ERP

Enterprise Resource Planning

ERP is a set of concepts and techniques employed for the integrated management of business as a whole, from the viewpoint of effective use of management resources, to improve the efficiency of an enterprise.

ERP can also be called a Management Information System that integrate and automate many of the business practices associated with the operations or production and distribution aspect of a company engaged in manufacturing products or services.

Goals of ERP

To improve and streamline internal business processes, which typically require reengineering of current business processes.

Advantages of ERP

breaks down barriers between departments management visibility into every area of the enterprise Supply chain flow improves data lag-time is eliminated on time shipment improved resource utilization

increases flexibility better customer satisfaction reduced Quality Cost

Components of ERP

ERP Software
Module based ERP system automates business activities of functional areas within an organization.

Business Processes
Strategic Planning Management Control Operational Control

ERP Users
Employees of the organization at all levels.

Operating Systems
Unix Windows NT Linux

Implementation

For functions which are not automated do we automate them?

For functions which already have software do we replace it with new ERP model or do we integrate ERP with existing software?

Implementation of ERP

Project Planning Choose ERP Software Business & Operational Analysis Gap Analysis Joint creation of Implementation Plan Business Process Reengineering Installation & Implementation Mapping of Business Requirement (Customization) Module configuration

Implementation of ERP Cont

Data conversion from legacy system Documentation Management Training End-User training Production / Implementation Post Implementation support

People Competencies

Functional Consultants
Domain Expertise People who have functional expertise in business function (Sales, HR, Production, Quality etc.)

Technical Consultants
People who have Technical Expertise in ERP & other technologies. Programming Database Networking

Types of ERP

Generic ERP
Industry Specific ERP Custom Built / Built to Order

Modules in Generic ERP

Finance Human Resource Material Management Quality Management Sales & Distribution Manufacturing Logistics Strategic & Operational Planning

Industry Specific ERP

Aerospace & Defense Automotive Banking Chemical Consumer Products Defense & Security Engineering, Construction & Operation Health Care Higher Education & Research Industrial Machinery & Components

Industry Specific ERP Cont

Insurance Life Sciences Logistic Services Media Mill Products Mining Oil & Gas Postal Services Public Sector Railways Telecommunications

ERP Vendors

SAP People Soft JD Edwards Oracle BaaN System Software Associates Ramco Marshall

SAP
(Systems, Applications and Products in Data Processing)

world leader ERP Company Two Versions SAP R/2 Mainframe Version SAP R/3 Client-Server Version 2/3rd Indian Market Share Works through High Class of Certified Consultants Consultants charge a high fee

SAP

suited for large corporations R/3 can handle multiple currencies has the largest number of features among all ERP software products Its software that runs on widest range of hardware platforms

SAP

supports multiple RDBMS ( DB2 from IBM, Oracle, Informix and Microsoft SQL server ) system is rigid and forces the organizations to change their internal processes needs significantly larger resources in terms of processing power, disk space and network speed.

SAP R/3 Modules

Financial Accounting Treasury Controlling Enterprise controlling Investment management Production planning Material management Plant maintenance and service management Quality management Project system Sales & Distribution Human resource management

People Soft

Belongs to Oracle Application Product Line Has outstanding HR Model Works through Global Consultants & third Party Vendors Had taken over JD Edward Support multiple hardware and software platforms

BaaN

Company is driven by innovation products run on multiple hardware and software platforms code length decreases with the new release of their products exceptionally strong in Manufacturing software is much less complex & far easy to master less expensive to implement permits a faster implementation Company taken over by SSA

Oracle

Includes People soft & JD Edward application products outstanding Manufacturing modules exceptionally high acceptance of its RDMBS product Other ERP installations use Oracle DBMS has a superior GUI user interface Practically every cellular phone company in India is an Oracle client

Ramco Marshall

World-class product from India wedded to Microsoft and Intel for processor architecture, Operating systems and DBMS O/S, & SQL Server simplicity of design & reduced cost of ownership do their own implementations inflexibility in platform choice Used by process industry in the South and a few Public Sector Undertakings

ERP Implementation Methodologies

The Big Bang

Modular Implementation Process Oriented Implementation

Cost of ERP

Cost of Hardware Cost of Software Cost of Professional Services

(Hidden Cost)

Hidden Costs

Training Integration & Testing Customization Data Conversion Consultants

Why ERP Projects Fail ?

Lack of clearly defined objectives and goals. A poor corporate vision. Absence of organization and structure. A poor project plan. Lack of involvement, coordination, communication, and support. A poor project team.

END

Finance

Financial Accounting Investment Management Controlling Treasury Enterprise Controlling

Financial Accounting

General Ledger Accounts Receivable / Payable Fixed Asset Accounting Legal Consolidation

Investment Management

Investment
Planning Budgeting Controlling

Depreciation
Forecast

Simulation
Calculation

Controlling

Overhead Cost Controlling Activity Based Costing Product Cost Accounting Profitability Analysis

Treasury

Cash Management Treasury Management Market Risk Management Funds Management

Enterprise Controlling

Executive Information System Business Planning & Budgeting Profit Center Accounting

Human Resource

Personnel Management Organizational Management Payroll Accounting Time Management Personnel Development

Material Management

Pre Purchasing Activity Purchasing Vender Evaluation Inventory Management Invoice Verifications and Material Inspection

Quality Management

Computer-Aided Quality Management

Quality Planning Quality Inspection Quality Control

Computer Integrated Quality Management

Sales & Distribution

Master Data Management Order Management Warehouse Management Shipping Billing Pricing Sale Support Transportation Foreign Trade

Big Five Consulting houses

Anderson consulting Ernst & Young Price Waterhouse Coopers & Lybrand KPMG and Delolite & Touche

Big Five Consulting houses

actively engaged in ERP consulting the richest ERP implementation experiences developed their own methodologies of implementation have full-fledged development centers have developed excellent course-ware and training materials operate in the "high risk high reward" area charge a very high fee