ENTERPRISE RESOURCE PLANNING - ERP

MUHAMMAD ALI
REFERENCE MATERIAL

 Book
 Modern ERP: Select, Implement & Use Today's Advanced Business Systems by Marianne Bradford
 Concepts in Enterprise Resource Planning by Ellen Monk and Bret Wanger, 4th Ed.
 Tool
 SAP (SAP enhancement package 3 for SAP Supplier Relationship Management 6.0)
 WHAT IS ERP ?
(Enterprise Resource Planning)
INTRODUCTION TO ENTERPRISE RESOURCE PLANNING
SYSTEMS
 Understand the essentials of ERP systems
 Recognize when a company would need an ERP system
 Know advantages and disadvantages of ERP systems
 Realize how ERP systems have evolved and identify trends in the market
 Distinguish among the three ERP vendor tiers
INTRODUCTION

 Organizations had disparate systems

 Organizations had redundant data
 Companies started implementation of ERP systems to automate, standardize and integrate their business processes
INTRODUCTION…
INTRODUCTION…

What is Business Process?

“A business process refers to a wide range of structured, often chained, activities or tasks conducted by people
or equipment to produce a specific service or product for a particular user or consumer.”
e.g. administration, banking, manufacturing, information technology etc.
ERP ESSENTIALS

 Previous systems were legacy systems i.e. Standalone systems or disjointed systems
 ERP systems integrate the data into one complete system
 Well-structured database serves the operational and decision making needs of organization
ERP ESSENTIALS…

Cross- * Integrate activities

Functional *cross departmental boundaries
ERP Systems
Process *provides clear, precise and complete view
Centered of business process
ERP MODULES
 ERP systems are sold in modules
 Price of ERP system depends on the number of modules bought
 Core ERP includes modules for financials, human capital management (HCM), and logistics.
 ERP systems are back office systems
 Extended ERP systems
WHO NEEDS KNOWLEDGE OF ERP ?

 Business Professionals
 End Users: shipping personnel, purchasing personnel, finance executives, (HR) staff
 Auditors: financial auditors, IT auditors
 Consultants
WHEN DOES A COMPANY NEED AN ERP SYSTEM ?

 Challenges that can be solved with ERP systems are:

 Too many business problems and unanswered questions
 Changing business model
 Business growth
 Need for advanced functionality
 Too many business systems supporting processes
 Lack of compliance
ADVANTAGES OF ERP SYSTEMS

 Data integration
 Simplified error correction process
 Real-time information access
 Share common process and data model covering broad and deep operational end-to-end processes
 Designed solutions based on industry best practice
o Vertical solution
 Modules look and act same
 Reduce operational cost
 increase revenue
DISADVANTAGES OF ERP SYSTEMS

 Complex installation
 Soft issues and technical stuff
 Lack of employee participation
o Change agents
 Price tag of ERP systems
 Need to be maintained
ERP MARKET
ERP VENDORS