JANUARY 2020 CONFIDENTIAL

ASSESSMENT COVERSHEET
Attach this coversheet as the cover of your submission. All sections must be completed.

Section A: Submission Details

Programmed : BACHELOR OF ENGINEERING BUSINESS MANAGEMENT
Course Code & Name : PNB 30404 ENTERPRISE RESOURCE PLANNING
Course Lecturer(s) : DR. PUNNOSE KOVOOR
Submission Title : FINAL ASSIGNMENT ERP
Deadline : Day 29 Month JULY Year 2020 Time 12PM
Penalties :  5% will be deducted per day to a maximum of four (4) working days, after which the
submission will not be accepted.
 Plagiarised work is an Academic Offence in University Rules & Regulations and will be
penalised accordingly.

Section B: Academic Integrity

Tick (√) each box below if you agree:

√ I have read and understood the UniKL’s policy on Plagiarism in University Rules & Regulations.
√ This submission is my own, unless indicated with proper referencing.
√ This submission has not been previously submitted or published.
√ This submission follows the requirements stated in the course.

Section C: Submission Receipt

(must be filled in manually)

Office Receipt of Submission

Date & Time of

Student Name(s) Student ID(s)
Submission (stamp)

AIMAN AFIQ BIN MOHD ROSLI 58215117103

Student Receipt of Submission

This is your submission receipt, the only accepted evidence that you have submitted your work. After this is
stamped by the appointed staff & filled in, cut along the dotted lines above & retain this for your record.

Date & Time of

Course Code Submission Title Student ID(s) & Signature(s)
Submission (stamp)

PNB 30404 FINAL ASSIGMENT ERP 58215117103

AIMAN

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INSTRUCTION: Answer ALL questions

Question 1

a) Draw and clearly label the MRP II framework.

(10 marks)

Marketing Market Demand Manufacturing Master production

schedule
Finance
Production Plan MRP

(Sales & Operation

Planning)
Adjust Master Schedule
Capacity Planning

Rough-cut capacity
Adjust planning (RCCP)
production plan

Yes No Yes
Problems Problems
Problems ??
??
No

Requirements
schedules

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b) Explain the function of each module in the MRP II framework.

(10 Marks)

1. Market Demand (Demand Management)

Demand management is a planning methodology used to forecast, plan for

and manage the demand for products and services. Organizations use demand
management systems to address external spending factors, arrange purchase
orders and eradicate waste. When applying demand management, key
considerations include:

I. Available options for volume

II. Order timing's impact on pricing
III. Whether or not the best suppliers are being utilized
IV. Precise attention to described contract processes

2. Production Planning (Sales and Operational Planning)

S & OP process is when management makes decision to satisfy the demand.

It draws input from an organization’s key functional areas, including sales,

marketing, manufacturing, distribution, and finance.   There are some

considerations have to be take place such as:-

 Capacity decisions

 Workforce levels

 Outsourcing

 Adding/ Cutting shifts etc.

 Inventory levels

 Backlogs

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3. Rough- Cut Capacity Planning (RCCP)

Rough-Cut Capacity Planning (RCCP) provides a quick capacity check of a

few critical resources to ensure the feasibility of the MPS. Critical resources are
bottlenecks operations in:-

 Labour

 Machine

 Material supply

Generally, it uses a Bill of Resources (also referred to as a Bill of Materials

when only dealing with materials) for each end item on the MPS. The Bill of
Resources gives a breakdown of the time in hours needed at each critical
resource required to build a particular end item.

4. Master Production Schedule (MPS)

The master production schedule (MPS) is effectively the plan that the
company has developed for production, staffing, inventory, and others. Master
Production Planning linked between S&OP, demand management and actual
production. It also identifed the important element of production such as:-

i. What final end product to make

ii. How much to make
iii. When to make, to be able to meet customers demand dates
The MPS must be verified at any time against the capacity constraints of the
most critical resources. This process is called Rough-Cut Capacity Planning (RCCP).

5. Material Requirement Planning

MRP is a system for calculating the materials and components needed to

manufacture a product. it Take the end product requirements from the MPS and
explodes it into sub-assemblies and purchase parts using the BOM. Basically
there are some important highlight in MRP includes of:-

i. To make sure the raw material and component part are enough for the
production and to keep the production runs smoothly.
ii. To support Just in Time (JIT) production by reducing the material and
inventory but still able to meet demand
iii. To meet customer demand in the specific demand dates.

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6. Capacity Planning

Capacity planning is important in e determining optimum utilization of resource

and plays an important role decision-making process. Capacity would be the ability to
produce output within the specific time period. Therefore capacity panning is referred
as an amount of the input resources available to produce relative output over period
of time.

Question 2
Given below are some of the enabling technologies in ERP systems. Briefly describe these
technologies and give TWO (2) advantages and TWO (2) disadvantages for each selected
technology.

i. 3 – tier client server technology

3-tier architecture is a client-server architecture in which the functional process

logic, data access, computer data storage and user interface are developed and
maintained as independent modules on separate platforms. The three tiers, or
layers, involved include:-

1. Presentation layer

2. Application Layer

3. Data Layer

3-tier client server technology

Advantages Disadvantages
Security - Database Security can be High installation cost
provided at application layer.
Scalability - Superior performance for Structure more complex compare to tier 1
medium to high volume environments and tier 2.

ii. Bar code technology

Bar code technology is the combination of black and white bar that
represents different text characters which follow a set algorithm for that barcode
type. When the sequence of elements is changed, it will give the different text
altogether. Then, a barcode scanner reads this pattern of black and white. it
translates them into a line of text to the computer. So that user able to read and
understand the text displays. Basically, there are two type of barcodes which is
1D and 2D. In comparison to 1D, 2D barcodes are a bit more complex as they

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organize information vertically and horizontally and even will to show output
image

Bar Code Technology

Advantages Disadvantages
Improved inventory control System failure may cause more delay
Better accuracy Scratches or crumple of bar codes
may cause error
.

iii. RFID technology

Radio Frequency Identification (RFID) is the wireless non-contact use of

radio frequency waves to transfer data. Tagging items with RFID tags allows
users to automatically and uniquely identify and track inventory and assets.
RFID takes auto-ID technology to the next level by allowing tags to be read
without line of sight and, depending on the type of RFID, having a read range
between a few centimeters to over 20 meters.

RFID Technology
Advantages Disadvantages
Reliable and accurate Cost involves for initially investment
Enhance security level Does not work properly on liquid and
metal product

iv. Service Oriented Architecture

Service-Oriented Architecture (SOA) is an architectural approach in which

applications make use of services available in the network. In this architecture,
services are provided to form applications, through a communication over the
internet. SOA is a technology that enables companies to link/integrate many different
client server systems together to access information. By using the Web services,
companies can integrate several different client server applications and create an
enterprise composite applications.

Service Oriented Architecture

Advantages Disadvantages
Improved scalability and availability - High investment - A huge initial
Services can run on different servers investment is required for SOA

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within an environment
High Flexibility, enhance integration Complex service management

Question 3

Assume that you are the salesperson calling your local grocery store. You just started
this job, and you are nervous about meeting your customer for the first time. From your
own research, you have found out that your organization adopt the following activities
for the order fulfillment process.

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 Receive enquiries and Create quotations

 Enter sales order details

 Prepare delivery

 Create invoice

 Receive payment

Required:

a) The above represents the standard activities normally carried out for the order
fulfillment process. Briefly describe each of these activities.

(10
marks)

I. Receive enquiries and Create quotations

 The Sales department receives a customer inquiry, which essentially is a

request for information concerning the availability and price of a specific
good.

 After sales department receives the inquiry, it issues a quotation that

indicates availability and price.

 Then the quotation will send to the customers.

II. Enter sales order details

 After the customer agrees the price and the terms, sales department will
received customer purchase order.

 After that, and sales department will creates a sales order which is an
internal document.

 A sales order standardizes all data from different POs so that company
personnel can easily read and understand.

 Then, the created sales order will send to the warehouse.

 It is used to start the processing order.

III. Prepare delivery

The warehouse prepares the shipment and produces two other internal
documents which includes

 Picking document - Used to remove goods from the warehouse

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 Packing list -Accompanies the shipment and provides details about

the delivery.

The warehouse also will confirm that the products and quantity are as per
picking list. Then, ERP will then printout a packing list to accompany the
shipment.

IV. Create invoice

 Creating invoice can be done manually or with the use of ERP.

 If invoice are creating manually, the accounting issues the invoice to the
customers.

 Meanwhile, by using ERP implementation I can create an invoice in 3

ways.

 First, automatically generate and invoice and email to the customer.

 Second way is send a notification to accounting to send an invoice.

 Wait for accounting to log into the system and request a billing due date
which is list of all invoices waiting to be send to customers in that day

V. Receive payment

This process is when accounting receives a payment that is consistent with the
invoice.

b) For each of the activities carried out in (a) above, briefly describe ONE main
problem you might encounter.
(10 marks)

I. Receive enquiries and Create quotations

 Poor inventory system- Give problem in determine the availability number

of product in the store.

II. Enter sales order details

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 Error in recording order – error in recording order can cause by human

error especially when involves manual recording

III. Prepare delivery

 Replacing lost or damage product

 Error in picking list – the error occurs when the picking list are not tally
with the real picking number.

 Delay in delivery

IV. Create invoice

 Overlooked and delay in creating invoice by accounting personnel.

 Technical problem of ERP in creating invoice.

V. Receive payment

 Overdue payment by the customer (late payment)

Question 4

ZETA, a retailing company is contemplating to implement an ERP system to replace

the traditional systems in the company. The top management has heard of the potential

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benefits of implementing the ERP system. Before making the decision to go ahead with
the implementation, the top management would like your assistance to explain the main
features of an ERP.

Briefly describe the main features of an ERP system and help the company to identify
the potential advantages that they could achieve if they were to implement an ERP
system.

(20 marks)

Features of ERP System

1. Financial Management

One of the ERP features is financial management. Financial

management is one of the most important functions in any business.
Therefore, by implementing ERP in financial management helps the main
component in financial process such as general ledger, accounts receivable,
accounts payable, billing and fixed asset management. Besides, it also helps
in analysing budget, cash flow, expenses and tax reporting

2. Business Intelligence

Business intelligence is one the most important features of ERP. With

this features, it allow the users to share and analyse the data collected across
the organization. Besides, it offers the centralized database system. Business
intelligence can come in various forms such as:-

 Dashboard

 Automated reporting tools

 Analysis tools

These types of business intelligence used to monitor the performance

of organization. Furthermore, it facilitated the decision making process and
flow of information in the business.

3. Human Resource Management

Human Resource modules in particular are used to track different
people-related functions, such as planning, payroll, administration,

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development, hiring, and more. In additional, it also involves performance

management, time tracking, benefits, compensation and workforce planning.
Hence, the data will be more systematic and much more accurate compare to
the manual system. ERP in the HR management also easier the management
and decision making process.

4. Manufacturing Operations

Manufacturing operation also is one of the ERP features. It can

increase the efficiency of the manufacturing operations. Crucial element that
include in manufacturing operations module is Capacity Requirements
Planning, Materials Requirements Planning, forecasting, Master Production
Scheduling, work-order management and shop floor control. Besides, it helps
in collecting data and inventory management system

5. Integration

ERP provides a fully- integrated platform which organization able to

analyse, monitor and conduct the main data-driven task. This is because,
ERP can collects, store and analyses the data across the organization with
different department. This feature increase flow of information and improve
the data sharing process. Overall, the integration offer high efficiency across
the organization.

Advantages of ERP

1. Reduction of lead time

 Lead time is time between placing an order and receiving the product.
ERP help in automating the task of inventory control such as:-

i. Alert on quantity below the re-order level

ii. When to release PO

iii. When to procure the raw material

 It integrates the inventory module with other module like marketing,

purchasing, manufacturing, and production planning.

 Besides ERP support virtual transaction with the use of latest

technology like EDI and EFT

2. Improved resource utilisation

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 ERP can give advantage to the organization by facilitated the capacity

planning to ensure the accurate and achievable schedule based on
the availability of capacity and material

 Besides it help the organization utilized the resources based on the

capability simulation.

 In additional, ERP ensure the resources utilization by:-

i. Keep minimum level of inventory

ii. Reduce machine don time

iii. Goods are produced only as per demand

3. Better customer satisfaction

 As ERP system increase the flexibility, it resulting better customer

satisfaction. With the use of ERP customer can place the order in
customize manner, track the status of order, make the payment and
get the technical support.

 Since the organization keep the data of their customers, the

organization able to use the information in order to improve the
services

4. Better analysis and planning capabilities

 ERP enabled to boost the planning functions by enabling

comprehensive and I integrated management of data.

 It support the decision making process and simulation function by

intelligence analysing data

 It also creates opportunities for a better analysis process across

organization and provides wide perspective in solving problems

5. Reduction in cycle time

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 The cycle time is time between receipt of order and the delivery of the
product. ERP system reduces the cycle time by implement automated
order fulfilment and purchasing without human intervention.

 Reduction in cycle time also involves the seamless of information flow

in an organization. As the use of ERP provide high integration system
and accessibility, the process between receipt order and delivery of
will become more efficient. This resulting shorter cycle time taken by
the organization.

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Question 5

Earlscourt Hospital is planning to implement an Enterprise Management System for

Hospital management purposes. The system has functions and features which support
Earlscourt Hospital’s business operations. The typical functions include: doctor
appointment, dispensary, kitchen operation and housekeeping.

a) Explain what are information systems silos with an example from the above
context?
(5
marks)

An information silo is a business division or group of employees within an

organization that fails to communicate freely or effectively with other groups,
including management. Information silos occurs when different individuals or groups
generate or record new data, but don’t integrate or aggregate that information for
other parts of the business to view or use in a strategic way.

From the above contact, we know that there are no integration in the
operation of Earlscourt. Therefore, the flow of information is limited only for a certain
group only. As example, the data of that used for the doctor appointment only limited
in that group of work and does flow to the other part of work such as dispensary,
kitchen operation and housekeeping. This will cause redundant of information.

Basically, there are information that can be use across different department
such as discharge date of patients and the medication prescription for patient.
Discharge date of patient can be across different department from doctor, pharmacy,
dispensary, kitchen operation and housekeeping. The information silo prevents the
data integration across organizations.

b) Discuss FOUR (4) potential problems of information systems silos

(5
marks)

1. Data Duplication and Inconsistency

Data duplication is one of the potential problems of information system silos.

This problem occurred when the same content of information are stored in every
department. Thus, resulting the duplication and redundancy of information in the

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organization system. Besides, the data duplication can also form the data
inconsistency across organization.

2. Disjoint Process

Disjoint process is a crucial problem that can occurs cause by information

system silo. This problem occurs when the data are not well integrated and cause
miscommunication in organization system. For example, in the hospital when the
patient have been prepare for discharge, the pharmacy department should already
prepare take home medication. But when disjoint problem occurs, the patient need to
register again in the pharmacy department in order to get the medication. This will
increase the time consuming for the patient.

3. Isolated Decision leads to organization inefficiency

This problem can occur because of the lack of information sharing and
integrations between the departments. The decision making process will be longer
compare to integrated system. For example, in manufacturing process, the isolated
decision between inventory department and production department can cause
insufficient raw material compare to the demand of the customer. Thus, it will affect
the cycle time and organization efficiency.

4. Increase Expenses

The information system silo also can cause increasing of organizational

expenses. This is due to unclear visibility of information and the poor dissemination of
information. As example when procurement department make decision to buy raw
material that is not tally to the demand of customer and inventory needed. Thus, it will
cause unnecessary expenses for the organization.

c) Process readiness is one of the most important factors which determines the success
or failure of integrating systems within an organization. Justify TWO (2) reasons why
this is so?
(5
marks) The process readiness is important factor in determines the success of
integrating system within an organization because of:-

1. To identify and set up business strategic goals for project

This is important to ensure the organizations have clearly

determined their target goals. The target goal have includes of the process

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efficiency, customer satisfaction and objectives. Besides, the organizations

also have to determine which key area of change and the potential impact
to the organization. Hence, with the clear business target goals, the
organization the integration process will become seamless.

2. To design and evaluate the business process

One of the reasons for process readiness is to design and evaluate

the integrated process. This involving the business document, data,
privacy and evaluation approach. Thuss, organization also need to ensure
the current process and the desired processes are well understood.

d) Justify THREE (3) reasons why an enterprise system such as ERP planning system
would be beneficial for Earlscourt Hospital.

(5 marks)

1. Integrated information

Main benefits for the Earlcourt Hospital is able to increase the data
integration across the department. The data integration will reduce the time
for decision making process. Therefore, the efficiency of the work will
increase. For example, when the when the patient can be discharge, the
other department can be prepare to handle other main activities such as
dispensary, housekeeping and pharmacy preparing the take home medication
based on the data that have been shared through the system.

2. Improve Customer Satisfaction

Earlcourt Hospital also able to improve the customer satisfaction by

implementing the ERP system. This is because patient able to access the
data, make online appointment and online payment for the medication. The
seamless information flow between patient and hospital will also improve the
hospital services, resulting improving customer satisfaction level.

3. Increase Productivity

The other benefits of implementing ERP planning system is able to

increase to productivity by eliminating redundant process and task work
across the organization. Therefore, it will create streamline process and
increase the efficiency of the process. Besides, it will also give positive impact
to the time taken for each of process in the hospital.

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