ENTERPRISE RESOURCE PLANNING

What is ERP?

Evolution of ERP
1960s - Systems Just for Inventory Control 1970s - MRP Material Requirement Planning (Inventory with material planning & procurement) 1980s - MRP II Manufacturing Resources Planning (Extended MRP to shop floor & distribution Management.) Mid 1990s - ERP Enterprise Resource Planning (Covering all the activities of an Enterprise) 2000 onwards ERP II Collaborative Commerce (Extending ERP to external business entities)

Functional Modules of ERP

ERP Production Planning Module ERP Purchasing Module ERP Inventory Control Module ERP Sales Module ERP Market in Module ERP Financial Module ERP HR Module

Objectives of ERP
Speed Scope Resources Risk Complexity Benefits

WHY ERP?
Complete integration of systems across the departments in a company as well as across the enterprise as a whole. Only solution for better project management. Better customer service. Automatic introduction of latest technologies. Expertise database.

HOW DO WE START FOR ERP?

Ensure the management is behind you. Ensure enough financial funds. Identify core project team, project manager, analysts and specialists from all functional areas. Evaluate and select ERP package. Make an implementation plan. Present plan to management committee for sanctions. Present plan to employees group for feedback.

ERP SELECTION
Check whether all functional aspects of business are duly covered. Check whether all the business functions and processes are fully integrated. Check whether all the latest IT trends have been covered. Check whether the vendor has customizing and implementing capabilities. Check your purse and calculate ROI.

ERP IMPLEMENTATION
Commitment from management. Form a task force with personnel from all functional areas. Take care of hardware requirements. Step-by-Step rather than big bang introduction. Be patient . ERP implementation takes time.

Need for ERP

Integrate organizations activities. Force the use of best practices. Enable organizational standardization. Allow simultaneous access to the same data for planning and control.

DECIDE MAKE OR BUY ERP ?

INHOUSE DEVELOPMENT ERP PACKAGE

INHOUSE DEVELOPMENT:
Project development takes time. Documentation is difficult. Maintenance depends on individual. EDI implementation modification to be taken care of.

Enterprise implementation is difficult as each unit follows different software option.

Latest developments to be studied before implementation.

DECIDE MAKE OR BUY? (Continued.)

ERP PACKAGE :
Documentation is a part of system. Ready made projects needs only customization. Company takes care of maintenance. EDI compatible universally acceptable. The package itself is designed as enterprise package. Constant updates on technology and processes assured.

Benefits of ERP
Integration Efficiency Cost reduction Accuracy Less personnel

DRAWBACKS OF MRP SYSTEMS

Expensive Not very flexible

CONCLUSION
Reduced overheads and inventory. Timely responsiveness. Market share and image enhancement. Keep up with technology changes. Only way for integrated systems for client with multiple locations.

Case Study
Previous manufacturing software did not provide engineers with an efficient method to create BOMs. Inventory inaccuracy let to material shortages.

The Challenges
Finished goods were not coming off the production line on time. Result financial statements did not accurately reflect a true picture of the company.

TrailTechs Results
Reduction in the manufacturing cycle. Improvements on shop floor flow. Eliminating of the production bottlenecks. Delivery dates are shorter and more reliable.

TrailTechs Results
Reduction in customer complaints Inventory accuracy Improve employees moral.

Advantages
Increase the customer satisfaction. Increase profitability and productivity. More flexible production processes. Reduced errors due to better coordination

Disadvantages
The systems can be very expensive to install and maintain. Some systems can be difficult to use. A problem in one department or at one of the partners will affect all the other participants.