financial markets and consolidation in
the ERP industry.

While ERP has been around for little more than a decade, more companies are now seeing the benefits
of using it. Many companies in the Middle East and Africa have failed to utilize the benefits of ERP, and
the reason for this deals with procedure rather than cost. Many of these companies have used the
same methods for many years, and are unwilling to switch to something new. 

At parieto-occipital sites, in both experiments, the repeated possible and impossible non-target items
elicited less positive ERP waveforms than did first presentations beginning at about 300 ms. The
briefly reduced frontal negativity to repeated items is consistent with familiarity arising from a
facilitation of access to conceptual, semantic and visuo-spatial representations during object
categorization. The polarity of the parieto-occipital effect was the reverse of what is usually found in
stimulus repetition tasks, although it is consistent with earlier work using similar visual stimuli. It is
interpreted as reflecting the availability of a newly formed representation (i.e., token) of the object
just experienced. 
The Essence of ERP

ERP is an outcome of 40 years of trial and error. It has evolved as a strategic tool
because of continuous improvement in the available techniques to manage
business and the fast growth of information technology. Prior to 1960s, the
business had to rely on the traditional ways of inventory management to ensure
smooth functioning of organisation. The most popularly known amongst them is
EOQ (Economic Order Quantity). In this method, each item in the stock is analysed
for its ordering cost and the inventory carrying cost. A trade off is established on a
phased out expected demand of one year, and this way the most economic
ordering quantity can be decided. This technique in principle is a reactive way of
managing inventory.

How does an ERP system make it all happen? The essence of it is the fundamental premise that the
whole being greater than the sum of its parts. The traditional application systems, which the
organisations generally employ, treat each transaction separately. They are built around the strong
boundaries of specific functions that a specific application is meant to cater. For an ERP, it stops
treating these transactions separately as stand-alone activities and considers them to be the part of
the inter-linked processes that make up the business. 

Almost all the typical application systems are nothing but the data manipulation tools. They store
data, process them and present them in the appropriate form whenever requested by the user. In this
process, the only problem is that there is no link between the application systems being used by
different departments. An ERP system also does the same thing, but in a different manner. There are
hundreds of such data tables, which store data generated as a result of diverse transaction, but they
are not confined to any departmental or functional boundaries, rather integrated to be used by
multiple users, for multiple purposes and at multiple places. 

The first of these is flexibility. Many companies need to change their operations and transactions on a
regular basis, and the ideal ERP system must be able to adapt to these changes. Client server
technology is important, because it will allow the ERP system to operate on multiple database back
ends, and it will do this through a process that is called ODBC, or Open Data Base Connectivity.
Another important feature of ERP systems is modularity. The term modularity is used to describe a
system that is "open." The module must be capable of being detached whenever it is needed to work
with other system modules. It should also be capable of supporting multple computer platforms.

Most companies will use a variety of system platforms, and they may also be in need of third party
platforms. The ideal ERP system must be capable of offering this. It is also important for an ERP
system to be comprehensive. It must be able to support a large number of different functions that are
related to the company. In addition to this, it must be calibrated for a diverse range of companies and
organizations. When one is looking at the quality of an ERP system, they must look beyond the
company. Instead of limiting it to boundaries within the company, they should make sure it supports
the internet and other elements within the company. It is also crucial for the organization to look at
best business practices. A collection of these business process should be used on an international
scale. The overall goal of a company should be to take the business processes of the physical world
and apply them to computers.

ERP Impact on Organizations

ERP implementation can positively affect the process capital of a company;

process capital can positively affect customer capital and customer capital
ultimately affects business performance. Companies implementing ERP can build
process capital to meet the challenges of the competitive market environment.

ERP'S impact on its stakeholders:

Impact of ERP on the role of managers or organization or stakeholders can be best studied and
understood if the subject is analyzed right from the implementation stage. Nevertheless it has a
strong influence on the business process itself as soon as it is gripped and decides major issues for
employees, customers and other stake holders. It is better to analyze it in this context rather than
debating on "How will ERP impact the accounting Profession?"

Impact during the Implementation Process:

ERP has a significant impact right from the time it is conceived in the organization. Firstly it facilitates
the members in the organization to arrive at a consensus though after a detailed and deliberate
discussion. It paves way for restructuring which would not have otherwise happened in organizations
sticking to traditional and conventional values. ERP is an eye-opener for such organizations because
they get to realize the nuances and edge involved in modifying the business process. This would not
have happened but for the intervention of ERP. Organizations disclose vital information in the public
domain which was otherwise considered confidential and not meant for dissemination. All this happens
in the implementation process as this it is the time the seeds sown (FOR ERP Intervention) gets
shaped in this phase. Nevertheless the impact of ERP on managers is noteworthy.

Impact on Departments:

It brings about interactions and tends to nurture healthy relationships among departments in
organizations which would have otherwise remained isolated. The problems of coordinations faced by
each department are made known to the company. They can arrive at a better means of doing things
on such group discussions. It is therefore necessary to study the impact of ERP on all departments
rather than restrict it to issues like "How will ERP impact the accounting profession"?

Impact on the organization as a whole:

The ERP consultant will able to identify the flaws and guide the organization in devising better
procedures. It helps organizations to adapt and adjust to change right from the implementation
process.

Impact on Employment:

It throws job opportunities to many individuals, whom the organizations hire at the implementation
process. They even realize the need to retain them on permanent rolls once ERP goes full-fledged in
the organization. The good news is that it gives another room of employment for the existing IT
professionals in the country. They were able to update themselves on ERP modules and continue
serving the organization in terms of enhancing user interface with ERP applications.

Impact on the nature of Job and information access:

ERP has directly and indirectly helped to redefine functions in the organization. Anything that people
wanted to know about the company was available by a click of the mouse. There was no more relying
on the department of internal communications even for single information. Outsiders don't have the
hassle of obtaining permission and following stringent procedures to access information. IT has helped
vastly and so it is not necessary to ask exclusive questions like "How will ERP impact the accounting
Profession"?

Impact on the individual employees:

ERP provided more freedom, authority and responsibility to the individual employees which were
mutually beneficial to the management. Each employee became more aware of his/her function while
ERP has given the confidence to execute it individually and successfully Above all it resulted in
transparency and accountability. The tasks of employees became totally independent as ERP
succeeded in doing away the need of exclusive interdepartmental dependence in order to elicit
information. This has resulted in easing the process of handling and answering customer queries and
undertaking clientele orders.

Conclusion:

A one phrase explanation for the impact of ERP would be "Simplifying Complex Process". One has to
have an idea of the above issues which will help in understanding the impact of ERP on the role of
managers

ERP Sales Solution

Essentially a point of sale system acts like an electronic cash register that impacts
on the whole business environment. Basically, wherever a retail sale occurs a
point of sale system should come into play. Early point of sale systems were
simple mechanical cash registers that began in the 1970's. As a result of time
factors and technological constraints these early machines had limited
functionality. Over time, as they evolved in functionality, they became operational
in many business environments such as restaurants, hotels and grocery stores.
Today's point of sale systems are powerful electronic solutions that are utilised
commercially. Even better is the fact that most point of sale modules available
today can be fully integratable with stock management systems, accounting
systems, as well as payroll systems, just to name a few.

Competition has never been more rife between businesses than it is today. In order to survive in
today's market a retail entrepreneur needs to be able to efficiently run their store, effectively keep
track of stock, as well as maintain customer satisfaction to ensure their loyalty. Thus the
implementation of an effective point of sale solution is pivotal. Most business owners want a point of
sale system that is easy to understand and operate, but at the same time is effective. However,
choosing a point of sale solution that will work wonders for your business can be a dilemma because
of the abundance of POS solutions available on the market today.

One needs to look for a point of sale module that is able to operate effectively, but at the same time is
within the company budget. Although it would be nice to have a system that has phenomenal
functionality most businesses should not take a risk of getting a system that they cannot afford. One
should therefore look for a system that is effective but affordable.

Look for a system that is simple to use and that employees will understand. In most instances, when
business owners purchase a point of sales module, they have to learn how to operate it themselves. If
the system is extremely complicated it can be frustrating and time consuming to the learner.
Additionally one needs to take into account that existing, as well as new employees, will have to learn
how to use the system. Therefore getting a system that is easy to understand should be a top priority.

One needs to look for a system that is physically appealing. Most entrepreneurs need to consider the
following factors when trying to persuade customers to make purchases. The physical environment of
your business which refers to the actual appearance of your business plays a vital role in influencing
peoples impressions of your business. Moreover the quality of the service you provide is just as
important. A point of sale system needs to work hand in hand with these two factors as it needs to
blend in with the type of impression you are trying to convey to potential customers. Therefore a POS
system needs to be appealing to the employees that are going to be operating on it.

Choose the correct ERP

The success rate for implementing not just MRP and ERP systems but all large
software packages has never been very good. In survey after survey, in the USA,
Europe and elsewhere, less than one third meet the basic criteria set out at the
start of the implementation. Too many software engineers know how the software
works but do not know how to integrate it into the business in a way that delivers
real business benefits. With enterprise resource planning (ERP) packages costing
hundreds of thousands, many costing millions, this failure rate is frightening.

The question is - how can you minimise the chance of failure or, more difficult, rescue a package that
is not delivering sufficient business benefits to justify the cost of implementation? The good news is
that, when properly implemented, an ERP package can be the most cost effective project a company
has ever seen.

ERP failure cannot be tolerated by organizations as it involves great money. On the contrary ERP
success makes great money. Selecting a new ERP system can be time-consuming and risky — but
with the right strategy and tools, the selection can be turned into a positive change. Here are some
steps to help identify the best solution for a company. The following elements acting in combination or
individually results in good planning and choosing the best posssible ERP solution:

Meeting and consultations in the organizations to decide ERP

Selecting ERP software does not happen all on a sudden or as a result of an overnight's discussion.
There is lot of groundwork that needs to be done in this regard. There are many reasons for the
ambiguity, with the foremost being advent of Internet. This has expanded the scope of computers and
redefined the technological implications in the business. As a result there is more expectations and
demand. These were not foreseen earlier. Advancement in computing indirectly implies the
advancement in enterprise resource planning. Needless to say the constant updating, upgrading and
innovating have become the benchmark of ERP packages. The indecisive mind of companies in
choosing ERP soft ware solutions needs no explanation.

Hire or Buy ERP

There are two alternatives in choosing ERP software for the company. The first one is purchasing the
software while the second one is obtaining one on hiring basis. There aren't any differences in terms
of costs or benefits irrespective of the option that the company goes for. It all lies in how best the
company makes use of ERP. However the company has to stick on to any one option as soon as it
finalizes.

ERP should Suit company preferences

Companies that choose ERP on grounds of their own preferences succeed in the long run than other
companies. Other companies who sail by some decision that does not justify their preferences are
most unlikely to succeed.

Choosing the ERP vendor

The quality of the services offered by the vendor is equally detrimental in choosing ERP software.
Buyers generally tend to purchase from sellers who have got adequate experience in ERP Products and
services. This is the usual practice for any commodity. This has to be strongly followed in the case of
ERP as there are several dimensions involved with regards to decision making. Nevertheless Choosing
to buy from the right person is alone not enough. How the organization makes the best use of it in
response to the specific needs, to avail the best services is more important in deciding to buy ERP
Systems. 
ERP implementation will be successful if certain guidelines are followed in choosing ERP software.
There is a dual purpose in ERP. It is neither meant exclusively to benefit the trade procedures in the
organization nor help the technological contents. It has to make both ends meet. This Key function
holds ERP in a special manner when compared with any other system. Therefore the company must be
prudent enough to choose an application that caters to this advantage to the maximum extent.
Therefore if a company chooses an enterprise process to assist the business or technology alone the
decision will not yield the required results.

Essential Elements of an ERP System

If a company is able to obtain all the related products of ERP from one seller /vendor then it can be
termed as a profitable Venture. The company will be able to avail their services in all matters relating
to ERP solutions. This is highly recommended and regarded as a wonderful combination. When they
choose to buy an ERP application of a particular module it must be ensured that they enable
connectivity and facilitate data transfer which should easily be made available to the stakeholders. The
advantage in buying a modular application is that the company can choose to select them on the basis
of the function for which it is purchased. These are the essential element of ERP systems.

Time constraints in respect to the organizations function

The ERP system should be purchased based on the long term needs of the organization. In that sense
the firm should visualize its prospects, position and requirements in the long term also. Therefore it
has to be made sure that ERP is not restricted to meeting the current needs. This will also help in
implementation of ERP. 
Suppose if a company is engaged in one particular domain of banking it also needs to understand that
it may have to cater to the entire banking sector if the need arises. Hence it must purchase ERP that
can serve related banking applications or if not be capable of modification for the said purpose in the
future. This will also stand out to be true in the case of organizations that aim at diversifying the
business. A choice is to be made from ERP implementation models. This will also help in
implementation of ERP

Employees to express their opinion on ERP

The core members in the decision making body (for ERP) should hear and heed to the views of all the
employees in the company as long as they are valid. This will make sure that everyone is given an
opportunity of being heard so that they don't lament that they were not allowed to express their
opinions on ERP. This discussions will facilitate the decision making body to know how well ERP is
received in the company and what are the setbacks that are to be removed. This will also help in
implementation of ERP 
There is another important objective in these meetings. They help to bring out the various
modifications and technological changes that the company has to undergo to become ERP friendly.
Gap meeting and business process requirements do help in bringing out them. But these processes
will witness the employees difficulties and requirements directly. The impact is also bound to be more
when it is voiced out in person and in detail.

Customizable and predefined Modules

A large majority of ERP sellers sell customized application in addition to predefined applications to ERP
customers. They assist the customers in making all decisions right from implementation to use. Both
have their own advantages and disadvantages. In the case of customizable applications the buyers will
be instructed about the various options available for modifying. The users have to make a decision of
choosing the appropriate combinations on the basis of their business requirements.

Resorting to an External Body for ERP Services

Some organization finds it tedious to undertake the above mentioned steps. Their workload would be
too large to concentrate on this. In that case they can be outsourced to a third party who can take
care by keeping the needs of the organizations in mind. There are many competitive advantages in
availing the services of such person. Firstly they have the professional expertise and the required
experience. The third party will also face the difficulties of the firm but there wont be any mindset or
favoritism as far as he is concerned .these are all inevitable when the company is doing the service.
Their services will be suited even for bigger operations that have numerous complexity and ambiguity
in operations. This will also help in implementation of ERP.

Verifying the credibility of Vendor's services

The company has to check if the Vendor has already installed a similar configuration elsewhere as it
would not be advisable to be subjected to first time testing given the huge investment in the name of
ERP. If possible the company can try to get information from the ERP customers of the vendors but it
is not practically possible to elicit the necessary information whether they are competitors or not, as
business ethics and professional code of conduct would not permit the same. They will also help in
analyzing ERP Systems.

Application Service Provider

Application service provider is an emerging concept in ERP packages. These are built in packages that
have their own setups for hardware and business process. The usual manner of choosing ERP viz
Deciding, buying and installing has even been given a go by in some occasions. This will also help in
ERP integration

The edge enjoyed by S.M.E.'s

ASP was discussed as a profitable option. The actual fact is that it is a boon to small and medium
enterprises (S.M.E.'S).They would not have been able to think about ERP but for ASP and outsourcing.
They would choose these due to efficient services and affordable costs.

Choosing an outsource service provider

These companies may also choose to select the systems on a rental basis so that they are not
burdened with the tasks like administration, handling network as these are too big when compared
with the size of their firms. As per ASP arrangement the infrastructure part will be taken care of by the
service provider. The company can access everything online, while the customers access to ASP at an
agreed Service charge for the stipulated periods. 
In the case of business process outsourcing the organization can avail the services of a consultant for
its business that will perform the required functions on behalf of the company. The company can also
choose to outsource inhouse operation to the outsourcer to get maximum benefits be made from ERP
implementation models.

Choosing ERP vendors for ASP

Companies must exercise caution in choosing Asp service provider. Many ERP sellers offer ASP
services in response to the rising market demand. Their expertise is unquestionable but the trouble
lies in terms of costs as the ERP vendor would price them at high rates. In addition the choices are not
plenty interms of choosing players. Therefore it is advised to refrain from vendors offering ASP
services and approach ASP service providers alone. This will also help in implementation of ERP.

Resorting to an External Body for ERP Services

Some organization finds it tedious to undertake the above mentioned steps. Their workload would be
too large to concentrate on this. In that case they can be outsourced to a third party who can take
care by keeping the needs of the organizations in mind. There are many competitive advantages in
availing the services of such person. Firstly they have the professional expertise and the required
experience. The third party will also face the difficulties of the firm but there wont be any mindset or
favoritism as far as he is concerned .these are all inevitable when the company is doing the service.
Their services will be suited even for bigger operations that have numerous complexity and ambiguity
in operations. There are different software solutions available for both purposes.

Verifying the credibility of Vendor's services

The company has to check if the Vendor has already installed a similar configuration elsewhere as it
would not be advisable to be subjected to first time testing given the huge investment in the name of
ERP. If possible the company can try to get information from the ERP customers of the vendors but it
is not practically possible to elicit the necessary information whether they are competitors or not, as
business ethics and professional code of conduct would not permit the same.

The Nuances in choosing ERP Software

Pre ERP implementation includes analysis, constructive criticism; homework's has a significant place in
the whole process of ERP. Lot of research and background work needs to be completed prior to the
implementation of ERP or even before thinking about bringing Erp into the organization. The plans of
the organization must be clearly charted out and how it intends to benefit from Erp operations have to
be looked from a broader context.

Important Points in the discussion

This discussion should include important element namely financial issues. Besides it should also
account for the potential threats, strengths and weakness. How much profit will be incurred have to be
discussed and substantiated? Other non monetary benefits should also find a place. These studies
should involve the contribution of the entire group in the organization right from the person in the
highest hierarchy to the one in the lowest level. The contribution should be validated and sharpened
by means of presentations which will help everybody to get insight of the different perspectives, and
views. All of them will be helpful in implementation of ERP.

The cost factor and compensation

ERP will definitely yield the required monetary benefits to organizations whether they have the
practice of built in systems or individual practices. If we are to calculate the costs involved in
preserving and building them over a period of time it will be evident that the ERP costs incurred to
support and facilitate the said functions will be comparatively less. 
This calculation will prove to be equally true even if we take the case of individual department for that
matter. Another important point in this issue is that it has to align with the target goals of the
organization (the purpose for which it is sought and justified) as organizations generally tend to go far
ERP with a view to improve or increase the efficiency of a particular section /dept and the whole
process in general. Similarly the costs incurred to facilitate that particular function must not be
monetarily pinching on the organization and even if they are the benefits and profits from that
particular department or the whole organization preferably should exceed the exorbitant costs.
Everything has to be calculated on the basis of the chosen ERP software systems

Committee to look after ERP process

Analysis and criticism will go a long way in deciding the fate of the ERP product. They are alone not
enough. The next process would be the services of the team who can decide everything concrete with
regards to ERP. The required powers are to be delegated to them. They will do the screening of the
potential vendor based on the organizational needs that have been classified and discussed earlier.
This will be helpful in implementation of ERP.

The organization should focus on what it wants to achieve out of ERP before going ahead with the
process. When that is done successfully the ERP operations will have to be shifted to that particular
objective in general and to the whole organization in particular. This cannot happen in the absence of
ERP integration.

Succeed by Implementing ERP

Implementing ERP systems are extremely complex and take months and even
years to implement. If your stakeholders understand the long-term benefits of the
system, they are much more willing to accept any perceived temporary steps
backward. An enterprise resource planning (ERP) software project can be
daunting for first-timers or veterans handling a migration.

AD

A common malady for some stakeholders is to become complacent with the status quo. You often
hear, “We like what we have. It works for us.” This mindset is predominantly on campuses with strong
IT departments, and older, homegrown legacy systems that still function quite well. Typically they
have been designed to do exactly what the functional departments want them to do. In these cases,
it’s easy to believe that an ERP does not meet their needs.This sentiment will continue throughout the
implementation unless you proactively sell constituents on the many advantages of the new ERP.

Tougher competition in the marketplace is generating the need to better optimize resources, improve
profitability and keep customers satisfied. Companies are increasingly implementing Enterprise
Resource Planning (ERP) software solutions to improve operations and provide faster customer
response.

Choosing an ERP solution that meets your specific business requirements will enable you to have a
smoother implementation. If the software package is written for your industry, you won’t have to
custom design a solution. Customized solutions are time consuming to implement and add
unnecessary cost. One of the top reasons ERP implementations fail is because the software doesn’t
meet basic industry specific business requirements. However; purchasing an ERP application is only
half the battle. A well designed implementation plan is the key to success.

The following five steps are treated as the key behind succwssful ERP implementation:

STRATEGIC PLANNING :
Project team: Assign a project team with employees from sales, customer service, accounting,
purchasing, operations and senior management. Each team member should be committed to the
success of the project and accountable for specific tasks, i.e. developing a timeline, finalizing
objectives, formulating a training plan. Make sure you include first line workers as well as
management on your team. Base the selection on the knowledge of the team not status of the
employee. 
Examine current business processes: Have the team perform an analysis on which business processes
should be improved. Gather copies of key documents such as invoices, batch tickets and bill of lading
for the analysis. To start the team discussion, consider questions such as: Are your procedures up to
date? Are there processes that could be automated? Are personnel spending overtime processing
orders? Does your sales force and customer service personnel have real-time access to customer
information? The team members should also conduct interviews with key personnel to uncover
additional areas of improvement needed
Set objectives: The objectives should be clearly defined prior to implementing the ERP solution. ERP
systems are massive and you won’t be able to implement every function. You need to define the scope
of implementation. Ideally, the scope should be all inclusive. But practically, it is very difficult to
implement. Examples of objectives would include: Does the solution reduce backlogs? Can the solution
improve on-time deliveries? Will you be able to increase production yields? Develop a project plan:
The team should develop a project plan which includes previously defined goals and objectives,
timelines, training procedures, as well as individual team responsibilities. The end result of the project
plan should be a “to do” list for each project team member.

PROCEDURE REVIEW :
Review software capabilities: Dedicate 3-5 days of intensive review of the software capabilities for the
project team. Train on every aspect of the ERP software to fully educate the team on capabilities and
identify gaps. Determine whether modifications are needed prior to employee training.  
Identify manual processes: Evaluate which processes that are manual and should be automated with
the ERP system. 
Develop standard operating procedures (SOPs): for every aspect of your business. These procedures
should be documented. Make sure that you modify the document as your SOPs change. This is a huge
task, but it is critical to the success of your implementation. Examples of SOPs: 
• How do you handle global price changes?
• What are the processes for inputting new customer records?
• How do you currently handle the paperwork on drop shipments?
• How do we add a new product or formula?

DATA COLLECTION & CLEAN-UP :

Convert data: You can’t assume 100% of the data can be converted as there may be outdated
information in the system. Determine which information should be converted through an analysis of
current data. 
Collect new data: Define the new data that needs to be collected. Identify the source documents of
the data. Create spreadsheets to collect and segment the data into logical tables (Most ERP systems
will have a utility to upload data from a spreadsheet to their database). Review all data input: After
the converted and manually collected data is entered into the ERP database, then it must be reviewed
for accuracy and completeness. Data drives the business, so it is very important that the data is
accurate. 
Data clean-up: Review and weed out unneeded information such as customers who haven’t purchased
in a while or are no longer in business. Now is the time for improving data accuracy and re-
establishing contact with inactive customers.

TRAINING AND TESTING :

Pre-test the database: The project team should practice in the test database to confirm that all
information is accurate and working correctly. Use a full week of real transaction data to push through
the system to validate output. Run real life scenarios to test for data accuracy. Occurring
simultaneously with testing, make sure all necessary interfaces are designed and integration issues
are resolved to ensure the software works in concert with other systems. 
Verify testing; Make sure the actual test mirrors the Standard Operating Procedures outlined in step 2,
and determine whether modifications need to made. 
Train the Trainer: It is less costly and very effective if you train the trainer. Assign project team
members to run the in-house training. Set up user workstations for at least 2 days of training by
functional area. Provide additional tools, such as cheat sheets and training documentation. Refresher
training should also be provided as needed on an ongoing basis. 
Final Testing: The project team needs to perform a final test on the data and processes once training
is complete and make any needed adjustments. You won’t need to run parallel systems, if you have
completed a thorough testing.

GO LIVE AND EVALUATION :

Evaluation: Develop a structured evaluation plan which ties back to the goals and objectives that were
set in the planning stage. In addition, a post-implementation audit should be performed after the
system has been up and running for the first week for reconciliation purposes and three to six months
following to test whether or not the anticipated ROI and business benefits are being realized.
Comparing actual numbers with previously established benchmarks will reveal if the software tool
does what it is intended to do - add value to the business. It is important to periodically review the
system's performance to maximize ROI. Upper management and project team members should be
committed for the company to realize the benefits of successful ERP

ERP Human Resources Management Sysytem

A Human Resource Management System (HRMS, EHRMS), Human Resource

Information System (HRIS), HR Technology or also called HR modules, refers to
the systems and processes at the intersection between human resource
management (HRM) and information technology. It merges HRM as a discipline
and in particular its basic HR activities and processes with the information
technology field, whereas the programming of data processing systems evolved
into standardised routines and packages of enterprise resource planning (ERP)
software. On the whole, these ERP systems have their origin on software that
integrates information from different applications into one universal database. The
linkage of its financial and human resource modules through one database is the
most important distinction to the individually and proprietary developed
predecessors, which makes this software application both rigid and flexible.

A growing number of businesses are adopting ERP (enterprise resource planning) systems in order to
give their departments accurate and accessible shared data. HR isn't being left out of the loop. In fact,
most major ERP vendors now offer their customers HR modules that help automate an array of tasks
while generating crucial data for enterprise planning and optimization.

HR processes of an organization can be optimised with a complete and integrated human capital
management solution. Such ERPs helps to attract the right people, develop and leverage their talents,
align their efforts with corporate objectives, and retain top performers.

ERP Human Resources, also referred to as HR Modules, bridges the gap between Human Resource
Management and Information Technology. The data processing systems oftentimes utilized in the IT
realm are easily applied to many of the needs of Human Resource Management Systems (HRMS. The
integration that ERP software makes possible aids in the linking of the two diverse systems.

Many EHRMS supports multiple languages, currencies, tax definitions, benefits, security configurations
and platforms. Resource Management component of EHRMS can support administration, payroll, FSAs
(flexible spending accounts) and compensation.

Work-Force Management aims to help HR departments cost-effectively handle complex work-force

management challenges. It includes scheduling, time and attendance, absence handling and
performance support.

Talent Management provides work-force development capabilities that are focused on recruitment,
learning, employee performance and competency management. Succession-planning capabilities are
also provided.

Most Human Resource Management Systems provides support for a variety of HR tasks, including
benefits, training, recruiting and compliance. Flexible design of this module lets users select their own
database platform. HRMS also includes powerful reporting and analysis tools that provide customized
insight on almost any HR issue. Hundreds of standard report templates are included. An integrated
database is designed to feed a steady flow of information to managers and staff.

The software can automate virtually all fundamental, and most advanced, HR processes, including
employee administration, payroll and reporting. The product supports compliance with both global and
local regulations. Other features include talent management, performance measurements and real-
time insight into just about any HR trend.

HRMS are designed to automate practically every HR-department function. A single integrated data
model aims to supply a fast, immediate and accurate view of HR-related activities, including
recruiting, payroll, benefits, performance management, learning, compensation, time management
and real-time analytics.

Many EHRMS softwares aim to help businesses create professional development plans focused on
employee's goals and skills. Features include a "competence framework" with a development process
that incorporates personal interviews, training curriculums, skills matching, skill-gap analysis and
other components. The software's various processes are collaborative and allow follow-up from
employees and managers to improve dialogue between the two groups

ERP Success Stories

When enterprise resource planning software fails, it's usually because the
company didn't dedicate enough time or money to training and managing culture-
change issues. "Faulty technology is often blamed, but eight out of nine times, ERP
problems are performance-related," says Pat Begley, senior vice president of
educational services at SAP, an ERP software company in Newtown Square,
Pennsylvania.

RP success stories will reveal that they were made possible through deliberate and hard work. The
assessment of enterprise planning resource and defense enterprise planning resource are important
tasks in this context. ERP success stories need not necessarily mean that an organization needs to be
contended with what they have achieved. They must think of extending the scope of enterprise
operations so that many and thereby be a role model for more ERP success stories.Some of them
requiring attention are as follows:

 Jada precisions Plastics co INC and IQMS ERP software:

The manufacturing Company Jada Precisions Plastics INC was not happy within the initial ERP
systems that were established to help them in raising the competence levels. The software
definitely helped them to reduce the complexity of the labor but it was not the ultimate
answer. 
They finally got the much desired results from IQMS ERP software. The software was
instrumental in giving the results. Upon analysis it was found that the former ERP systems
tried to give ready made solutions to their problems in the form of packaged solutions while
the later facilitated tin creating an automatic system for data transfer. This resulted in ERP
success. 
The point to be learned from this issue is that the ERP vendor should provide appropriate
solutions based on the requirements of the client and not on the basis of his services. They are
meant to make one understand the critical success factor for ERP implementation.
 Eiffel ERP software's implementation in U.S. based chemical company:
In this situation their main challenges of the software lay in facilitating communication
between the corporate office and the manufacturing unit that uses very old systems on one
hand and managing a new chemical plant. Both these process had to be done simultaneously
with the second process coming under the control of the first one after the intervention of
ERRP software. Deciding this is like squaring upon critical success factor for ERP systems. 
The main challenge with the first issue was that the data processed by the corporate office
was to be reverted and resend by the manufacturing setup which was using primitive systems
that were not capable of processing large information. The manufacturing unit neither required
the whole information nor had the ability to process the same. This was the critical success
factor for ERP implementation. 
Eiefeel ERP system was designed to filter the required information and storing the rest till the
retrieval. In the meanwhile ERP also processed the complex information in order to suit the
 capability of manufacturing unit. 
The issue with the second process was that the newly setup unit had to become a part of the
manufacturing unit. The problem was that the new process could work on the latest software
whereas it had to be coordinated with the old manufacturing unit. The new software was
designed to do the very old process but by making use of the latest equipments and thus ERP
success followed. This again points the facts that ERP has to be designed based on the
systems in the organization.
 WinMan ERP in Athena controls:
Success stories usually explain how ERP facilitated organizations to reach milestones. This
story has a different style. They explain the concrete steps that are to be taken in an
organization in order to attain the maximum benefits from ERP. This company is a concrete
example and a living proof to substantiate the fact regarding the steps that a company needs
to take and in not believing that a more implementation of ERP will give the necessary
impetus for success in the organization. 
The basic factor for success in this company is backed by the fact that they believed software
to be a tool and not the solution to the enterprise problems. This is backed up by the fact that
the company successfully combined the business practices with the nuances of the software.
This process took place during a crucial time for the company i/.e. when they experienced a
sudden deflation of profits. 
They had a successful collaboration with Winmap software to unleash the enterprise Solutions.
The cordial work atmosphere among the two prevailed over any mishaps. They experienced an
increase in the profits level and various aspects of business like inventory management, cost
reduction and so on. The facts and figures were amazing and would not have happened if the
company had not used the circumstance like a platform for doing their best and understanding
the fundamental mistake of not aligning software with business process.
 Intitutive ERP Software in San Antonio's Lighthouse
SanAntonio's Lighthouse is a company that provides employment opportunities to the visually
challenged and others undergoing some form of physical hazards. The company's core
business is to manufacture products that best suit them to carry on a trade or profession of
their own choice. In addition to making them the company also sees to that it reaches the end
user. 
The market trend underwent a sea change. The company decided to change their strategy in
order to ensure that the customers received the products in the correct time. The pressure
from competitors circle also led them to think an alternative for their existing
distribution system. 
The company had also ventured into selling goods and services online. They went ahead with
Intitutive ERP systems as it gave them advantage of services like Microsoft Environments and
platforms. The implementation process and shipping time were drastically improved. The
company was able to realize its full potential and sailed in tune with the market demands.
 SAP ERP Solutions in TISCO (Tata Iron and steel company Limited):
The steel majors prompt response to market change and shifting to customer orientation from
product coupled with the implementation of ERP will speak more than volumes of their success
for the timely action. The company is now able to reap benefits in all aspect and make further
progress in each and every operation of an enterprise. 
The company decided to implement SAP ERP 3 after careful consideration for they matched
best with their requirements. In addition the company also forecasted on what would happen
to their operations in the future while making this choice .This anticipation helped them to
obtain the proper solution at the right point of time. The implementation process took a long
span of about a year owing to the volume of operations and the major steps to be taken.  
The company never got bogged down by the reported failure rate of ERP implementations
especially in bigger units and kept continuing their endeavors with vigor to get the best and
make the whole process learning cum experimental one. The net result brought substantial
increase in profits. The speed at which they worked (and without even the minutest error)
deserves great appreciation and is accorded as one of the main contributing factors for the
success

Reasons to get ERP

Many people say that ERP is the future, that it is completely necessary nowadays.
The following are the reasons to implement an ERP software system in an
organization.

 Enhance productivity, flexibility and customer responsiveness: From quote to

cash, an integrated business system helps you get product out the door faster. ERPgives you
the tools to maximize the efficiency of business processes across the entire enterprise.
Forecast demand to suppliers. Increase on-time delivery. Automate the shop floor. Decrease
lead times. Increase order capacity. Make commitments you know you can keep.
 Enable new business and growth strategies: Undertaking new business strategies
requires an infrastructure that can handle the demands of an industry that is increasingly
dependent on technology. Updating and integrating your business processes with an
enterprise system enables you to take on more business and grow in new directions. Connect
multiple plants. Take advantage of the Internet and wireless technology to connect to
customers and partners. Introduce new product lines. Mobilize your sales force.
 Eliminate costs and inefficiencies: Using an enterprise system to standardize your
business processes can dramatically improve your company’s bottom line. Better resource
management results in more inventory turns. Management of your vendor relationships
reduces costs for purchased items. More efficient scheduling on the shop floor reduces
downtime and overtime. Improved customer service leads to repeat business.
 Expand your knowledge of key business data : An ERP system integrates all
business management functions, eliminating contradictory information from disparate
systems. Reports, graphs and charts on key business data can be automatically generated to
provide a higher level of business performance visibility, with the drill-down capability into
details behind the data that you’ve always dreamed of.
 Extend your business using the Internet: Taking your business onto the Internet can
give your company a competitive edge. Web-enabled technology allows you to access
information, sell product, run business processes, and communicate with your customers and
partners at any time and from anywhere in the world.

Benefits of ERP

 ERP systems are great to help your company streamline your processes. In
order to have a successful implementation of your ERP system, you need to
make sure you have your information in line to help make the process swift.
It doesn’t matter whether or not your company deals with paper or plastics,
ERP provides your company with the right system and performance that you
need. ERP can help your company reduce operating cost and it is a benefit
when running company analytics. It improves the coordination of your
company’s process into one streamlined process where everything can be
accessed through one enterprise wide information network.

organizational processes fall into three levels - strategic planning, management control and
operational control. Even though much of ERP success has been in facilitating operational coordination
across functional departments, successful implementation of ERP systems benefit strategic planning
and manegment control one way or other.

Help reduce operating costs

ERP software attempts to integrate business processes across departments onto a single enterprise-
wide information system. The major benefits of ERP are improved coordination across functinal
departments and increased efficiencies of doing business. The immediate benefit from implementing
ERP systems we can expect is reduced operating costs, such as lower inventory control cost, lower
production costs, lower marketing costs and lower help desk support costs.
Facilitate Day-to-Day Management

ERP programs are being developed and updated all the time. With so many different types on the
market, companies should make sure they do due diligence and try out different packages before
choosing one to use. Some of the programs even offer mobile capabilities so that you can always have
a finger on the pulse of your business activities from your pda. 
With real time capabilities and the ability to be able to see what is going on with your company as it
happens, ERP systems are handy when you deal with high volume. With an ERP system, your
company will never have inventory shortages or wasted time spent transferring files. You can test out
an ERP system before buying it and see how it will work with your business.

Support Strategic Planning

Strategic Planning is "a deliberate set of steps that assess needs and resources; define a target
audience and a set of goals and objectives; plan and design coordinated strategies with evidence of
success; logically connect these strategies to needs, assets, and desired outcomes; and measure and
evaluate the process and outcomes." (source) Part of ERP software systems is designed to support
resource planning portion of strategic planning. In reality, resource planning has been the weakest link
in ERP practice due to the complexity of strategic planning and lack of adequate integration with
Decision Support Systems (DSS).

How ERP Helps Management Functions

ERP management systems provide a technology platform in which organizations

can integrate and coordinate their main internal business processes. They use this
to fight against the problem of the organizational inefficiency brought on by the
use of differece

ERP software integrates all of the major business processes, which helps ensure consistent data across
all your functional departments. ERP applications typically consist of modules such as Marketing and
Sales, Field Service, Production, Inventory Control, Procurement, Distribution, Human Resources,
Finance, and Accounting.

Enterprise Resource Planning (ERP) is sold as the solution to the problems with human resource
management and salaries, document control and, sometimes, maintenance.

Department based organizations, with vertical structures are integrating their business processes in
response to the need to be effective, reliable and quick to anticipate the market needs. The employees
need to understand each others task and continuously communicate with each other to work
efficiently together.

A general understanding between departments is needed with a clear set of practices, and
methodology. An ERP system is an ideal tool for providing this common understanding between
departments. However, there are also inherent risks and costs associated with the integration of an
ERP system.

Business is all about taking risks. But intelligent managers know how to manage risks, thus preventing
accidental losses as well as other operational, financial, and strategic risks - including fraud. To
manage business risks by using technology, we must first understand and prioritize the risks a specific
business faces, and then understand how Information Technology (IT) can help that business. Then
we can come to understand how those risks intersect with the IT systems a business might already
have in place. Indeed, intelligent use of an ERP system can not only help ensure compliance with legal
requirements and accounting rules, but it can also help prevent fraud. An Enterprise Resource
Planning (ERP) application and its user permissions settings can prevent theft.
Manufacturing Industry is one form of business that existed from the ancient period. There is no
exaggeration in saying that it one the oldest business itself. The manufacturing segment initially
started in traditional business models and kept constantly developing as improved practices spurted
and modern practices developed.

It is also to be understood that the sector has been famous for providing job opportunities and
contributing towards national income on a large volume. It also bears the credit of employing a large
pool of uneducated labor. In this context it becomes important to study the advancements in the
sector and technological improvements like ERP

How ERP Improves General Ledger Capacity

ERP provides unprecedented flexibility to meet the needs of organizations of all

types and sizes. It provides a robust feature set designed to meet even the most
demanding budgeting and processing needs. General Ledger modules are highly
customizable using the many tools inherent in the system, including a built-in
financial report writer that provides a timely picture of the company's fiscal
activities.

This module fully integrates with all other ERP modules and is the key to maximizing the efficiency and
accuracy of your financial data. Some ERp Vendors provide online ERP which runs through a standard
Web browser and as such financial statements can be designed and viewed anytime, anywhere using
an Internet browser.

In general, ERP can help improve the General Ledger Capacity because of its following features:

 Flexible Account Structure and Account Processing

 Powerful Budgeting Features
 Extensive comparative and historical data.
 Financial reporting.
 Multicurrency support using the add-on Multicurrency module.
 Ability to drill down to originating transaction in other modules.
 Integrates with Microsoft Office.
 Web-based or traditional Accpac desktop interface.