ERP(Enterprise Resource

Planning)
 Introduction
• Instead of independent systems, vendors
provided packaged system to purchase.
• Expanded the concept to include s/w to
handle all transactions .These larger s/w
system became known as ERP.
 Definition
• a business management system that integrates all processes of the
business, including planning, manufacturing, sales, and marketing

• Gives an integrated real time view of its core business processes

• Is a cross functional enterprise system driven by integrated suite of

software modules that supports the basic internal business
processes of a company.
• Example
ERP s/w for a manufacturing company
1.Track status of sales
2.Inventory
3.Shipping.
4.Tracking of raw materials and Human

resource.
• Vendors sell modules which handles the major activity.

• Should integrate well.

• It typically consists of integrated modules of manufacturing,

distribution, sales, accounting and human relations application
 Benefits
• Quality and efficiency – integrates and improves a company’s
internal business processes

• Decreased cost – reduction in transaction processing costs, IT

support staff

• Decision Support – provides vital cross-functional information on

business which helps in better decision making

• Standardization & enterprise agility – helps in building more flexible

organizational structure, work roles to capitalize on new business
oppurtunities
 Complexity

• Convince to purchase a general s/w package

• High cost of implementation which includes hardware,

software, developing new business process (BPR),
preparing employees (training and change management)
 Approach
• Customize the package for various
industries
• Include lot of options
• Custom coding
• Change procedure
• Provide training
 Product Example
• SAP
20 different solutions
mySAP SCM
Business Intellegence
CRM
Mass data processing
• Oracle
Marketing
Sales
Service
HR
Supply Chain
Project Management
• Success
Cisco
Colgate-Palmolive
• Noted Failure
Nike
Whirlpool
 Causes of Failure
• Underestimate the time required for planning, development, training

• Underestimate the complexity involved in planning, developing and

training

• Failure to involve affected employees in planning and development

phases and in change management programmes

• Trying to do much too fast

• PC compatibility issues

• knowing when to allow users to modify the packaged software

 Trends in ERP
• Flexible, more open and standard based software – makes it easier
to integrate with other applications. Ex SAP R/3 is a modified
version of SAP R3

• Web-enabling ERP software – using IT to build web interfaces and

networking capabilities. This makes it easier to use and connect to
other internal applications.

• Integration of ERP functions in e-business suites – integrate ERP,

customer relationship management, supply chain management,
decision support, enterprise portals. Ex: mySAP and Oracle’s e-
business suites
 Information communication technology

• (ICT) is a term that includes all

technologies used for the communication
of information
• medium to record information
• technology for broadcasting information
• any technology for communicating through
voice and sound or images-
• At present, its an information
communication with the help of
personal computers (PCs) networked
through the Internet through
information technology that can transfer
information using satellite systems or
intercontinental cables
• PC-based ICT
• Internet
• Business
 Limitations
• Bandwidth: The time taken to access a
particular piece of information on the
Internet depends on the bandwidth
available to the user at that time.
• Disruptive software:
computer viruses.
 Trends
• mobile phone technology, which is fast
becoming very affordable by the masses,
is voice based and can be integrated with
the Information Technology at the server
end of a computer network