Enterprise Resource planning

MIS

Management Information System 1

 Why Enterprise Resource planning?

In order to manage information, in order to deliver high quality

information to the decision-makers at the right time, in order to
deliver high quality information to the decision-makers at the right
time, in order to automate the process of data collection, collation
and refinement, organizations have to make IT an ally, harness its
full potential and use it in the best possible way.
For any organization to succeed, all business units or departments
should work towards this common goal. At the organizational level,
IT should assist in specifying objectives and strategies of the
organization. At the departmental level, IT must ensure a smooth
flow of information across departments, and should guide
organizations to adopt the most viable business practices.
As the departments are large, they remain closed except at the top
level, unless a common system is implemented.

Management Information System 2

 ERP
An Enterprise is a group of people with a
common goal, which has certain resources at
its disposal to achieve that goal. Resources
included are money, material, man-power and
all other things that are required to run the
enterprise. Planning is done to ensure that
nothing goes wrong. Thus Enterprise Resource
planning is a method of effective planning of
all the resources in an organization.
Management Information System 3
 ERP
• ERP is primarily an enterprise-wide system, which
encompasses corporate mission, objectives, attitudes,
beliefs, values, operating style, and people who make the
organization.
• ERP covers the techniques and concepts employed for the
integrated management of businesses as a whole, from the
viewpoint of the effective use of management resources, to
improve the efficiency of an enterprise. It is a mirror image
of the major business processes of an organization, such as
customer order fulfillment and manufacturing. Its set of
generic processes, produce the dramatic improvements
they are capable of only, when used to connect parts of an
organization and integrate its various processes seamlessly.

Management Information System 4

 Reasons for the growth of the ERP market

• To enable improved business performance through reduces

cycle time, increased business agility, inventory reduction,
order fulfillment improvement
• To support business growth requirements through new
product lines, new customers, meeting global requirements
• To provide flexibility, integrated, real-time decision support
through improved responsiveness across the organization
• To eliminate limitation in legacy systems of century dating ,
fragmentation of data, inflexibility to change etc
• To take advantage of the untapped mid-market by
increasing functionality at a reasonable cost, vertical
market solutions etc.

Management Information System 5

 The advantages of ERP

• Business Integration through automatic data

updations
• Flexibility to adapt to global differences
• Better analysis and Planning capabilities by
utilizing many types of support systems
• Use of latest technology to sustain growth.

Management Information System 6

 Why do many ERP implementations fail?

• Wrong product
• Incompetent and hazardous implementation.
• Lack of training fr employees

Management Information System 7

 ERP Modules

• Finance
– Financial Accounting e.g. General Ledger, Accounts
receivable and payable, Asset accounting, legal
consolidation, controlling, overhead cost controlling, cost
centre accounting, overhead orders, activity based costing,
product cost controlling, cost object controlling,
profitability analysis
– Investment Management e.g. Investment Planning
– Controlling e.g. Overhead cost Control
– Treasury e.g. Cash Management, treasury management,
market risk management, funds management
– Enterprise Controlling e.g. EIS
– Profit Centre Accounting

Management Information System 8

 ERP Modules

• Manufacturing
– Material and Capacity Planning
– Shop Floor Control
– Quality Management
– JIT/ Repetitive Manufacturing
– Cost management
– Engineering Data Management
– Engineering Change Control
– Configuration Management
– Serialization/ Lot Control
– Tooling
Management Information System 9
 ERP Modules

• Sales and Distribution

– Master Data Management
– Order management e.g. Sales Order Management, Purchase
Order Management,
– Warehouse Management includes inventory planning, inventory
handling, intelligent location, inventory reporting, inventory
analysis, lot control, distribution data collection, etc.
– Shipping
– Billing
– Pricing
– Sales Support
– Transportation
– Foreign Trade

Management Information System 10

 ERP Modules

• Plant Maintenance
– Preventive Maintenance Control
– Equipment Tracking
– Component Tracking
– Plant Maintenance Calibration Tracking
– Plant Maintenance Warranty Claims Tracking

Management Information System 11

 ERP Modules

• Quality Management
– Quality planning
– Quality inspection
– Quality control
• Materials Management
– Pre-purchase Activities
– Purchasing
– Vendor Evaluation
– Inventory management
– Invoice verification and material inspection
Management Information System 12
 ERP Modules

• Human Resources
– Personnel Management includes personnel
administration, employee master data, recruitment
management, travel management, benefits
administration, salary administration
– Organizational Management includes payroll
accounting
– Payroll Accounting
– Time Management includes shift planning
– Personnel Development includes training and event
management
Management Information System 13
 ERP Market
ERP Market consists of the big 5 vendors (Sap, Oracle,
Peoplesoft, Baan, JD Edwards) and others. The big 5
account for 61% of the market share.

SAP (Systems, Applications and products in Data Processing)

SAP ERP packages come in two versions: the mainframe
version (SAP R/2) and the client/server version (SAP R/3)
SAP products feature a sophistication and robustness
unmatched by other business software solutions. SAP has
developed an extensive library of more than 80 predefined
business processes, spanning each functional software
requirement.

Management Information System 14

 R/3 Overview

The 3-tier architecture separates a system into three functional layers, each
structured to support the demands of its functions.
The database layer resides on central servers or mainframe host computers
The application layer holds the processing logic of the system, preparing and
formatting data for individual offices or departments.
The presentation layer typically on personal computers, handles all the tasks
related to the presentation of data, including user interfaces that enable
easy access to complex applications and data.

SAP also incorporated And integrated the intranet and internet technologies
into business solutions for its customers.
Although designed as an integrated system, R/3’s modules can also be used
individually
SAP has recently come out with BAPIs (Business application programming
interface) which helps SAP interact with third party applications

Management Information System 15

 Bann

The Baan series-based product family includes Baan

Enterprise Resource Planning (Baan ERP), Baan Front
Office, Baan Corporate Office Solutions, Baan Supply Chain
Solutions etc.
Baan serves a number of industries like Aerospace & Defense
and Automative.
The Baan ERP modules include the following
• Manufacturing
• Finance
• Project
• Distribution
•

Management Information System 16

 Oracle

Oracle’s Warehouse Technology Initiative provides customers with a complete data

warehousing solution.
Oracle’s Integrated Business Intelligence Solutions deliver powerful capabilities to
users anywhere in the enterprise, at any time. Products include Oracle Reports,
Oracle’s Enterprise Reporting Tool, Oracle Discoverer, Oracle’s Query and Analysis
tool etc.
Oracle Applications is a leading provider of packaged and integrated front office and
ERP solutions for the enterprise. It follows internet computing model.
Oracle has 45+ modules divided into following categories
• Oracle Financials
• Oracle Human Resource
• Oracle Projects
• Oracle Manufacturing
• Oracle Supply Chain
• Oracle Front Office
•

Management Information System 17

 Peoplesoft

It provides industry specific enterprise solutions to customers in select

markets, including communications, financial services, healthcare,
manufacturing, higher education.
Its applications can be implemented as a single application, or a complete
enterprise-wide solution
Peoplesoft tools include several tools for reporting, customization and
workflow.
Peoplesoft implementation toolkit has a modular application structure, which
lends itself to the use of phasing-an incremental process. It has four
phasing strategies:
• Geographical: Applicable when business practices and processes in
various locations are independent to justify separate implementations.
• Departmental: Your initial phase is focused on full implementation for a
given department, additional departments incremented later.
• Core and then support processes
• No phasing required in some situations.

Management Information System 18

 JD Edwards

JD Edwards WorldVision is a thin client bridge that provides the Graphical User
Interface (GUI) with a look and feel common to the PC, while protecting your
investment in WorldSoftware and the AS/400. The different product modules
available from JD Edwards are:
• Foundation Suite
• Financial Suite
• Logistics/Distribution Suite
• Services Suite
• Manufacturing Suite
• Architecture, Engineering, Construction, Mining and Real Estate Suite
• Energy and Chemical Suite
• Payroll Suite
• Human Resource Suite
• Customer Service Management Suite
• Government, Education, and Not-for-profit Solutions
• Utility and Energy Solutions

Management Information System 19

 ERP Implementation lifecycle
Pre-selection screening

Package Evaluation

Project Planning

GAP Analysis Reengineering Configuration

Implementation team building Testing End User Training

Go-Live

Post Implementation Phase

Management Information System 20

 Examples of ERP
E-Business Suite 12 by Oracle (Overview)
• Founded in 1977, Oracle Corporation (NASDAQ: ORCL) supplies software for information
management. With annual revenues of more than $10.9 billion (USD), the company offers its
database, tools, and application products, along with related consulting, education, and
support services, in more than 145 countries around the world.

• Headquartered in Redwood Shores, California (US), Oracle develops and deploys Internet-
enabled enterprise software across its entire product line, which includes database, server,
enterprise business applications and application development, and decision support tools.
Oracle offers e-business solutions that extend from front-office customer relationship
management (CRM), to back-office operational applications, to platform infrastructure.

• Oracle E-Business Suite is a fully integrated suite of business applications. Depending on the
users’ needs for enterprise resource planning (ERP) for services (non-manufacturing), the
suite can be split into one module, multiple modules, or a complete suite. Incorporating best
practices and industry-specific capabilities, E-Business Suite helps businesses protect their
existing investments, extend the value of their applications, and evolve to the next
generation of business applications. E-Business Suite also supports Oracle’s Fusion
Middleware, which extend processes, secure information, and enhance decision-making
capabilities with solutions that include business integration, business intelligence, master
data management, and identity management.

• For more information, visit the company's web site http://www.oracle.com/

 SAP Business ByDesign by SAP (Overview)
• Founded in 1972, SAP provides collaborative e-business solutions for a variety of
industries and markets. SAP is a worldwide provider of e-business software
solutions. With subsidiaries in over fifty countries, the company is listed on several
exchanges, including the Frankfurt stock exchange and the New York Stock
Exchange (NYSE) under the symbol SAP. Headquartered in Walldorf, Germany, SAP
is a large inter-enterprise software company, and the world's third-largest
independent software supplier overall. SAP employs over 28,909 people in more
than 50 countries. Today, more than 17,000 companies in over 120 countries run
more than 44,500 installations of SAP software.

• SAP Business ByDesign is an ERP system geared towards small and midsized
businesses. SAP Business ByDesign supports common business processes across
multiple industries and is available as an on-demand deployment. It is an
integrated business solution that supports financials, customer relationship
management, human resource management, supply chain management, project
management, supplier relationship management, compliance management, and
executive management support.

• For more information visit company's web site

http://www.sap.com/usa/index.epx