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Introduction To ERP - Stu
Introduction To ERP - Stu
Calculation systems
1950-80
Single purpose
Eliminate tedious human work
Examples: Payroll, General ledger,
Inventory
Technology used: Mainframes, magnetic
tapes, batch processing
Functional systems
1975-20??
Use computers to improve operations
Applications: Human resources, order
entry, manufacturing resource planning
Technologies: Mainframes, PCs, LANs
Functional systems
Typically contained within a department
Islands of automation
Applications independently developed
and deployed
Driving force: availability of minicomputers
Human Resources
Recruiting
Compensation
Assessment
Development and Training
Planning
General Ledger
Financial Reporting
Costing
Budgeting
Accounts Payable
Accounts receivables
Operations
Order management
Inventory management
Customer service
Manufacturing
Inventory
Planning
Types of Organizational
information Systems
Administrative systems
Scheduling / Transaction systems
Value oriented systems
Reporting and controlling systems
Analysis and information systems
Planning and decision support systems
Integration
Consolidation
Right-sizing
Business Process Redesign
Enterprise wide system
Integrated systems
or
Enterprise Resource Planning
System
What is ERP?
ERP is a set of integrated business
applications, or modules which carry out
common business functions such as
general ledger, accounting, or order
management
An ERP system is an attempt to
integrate all functions across a company
to a single computer system that can
serve all those functions specific needs.
What is ERP?
It may also integrate key customers and
suppliers as part of the enterprises
operation.
It provides integrated database and
custom-designed report systems.
It adopts a set of best practices for
carrying out all business processes.
ERP History
Vendors
Sales Dept.
Customer
Demographic
Files
Orders
Parts
Customers
Accounting
Files
Accounting
Sends report
Sends report
Invoices
accounting
Vendor
Order is placed
with Vendor
Purchasing
Files
Purchasing
Ships parts
Warehouse
Inventory
Files
Sales Dept.
Customers
Inventory Data
If no parts,
order is placed
through DB
Accounting
Financial Data exchange;
Books invoice against PO
Order is submitted
to Purchasing.
Purchasing record
order in DB
Database
Books inventory
against PO
Order is placed
with Vendor
Warehouse
Vendor
Purchasing
Ships parts
And invoices accounting
Selecting ERP
Vendors
Selecting ERP
Vendors
Midmarket ERP (ERP Tier II)
For the midmarket vendors include Infor,
QAD, Lawson, Epicor, Sage and IFS.
Small Business ERP (ERP Tier III)
Exact Globe, Syspro, NetSuite, Visibility,
Consona, CDC Software and Activant
Solutions round out the ERP vendors for
small businesses.
ERP Implementation
Approaches
The big bang install a single ERP system
across the entire organization
Franchising Independent ERP systems
are installed in different units linked by
common processes, e.g., bookkeeping.
Slam dunk install one or several ERP
modules for phased implementation of
key business processes.
Medium Average
13.6
5.7
0.4
0.8
0.8
16.4 Oracle
PeopleSoft
7.4
Smallest
Largest Baan
16.1
26.5
JD Edwards
3.9
21.6 Lawson
1.9
4.1
5.4
11.2
1.4
15.5
1.3
SAP
13.9
52.2
0.8
SSA
1.7
7.6
0.7
42.8
58.6
308.2
29.6
Difficulty in implementation
Very difficult
Extremely costly and time intensive
Typical: over $10,000,000 and over a
year to implement
Company may implement only certain
modules of entire ERP system
You will need an outside consultant
Common Pitfalls
Do not adequately benchmark current
state
Did not plan for major transformation
Did not have executive sponsorship
Did not adequately map out goals and
objectives
Highly customized systems to look like
old MRP systems
Survey of ERP
implementations
Done by ittoolbox.com in 2004
Overview
375 IT and business professionals
52% anticipate budget increases for
new ERP implementations/new modules
SAP and PeopleSoft/J.D. Edwards were
cited as the most popular ERP packages
46% indicated that the main challenge
to successful ERP implementations was
inadequate definition of requirements
and resistance to change