SAP is the name of the company founded in 1972 under the German name

(Systems, Applications, and Products in Data Processing) is the leading ERP

(Enterprise Resource Planning) software package.

Introduction to ERP

ERP stands for Enterprise Resource Planning. ERP is a way to integrate the
data and processes of an organization into one single system. Usually ERP
systems will have many components including hardware and software, in
order to achieve integration, most ERP systems use a unified database to
store data for various functions found throughout the
organization.Enterprise resource planning (ERP) is a company-wide
computer software system used to manage and coordinate all the resources,
information, and functions of a business from shared data stores.

An ERP system has a service-oriented architecture with modular hardware and software units
or "services" that communicate on a local area network. The modular design allows a business
to add or reconfigure modules (perhaps from different vendors) while preserving data integrity
in one shared database that may be centralized or distributed.

The term ERP originally referred to how a large organization planned to use organizational
wide resources. In the past, ERP systems were used in larger more industrial types of
companies. However, the use of ERP has changed and is extremely comprehensive, today the
term can refer to any type of company, no matter what industry it falls in. In fact, ERP
systems are used in almost any type of organization - large or small.

In order for a software system to be considered ERP, it must provide an organization with
functionality for two or more systems. While some ERP packages exist that only cover two
functions for an organization (QuickBooks: Payroll & Accounting), most ERP systems cover
several functions.

Today's ERP systems can cover a wide range of functions and integrate them into one unified
database. For instance, functions such as Human Resources, Supply Chain Management,
Customer Relations Management, Financials, Manufacturing functions and Warehouse
Management functions were all once stand alone software applications

, usually housed with their own database and network, today, they can all fit under one
umbrella - the ERP system

ERP Benefits: Myth or Reality

ERP Benefits: Myth or Reality

Many industry leaders have believed on the evasive nature of ERP benefits.
But how real is the issue of ERP benefits realization? To find out, it helps to
look into some key statistics from our ongoing ERP benchmark study. The
study, which focuses on companies across the globe that have implemented
or are in the process of implementing various ERP packages, reveals some
interesting points:
 • 30% of those surveyed did not realize any sort of staff reductions after go-live
• 18% did not measure benefits after go-live
• 28% had some type of problem or operational stoppage after go-live

Surprisingly, only 18% of companies did not measure post-go-live benefits (in other words,
82% did indeed measure). Besides almost 100% of the companies that have implemented
ERP, does not measure post-implementation benefits.

Second, the fact that 28% experienced stoppages seems somewhat alarming. It does highlight
that at least 1 in 4 companies have operational problems and/or stoppages because of the
disruptions caused by ERP.

So what does this all mean? First, the results show that ERP benefits are by no means
guaranteed. Second, the risk of ERP disrupting an organization's core operations is a
significant business risk. These factors are clearly areas that will affect the ROI of the
investment in ERP and should be carefully managed as part of an overall ERP Benefits
Realization plan

The Advantages and Disadvantages of ERP

The Advantages and Disadvantages of ERP

There are a number of powerful advantages to Enterprise Resource

Planning. It has been used to solve a number of problems that have plagued
large organizations in the past. At the same time, it is not without a number
of disadvantages. Being able to weigh the two will allow a company to
decide if this solution will properly meet their needs.

Advantages of ERP:

In the absence of an ERP system, a large manufacturer may find itself with many software
applications that do not talk to each other and do not effectively interface. Tasks that need to
interface with one another may involve:

• design engineering (how to best make the product)

• order tracking from acceptance through fulfillment
• the revenue cycle from invoice through cash receipt
• managing interdependencies of complex Bill of Materials
• tracking the 3-way match between Purchase orders (what was ordered), Inventory
receipts (what arrived), and costing(what the vendor invoiced)
• the Accounting for all of these tasks, tracking the Revenue, Cost and Profit on a
granular level.

Change how a product is made, in the engineering details, and that is how it will now be
made. Effective dates can be used to control when the switch over will occur from an old
version to the next one, both the date that some ingredients go into effect, and date that
some are discontinued. Part of the change can include labeling to identify version numbers.

Computer security is included within an ERP to protect against both outsider crime, such as
industrial espionage, and insider crime, such as embezzlement. A data tampering scenario
might involve a terrorist altering a Bill of Materials so as to put poison in food products, or
other sabotage. ERP security helps to prevent abuse as well.
Disadvantages of ERP:

Many problems organizations have with ERP systems are due to inadequate investment in
ongoing training for involved personnel, including those implementing and testing changes, as
well as a lack of corporate policy protecting the integrity of the data in the ERP systems and
how it is used.

Limitations of ERP include:

• Personnel turnover; companies can employ new managers lacking education in the
company's ERP system, proposing changes in business practices that are out of
synchronization with the best utilization of the company's selected ERP.
• Customization of the ERP software is limited. Some customization may involve
changing of the ERP software structure which is usually not allowed.
• Re-engineering of business processes to fit the "industry standard" prescribed by the
ERP system may lead to a loss of competitive advantage.
• ERP systems can be very expensive to install often ranging from 30,000 to
500,000,000 for multinational companies.
• ERP vendors can charge sums of money for annual license renewal that is unrelated to
the size of the company using the ERP or its profitability.
• Technical support personnel often give replies to callers that are inappropriate for the
caller's corporate structure. Computer security concerns arise, for example when
telling a non-programmer how to change a database on the fly, at a company that
requires an audit trail of changes so as to meet some regulatory standards.
• ERPs are often seen as too rigid and too difficult to adapt to the specific workflow and
business process of some companies—this is cited as one of the main causes of their
failure.
• Systems can be difficult to use.
• Systems are too restrictive and do not allow much flexibility in implementation and
usage.
• The system can suffer from the "weakest link" problem—an inefficiency in one
department or at one of the partners may affect other participants.
• Many of the integrated links need high accuracy in other applications to work
effectively. A company can achieve minimum standards, then over time "dirty data"
will reduce the reliability of some applications.
• Once a system is established, switching costs are very high for any one of the partners
(reducing flexibility and strategic control at the corporate level).
• The blurring of company boundaries can cause problems in accountability, lines of
responsibility, and employee morale.
• Resistance in sharing sensitive internal information between departments can reduce
the effectiveness of the software.
• There are frequent compatibility problems with the various legacy systems of the
partners.
• The system may be over-engineered relative to the actual needs of the customer.

Conclusion:

The success of the system is fully dependent on how the workers utilize it. This means they
must be properly trained, and a number of companies have attempted to save money by
reducing the cost of training. Even if a company has enough money to implement ERP, they
may not be able to successfully use it if they do not have enough money to train their workers
on the process of using it. One of the biggest problems with ERP is that it is hard to customize.
Very few companies can effectively use ERP right out of the box. It must be modified to suit
their needs, and this process can be both expensive and tedious. Even when a company does
begin changing the system, they are limited in what they can do.
 Introduction to Enterprise Resource Planning
Enterprise Resource Planning is the latest high end solution, information
technology has lent to business application. The ERP solutions seek to
streamline and integrate operation processes and information flows in the
company to synergise the resources of an organisation namely men,
material, money and machine through information. Initially implementation
of an ERP package was possible only for very large Multi National
Companies and Infrastructure Companies due to high cost involved. Today
many companies in India have gone in for implementation of ERP and it is
expected in the near future that 60% of the companies will be implementing
one or the other ERP packages since this will become a must for gaining
competitive advantage.

Most organizations across the world have realized that in a rapidly changing environment, it is
impossible to create and maintain a custom designed software package which will cater to all
their requirements and also be completely up-to-date. Realizing the requirement of user
organizations some of the leading software companies have designed Enterprise Resource
Planning software which will offer an integrated software solution to all the functions of an
organisation.

It was introduced by research and analysis firm Gartner in 1990. ERP systems now attempt to
cover all core functions of an enterprise, regardless of the organization's business or charter.
These systems can now be found in non-manufacturing businesses, non-profit organizations
and governments.
To be considered an ERP system, a software package must provide the function of at least two
systems. For example, a software package that provides both payroll and accounting functions
could technically be considered an ERP software package
Enterprise Resource Planning

Some organizations — typically those with sufficient in-house IT skills to integrate multiple
software products — choose to implement only portions of an ERP system and develop an
external interface to other ERP or stand-alone systems for their other application needs. For
example, one may choose to use human resource management system from one vendor, and
the financial systems from another, and perform the integration between the systems
themselves.

This is common to retailers, where even a mid-sized retailer will have a discrete Point-of-Sale
(POS) product and financials application, then a series of specialized applications to handle
business requirements such as warehouse management, staff rostering, merchandising and
logistics.
Ideally, ERP delivers a single database that contains all data for the software modules, which
would include:

Manufacturing
Engineering, bills of material, scheduling, capacity, workflow management, quality control,
cost management, manufacturing process, manufacturing projects, manufacturing flow

Supply chain management

Order to cash, inventory, order entry, purchasing, product configurator, supply chain planning,
supplier scheduling, inspection of goods, claim processing, commission calculation

Financials
General ledger, cash management, accounts payable, accounts receivable, fixed assets

Projectmanagement
Costing, billing, time and expense, performance units, activity management

Human resources
Human resources, payroll, training, time and attendance, rostering, benefits

Customerrelationshipmanagement
Sales and marketing, commissions, service, customer contact and call center support

Data warehouse and various self-service interfaces for customers, suppliers, and employees

Access control - user privilege as per authority levels for process execution

Customization - to meet the extension, addition, change in process flow

Enterprise resource planning is a term originally derived from manufacturing resource planning
(MRP II) that followed material requirements planning (MRP). MRP evolved into ERP when
"routings" became a major part of the software architecture and a company's capacity
planning activity also became a part of the standard software activity. ERP systems typically
handle the manufacturing, logistics, distribution, inventory, shipping, invoicing, and accounting
for a company. ERP software can aid in the control of many business activities, including sales,
marketing, delivery, billing, production, inventory management, quality management and
human resource management.

ERP systems saw a large boost in sales in the 1990s as companies faced the Y2K problem in
their legacy systems. Many companies took this opportunity to replace their legacy
information systems with ERP systems. This rapid growth in sales was followed by a slump in
1999, at which time most companies had already implemented their Y2K solution.

ERPs are often incorrectly called back office systems indicating that customers and the general
public are not directly involved. This is contrasted with front office systems like customer
relationship management (CRM) systems that deal directly with the customers, or the
eBusiness systems such as eCommerce, eGovernment, eTelecom, and eFinance, or supplier
relationship management (SRM) systems.
ERPs are cross-functional and enterprise wide. All functional departments that are involved in
operations or production are integrated in one system. In addition to manufacturing,
warehousing, logistics, and information technology, this would include accounting, human
resources, marketing and strategic management.
 Understanding ERP

Understanding ERP

ERP covers a multitude of topics, all integral parts of a very expansive and
comprehensive process. In learning what it’s about and how it works, there
are some central features one must understand.

• Business process reengineering:

ERP is about leveraging a company’s information, as well as the information resources
of partner companies, in the pursuit of more efficient ways of doing business. In
general, a company’s business processes already leverage existing resources and
information availability optimally in order to achieve the most efficient operation
possible. But by reconfiguring information resources, combining and extending
applications, and partnering with other companies in the sharing of information, new
possibilities emerge in terms of how business processes (such as manufacturing, order
processing, and inventory control) may be implemented. Making business systems
better is a central ERP objective.
• Database integration:
Most traditional businesses store information by business function. Financial
information is in an accounting database, customer data is in a customer database,
and so on. ERP calls for the integration of databases into a super-database that
enables logical links between records that traditional applications would not require
but that process-oriented ERP applications do require. Often, ERP platform software
simply creates convenient and easily maintained bridges between existing databases
rather than requiring the awkward generation of new databases from old.
• Enhanced user interfaces:
ERP applications, in general, cease to be stand-alone and become steps in a process.
Often, a user interface will initiate down-line processes, in addition to its primary
function, in highly efficient ways (such as the triggering of updates in down-line
databases when a record is changed in the database the user interface is using). It is
also often the case that ERP-integrated databases offer wider reporting options via
application interfaces than conventional systems do. It is important to learn what
options are useful and how this extended reporting may be enabled.
• Data transport between companies:
As the Internet continues to blossom, the sharing of strategic information between
partner companies and logistical data between companies partnered in supply chains
is increasingly important. The enhanced databases and interfaces of an ERP-based
company are made all the more valuable if partner companies are invited to the party.
So a broad and detailed knowledge of the various data communication options is
essential to an ERP designer.
• Extended and distributed applications:
What exactly does it mean to extend an application or to share in a distributed
application? Basically, a conventional information system is much like a farm covered
with ponds: you go to a particular pond and scoop out a bucket of water in order to
water your plants. In an ERP environment, the ponds are all converted into an
irrigation system: the water is routed to the section of the farm where it’s needed. And
this includes sharing water with neighboring farms. An extended application has
ancillary functions; a distributed application accommodates many users—even if the
users have different needs and are all making use of different portions of database
records. It is essential to understand how to facilitate this varied use of common data
and to familiarize yourself with how a particular development environment can enable
it.
 How To Combine ERP With CRM

How To Combine ERP With CRM

Being able to blend together ERP with CRM is important. Being able to
combine your ERP and customer data is what will ensure the myriad of data
points across a variety of business processes are tracked and turned from
raw data into intelligence. Being able to plot the inventory cycles of your
product combined with data on all your customers needs and preferences
will help you maximize nuances of inventory and customer repeat
purchases.

Enterprise Resource Applications (ERP) is what mainly mid to larger sized businesses use and
need to manage their business operations. This includes, logistics, shipping, inventory,
receiving and sales. ERP lets you know that shipment of shoes has left the dock, when it
arrives in your warehouse, when it ships to your retail stores and many more.

Customer Relationship Management (CRM) is also critically important as it is the intelligent

glue that ensures you know what your customers want and that you can deliver it to them,
when they want it and how they want it.

Enterprise Resource Applications (ERP) is what mainly mid to larger sized businesses use and
need to manage their business operations. This includes, logistics, shipping, inventory,
receiving and sales. ERP lets you know that your shipment of shoes has left the dock in China.
Lets you know when it arrives in your warehouse. Let's you know when it ships to your retail
stores and more.

Customer Relationship Management (CRM) is also critically important as it is the intelligent

glue that ensures you know what your customers want and that you can deliver it to them,
when they want it and how they want it. It tells you that Mary and 100 other customers travel
15 miles every week to shop at your store. It tells you that Ted calls up every Mother's day to
order pink orthopedic shoes for his Mom. Take a look at how Amazon.com tries to "know you"
this what CRM is all about.

Being able to blend together ERP with CRM is important and this is what Sage has done with
its new Sage Accpac Extended Enterprise Suite consisting of Sage Accpac ERP version 5.5 with
integrated CRM.
Being able to combine your ERP and customer data is what will ensure the myriad of data
points across a variety of business processes are tracked and turned from raw data into
intelligence. Being able to plot the inventory cycles of your product combined with data on all
your customers needs and preferences will help you maximize nuances of inventory and
customer repeat purchases.

How To Make ERP Complement Business

The smart and aggressive organizations are finding that ERP and CRM solutions can be
an effective way to weather the economic storm and better position themselves in the
coming days.

Business is all about taking risks. But intelligent managers know how to manage risks, thus
preventing accidental losses as well as other operational, financial, and strategic risks -
including fraud. To manage business risks by using technology, we must first understand and
prioritize the risks a specific business faces, and then understand how Information Technology
(IT) can help that business. Then we can come to understand how those risks intersect with
the IT systems a business might already have in place. Indeed, intelligent use of an ERP
system can not only help ensure compliance with legal requirements and accounting rules, but
it can also help prevent fraud. An Enterprise Resource Planning (ERP) application and its user
permissions settings can prevent theft.

Becoming Lean has been a goal of most companies over the last few years. Lean delivers what
companies really need in today’s highly competitive world — shorter lead times, improved
quality, reduced cost, increased profit, improved productivity and better customer service. To
become Lean, a company must take a hard look at processes and practices to identify those
things that truly add value for the customer and eliminate those that do not. The continuous
pursuit of waste elimination is the essence of Lean, and ERP (enterprise resource planning)
can help in a Lean initiative.

Below are a benefits and results of implementing ERP to make it complement the business

• Reduce total cost of ownership

• Increase revenues
• Increase productivity
• Improve business process efficiency
• Ability to choose from multiple ERP delivery options
• Scale for growth and economic recovery
• Leverage available resources
• Prepare for mergers and acquisitions
• Force management to focus on benefits realization
• Increase rationalization of ERP investments

ERP projects needs to be implemented for overall improvement of business operations and
systems.

ERP in Small and Midsize Businesses

ERP in Small and Midsize Businesses

Despite aggressive cost cutting, middle-market enterprises still consider

pressure to reduce operating costs as key to their business strategies. Yet
these businesses are in the market for new technology — specifically
customer relationship management (CRM), an area in which either slight
increases or significant investment over the next two years is most often
designated.

ERP for small business calls for voluminous investments. The amount was fairly affordable to
small business entities. There is no doubt or two say about its benefits. But the question that
kept ringing in the market was can everyone afford it. The answer was a stubborn no initially
but not anymore. ERP outsourcing, Open Source ERP's and ERP applications designed for
S.M.E.'s (Small and medium Enterprises) have successfully overcome the above said
limitations.

Enterprise Resource planning was a term restricted purely to elite class. This scene was
witnessed in the IT market for some long time ever since ERP was introduced. The large
organizations went ahead with ERP process unmindful of negative consequences, not to forget
mentioning the fact that they took every proactive measure to curb the same. Needles to say
firms were interested in serving such large players. So the fate of Small and Medium
enterprises remained unanswered. ERP for S.M.E's remained a mere dream.
It so happened that the number of larger companies without ERP turned out to be nil. Thanks
to the awareness created by vendors and IT researchers. No doubt companies were initially
hesitant lot and apprehensive on just hearing the word ERP. However the industry proved
them otherwise. Then came a stage where a company could not exist but without ERP. Even if
their performance was satisfactory they were not able to gain any competitive advantages.
This explanation of how goliaths adapted to ERP has lot of significance in studying their
intervention with S.M.E. These bigger companies were not providing the required business to
ERP vendors. Even though there are many big companies the number of vendors was always
greater in multiples. This means only the best could strike deals and there was no possibility
for mediocre or average vendors (in terms of performance).The best players also found that
they had none to serve after a point of time because almost every company in the market
successfully established ERP (whether on the first or further attempts).

SO they had to naturally look for greener and fresher pastures. S.M.E.'S was the only answer.
The next question was how to provide best services at an affordable cost and still make profit.
In this case the vendors had to be worried only about the number of sales they could make
and not the quantum of profits because the number of vendors was few and far between when
compared with the number of S.M.E.'S choosing to go for ERP. As the saying goes "necessity
is the mother of Invention" vendors had to devise cost effective applications to meet the
demands of the Small and Medium enterprises. This was the origin of ERP for S.M.E.'S. This
benefited them in terms of business .On the other hand the firms enjoyed greater benefits by
making use of this application. Hence ERP and S.M.E. was weighed on the same scale.

The key things driving small businesses to ERP seems to be 1) growth of the small business
sector, and 2) more focus on the small business market from ERP software vendors. Most of
our small business clients are considering or implementing ERP because of their rapid growth
and the corresponding strain it puts on their legacy systems. In addition, large ERP vendors
that typically focused solely on the Fortune 500 market are now developing lower-cost
solutions with more appropriate functionality for smaller businesses.

A third and final possible reason is because many niche ERP players have entered the
marketplace to provide functional solutions for specific industries. Open technologies such
as .net have reduced barriers to entry into the ERP market, so many smaller, industry-specific
niche players are able to fill the voids left by the big ERP comapnies at a lower cost.

Although this increasing focus on small business is good for companies with limited capital
budgets, it also poses additional risks. Now, there are more choices than ever, and some
vendors' products are much more proven than others. So small businesses should be
especially thorough when evaluating and selecting an ERP package. They should engage in a
vendor selection process that ensures they choose a solid software package that provides a
strong ROI to the company.

S.M.E.'s are becoming the popular choice of ERP vendors. There is an increasing awareness of
ERP in S.M.E. market. It has practically helped to unravel the myth that ERP is exclusively
meant to business empires. ERP and S.M.E have become important part of enterprise studies.
 How To Extend the Capabilities of ERP
To be and remain competitive, today’s businesses require the ability to have
a full and up-to-date view of their business—whenever they need it. To
achieve this, you need an integrated business environment and automated
processes that can consolidate the data from your ERP and CRM systems
with your other business applications

Integrating your ERP with your CRM, and integrating ERP and CRM with your company’s other
internal systems and with systems

external to your business may help you to extend functionality by automating business
processes such as:

• Automating manual communication with your trading partners

• Connecting your eCommerce site to your ERP
• Handling service requests via the Web
• Allowing your customers to submit their orders via the Web
• Facilitating EDI transactions
• Sharing data across systems and/or combining processes
• Consolidating a chart of accounts
• Synchronizing your company’s data across multiple sites
• Logging your incoming email

Increase Profits With ERP

Many manufacturers' information technology (IT) budgets are skewed

toward maintenance and integration activities. This can prevent strategic
investment in the systems the company really needs and restricts the
organization's ability to grow and remain profitable. It becomes even more
confining as the demands of the industry change, requiring new
information.

A core problem is that while many IT shops can tell you about the frugality of their budget and
targeted project ROI, few can explain IT's impact on productivity or profitability.

A litmus test for IT budgets is comparing IT operating expense to IT capital investment. A

good rule of thumb suggests numbers should be in the range of 70 percent for operating
expenses to 30 percent in capital investment. This tells us that systems are being invested in
and renewed and that IT is continually addressing new business problems with technology.

If you compare the cash outflow of the IT budget to employee productivity you'll find some
interesting things.
Is productivity improving or slowly deteriorating over time? Depending upon the level of detail
available here, the answer shows up in high indirect to direct employee ratios in
manufacturing and often in high SG&A numbers for the overall company. The implication we
can draw is that the systems may no longer be helping the firm succeed.
How so? Look for disconnected processes and systems that hamper communication and see if
you find lots of workarounds. It's likely these prevent employees from doing the right things—
slowing down decisions and customer response times while pushing up overhead—or they are
doing the right things, but by spending far too much effort. The cost, ultimately, is
profitability.
There a several areas that today's ERP systems can make a substantial difference.

Gain visibility into all aspects of the supply chain

Benchmarking studies have shown that one of the keys to supply chain success is forecast
accuracy. A better forecast helps you make better decisions throughout your operations. For
example, smoothing production plans uses labor and your manufacturing assets more
effectively. And accurate procurement from your suppliers minimizes inventory. More efficient
operation leads to more efficient customer response. And it's worth it. Supply chain
benchmarking done by AMR Research has shown that improving sales forecast accuracy by as
little as 1 percent can improve profitability by 2 percent.
To determine whether an ERP system would optimize your supply chain, assess forecasting
and demand management systems. Look at how analytics systems reveal true performance. If
there's room for improvement, consider how today's ERP systems provide the capabilities to
access information through familiar desktop tools, so that employees can make rapid decisions
informed by real-time, accurate data.

Get new products to market faster

New product development and launch is improved when good information and collaboration
tools are available. Companies must quickly assess projects, pick the right ones, and manage
intellectual property. Collaboration extends beyond coordinating the project and engineers,
now it embraces marketing, sales, and all supply chain activity, both internally and externally.

Streamline manufacturing processes

While most manufacturers agree that lean manufacturing improves customer-response time
and reduces costs, many organizations run their lean processes with manual systems,
spreadsheets, and standalone personal computer applications rather than with enterprise-class
applications. The challenge is to make data available to everyone. But this is difficult,
laborious, and costly when sharing information with staff, customers, vendors, and partners
must be done manually.

Increase collaboration and customer satisfaction

In most industries, supply-chain transparency is essential to success. Manufacturers need to

be tightly integrated with their suppliers and to provide critical product, price, availability, and
shipment information to their customers. This is especially true in a global supply network.
Responding to changing demands rapidly requires visibility across the entire supply chain and
accurate information about the supplier's capacity.
Yet capabilities, such as inventory visibility, vendor-managed inventories, electronic Kanban
replenishment signals, or working with new suppliers, are often done manually or not at all.
So, the supply chain is difficult to manage efficiently. To increase efficiency, many companies
invest heavily in integrating data from their customers and suppliers into their ERP systems.
And they're adding customer portals to reduce order-taking costs, speed fulfillment, and
increase customer satisfaction.

Ensure compliance with regulations

There is probably no sector of the manufacturing industry that is not concerned with new
regulatory compliances. Simply put, regulatory compliance means collecting critical data and
ensuring that production and the resulting products meet the constantly evolving required
safety and quality standards. For far too many manufacturers, collecting and compiling this
data is an offline task that consumes valuable employee time and reduces profit margins.
Compliance can't be ignored, but it can be done more efficiently when data is captured by a
current ERP system.

Implement integrated information systems—from making do to moving

on

Just because a business doesn't request an integrated system doesn't mean they don't need
it. People have an amazing ability to accept what they have. When they need data, people go
to great lengths to get it – even if it means re-keying data into spreadsheets and other
applications. But when they do, it can add to overhead costs and slow down business
processes—especially those critical to bringing new products to market or are customer facing.

Integrated systems can speed time-to-market, improve customer delivery performance, and
provide the data executives need to make the right cost and investment decisions as markets
and products change.

Succeeding in today's fast-moving manufacturing world requires a combination of exciting new

products, collaborative development, partnerships, and acquisitions. Integrated ERP systems
have already embedded the best practices for many state-of-the-art global business
processes. And, with powerful and familiar desktop tools integrated to the corporate data
source, ERP systems give real-time, accurate visibility to the specific information needed to
make decisions and move your organization forward.

Enterprise Resource Planning

Enterprise resource planning (ERP) is a company-wide computer software system used to

manage and coordinate all the resources, information, and functions of a business from shared
data stores.
An ERP system has a service-oriented architecture with modular hardware and software units
or "services" that communicate on a local area network. The modular design allows a business
to add or reconfigure modules (perhaps from different vendors) while preserving data integrity
in one shared database that may be centralized or distributed.

There are many different systems in a large company's "back office," including planning,
manufacturing, distribution, shipping, and accounting.Enterprise resource planning (ERP) is a
system that integrates all of these functions into a single system, designed to serve the needs
of each different department within the enterprise. ERP is more of a methodology than a piece
of software, although it does incorporate several software applications, brought together under
a single, integrated interface.

An ERP system spans multiple departments in a corporation, and in some cases an ERP will
also transcend the corporate boundary to incorporate systems of partners and suppliers as
well, to bring in additional functions like supply chain management. Because it is so vast and
all-encompassing, the ERP system goes far beyond being just a simple piece of software. Each
implementation is unique and is designed to correspond to the implementer's various business
processes. An ERP implementation can cost millions of dollars to create, and may take several
years to complete.

An ERP system likely represents a company's largest IT investment, so some companies prefer
to implement ERP in a more incremental fashion rather than all at once. Some ERP vendors
provide modular software units together with a unified interface to allow for this gradual
approach.

Some organizations — typically those with sufficient in-house IT skills to integrate multiple
software products — choose to implement only portions of an ERP system and develop an
external interface to other ERP or stand-alone systems for their other application needs. For
example, one may choose to use human resource management system from one vendor, and
the financial systems from another, and perform the integration between the systems
themselves.

This is common to retailers, where even a mid-sized retailer will have a discrete Point-of-Sale
(POS) product and financials application, then a series of specialized applications to handle
business requirements such as warehouse management, staff rostering, merchandising and
logistics.

Ideally, ERP delivers a single database that contains all data for the software modules, which
would include:

• Manufacturing
Engineering, bills of material, scheduling, capacity, workflow management, quality
control, cost management, manufacturing process, manufacturing projects,
manufacturing flow
• Supply chain management
Order to cash, inventory, order entry, purchasing, product configurator, supply chain
planning, supplier scheduling, inspection of goods, claim processing, commission
calculation
• Financials
General ledger, cash management, accounts payable, accounts receivable, fixed
assets
• Project management
Costing, billing, time and expense, performance units, activity management
• Human resources
Human resources, payroll, training, time and attendance, rostering, benefits
• Customer relationship management
Sales and marketing, commissions, service, customer contact and call center support
• Data warehouse and various self-service interfaces
for customers, suppliers, and employees
• Access control
user privilege as per authority levels for process execution
• Customization
to meet the extension, addition, change in process flow

ERP Analysis
ERP calls for different operations and applications in different industries.
Each industry has their own drawbacks and plus points in dealing with the
enterprise applications. A comparative study will help in analyzing them
precisely.

Enterprise resource planning (ERP) software helps integrate management, staff, and
equipment, combining all aspects of the business into one system in order to facilitate every
element of the manufacturing process. ERP groups traditional company and management
functions (such as accounting, human resources [HR], manufacturing management, and
customer relationship management [CRM]) into a coherent whole. Manufacturing management
also includes inventory, purchasing, and quality and sales management.

ERP systems aid in the control and communication of business activities, such as:

• efficient handling of order processing and production scheduling

 • management and analyses of business processes within an interactive environment
• synchronization of departmental activities (e.g., within human resources or finances)
with the needs and output from production facilities
• monitoring, sharing, and tracking of information throughout the organization

Enterprise Resource Planning Evaluation helps in

• Examine how each solution addresses your management and manufacturing

requirements.
• Compare systems to see if they offer the functions critical to your industry.
• Analyze each solution's capacity to support your company's growth and operations
over time.

Some of the well known beneficiaries include the following sectors:

• Manufacturing
ERP has helped to increase the efficiency and quality of the manufacturing process.
The manufacturing process experienced slumps quiet often because of improper
communication, miscommunication, wrong communication and even lack of
communication. ERP provided solutions to those troubles by coordinating the actions
of supply chains, ware house and logistics.
It also helped greatly in functions like tracking down the status of the product.
Formerly customers were made to run from pillar to post to enquire the status of
product or for enquiring a technical problem. The customer service representative
would not be in a position to directly reply to these queries. On the contrary he would
ask the person from the concerned department. The person would check the details
and get back to him be it the status of a product or technical issue. This seemed to be
time-consuming and meaningless. The longer the chains of communication greater are
the chances of mistakes. CSC erp finance is a software meant for accounting purposes.
• Software
The manufacturing sector has been rated as the largest beneficiary. This sector can be
rated as the one who uses ERP easily because it is a product from their species. This
does not undermine ERP'S use in Software sector because it becomes easy to manage
projects with acute deadlines. ERP industry paper will also reveal that it is easy to
train and make people work in this sector than anywhere else.
• Insurance
Enterprise Resource planning has played a vital role in this business by covering three
vital areas. Firstly it has provided a common platform for insurers and his agents. This
has helped in easing the transactions and keeping an eye on the performance of the
agent. This has addressed the difficulties of both the agents and insurers and thus
facilitated coordination in the better interests of the business.
Secondly it has helped in curbing procedural delays and inefficiencies for which the
sector is famous for. This statement can turn out to be truer if the sector is owned and
controlled by the government either fully or partially. Of course bureaucracy and
redtapism are inborn features in a state's set up but their presence in an insurance
industry can do more harm because it calls for dispensing immediate information
during lawsuits and pending claims. IBM erp Insurance is a famous player in this
sector.
• Healthcare
The sharing of databases among hospitals seemed to be a great advantage for doctors
and patients. This even makes one to exaggerate that a person need not maintain a
collection of his medical problems provided that his/her choice of hospital/hospitals
has a database of patient records(or commonly shares them by any other
means).Even though it is not practical to follow those practices ERP has been a
lifesaving measure to patients who are admitted in a hospital in an emergency
condition irrespective of the fact that the doctor in charge is aware of his medical
 history as ERP provides everything. ERP industry analysis here will reveal that
confidentiality is affected but the life of a person is to be given the utmost priority.
• Hospitality
ERP has helped a lot in bringing down the operational costs and coordinating the acts
of individual departments. Hotels are well known for the segregation of functions. One
can find many small departments like house keeping beverage supply room service
etc. Even though these segregations sound small they have a large impact on the
organizational structure. ERP offers a common medium to coordinate their actions. The
entire action can be controlled in the reception desk. ERP industry paper points the
exact benefit as per ERP industry analysis. Besides this textile erp insurance is equally
famous.

How ERP Vendors Operate

Success of an ERP system depends on it's capability of successfully
integrating manufacturing with the other processes of a company. Keeping
this in mind, a number of vendors are adding a wide variety of tools to their
products. One example of such value added product is the integration of
sales automation with supply chain maintenance. This have become some of
the most important areas of development

PeopleSoft became the market leader in human resources ERP software in the late 1980s. As a
measure of market expansion they moved to software programs that dealt with finance. The
company continued to maintain a high level of dominance in this market also. Yet for complete
success in ERP market PeopleSoft integrated other software tools in their ERP System.

While it is possible to specialize in certain things, tailoring your products towards multiple
industries can allow you to gain a great deal of success. A number of ERP suppliers are now
offering their products in two basic types, and these are business solutions and industry
solutions. The industry products are designed for people who are working in specific
industries. An example of this could be finance, communications, education, or healthcare.

ERP Vendors are offering various powerful tools ranging from manufacturing to human
resources to finance.The finance tools allow companies to successfully maintain their financial
information like assets, accounts, budgets, and cash. A company that uses ERP financial
products can save a great deal of money over the long term becuase the productivity of the
organization improves over the period. It can assist a company in managing internal as well as
external factors. Enterprise Resource Planning is instrumental in getting rid of time consuming
things such as paper management. Besides the ERP implementations help companies take
crucial and important decision on time.

The business solutions are designed for companies that work in a wide variety of different
areas. For instance, while industry solutions are specific to certain industries, business
solutions will be much more diverse. They will combine a large number of different elements
into a single unit. A number of ERP vendors have offered what are called "suites." These suites
will often be comprised of modules that a client can purchase in groups or a single unit.

The key to success for companies in the global market today is to properly measure their
performance. Enterprise Resource Planning has made things considerable easier. A company is
now able to study their processes, earnings, and performance by merging their operational
information with their financial information. Once this information is integrated,
competitiveness and and productivity of the company increases. Synergy is an important part
of ERP solutions. The concept of combining multiple processes into a single whole helps the
company to become successful in the long term.
Materials Management is yet another area of the company where ERP Vendors are offering
end-to-end solutions. Enterprise Resource Planning allows a company to successfully automate
the process of buying materials and maintaining them. It is possible for a company to predict
the demand of the market based on history, economic statistics, and data from their
employees. They can decide when a product should be producted, and they can do this based
on the raw material that is available. The modules in Materials Management keeps track of the
supplies that are purchased and make calculations about how these materials should be
distributed.

Through real time planning, it is possible for a company to decrease their inventory and
improve the processes of their goods and supplies. Another powerful aspect of Enterprise
Resource Planning is that it can give companies a high level of accuracy. Their orders and
shipments can have a much higher level of precision. ERP vendor to remain competitive in the
market should always focus on these aspects and take necessary steps.

The Importance of Enterprise Resource Planning

ERP is a Rising Need of Enterprises. is a strategic tool helping an
organization to gain and edge over its competitors by helping in successfully
integrating its key business operations, synchronizing, planning and
optimizing the resources available in the existing extremely competitive
environment.

Its use has a much broader scope in today's world rather than of just planning the use of the
enterprise resources.
Organizations (especially those which are borderless) face many difficulties in quickly making
out the information required. The integration of the business processes improves coordination
between bodies, streamlines workflows and processes and benefits them in terms of retaining
and satisfying customers by delivering their orders "just-in-time" and keeping them well
informed about their orders' current status rather than keeping them waiting for just a small
piece of information. ERP has the effect of making an enterprise more time-sensitive. Another
benefit is of better marketing opportunities. ERP penetrates one segment after the other and
addresses solutions to many debacles existing in an enterprise.

Different ERP systems have been made to facilitate organizations in Enterprise Resource
Planning. Leading ERP giants making ERP systems are Microsoft, Oracle, PeopleSoft and JD
Edwards, SAP AG etc. These systems link the order, inventory, sales, purchase,
manufacturing, supply chain and warehouse management modules in an enterprise for better,
fast and accurate information availability to every single person which is its 'primary objective'
because every single operation and action taken at any place by any person depends on
consistent and updated information availability. Whatever a person needs can be immediately
accessed by him subject to the delegated authority. ERP function has thus helped individuals.

They also enhance management decision making by making future projections about sales
during a certain period of a certain product. Management would then be able to make
decisions whether to increase/decrease production of that particular product which in turn
would help save resources from being wasted which could be used for other purposes e.g for
making other products. They also help managers make decisions about introducing some new
value added features to an existing 'hot-demand' product to enhance sales further. This is how
product quality is also enhanced. Inventory costs reduction must be given a great importance
in every organization. ERP helps reduce inventory costs by better planning and forecasting of
requirements. ERP system helps getting higher return on investments (ROI) in a fast manner.
While there are absolute benefits, an ERP system also poses significant challenges in the areas
of information security and business continuity planning. Above mentioned things point to a
very critical step, the right choice of an ERP for your enterprise! Off all the ERP systems
exiting in the market, all seem to be performing the same function but the one best suiting
your requirements needs to be picked up in order to achieve required results. The choice
depends upon the structure and type of the organization e.g financial, manufacturing etc. This
is why some organizations experience higher benefits as compared to others because they've
made the right choice and are able to make the right use of their system.

One of the most powerful advantages to ERP is the implementation of software. Even though
Y2K didn't become the disaster that many people expected, it gave rise to the concept of
making sure software was properly implemented. In addition to dealing with software issues,
ERP can also help companies integrate their operations. At the same time, it is important to
realize that there are a number of challenges involved with utilizing ERP. Perhaps one of the
greatest of these challenges is cost. Enterprise Resource Planning tools are outside the price
range of many organizations.

It is important to understand that ERP tools must be customized to meet the needs of the
company. In most cases, it will not be useful when it first purchased. Each company has
unique needs, and ERP tools must be able to meet them. A number of companies run into
problems when they attempt to customize the software.

To summarize, ERP has a great importance and ERP systems have become the biggest need of
today's organizations to survive. They provide tremendous benefits provided the Critical
Success Factors of ERP system implementation are kept in mind.

ERP systems and ADC Tools

Enterprise Resource Planning (ERP) integrated application software
systems and Automated Data Collection (ADC) tools are experiencing a
resurgence. Existing users are expanding their use of existing functionality,
and new users are acquiring one or both applications to meet business
requirements. This increased interest has been driven by customer
requirements

ERP systems are a well-established IT application in today's medium to large multi-national

organizations. They have evolved into fully integrated supply chain tools, including customer
relationship management (CRM), business-to-business transaction support, vendor-managed
inventory tools and customer self-service interfaces and portals.

Automated Data Collection, or ADC/barcoding tools, employ fixed and portable barcode
scanners that read labels as products pass through the production cycle, so that transactional
and product data is wirelessly transmitted via a wireless network to radio antennae, which
seamlessly update the ERP system.

Often a secondary implementation to an ERP installation, ADC/barcoding tools effectively

leverage the existing capabilities of ERP systems. While these tools are also not a new
development (the first barcode was actually scanned in 1972), there is now an increased
demand for them, particularly now that they may include radio frequency identification (RFID)
tags, which provide an efficient solution for regulatory and customer food/product security
requirements, particularly in high volume environments.

With RFID, portals can be positioned so that a forklift driver could pass through with a full
pallet of mixed items, and all of the RFID labels could be read simultaneously and discretely.
Large organizations like Wal-Mart and the U.S. Department of Defense, which deal with
millions of pallets of material a year, foresee large savings in labour and increased data
accuracy, by employing RFID technology. Driven backwards through the supply chain,
primarily by large retailers, RFID will eventually become a universal, entrenched part of the
physical buyer/seller transactions in industries where large volume transactions exist, in
addition to a regulatory environment where issues of food/product security, lot traceability and
real-time data accuracy are paramount. The rela-tively high cost of RFID labels and the lack of
standardization of the format are still obstacles, but RFID will become a standard in these
industries over time.

Shifting paradigm

The impact of this evolution on accounting and management information systems (MIS) has
been substantial, even revolutionary. However, the impact hasn't been limited to these areas.
All areas of the organization have had to evolve with changing organizational paradigms.

One of the fundamental organizational changes that ERP systems have created is a demand
for more strategic staff and fewer clerical staff. Given the inherent integration of transaction
processes connected to ERP systems, users need to understand at least one step before and
one step after their own job functions, both inside and outside the ERP system. ERP systems
are configured around key business processes outside the system itself, which means users
have to understand these connections and work with them to create an efficient organization.

Optimal ERP system configuration and transactional processing requires that the
implementation integrate business processes and train the users in the integrated
transactional processes of the system. This process creates an expanded organizational
knowledge and greater functional capabilities for the system users.

The rigorous requirements that ERP systems place on their users is evident in the people focus
of the implementation models and methodology of IT consulting firms. Many of these firms
consider the relative importance of resource allocation and effort as follows: people--50%,
process--35%, technology--15%. Hence training with, and user understanding of, the ERP
system is paramount.

These considerations have obvious impacts on the HR function. An ERP system implementation
is a large scale change management initiative. Organizational processes are reviewed,
documented and rationalized, often in a "current state/future state" analysis, or as part of a
business process re-engineering plan. Management must manage the change efficiently and
effectively. HR must work closely with management, the project manager and any external
consultants, to ensure these considerations are addressed.

In the same manner that ERP systems can be viewed as leveraging the human capital of an
organization, ADC tools have leveraged the inherent capabilities of ERP systems, which are
often described as integrated, "real-time" systems. The reality is that while ERP systems are
capable of real-time reporting for an organization's MIS, data capture often isn't automated.
ADC tools form the last link in this information chain, turning "real time" into "real, real time."
Thus the accounting assertion that there need be a trade-off between relevance (timeliness)
and reliability (accuracy) of financial information is no longer the case.

These developments have also enhanced quality assurance (QA) capabilities and compliance
effectiveness. With the timely and accurate tracking of supplier and customer lots in real time,
efficient and effective lot tracking and mock recall protocols are also possible. This is a major
boost for the product and process components of any food/product security program, for
instance.
It's interesting to note that in the same manner that inventory items are barcoded and
scanned by ADC tools, so too can employee ID badges, as the employee moves within the
plant or work centre. Not only does this enhance the people and plant components of a
security program, but it can be interfaced with the ERP system to produce additional labour
reports. In many labour-intensive plants, accurate labour reporting is difficult to attain. With
this tool, labour variances can be analyzed.

Selecting the right system

To derive the benefits of an ERP implementation, a number of considerations must be

evaluated. These include considering:

• both the current and future/growth business requirements (scalability);

• the appropriate trade-off between application software complexity and related user
needs (usually a mid-market vs. high-end software application acquisition decision);
• an assessment of the "time-to-benefit" for key business processes in the
organization's strategic plans;
• the key metrics that indicate relative application software complexity and time to
benefit, such as the historical ratio of consulting dollars to initial license fees (the
application software vendor and/or consulting firm can provide this);
• the software version of the application being selected (leading edge vs. bleeding
edge);
• the stability of the software vendor;
• the ability of the organization to devote sufficient resources (people, amount of
dedicated project time per person, minimum funding) over time;
• the involvement of key users in the planning process (when key players "plan the
battle" they don't "battle the plan");
• producing a specific, measurable, achievable, realistic, time-oriented project plan and
budget; and
• selecting application software certified implementation consultants with relevant
industry experience.

Given that each application is provided by a different software vendor, it's crucial that the ERP
system and its integrated ADC tool have significant, successful implementation history
together.

A second important proviso is that the appropriate procedures and controls must exist both
inside and outside the system, including appropriate levels of user training and system
familiarity, with the ERP system, the ADC tool, and their integration. With a tight integration of
these applications there are fewer change management challenges when, for instance,
implementing an ADC solution subsequent to the initial ERP implementation (the standard
sequence of events).

The substantial benefit to accounting and MIS of ERP systems, ADC tools, and more recently
RFID, will continue to be simultaneously relevant and reliable data. At the same time,
organizations will be able to devote more of their human resources to strategic challenges.

ERP Suppliers
In looking at the ERP value proposition from a market research perspective,
functionality, market penetration, industry orientation, and partnership
strategy are the keys. IT managers and staffs look at these same
characteristics from their perspective, sometimes after first making an
architectural or platform decision, but most often “Functionality rules!” By
“ERP Value Proposition,” IT Investment Research refers to the advantages
of a single database for all business information being updated in real time
from consistent user interfaces such that it is theoretically the only piece of
business software the enterprise needs.

End users such as plant managers and budget planners assume all software offers this value
and become very frustrated when they find that standalone application software does not.

The characteristics are important to IT staffs for a variety of reasons. For example, a higher
market penetration translates to an increasing likelihood that you will find references in your
specific industry and size of company classification. The supplier’s partnership strategy also
helps in terms of industry centricity. Infor, Microsoft, Oracle and SAP are the leading suppliers
of ERP software.

Delivery methods such as software-as-a-service or availability in a hosting arrangement are

important also, but all the leading suppliers offer all the leading methods, so the differences
are less relevant.

The suppliers’ visions for the future are equally important but since enterprises still tend to
turn over their ERP applications only once per decade, you can be pretty sure your supplier
will be where you need it by the time you are ready to move.

Of the characteristics considered in ERP product research and the value proposition IT is
looking for, IT Investment Research thinks industry centricity is the most important to users.
And of course, functionality rules.

The Building Blocks of ERP

VERP software solutions are developed after in depth analysis of the needs
and requirements of the construction and buildings business owners to
increase the efficiency of the entire system.

The Building Blocks of ERP can be categorised into the following layers:

• Layer 0:
"Layer 0" is the name for the bundle of all basic building blocks that always have to be
installed when you want to install one (or more or all) ERP scenarios. "Layer 0"
contains the following building blocks: B32, J02, N69, N70, N71, J05, J04, J30 and
J15.
• Layer 1:
o J06 - Production Planning and Control:This building block contains all the
necessary activities and settings required for production and implementation
of the master data for the Production Planning and Control System.
The building block contains the major activities within the production area and
the following functions are provided to support the Production Planning and
Control building block
o J18 – Product Cost Planning:This building block provides all the settings that
are required to create a standard cost estimate, that is, a standard price
calculation for materials without relation to a specific production scenario,
which can then be updated as standard price in the material master.
building block J18 provides functionalities like Costing sheet, Cost component
structure, Valuation variant, Costing variant, Cross-company costing.
o J17 - Profitability Analysis:This building block is used to set up Profitability
Analysis. The building block provides functionality to plan, organize and
 evaluate the effectiveness of sales by calculating contribution margins. The
Profitability Analysis Building Block (J17) provides functionalities such as
Master Data and Structures, Valuation of Sales, Planning,Transfer of Billing
Documents and Actual Flows, Information System.
With the help of this building block Profitability Analysis is set up. This can be
used for valuation of sales and the transfer of billing documents. Planning
processes can be performed. This building block can also be used to perform
period-end closing and reporting in Profitability Analysis.
• BW Building Blocks :
o BI Connectivity:This building block contains all settings that are necessary to
connect all the relevant source systems with SAP BW. If only some source
systems are relevant for the installation, the building block activities can be
reduced without any effect on other source systems. An installation role for
each component is provided to access all transactions relevant for the
installation.
o General Settings for BI Integration:This building block describes all the
activities that must be performed for BI Integration for each system involved
regardless of the analysis that is going to be performed.
o General Settings for BI Integration:This building block describes all the
activities that must be performed for BI Integration for each system involved
regardless of the analysis that is going to be performed.
o CO-PA Analysis:CO-PA is an application that generates data but does not
deliver any structures or tables. These structures and tables are only defined
when the customer-specific operating concern. To ensure that CO-PA data is
analyzed correctly in SAP BW, the structure of the InfoCube should correspond
to that of the appropriate operating concern. This InfoCube allows to perform
a results analysis that is specific to the CO-PA of Baseline Package. The
InfoCube is compatible with the operating concern, which is delivered in the
Baseline Package.
o Accounts Receivable Analysis:The building block contains the configuration
that is required for the use of the following Business Content InfoCubes. This
building block provides Source system configuration, Installation of Business
Content, Data upload.
o Capacity Load Utilization:The building block contains the configuration that is
required if the InfoCube Capacity Load Utilization is used for reporting. This
InfoCube enables to view information about available capacity from ERP such
as a comparison of the available capacity with the target capacity
requirements.
• E-Commerce for mySAP ERP Building Block :
o E-Commerce for mySAP ERP:With SAP E-Commerce for mySAP ERP, new,
attractive sales channels can be rapidly created . Organization can increase
the productivity of its sales representatives while ensuring that business
partners and customers receive a highly personalized experience. It
guarantees consistency, effectiveness, and predictability, to make the most
promising leads become the most profitable customers.
• ERP Building Blocks :
o Enterprise Portal 7.0 Installation
o Connectivity
o General Settings

The Current State of Enterprise Resource Planning

ERP evolved from manufacturing resource planning (which originated from
material resource planning).The functioning of ERP has gained much
prominence and utility with the intervention of web enabled and open
source technologies.ERP II the latest advancement in ERP software
deserves special mention.

ERP has a significant impact right from the time it is conceived in the organization. It paves
way for restructuring which would not have otherwise happened in organizations sticking to
traditional and conventional values. ERP is an eye-opener for organizations because they get
to realize the fine distinction involved in modifying the business processes. Organizations now
disclose vital information in the public domain, which was otherwise, considered confidential
and not meant for dissemination.
ERP has undoubtedly become an important business application to all industries. It has almost
become a must for all organizations irrespective of the type of business manufacturing or
service .If companies feel that coordination and enterprise communication are their only
problems they don't have any other alternative but to go for ERP, provided they want to make
profits and remove the existing setbacks.
Needles to say ERP has helped companies in monetary and nonmonetary aspects if they are
keen in utilizing it to the core and take the necessary steps to overcome the setbacks.
However ERP needs lot of improvement (this statement included the latest versions also).ERP
is an effective application. It will be great if one can bring an ERP system that id devoid of the
drawbacks from the existing ones. The latest intrusions namely open source and web enabled
technologies has increased the effectiveness of the application. However they are not enough
(technically speaking).ERP applications should be designed to make the maximum use of
internet so that the user can access data from any part of the world just by a click of the
mouse. This has further deepened the future of ERP. ERP's future is yet to reach saturation.

According to a research on predominantly Fortune 1000 companies, some startling results

have been revealed. About 48 per cent reported that returns from their ERP project were
lower than expected while only 17 per cent reported gains which exceeded expectations.
However, 76 per cent of all respondents report not having done a business case for their ERP
projects.
According to the research, following is the current situation of ERP:

• Over 42 per cent indicated that additional user training, better skilled people, and/or
change management are required to fully leverage ERP;
• 32 per cent indicated that changing or standardizing processes, organizing differently,
changing the work culture, or "adapting to the power of ERP" are necessary to
leverage ERP;
• 32 per cent indicated that full implementation, better integration, or economies of
scale are necessary.

Formerly ERP was purely restricted to fortune 500 companies, in the sense only they could
afford to invest on them. This put the small and Medium Industries at a large disadvantage.
They were not able to make use of the application to gain the necessary benefits. ERP's future
seemed to be dooming on them.

However this drawback has been removed after the intervention of open source facilities. The
concept of outsourcing has helped in removing the difficulties faced by small and medium
enterprises. Hence a large potential for ERP still exists in the S.M.E. market.

The ERP vendors are targeting this market effectively. However both the vendor and the
companies in this segment have to remember that there are lot of competition in this sector
and one is not likely to succeed unless he serves the best product.

ERP has thrown open opportunities for many companies to trade with foreign counter parts in
the name of outsourcing, implementation and deployment of the existing ones. It has
contributed lot to the economy .Academics also boast its own share of ERP relations.
It has promoted lot of employment and educational opportunities. India happens to be a key
beneficiary in this aspect.

The Effect of ERP on Mid Market Companies

ERP (Enterprise Resource Planning) systems are used in the organizations
for information integration and aligning & streamlining their processes for
delivering high value to the customers. Through its very use, it influences
manager's jobs and the organization structure as well.

ERP has significant impact on the organizations and has tremendously changed the way of
manager's job and organization structures.ERP implementation on five dimensions of
Manager's job (autonomy, use of power, delegation, people skills and privileged information),
five dimensions of organizational structure (specialization, formalization, centralization,
standardization and complexity of work flow) and on the flexibility of organization has been
effected by the use of ERP in organisations of all levels.

ERP systems have become the system of choice for the majority of publicly traded companies
and have radically changed the way accounting information is processed, analyzed, audited,
and disseminated. In this study, we examine whether ERP system implementations have
impacted the decision usefulness of accounting information. We find that ERP adoptions lead
to a trade-off between increased information relevancy and decreased information reliability
for external users of financial statements. After implementing the system, firms concurrently
experience both a decrease in reporting lag and an increase in the level of discretionary
accruals. Contrary to expectations, adopting more ERP modules did not augment these effects.
These results should be of interest to financial statement preparers initially adopting or
implementing new versions of ERP applications, auditors serving clients with ERP systems, and
regulators overseeing the financial markets and consolidation in the ERP industry.

While ERP has been around for little more than a decade, more companies are now seeing the
benefits of using it. Many companies in the Middle East and Africa have failed to utilize the
benefits of ERP, and the reason for this deals with procedure rather than cost. Many of these
companies have used the same methods for many years, and are unwilling to switch to
something new.

At parieto-occipital sites, in both experiments, the repeated possible and impossible non-
target items elicited less positive ERP waveforms than did first presentations beginning at
about 300 ms. The briefly reduced frontal negativity to repeated items is consistent with
familiarity arising from a facilitation of access to conceptual, semantic and visuo-spatial
representations during object categorization. The polarity of the parieto-occipital effect was
the reverse of what is usually found in stimulus repetition tasks, although it is consistent with
earlier work using similar visual stimuli. It is interpreted as reflecting the availability of a
newly formed representation (i.e., token) of the object just experienced.

Essence of ERP
ERP is an outcome of 40 years of trial and error. It has evolved as a
strategic tool because of continuous improvement in the available
techniques to manage business and the fast growth of information
technology. Prior to 1960s, the business had to rely on the traditional ways
of inventory management to ensure smooth functioning of organisation. The
most popularly known amongst them is EOQ (Economic Order Quantity). In
this method, each item in the stock is analysed for its ordering cost and the
inventory carrying cost. A trade off is established on a phased out expected
demand of one year, and this way the most economic ordering quantity can
be decided. This technique in principle is a reactive way of managing
inventory.

How does an ERP system make it all happen? The essence of it is the fundamental premise
that the whole being greater than the sum of its parts. The traditional application systems,
which the organisations generally employ, treat each transaction separately. They are built
around the strong boundaries of specific functions that a specific application is meant to cater.
For an ERP, it stops treating these transactions separately as stand-alone activities and
considers them to be the part of the inter-linked processes that make up the business.

Almost all the typical application systems are nothing but the data manipulation tools. They
store data, process them and present them in the appropriate form whenever requested by
the user. In this process, the only problem is that there is no link between the application
systems being used by different departments. An ERP system also does the same thing, but in
a different manner. There are hundreds of such data tables, which store data generated as a
result of diverse transaction, but they are not confined to any departmental or functional
boundaries, rather integrated to be used by multiple users, for multiple purposes and at
multiple places.

The first of these is flexibility. Many companies need to change their operations and
transactions on a regular basis, and the ideal ERP system must be able to adapt to these
changes. Client server technology is important, because it will allow the ERP system to operate
on multiple database back ends, and it will do this through a process that is called ODBC, or
Open Data Base Connectivity. Another important feature of ERP systems is modularity. The
term modularity is used to describe a system that is "open." The module must be capable of
being detached whenever it is needed to work with other system modules. It should also be
capable of supporting multple computer platforms.

Most companies will use a variety of system platforms, and they may also be in need of third
party platforms. The ideal ERP system must be capable of offering this. It is also important for
an ERP system to be comprehensive. It must be able to support a large number of different
functions that are related to the company. In addition to this, it must be calibrated for a
diverse range of companies and organizations. When one is looking at the quality of an ERP
system, they must look beyond the company. Instead of limiting it to boundaries within the
company, they should make sure it supports the internet and other elements within the
company. It is also crucial for the organization to look at best business practices. A collection
of these business process should be used on an international scale. The overall goal of a
company should be to take the business processes of the physical world and apply them to
computers.

ERP Impact on Organizations

ERP implementation can positively affect the process capital of a company;
process capital can positively affect customer capital and customer capital
ultimately affects business performance. Companies implementing ERP can
build process capital to meet the challenges of the competitive market
environment.

ERP'S impact on its stakeholders:

Impact of ERP on the role of managers or organization or stakeholders can be best studied
and understood if the subject is analyzed right from the implementation stage. Nevertheless it
has a strong influence on the business process itself as soon as it is gripped and decides major
issues for employees, customers and other stake holders. It is better to analyze it in this
context rather than debating on "How will ERP impact the accounting Profession?"

Impact during the Implementation Process:

ERP has a significant impact right from the time it is conceived in the organization. Firstly it
facilitates the members in the organization to arrive at a consensus though after a detailed
and deliberate discussion. It paves way for restructuring which would not have otherwise
happened in organizations sticking to traditional and conventional values. ERP is an eye-
opener for such organizations because they get to realize the nuances and edge involved in
modifying the business process. This would not have happened but for the intervention of ERP.
Organizations disclose vital information in the public domain which was otherwise considered
confidential and not meant for dissemination. All this happens in the implementation process
as this it is the time the seeds sown (FOR ERP Intervention) gets shaped in this phase.
Nevertheless the impact of ERP on managers is noteworthy.

Impact on Departments:

It brings about interactions and tends to nurture healthy relationships among departments in
organizations which would have otherwise remained isolated. The problems of coordinations
faced by each department are made known to the company. They can arrive at a better
means of doing things on such group discussions. It is therefore necessary to study the impact
of ERP on all departments rather than restrict it to issues like "How will ERP impact the
accounting profession"?

Impact on the organization as a whole:

The ERP consultant will able to identify the flaws and guide the organization in devising better
procedures. It helps organizations to adapt and adjust to change right from the
implementation process.

Impact on Employment:

It throws job opportunities to many individuals, whom the organizations hire at the
implementation process. They even realize the need to retain them on permanent rolls once
ERP goes full-fledged in the organization. The good news is that it gives another room of
employment for the existing IT professionals in the country. They were able to update
themselves on ERP modules and continue serving the organization in terms of enhancing user
interface with ERP applications.

Impact on the nature of Job and information access:

ERP has directly and indirectly helped to redefine functions in the organization. Anything that
people wanted to know about the company was available by a click of the mouse. There was
no more relying on the department of internal communications even for single information.
Outsiders don't have the hassle of obtaining permission and following stringent procedures to
access information. IT has helped vastly and so it is not necessary to ask exclusive questions
like "How will ERP impact the accounting Profession"?

Impact on the individual employees:

ERP provided more freedom, authority and responsibility to the individual employees which
were mutually beneficial to the management. Each employee became more aware of his/her
function while ERP has given the confidence to execute it individually and successfully Above
all it resulted in transparency and accountability. The tasks of employees became totally
independent as ERP succeeded in doing away the need of exclusive interdepartmental
dependence in order to elicit information. This has resulted in easing the process of handling
and answering customer queries and undertaking clientele orders.

Conclusion:

A one phrase explanation for the impact of ERP would be "Simplifying Complex Process". One
has to have an idea of the above issues which will help in understanding the impact of ERP on
the role of managers.

ERP Sales Solution

Essentially a point of sale system acts like an electronic cash register that
impacts on the whole business environment. Basically, wherever a retail
sale occurs a point of sale system should come into play. Early point of sale
systems were simple mechanical cash registers that began in the 1970's. As
a result of time factors and technological constraints these early machines
had limited functionality. Over time, as they evolved in functionality, they
became operational in many business environments such as restaurants,
hotels and grocery stores. Today's point of sale systems are powerful
electronic solutions that are utilised commercially. Even better is the fact
that most point of sale modules available today can be fully integratable
with stock management systems, accounting systems, as well as payroll
systems, just to name a few.

Competition has never been more rife between businesses than it is today. In order to survive
in today's market a retail entrepreneur needs to be able to efficiently run their store,
effectively keep track of stock, as well as maintain customer satisfaction to ensure their
loyalty. Thus the implementation of an effective point of sale solution is pivotal. Most business
owners want a point of sale system that is easy to understand and operate, but at the same
time is effective. However, choosing a point of sale solution that will work wonders for your
business can be a dilemma because of the abundance of POS solutions available on the market
today.

One needs to look for a point of sale module that is able to operate effectively, but at the
same time is within the company budget. Although it would be nice to have a system that has
phenomenal functionality most businesses should not take a risk of getting a system that they
cannot afford. One should therefore look for a system that is effective but affordable.

Look for a system that is simple to use and that employees will understand. In most instances,
when business owners purchase a point of sales module, they have to learn how to operate it
themselves. If the system is extremely complicated it can be frustrating and time consuming
to the learner. Additionally one needs to take into account that existing, as well as new
employees, will have to learn how to use the system. Therefore getting a system that is easy
to understand should be a top priority.

One needs to look for a system that is physically appealing. Most entrepreneurs need to
consider the following factors when trying to persuade customers to make purchases. The
physical environment of your business which refers to the actual appearance of your business
plays a vital role in influencing peoples impressions of your business. Moreover the quality of
the service you provide is just as important. A point of sale system needs to work hand in
hand with these two factors as it needs to blend in with the type of impression you are trying
to convey to potential customers. Therefore a POS system needs to be appealing to the
employees that are going to be operating on it.
 Choose the correct ERP
The success rate for implementing not just MRP and ERP systems but all
large software packages has never been very good. In survey after survey,
in the USA, Europe and elsewhere, less than one third meet the basic
criteria set out at the start of the implementation. Too many software
engineers know how the software works but do not know how to integrate
it into the business in a way that delivers real business benefits. With
enterprise resource planning (ERP) packages costing hundreds of
thousands, many costing millions, this failure rate is frightening.

question is - how can you minimise the chance of failure or, more difficult, rescue a package
that is not delivering sufficient business benefits to justify the cost of implementation? The
good news is that, when properly implemented, an ERP package can be the most cost effective
project a company has ever seen.

ERP failure cannot be tolerated by organizations as it involves great money. On the contrary
ERP success makes great money. Selecting a new ERP system can be time-consuming and
risky — but with the right strategy and tools, the selection can be turned into a positive
change. Here are some steps to help identify the best solution for a company. The following
elements acting in combination or individually results in good planning and choosing the best
posssible ERP solution:

Meeting and consultations in the organizations to decide ERP

Selecting ERP software does not happen all on a sudden or as a result of an overnight's
discussion. There is lot of groundwork that needs to be done in this regard. There are many
reasons for the ambiguity, with the foremost being advent of Internet. This has expanded the
scope of computers and redefined the technological implications in the business. As a result
there is more expectations and demand. These were not foreseen earlier. Advancement in
computing indirectly implies the advancement in enterprise resource planning. Needless to say
the constant updating, upgrading and innovating have become the benchmark of ERP
packages. The indecisive mind of companies in choosing ERP soft ware solutions needs no
explanation.

Hire or Buy ERP

There are two alternatives in choosing ERP software for the company. The first one is
purchasing the software while the second one is obtaining one on hiring basis. There aren't
any differences in terms of costs or benefits irrespective of the option that the company goes
for. It all lies in how best the company makes use of ERP. However the company has to stick
on to any one option as soon as it finalizes.

ERP should Suit company preferences

Companies that choose ERP on grounds of their own preferences succeed in the long run than
other companies. Other companies who sail by some decision that does not justify their
preferences are most unlikely to succeed.

Choosing the ERP vendor

The quality of the services offered by the vendor is equally detrimental in choosing ERP
software. Buyers generally tend to purchase from sellers who have got adequate experience in
ERP Products and services. This is the usual practice for any commodity. This has to be
strongly followed in the case of ERP as there are several dimensions involved with regards to
decision making. Nevertheless Choosing to buy from the right person is alone not enough.
How the organization makes the best use of it in response to the specific needs, to avail the
best services is more important in deciding to buy ERP Systems.
ERP implementation will be successful if certain guidelines are followed in choosing ERP
software. There is a dual purpose in ERP. It is neither meant exclusively to benefit the trade
procedures in the organization nor help the technological contents. It has to make both ends
meet. This Key function holds ERP in a special manner when compared with any other system.
Therefore the company must be prudent enough to choose an application that caters to this
advantage to the maximum extent. Therefore if a company chooses an enterprise process to
assist the business or technology alone the decision will not yield the required results.

Essential Elements of an ERP System

If a company is able to obtain all the related products of ERP from one seller /vendor then it
can be termed as a profitable Venture. The company will be able to avail their services in all
matters relating to ERP solutions. This is highly recommended and regarded as a wonderful
combination. When they choose to buy an ERP application of a particular module it must be
ensured that they enable connectivity and facilitate data transfer which should easily be made
available to the stakeholders. The advantage in buying a modular application is that the
company can choose to select them on the basis of the function for which it is purchased.
These are the essential element of ERP systems.

Time constraints in respect to the organizations function

The ERP system should be purchased based on the long term needs of the organization. In
that sense the firm should visualize its prospects, position and requirements in the long term
also. Therefore it has to be made sure that ERP is not restricted to meeting the current needs.
This will also help in implementation of ERP.
Suppose if a company is engaged in one particular domain of banking it also needs to
understand that it may have to cater to the entire banking sector if the need arises. Hence it
must purchase ERP that can serve related banking applications or if not be capable of
modification for the said purpose in the future. This will also stand out to be true in the case of
organizations that aim at diversifying the business. A choice is to be made from ERP
implementation models. This will also help in implementation of ERP

Employees to express their opinion on ERP

The core members in the decision making body (for ERP) should hear and heed to the views of
all the employees in the company as long as they are valid. This will make sure that everyone
is given an opportunity of being heard so that they don't lament that they were not allowed to
express their opinions on ERP. This discussions will facilitate the decision making body to know
how well ERP is received in the company and what are the setbacks that are to be removed.
This will also help in implementation of ERP
There is another important objective in these meetings. They help to bring out the various
modifications and technological changes that the company has to undergo to become ERP
friendly. Gap meeting and business process requirements do help in bringing out them. But
these processes will witness the employees difficulties and requirements directly. The impact
is also bound to be more when it is voiced out in person and in detail.

Customizable and predefined Modules

A large majority of ERP sellers sell customized application in addition to predefined

applications to ERP customers. They assist the customers in making all decisions right from
implementation to use. Both have their own advantages and disadvantages. In the case of
customizable applications the buyers will be instructed about the various options available for
modifying. The users have to make a decision of choosing the appropriate combinations on the
basis of their business requirements.

Resorting to an External Body for ERP Services

Some organization finds it tedious to undertake the above mentioned steps. Their workload
would be too large to concentrate on this. In that case they can be outsourced to a third party
who can take care by keeping the needs of the organizations in mind. There are many
competitive advantages in availing the services of such person. Firstly they have the
professional expertise and the required experience. The third party will also face the difficulties
of the firm but there wont be any mindset or favoritism as far as he is concerned .these are all
inevitable when the company is doing the service. Their services will be suited even for bigger
operations that have numerous complexity and ambiguity in operations. This will also help in
implementation of ERP.

Verifying the credibility of Vendor's services

The company has to check if the Vendor has already installed a similar configuration elsewhere
as it would not be advisable to be subjected to first time testing given the huge investment in
the name of ERP. If possible the company can try to get information from the ERP customers
of the vendors but it is not practically possible to elicit the necessary information whether they
are competitors or not, as business ethics and professional code of conduct would not permit
the same. They will also help in analyzing ERP Systems.

Application Service Provider

Application service provider is an emerging concept in ERP packages. These are built in
packages that have their own setups for hardware and business process. The usual manner of
choosing ERP viz Deciding, buying and installing has even been given a go by in some
occasions. This will also help in ERP integration

The edge enjoyed by S.M.E.'s

ASP was discussed as a profitable option. The actual fact is that it is a boon to small and
medium enterprises (S.M.E.'S).They would not have been able to think about ERP but for ASP
and outsourcing. They would choose these due to efficient services and affordable costs.

Choosing an outsource service provider

These companies may also choose to select the systems on a rental basis so that they are not
burdened with the tasks like administration, handling network as these are too big when
compared with the size of their firms. As per ASP arrangement the infrastructure part will be
taken care of by the service provider. The company can access everything online, while the
customers access to ASP at an agreed Service charge for the stipulated periods.
In the case of business process outsourcing the organization can avail the services of a
consultant for its business that will perform the required functions on behalf of the company.
The company can also choose to outsource inhouse operation to the outsourcer to get
maximum benefits be made from ERP implementation models.

Choosing ERP vendors for ASP

Companies must exercise caution in choosing Asp service provider. Many ERP sellers offer ASP
services in response to the rising market demand. Their expertise is unquestionable but the
trouble lies in terms of costs as the ERP vendor would price them at high rates. In addition the
choices are not plenty interms of choosing players. Therefore it is advised to refrain from
vendors offering ASP services and approach ASP service providers alone. This will also help in
implementation of ERP.

Resorting to an External Body for ERP Services

Some organization finds it tedious to undertake the above mentioned steps. Their workload
would be too large to concentrate on this. In that case they can be outsourced to a third party
who can take care by keeping the needs of the organizations in mind. There are many
competitive advantages in availing the services of such person. Firstly they have the
professional expertise and the required experience. The third party will also face the difficulties
of the firm but there wont be any mindset or favoritism as far as he is concerned .these are all
inevitable when the company is doing the service. Their services will be suited even for bigger
operations that have numerous complexity and ambiguity in operations. There are different
software solutions available for both purposes.

Verifying the credibility of Vendor's services

The company has to check if the Vendor has already installed a similar configuration elsewhere
as it would not be advisable to be subjected to first time testing given the huge investment in
the name of ERP. If possible the company can try to get information from the ERP customers
of the vendors but it is not practically possible to elicit the necessary information whether they
are competitors or not, as business ethics and professional code of conduct would not permit
the same.

The Nuances in choosing ERP Software

Pre ERP implementation includes analysis, constructive criticism; homework's has a significant
place in the whole process of ERP. Lot of research and background work needs to be
completed prior to the implementation of ERP or even before thinking about bringing Erp into
the organization. The plans of the organization must be clearly charted out and how it intends
to benefit from Erp operations have to be looked from a broader context.

Important Points in the discussion

This discussion should include important element namely financial issues. Besides it should
also account for the potential threats, strengths and weakness. How much profit will be
incurred have to be discussed and substantiated? Other non monetary benefits should also
find a place. These studies should involve the contribution of the entire group in the
organization right from the person in the highest hierarchy to the one in the lowest level. The
contribution should be validated and sharpened by means of presentations which will help
everybody to get insight of the different perspectives, and views. All of them will be helpful in
implementation of ERP.

The cost factor and compensation

ERP will definitely yield the required monetary benefits to organizations whether they have the
practice of built in systems or individual practices. If we are to calculate the costs involved in
preserving and building them over a period of time it will be evident that the ERP costs
incurred to support and facilitate the said functions will be comparatively less.
This calculation will prove to be equally true even if we take the case of individual department
for that matter. Another important point in this issue is that it has to align with the target
goals of the organization (the purpose for which it is sought and justified) as organizations
generally tend to go far ERP with a view to improve or increase the efficiency of a particular
section /dept and the whole process in general. Similarly the costs incurred to facilitate that
particular function must not be monetarily pinching on the organization and even if they are
the benefits and profits from that particular department or the whole organization preferably
should exceed the exorbitant costs. Everything has to be calculated on the basis of the chosen
ERP software systems

Committee to look after ERP process

Analysis and criticism will go a long way in deciding the fate of the ERP product. They are
alone not enough. The next process would be the services of the team who can decide
everything concrete with regards to ERP. The required powers are to be delegated to them.
They will do the screening of the potential vendor based on the organizational needs that have
been classified and discussed earlier. This will be helpful in implementation of ERP.

The organization should focus on what it wants to achieve out of ERP before going ahead with
the process. When that is done successfully the ERP operations will have to be shifted to that
particular objective in general and to the whole organization in particular. This cannot happen
in the absence of ERP integration.

Succeed by Implementing ERP

Implementing ERP systems are extremely complex and take months and
even years to implement. If your stakeholders understand the long-term
benefits of the system, they are much more willing to accept any perceived
temporary steps backward. An enterprise resource planning (ERP) software
project can be daunting for first-timers or veterans handling a migration.

A common malady for some stakeholders is to become complacent with the status quo. You
often hear, “We like what we have. It works for us.” This mindset is predominantly on
campuses with strong IT departments, and older, homegrown legacy systems that still
function quite well. Typically they have been designed to do exactly what the functional
departments want them to do. In these cases, it’s easy to believe that an ERP does not meet
their needs.This sentiment will continue throughout the implementation unless you proactively
sell constituents on the many advantages of the new ERP.

Tougher competition in the marketplace is generating the need to better optimize resources,
improve profitability and keep customers satisfied. Companies are increasingly implementing
Enterprise Resource Planning (ERP) software solutions to improve operations and provide
faster customer response.

Choosing an ERP solution that meets your specific business requirements will enable you to
have a smoother implementation. If the software package is written for your industry, you
won’t have to custom design a solution. Customized solutions are time consuming to
implement and add unnecessary cost. One of the top reasons ERP implementations fail is
because the software doesn’t meet basic industry specific business requirements. However;
purchasing an ERP application is only half the battle. A well designed implementation plan is
the key to success.

The following five steps are treated as the key behind succwssful ERP implementation:

STRATEGIC PLANNING :
Project team: Assign a project team with employees from sales, customer service, accounting,
purchasing, operations and senior management. Each team member should be committed to
the success of the project and accountable for specific tasks, i.e. developing a timeline,
finalizing objectives, formulating a training plan. Make sure you include first line workers as
well as management on your team. Base the selection on the knowledge of the team not
status of the employee.
Examine current business processes: Have the team perform an analysis on which business
processes should be improved. Gather copies of key documents such as invoices, batch tickets
and bill of lading for the analysis. To start the team discussion, consider questions such as:
Are your procedures up to date? Are there processes that could be automated? Are personnel
spending overtime processing orders? Does your sales force and customer service personnel
have real-time access to customer information? The team members should also conduct
interviews with key personnel to uncover additional areas of improvement needed

Set objectives: The objectives should be clearly defined prior to implementing the ERP
solution. ERP systems are massive and you won’t be able to implement every function. You
need to define the scope of implementation. Ideally, the scope should be all inclusive. But
practically, it is very difficult to implement. Examples of objectives would include: Does the
solution reduce backlogs? Can the solution improve on-time deliveries? Will you be able to
increase production yields? Develop a project plan: The team should develop a project plan
which includes previously defined goals and objectives, timelines, training procedures, as well
as individual team responsibilities. The end result of the project plan should be a “to do” list
for each project team member.

PROCEDURE REVIEW :
Review software capabilities: Dedicate 3-5 days of intensive review of the software capabilities
for the project team. Train on every aspect of the ERP software to fully educate the team on
capabilities and identify gaps. Determine whether modifications are needed prior to employee
training.
Identify manual processes: Evaluate which processes that are manual and should be
automated with the ERP system.
Develop standard operating procedures (SOPs): for every aspect of your business. These
procedures should be documented. Make sure that you modify the document as your SOPs
change. This is a huge task, but it is critical to the success of your implementation. Examples
of SOPs:
• How do you handle global price changes?
• What are the processes for inputting new customer records?
• How do you currently handle the paperwork on drop shipments?
• How do we add a new product or formula?

DATA COLLECTION & CLEAN-UP :

Convert data: You can’t assume 100% of the data can be converted as there may be outdated
information in the system. Determine which information should be converted through an
analysis of current data.
Collect new data: Define the new data that needs to be collected. Identify the source
documents of the data. Create spreadsheets to collect and segment the data into logical tables
(Most ERP systems will have a utility to upload data from a spreadsheet to their database).
Review all data input: After the converted and manually collected data is entered into the ERP
database, then it must be reviewed for accuracy and completeness. Data drives the business,
so it is very important that the data is accurate.
Data clean-up: Review and weed out unneeded information such as customers who haven’t
purchased in a while or are no longer in business. Now is the time for improving data accuracy
and re-establishing contact with inactive customers.

TRAINING AND TESTING :

Pre-test the database: The project team should practice in the test database to confirm that
all information is accurate and working correctly. Use a full week of real transaction data to
push through the system to validate output. Run real life scenarios to test for data accuracy.
Occurring simultaneously with testing, make sure all necessary interfaces are designed and
integration issues are resolved to ensure the software works in concert with other systems.
Verify testing; Make sure the actual test mirrors the Standard Operating Procedures outlined
in step 2, and determine whether modifications need to made.
Train the Trainer: It is less costly and very effective if you train the trainer. Assign project
team members to run the in-house training. Set up user workstations for at least 2 days of
training by functional area. Provide additional tools, such as cheat sheets and training
documentation. Refresher training should also be provided as needed on an ongoing basis.
Final Testing: The project team needs to perform a final test on the data and processes once
training is complete and make any needed adjustments. You won’t need to run parallel
systems, if you have completed a thorough testing.

GO LIVE AND EVALUATION :

Evaluation: Develop a structured evaluation plan which ties back to the goals and objectives
that were set in the planning stage. In addition, a post-implementation audit should be
performed after the system has been up and running for the first week for reconciliation
purposes and three to six months following to test whether or not the anticipated ROI and
business benefits are being realized. Comparing actual numbers with previously established
benchmarks will reveal if the software tool does what it is intended to do - add value to the
business. It is important to periodically review the system's performance to maximize ROI.
Upper management and project team members should be committed for the company to
realize the benefits of successful ERP.

ERP Human Resources Management Sysytem

A Human Resource Management System (HRMS, EHRMS), Human Resource
Information System (HRIS), HR Technology or also called HR modules,
refers to the systems and processes at the intersection between human
resource management (HRM) and information technology. It merges HRM
as a discipline and in particular its basic HR activities and processes with
the information technology field, whereas the programming of data
processing systems evolved into standardised routines and packages of
enterprise resource planning (ERP) software. On the whole, these ERP
systems have their origin on software that integrates information from
different applications into one universal database. The linkage of its
financial and human resource modules through one database is the most
important distinction to the individually and proprietary developed
predecessors, which makes this software application both rigid and flexible.

A growing number of businesses are adopting ERP (enterprise resource planning) systems in
order to give their departments accurate and accessible shared data. HR isn't being left out of
the loop. In fact, most major ERP vendors now offer their customers HR modules that help
automate an array of tasks while generating crucial data for enterprise planning and
optimization.

HR processes of an organization can be optimised with a complete and integrated human

capital management solution. Such ERPs helps to attract the right people, develop and
leverage their talents, align their efforts with corporate objectives, and retain top performers.

ERP Human Resources, also referred to as HR Modules, bridges the gap between Human
Resource Management and Information Technology. The data processing systems oftentimes
utilized in the IT realm are easily applied to many of the needs of Human Resource
Management Systems (HRMS. The integration that ERP software makes possible aids in the
linking of the two diverse systems.

Many EHRMS supports multiple languages, currencies, tax definitions, benefits, security
configurations and platforms. Resource Management component of EHRMS can support
administration, payroll, FSAs (flexible spending accounts) and compensation.
Work-Force Management aims to help HR departments cost-effectively handle complex work-
force management challenges. It includes scheduling, time and attendance, absence handling
and performance support.

Talent Management provides work-force development capabilities that are focused on

recruitment, learning, employee performance and competency management. Succession-
planning capabilities are also provided.

Most Human Resource Management Systems provides support for a variety of HR tasks,
including benefits, training, recruiting and compliance. Flexible design of this module lets users
select their own database platform. HRMS also includes powerful reporting and analysis tools
that provide customized insight on almost any HR issue. Hundreds of standard report
templates are included. An integrated database is designed to feed a steady flow of
information to managers and staff.

The software can automate virtually all fundamental, and most advanced, HR processes,
including employee administration, payroll and reporting. The product supports compliance
with both global and local regulations. Other features include talent management,
performance measurements and real-time insight into just about any HR trend.

HRMS are designed to automate practically every HR-department function. A single integrated
data model aims to supply a fast, immediate and accurate view of HR-related activities,
including recruiting, payroll, benefits, performance management, learning, compensation, time
management and real-time analytics.

Many EHRMS softwares aim to help businesses create professional development plans focused
on employee's goals and skills. Features include a "competence framework" with a
development process that incorporates personal interviews, training curriculums, skills
matching, skill-gap analysis and other components. The software's various processes are
collaborative and allow follow-up from employees and managers to improve dialogue between
the two groups

ERP Success Stories

When enterprise resource planning software fails, it's usually because the
company didn't dedicate enough time or money to training and managing
culture-change issues. "Faulty technology is often blamed, but eight out of
nine times, ERP problems are performance-related," says Pat Begley, senior
vice president of educational services at SAP, an ERP software company in
Newtown Square, Pennsylvania.

ERP success stories will reveal that they were made possible through deliberate and hard
work. The assessment of enterprise planning resource and defense enterprise planning
resource are important tasks in this context. ERP success stories need not necessarily mean
that an organization needs to be contended with what they have achieved. They must think of
extending the scope of enterprise operations so that many and thereby be a role model for
more ERP success stories.Some of them requiring attention are as follows:

• Jada precisions Plastics co INC and IQMS ERP software:

The manufacturing Company Jada Precisions Plastics INC was not happy within the
 initial ERP systems that were established to help them in raising the competence
levels. The software definitely helped them to reduce the complexity of the labor but it
was not the ultimate answer.
They finally got the much desired results from IQMS ERP software. The software was
instrumental in giving the results. Upon analysis it was found that the former ERP
systems tried to give ready made solutions to their problems in the form of packaged
solutions while the later facilitated tin creating an automatic system for data transfer.
This resulted in ERP success.
The point to be learned from this issue is that the ERP vendor should provide
appropriate solutions based on the requirements of the client and not on the basis of
his services. They are meant to make one understand the critical success factor for
ERP implementation.
• Eiffel ERP software's implementation in U.S. based chemical company:
In this situation their main challenges of the software lay in facilitating communication
between the corporate office and the manufacturing unit that uses very old systems
on one hand and managing a new chemical plant. Both these process had to be done
simultaneously with the second process coming under the control of the first one after
the intervention of ERRP software. Deciding this is like squaring upon critical success
factor for ERP systems.
The main challenge with the first issue was that the data processed by the corporate
office was to be reverted and resend by the manufacturing setup which was using
primitive systems that were not capable of processing large information. The
manufacturing unit neither required the whole information nor had the ability to
process the same. This was the critical success factor for ERP implementation.
Eiefeel ERP system was designed to filter the required information and storing the rest
till the retrieval. In the meanwhile ERP also processed the complex information in
order to suit the capability of manufacturing unit.
The issue with the second process was that the newly setup unit had to become a part
of the manufacturing unit. The problem was that the new process could work on the
latest software whereas it had to be coordinated with the old manufacturing unit. The
new software was designed to do the very old process but by making use of the latest
equipments and thus ERP success followed. This again points the facts that ERP has to
be designed based on the systems in the organization.
• WinMan ERP in Athena controls:
Success stories usually explain how ERP facilitated organizations to reach milestones.
This story has a different style. They explain the concrete steps that are to be taken in
an organization in order to attain the maximum benefits from ERP. This company is a
concrete example and a living proof to substantiate the fact regarding the steps that a
company needs to take and in not believing that a more implementation of ERP will
give the necessary impetus for success in the organization.
The basic factor for success in this company is backed by the fact that they believed
software to be a tool and not the solution to the enterprise problems. This is backed
up by the fact that the company successfully combined the business practices with the
nuances of the software. This process took place during a crucial time for the company
i/.e. when they experienced a sudden deflation of profits.
They had a successful collaboration with Winmap software to unleash the enterprise
Solutions. The cordial work atmosphere among the two prevailed over any mishaps.
They experienced an increase in the profits level and various aspects of business like
inventory management, cost reduction and so on. The facts and figures were amazing
and would not have happened if the company had not used the circumstance like a
platform for doing their best and understanding the fundamental mistake of not
aligning software with business process.
• Intitutive ERP Software in San Antonio's Lighthouse
SanAntonio's Lighthouse is a company that provides employment opportunities to the
visually challenged and others undergoing some form of physical hazards. The
company's core business is to manufacture products that best suit them to carry on a
trade or profession of their own choice. In addition to making them the company also
sees to that it reaches the end user.
 The market trend underwent a sea change. The company decided to change their
strategy in order to ensure that the customers received the products in the correct
time. The pressure from competitors circle also led them to think an alternative for
their existing distribution system.
The company had also ventured into selling goods and services online. They went
ahead with Intitutive ERP systems as it gave them advantage of services like Microsoft
Environments and platforms. The implementation process and shipping time were
drastically improved. The company was able to realize its full potential and sailed in
tune with the market demands.
• SAP ERP Solutions in TISCO (Tata Iron and steel company Limited):
The steel majors prompt response to market change and shifting to customer
orientation from product coupled with the implementation of ERP will speak more than
volumes of their success for the timely action. The company is now able to reap
benefits in all aspect and make further progress in each and every operation of an
enterprise.
The company decided to implement SAP ERP 3 after careful consideration for they
matched best with their requirements. In addition the company also forecasted on
what would happen to their operations in the future while making this choice .This
anticipation helped them to obtain the proper solution at the right point of time. The
implementation process took a long span of about a year owing to the volume of
operations and the major steps to be taken.
The company never got bogged down by the reported failure rate of ERP
implementations especially in bigger units and kept continuing their endeavors with
vigor to get the best and make the whole process learning cum experimental one. The
net result brought substantial increase in profits. The speed at which they worked (and
without even the minutest error) deserves great appreciation and is accorded as one
of the main contributing factors for the success.

Reasons to get ERP

Many people say that ERP is the future, that it is completely necessary
nowadays. The following are the reasons to implement an ERP software
system in an organization.

• Enhance productivity, flexibility and customer responsiveness: From

quote to cash, an integrated business system helps you get product out the door
faster. ERPgives you the tools to maximize the efficiency of business processes across
the entire enterprise. Forecast demand to suppliers. Increase on-time delivery.
Automate the shop floor. Decrease lead times. Increase order capacity. Make
commitments you know you can keep.
• Enable new business and growth strategies:Undertaking new business
strategies requires an infrastructure that can handle the demands of an industry that
is increasingly dependent on technology. Updating and integrating your business
processes with an enterprise system enables you to take on more business and grow
in new directions. Connect multiple plants. Take advantage of the Internet and
wireless technology to connect to customers and partners. Introduce new product
lines. Mobilize your sales force.
• Eliminate costs and inefficiencies: Using an enterprise system to standardize
your business processes can dramatically improve your company’s bottom line. Better
resource management results in more inventory turns. Management of your vendor
relationships reduces costs for purchased items. More efficient scheduling on the shop
floor reduces downtime and overtime. Improved customer service leads to repeat
business.
• Expand your knowledge of key business data : An ERP system integrates all
business management functions, eliminating contradictory information from disparate
systems. Reports, graphs and charts on key business data can be automatically
 generated to provide a higher level of business performance visibility, with the drill-
down capability into details behind the data that you’ve always dreamed of.

• Extend your business using the Internet:Taking your business onto the
Internet can give your company a competitive edge. Web-enabled technology allows
you to access information, sell product, run business processes, and communicate with
your customers and partners at any time and from anywhere in the world.

Benefits of ERP for the Financial Area

ERP systems are great to help your company streamline your processes. In order to have
a successful implementation of your ERP system, you need to make sure you have your
information in line to help make the process swift. It doesn’t matter whether or not your
company deals with paper or plastics, ERP provides your company with the right system
and performance that you need. ERP can help your company reduce operating cost and it
is a benefit when running company analytics. It improves the coordination of your
company’s process into one streamlined process where everything can be accessed
through one enterprise wide information network.

organizational processes fall into three levels - strategic planning, management control and
operational control. Even though much of ERP success has been in facilitating operational
coordination across functional departments, successful implementation of ERP systems benefit
strategic planning and manegment control one way or other.

Help reduce operating costs

ERP software attempts to integrate business processes across departments onto a single
enterprise-wide information system. The major benefits of ERP are improved coordination
across functinal departments and increased efficiencies of doing business. The immediate
benefit from implementing ERP systems we can expect is reduced operating costs, such as
lower inventory control cost, lower production costs, lower marketing costs and lower help
desk support costs.

Facilitate Day-to-Day Management

ERP programs are being developed and updated all the time. With so many different types on
the market, companies should make sure they do due diligence and try out different packages
before choosing one to use. Some of the programs even offer mobile capabilities so that you
can always have a finger on the pulse of your business activities from your pda.
With real time capabilities and the ability to be able to see what is going on with your
company as it happens, ERP systems are handy when you deal with high volume. With an ERP
system, your company will never have inventory shortages or wasted time spent transferring
files. You can test out an ERP system before buying it and see how it will work with your
business.

Support Strategic Planning

Strategic Planning is "a deliberate set of steps that assess needs and resources; define a
target audience and a set of goals and objectives; plan and design coordinated strategies with
evidence of success; logically connect these strategies to needs, assets, and desired
outcomes; and measure and evaluate the process and outcomes." (source) Part of ERP
software systems is designed to support resource planning portion of strategic planning. In
reality, resource planning has been the weakest link in ERP practice due to the complexity of
strategic planning and lack of adequate integration with Decision Support Systems (DSS).

How ERP Helps Management Functions

ERP management systems provide a technology platform in which
organizations can integrate and coordinate their main internal business
processes. They use this to fight against the problem of the organizational
inefficiency brought on by the use of differece

ERP software

integrates all of the major business processes, which helps ensure consistent data across
all your functional departments. ERP applications
typically consist of modules such as Marketing and Sales, Field Service, Production,
Inventory Control, Procurement, Distribution, Human Resources, Finance, and
Accounting.

Enterprise Resource Planning (ERP) is sold as the solution to the problems with human
resource management and salaries, document control and, sometimes, maintenance.

Department based organizations, with vertical structures are integrating their business
processes in response to the need to be effective, reliable and quick to anticipate the market
needs. The employees need to understand each others task and continuously communicate
with each other to work efficiently together.

A general understanding between departments is needed with a clear set of practices, and
methodology. An ERP system is an ideal tool for providing this common understanding
between departments. However, there are also inherent risks and costs associated with the
integration of an ERP system.

Business is all about taking risks. But intelligent managers know how to manage risks, thus
preventing accidental losses as well as other operational, financial, and strategic risks -
including fraud. To manage business risks by using technology, we must first understand and
prioritize the risks a specific business faces, and then understand how Information Technology
(IT) can help that business. Then we can come to understand how those risks intersect with
the IT systems a business might already have in place. Indeed, intelligent use of an ERP
system can not only help ensure compliance with legal requirements and accounting rules, but
it can also help prevent fraud. An Enterprise Resource Planning (ERP) application and its user
permissions settings can prevent theft.

Manufacturing Industry is one form of business that existed from the ancient period. There is
no exaggeration in saying that it one the oldest business itself. The manufacturing segment
initially started in traditional business models and kept constantly developing as improved
practices spurted and modern practices developed.

It is also to be understood that the sector has been famous for providing job opportunities and
contributing towards national income on a large volume. It also bears the credit of employing
a large pool of uneducated labor. In this context it becomes important to study the
advancements in the sector and technological improvements like ERP.
 How ERP Improves General Ledger Capacity

ERP provides unprecedented flexibility to meet the needs of organizations of

all types and sizes. It provides a robust feature set designed to meet even
the most demanding budgeting and processing needs. General Ledger
modules are highly customizable using the many tools inherent in the
system, including a built-in financial report writer that provides a timely
picture of the company's fiscal activities.

This module fully integrates with all other ERP modules and is the key to maximizing the
efficiency and accuracy of your financial data. Some ERp Vendors provide online ERP which
runs through a standard Web browser and as such financial statements can be designed and
viewed anytime, anywhere using an Internet browser.

In general, ERP can help improve the General Ledger Capacity because of its following
features:

• Flexible Account Structure and Account Processing

• Powerful Budgeting Features
• Extensive comparative and historical data.
• Financial reporting.
• Multicurrency support using the add-on Multicurrency module.
• Ability to drill down to originating transaction in other modules.
• Integrates with Microsoft Office.
• Web-based or traditional Accpac desktop interface.