Department of Information Technology & Operations Management

Exercise II
Business Processes and ERP – Basic Concepts

Name: __Raymond El Hady__ ID: __202004778__

Name: __Jad Rahal__ ID: __202102821__

Name: __Joe El Kassouf ID: __202003775__

Now, based on the previous exercise, and the material related to handouts I and II, regarding
functional areas and business processes, do the following exercises again individually, or in
groups of two, and complete the following two exercises.

The first exercise here, as we mentioned in class, is similar to the previous one, but here, the
company is playing the role of a customer, not a vendor, as in the previous one.

Input Functional Area (related to Process Output

input)
Request for proposal purchasing Suppler evaluation and Supplier selection
selection
Receipt of quotation purchasing Quotation analysis Select quotation
Request to purchase SCM Requirement/ product Issue purchase order
raw material specification
Order received SCM Confirm order Receive order

Invoice received Accounting Department Invoice verification Payment sent to supplier

payment processing
I. Please consider the following inputs. State the functional area responsible to handle this input,
as well as the relevant business process and the expected output.
Now, have a look at the following exercise. Look at each figure, and try to understand it. Concentrate
on problems and what they are caused by. Give each figure an appropriate title, and then justify your
answer.

II. Below are 3 figures related to what we discussed earlier regarding business processes and the
importance of having proper coordination among them. Please study each figure alone, and
write your comment about it?

Sales Warehouse Accounting

Receive
Prepare Send Send Receive
Customer
Shipment Shipment Invoice Payment
Order

Create/ Create/ Create/

update Send paperwork update Send paperwork update
Paperwork Paperwork Paperwork

Delay! Delay! Delay! Delay! Delay!

! ! ! ! !
Figure 1:

___"disadvantages of using traditional date entry". This traditional data entry method indicates there are delays and that it is
inefficient.___

Sales Warehouse Accounting

Receive
Prepare Send Send Receive
Customer
Shipment Shipment Invoice Payment
Order

Send paperwork Send paperwork

Enter/Update Enter/Update Enter/Update Enter/Update Enter/Update

Data Data Data Data Data
Delay! Delay!
! !

Sales Warehouse Accounting

information Information information
System System System

Figure 2:

___” Progress of using database system composed to traditional data entry” Using traditional database systems is more
efficient than using traditional data entry because there is less delay, as this graph illustrates. ___
 Sales Warehouse Accounting

Receive
Prepare Send Send Receive
Customer
Shipment Shipment Invoice Payment
Order

Send paperwork Send paperwork

Enter/Update Enter/Update Enter/Update Enter/Update Enter/Update

Data Data Data Data Data

Enterprise
Information
System

Figure 3:

__"Efficiency of using ERP system" This figure shows how our use of ERP systems ensures that the process is swift and error-
free. __

III. Simple Case Study

 In this exercise, I need you to read the case, and tell how the introduced changes and systems
could make things different.
Integrated Information Systems
Integration of information is essential for company efficiency. Although people in organizations
are often bombarded with too much information, it can still be challenging to get the correct information
to the department that needs it. The appliance giant Whirlpool Corporation has faced just the challenge.
Let’s read about this corporation, which we can use to learn something about SAP ERP system.
Ready? Start reading….!
Managing price increases is a particular challenge. With rising oil prices and increased raw
material costs, Whirlpool needs to be able to look at the business as a whole—in other words, globally.
Just like Colgate-Palmolive, it needed global reporting and global analysis along with more accurate and
more timely cash positions. As a result, it looked to ERP systems to enable those capabilities.
Whirlpool corporate vice president and chief information officer Esat Sezer explains that,
regarding raw material price increases, “We had to have the capability to see product by product,
category by category, day to day, the impact of material costs, logistics costs, and the impact into our
(profit) margins.” With reference to the supply chain, in particular, Whirlpool has updated and fixed an
unintegrated system that used to consist of spreadsheets and manual procedures. Now, with its integrated
supply chain, things are different.
Some of Whirlpool’s midsized trading partners could not connect directly to Whirlpool’s order entry
system, and instead were ordering either by phone or fax, which was extremely inefficient. With the SAP
integrated system, things now are also different.
Many other large corporations have similar integration stories. The DuPont Corporation is
committed to SAP for integrating business units. For example, DuPont Fluorochemicals couldn’t do
division-wide capacity planning, nor could its customers order over the Web, until DuPont integrated its
systems with one ERP system.
Question:
How are things different at Whirlpool now?

Now, with its integrated supply chain, Whirlpool has moved away from manual processes and
spreadsheets and towards a unified, integrated architecture. This means greater operational
efficiency, faster data availability, and the capacity to make educated decisions in real time. As a
result, tasks that previously required manual input or were prone to error can now be automated or
more precisely tracked, resulting in improved resource management and performance.

With the SAP integrated system, With the adoption of the SAP system, Whirlpool has streamlined its
processes, eliminating inefficiencies like phone or fax orders, leading to enhanced connectivity and
smoother operations.