THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

 INTRODUCTION: -
Enterprise resource planning (ERP) systems have become a critical tool for businesses
over the past several decades. An ERP solution automates critical business processes
and serves as a shared database for all financial and operational information from
across the company. It pulls this data from a number of modules built to help various
departments, from accounting to supply chain to human resources, perform their
individual functions.

An ERP solution gives all employees access to the information they need to answer
important questions about their department’s current performance and future planning,
as well as target areas for improvement. This single source of information minimizes
data accuracy and consistency issues and ensures everyone is looking at the same
numbers, no matter their role. It also drives better decision-making that leads to more
efficient processes and cost savings. Additionally, ERP can automate many tasks,
reducing errors and freeing up employees to focus on more strategic work.

Common ERP modules support back- and front-office functions like finance and
accounting, procurement, manufacturing, inventory management, order
management, warehouse management, supply chain management, customer
relationship management (CRM) procurement and workforce management. More
functionally rich solutions may also include professional services automation (service
resource management), human resources management, ecommerce and marketing
automation.

ERP SYSTEM MODULES: -

THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

Each ERP module is designed for specific business functions, providing the data and
supporting the processes that will help those employees do their jobs. Every module
plugs into the ERP system, so the system provides a single source of accurate data,
even as the business adds new modules. If the ERP system is the toolbox, the modules
are the screwdriver, wrench, hammer and other tools in the box that each have specific
uses.

 13 ERP MODULES: -

1. Finance:
The Finance and accounting module is the most important ERP module because it
allows businesses to understand their current financial state and future outlook. Key
features of this module include tracking accounts payable (AP) and accounts
receivable (AR) and managing the general ledger. It also creates and stores crucial
financial documents like balance sheets, payment receipts and tax statements.

2. Procurement:

The procurement module, also known as the purchasing module, helps an organization

secure the materials or products it needs to manufacture and/or sell goods. Companies
can keep a list of approved vendors in this module and tie those suppliers to certain
items, helping with supplier relationship management. The module can automate
requests for a quote, then track and analyse the quotes that come in.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

3. Manufacturing
During the manufacturing process, it can update the status of goods-in-progress and
help companies track actual output against forecasted production. It also provides a
real-time picture of the shop floor, capturing information on items in progress and
finished goods. It can calculate the average time to produce an item and then compare
supply with forecasted demand to plan adequate production.

4. Inventory Management:
The inventory management module enables inventory control by tracking item
quantities and location down to individual SKUs. This module offers a complete
picture of not only current but also incoming inventory, through an integration with
the procurement tool. This piece of software helps businesses manage inventory costs,
making sure they have sufficient stock without tying up too much cash in inventory.

5. Order Management:
An order management module tracks orders from receipt to delivery. This piece of the
ERP feeds all orders to the warehouse, distribution center or retail store after
customers place them and tracks their status as they’re prepared, fulfilled and shipped
to the customer. The order management module prevents orders from being lost and
boosts on-time delivery rates to keep customers happy and cut unnecessary expenses
for expedited shipping.

6. Warehouse Management:
A warehouse management module can deliver a rapid return on investment for
businesses that operate their own warehouses. When the warehouse management
module is integrated with inventory management and order management applications,
employees can quickly find the right products and get shipments out the door quickly.
Faster delivery ultimately increases customer satisfaction.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

7. Supply Chain Management:

A supply chain management module tracks each step in the movement of supplies and
goods throughout the supply chain, from sub-suppliers to suppliers to manufacturers
to distributors to retailers or consumers. It can also manage any materials or products
returned for refund or replacement.

As noted earlier, supply chain management can include a wide array of modules like
procurement, inventory management, manufacturing, order management and
warehouse management. However, it may have functionality beyond the core
capabilities of those modules.

8. Customer Relationship Management (CRM):

The customer relationship management (CRM) module stores all customer and
prospect information. That includes the company’s communication history with a
person—the date and time of calls and emails, for example—and their purchase
history. A CRM improves customer service because staffers can easily access all the
information they need when working with a customer.

9. Professional Services Automation (Service Resource Management):

A professional services automation (PSA) module, also called a service resource
management module, allows an organization to plan and manage projects. Services-
based businesses often use this module. The application tracks the status of projects,
managing human and capital resources throughout, and allows managers to approve
expenses and timesheets. It facilitates collaboration between teams by keeping all
related documents in a shared place.

10. Workforce Management:

A workforce management module is similar to a human resource management module
but is designed for companies with more hourly than salaried employees. It can
monitor workers’ attendance and hours and measure things like employee productivity
and absenteeism. Payroll could also fall under the workforce management module.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

11. Human Resources Management:

A human resource management (HRM) or human capital management (HCM) module
usually encompasses all the features of a workforce management application and
offers additional capabilities. HRM could be viewed as CRM for employees. This
popular module has detailed records on all employees and stores documents like
performance reviews, job descriptions and offer letters

12. Ecommerce:
Certain ERP vendors offer an ecommerce module for businesses that want to sell
online. This module allows companies to quickly launch a business-to-business (B2B)
or business-to-consumer (B2C) ecommerce website. Leading commerce applications
include user-friendly tools that allow employees to easily add new items, update
product content (item descriptions, titles, specs, images, etc.) and change the look and
feel of the website.

13. Marketing Automation

Like with ecommerce, certain software providers have developed a marketing
automation module. A marketing module manages marketing campaigns across digital
channels like email, web, social media and SMS. It can automate email sends based
on campaign rules and has advanced customer segmentation features, so customers
only receive relevant messages.

Supply chain management:

It plays an important role in the overall success of a business, especially for the
manufacturing industry. Manufacturers rely on partners and vendors to supply them
with the right type and amount of resources at the necessary time to keep production
moving according to schedule. However, and according to a recent 2021 State of
Manufacturing Report, “97% of respondents report supply chain management consumes
a significant amount of employee’s time.” Supply chain management can be a
cumbersome and time-consuming process if not managed efficiently, and ineffective
management can inhibit productivity, cause delays, affect quality, and result in
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

unnecessary expenses and profit loss.

As manufacturers expand, supply chain management can become an even more

essential component of a smart business plan. That’s where Enterprise Resource
Planning (ERP) software can greatly help businesses simplify and optimize their
supply chain management processes for smoother and more profitable outcomes.

 Enterprise Resource Planning (ERP) And Supply Chain Management

(SCM)
Affordable Enterprise Resource Planning software for manufacturers and accessible
automation technologies for manufacturers enable competitiveness in an industry that
is constantly evolving. Supply chain automation technology is in higher demand with
each passing day. Built to increase the efficiency of operations that extend beyond the
four walls of the factory, supply chain management software holds suppliers
accountable, builds stronger trading partnerships, and delivers increased customer
satisfaction that earns businesses brand loyalty.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

 ERP Software Enables Better Supply Chain Management

When a business considers all the parties involved in the supply chain, from
manufacturers, suppliers, distributors, retailers, and customers, it can be difficult to
control. The process of keeping everything in line requires careful and diligent
planning, execution, control, and ongoing monitoring of supply chain activities.

Businesses will find that an ERP system built with the supply chain in mind will be
more than effective in handling the storing, transporting, managing demand for
manufactured goods. From procurement to product delivery, the integration of
material, information, and financial information flow cement ERP as an essential tool
for efficient supply chain management.

 The Roles of ERP In Supply Chain Management Processes:

From the global conglomerate the mom-and-pop job shop, ERP and SCM software
may seem intimidating. However, their viability for businesses at any size cannot be
overstated. It simply becomes a matter of size and scope of the software. Placing a
focus on efficient supply chain activities and strategy going forward will enhance
facility productivity, product quality, and cost-efficiency.

ERP software scales businesses, plain and simple. With growth, the subject of Supply
Chain Management demands greater emphasis. Mixed-mode, make-to-order, make-to-
stock, Engineered -to-order, and configured-to-order manufacturing operations all
have a need for these advanced technologies. This doesn’t even consider the supply
chain automation opportunities that arise when ERP systems in place. Replenishment,
communications between partners, manufacturers, and customers, even automated
profiling of suppliers to get the next replenishment from your favored vendors are
possible with automated supply chain management software embedded within ERP.

ERP software doesn’t just enable supply chain management strategies, it informs your
teams and keeps them running at peak efficiency. This ensures your business runs
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

smoothly in the face of supply chain disruption. We can break down the role of Epicor
ERP alongside supply chain management into eight main categories:

 Purchase Management
 Demand Management
 Inventory Management
 Shipping And Receiving
 Warehouse Management
 Advanced Material Management
 Supplier Relationship Management
 Supplier Connect

 ERP Supply Chain Purchasing Management:

Collaboration is key during the purchasing process to ensure orders move smoothly in
and out of an ERP system. Tracking the performance of collaborative activities
becomes more difficult as an organization grows. ERP fills the gap, providing
businesses with the means to track, control, and comply with regulation and
governance standards of their given industry. The result is accuracy, compliance, and
security in supplier relationships.

Automated purchasing tools improve supplier collaboration, order accuracy, and

negotiating while streamlining purchase order writing and tracking of supplier
performance.

Improved on-time delivery reduces inventory levels, which improves cash flow and
enables cross-referencing, mass purchase order receipts, requisition tracking, and
more.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

 ERP Supply Chain Demand Management:

Convert demand into sales orders and forecasts thanks to the efficient management of
short- and long-term customer demand contracts. As a result, fulfilment decisions
become second nature.

Inventory management is made easy with statistical forecasting and planning tools
that enable collaboration, consolidation, and aggregation.

Leverage invaluable insights to decrease on-the-shelf inventory, enhance flexibility,

improve fill rates, and deliver a better customer experience overall.

Visual tools make interacting with supply chain demand data efficient and easy.

 ERP Supply Chain Inventory Management:

Digitize, automate, and simplify your processes for greater profitability at any scale,
all while minimizing the inventory costs and risks associated with conforming to
industry standards.

Meeting customer expectations becomes easy with superior visibility into costing,
tracking, and country of origin.

From purchase order through manufacturing and shipping, material flow management
becomes easy with an extensive suite of analysis tools, including shortage monitoring,
reorder analysis, stock status, and many more.

Reduce annual audit costs significantly by leveraging automated control and regular
inventory counting tools provided by ERP solutions for the supply chain.\
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

 ERP Supply Chain Shipping and Receiving Management:

Ensuring accuracy and customer satisfaction becomes easy with the shipping and
receiving logistics solutions provided by ERP. The ability to monitor incoming and
outgoing items for orders, subcontract parts being sent to a supplier, raw materials
being received, or filling an order from stock all contribute to the enhanced shipping
and receiving tools found in a robust ERP solution.

Efficiency, speed, and a consistent interface promote the rapid processing of

shipments and receipts to provide reliable tracking at every stage of the journey.

By tracking container shipments and regularly updating purchase orders with

enhanced accuracy and information visibility, your business can improve reliability
and deliver on expectations without sacrificing time, money, or customer goodwill.

By driving out the cost of freight, insurance, and import duties with landed cost
processing functionality margins improve significantly.

 ERP Supply Chain Warehouse Management:

ERP systems link warehouses with order processing and manufacturing operations
seamlessly to optimize pick, pack, ship, and receiving processes.

Drive out errors and wasted resources by automating pick-and-pack, mobile-driven,

and pre-pack fulfilment processes.

Leverage greater visibility into resource utilization throughout your warehouse to

optimize processes and improve efficiency.

Rapid fulfilment capability enables businesses to better compete not just on cost and
quality but on speed, as well.

 ERP Supply Chain Advanced Material Management:

THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

Track materials with real-time visibility and control with an advanced material
management module, like that found with Epicor ERP. This function enables the
monitoring of raw materials and work in process (WIP) activities throughout an entire
enterprise using mobile devices and bar-coding technology.

By simply scanning a bar code tag you can produce accurate and timely electronic
requests for materials.

Ensure that the right parts are delivered to the right resource at the right time utilizing
an online queue of raw material and WIP parts.

Track movement of raw materials and WIP to continuously improve efficiency.

 ERP Supply Chain Supplier Relationship Management:

Supplier relationship management is a critical and ongoing process for manufacturers.
Identifying the best partners to work with and improving supplier collaboration is
easier with ERP supply chain management tools that enable buyers, procurement staff,
and purchasing agents or those providing quotes, to request quotes for raw materials
or subcontract services from one or multiple suppliers.

Make smarter and more informed sourcing decisions thanks to greater visibility and
insight into supplier communications

Create centralized records for buyers, parts, and suppliers to maintain accuracy,
simplify workflows, and eliminate redundant data entry

Reduce transaction times with automated tools that quickly convert supplier responses
into actionable purchase orders.

 Supplier Connect for ERP Supply Chain management:

THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

ERP is specifically tailored for suppliers It delivers an intuitive environment use to

update their information via the supplier portal, answer requests for information, and
confirm changes to purchase orders.

Enable business partners and customers transact with your brand online for a
competitive advantage.

Improve collaboration by offering supplier self-service on open orders, part

information, and access to invoice history.

Reduce staff time spent answering email, phone, or fax inquiries and increase
efficiencies of your sales team.

 Benefits of Using ERP in a Supply Chain Management Strategy:

Adding ERP software to your supply chain management strategy is a game changer.
Some of the primary ERP supply chain benefits users experience that lead
to measurable business growth include the following.

Reliable Processing & Documentation

An ERP system can also create invoices, which are sent straight to the customer once
products have shipped. Or, create and transmit required import and export
documentation required for cross-border shipments. It automatically collects an
archive of shipment and delivery data as well to reduce errors and ensure on-time
delivery and better customer service.

Enhanced Collaboration
ERP and supply chain management processes are especially helpful in streamlining
coordination between businesses and vendors. When suppliers are connected to your
ERP system, they can work more effectively with you to meet your goals and reduce
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

bottlenecks, such as recognizing when certain supply inventories are low and ensuring
resource availability.

Increased Visibility
With more visibility and transparency, businesses can create smarter strategies around
how they use their resources, from parts to personnel. ERP software can give your
team a detailed, real-time look into your operations so you can see where things are
going well and where they’re not, allowing you to target specific inefficiencies for
better outcomes.

Cloud Capabilities
Though ERP systems are available as on-premise solutions, cloud ERP software has
become popular in recent years. The major benefits of cloud ERP are dedicated data
security and mobility. Using a cloud-hosted ERP solution means that the system can
be accessed anywhere, anytime on mobile devices as long as there’s an internet
connection. This allows for quicker action without the need for team members to be
together, which can be valuable with the fast-moving aspects of supply chains.

  ERP Improve Supply Chain Management & Efficiency:

Outside of more effective forecasting, planning, and collaborating, ERP is
instrumental in supply chain efficiency in another area: business disruption. Market
disruptors are inevitable to virtually every industry, and when one hits yours, you have
to be ready to adapt quickly and successfully to get the job done.

The COVID-19 pandemic has shown how necessary proper preparation and
responsiveness are to keeping businesses above water. Manufacturers are now
focusing less on cost savings and more on supply chain adaptability, risk management,
and speed, with the goal of creating flexible sourcing and more connected supply
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW

chain networks to respond to customers’ needs. Greater visibility, accelerated

decision-making, rapid responsiveness, and other performance improvements are
necessary to strengthen supply chain operations and prevent major setbacks when
business disruptions occur.
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW
THE MODULAR FRAMEWORK OF ERP IN SUPPLY CHAIN MANAGEMENT: AN OVERVIEW