IT in Business

Instructor: Urooj Azhar

 An Enterprise is a group of people with a
common goal, with certain resources at its
disposal to achieve that goal.
 Resources include money, manpower and all
other things that are required to run the
enterprise.
 Planning is putting necessary functions in
place and more importantly putting them
together.

 Enterprise Resource Planning is not software

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 Support effective  Enterprise
resource planning systems (Es)
 Make much of it  Packages of
feasible computer
 But do not truly do applications that
it. support many, even
 Contain many most, aspects of a
company’s
business processes information needs.
other than (Thomas H. Davenport)

resource planning

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 E E
R S
P
ERP
Processes not ERP Non-ERP
part of a Processes Processes
typical ES Found in a Found in a
typical ES typical ES

•Master Production •Accounts Receivable

•Sale Forecast
•Sales & Operation
Schedule •Accounts Payable
•Rough-cut Capacity •General Ledger
Planning
•Advanced
Planning •Cash Management
•Material Requirement •Customer Relations
Planning Systems
•Suppliers Rating
Planning Management
•Capacity Requirement •Human Resources
Systems
•Performance
Planning •Data Warehousing
•Distribution Requirement
Matrics
Planning
•Customer Order Entry &
Promising
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 an
Finance Le ce
du ower
Personnel e
R np
Cut Down Adv. New Ma
Budget Recruitment

Ma
Production r ke
Prod. planning More Mo ti ng
Reduce re
Stocks M
Inventory on
e y

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 on
ti
olu
S
r ic
n e
ge
A
Manufacturing

Company
Business
M anuf ctu ring

Co mp an y
Bu sin es s
Pla n
En gine erin g

Plan
Engineering

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 Beyond
ERP
ERP ( Information
& Knowledge
( Information as ASSET)
MRPII as Resource)
MRP ( Material & SCM
Capacity
( Material as Resource) CRM
Application as Resource) BI/KM
Systems In-
house
E-Comm
Development
( Data as Resource)

Early 70’s Early 80’s Late 80’s Early 90’s Late 90’s
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 Information Technology Developing Fast

Impact on our lives and the Revolutionizing

way we do businesses?

We can handle information fast and accurately, calculational

power increasing exponentially.

Delivery of high quality Manage

Competition Survival information to the
What to decision makers at the right time.
Managing
The
Automating collection
Brutal Essential & processing
Do?means harnessing IT’s full potential
Information
Future

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 ERP systems or ES are software systems for
business management encompassing modules
covering functional areas such as planning,
manufacturing, sales, marketing, distribution,
accounting, financials, human resource
management, project management, inventory
management, service and maintenance,
transportation and e-business.
 The architecture of the software facilitates
transparent integration of modules, providing flow
of information between all functions within the
enterprise in a consistently transparent manner.
 A single integrated system replaces legacy
information systems.
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 Strategic &
Operational Planning
Manufacturing
Finance

Materials Management
Human Resource

Quality Management Logistics Management

Maintenance Management
Sales & Distribution

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 Strategic &
Operational Planning
Manufacturing
Finance

Materials Management
Human Resource
ERP

Quality Management Logistics Management

Maintenance Management
Sales & Distribution

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 Benefits How
Reliable information access Common DBMS, Consistent and
accurate data, improved reports.
Avoid data and operations Modules access data from the
redundancy same DB, avoids multiple data
inputs and update operations.
Delivery and cycle time reduction Minimizes retrieving and reporting
delays
Cost Reduction Time Saving, Improved control by
enterprise-wide analysis of
organizational decisions.

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 Benefits
Easy adaptability
Improved Scalability
Improved Maintenance
Global Outreach
E-commerce, e-business
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How
Changes in business processes
easy to adapt and restructure.
Structured and modular design
Vendor-supported long term
contract as part of the system
procurement.
Extended modules such as CRM
and SCM.
Internet Commerce, Collaborative
Culture.
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 Disadvantage How to overcome?
Time Consuming Minimize sensitive issues, internal politics
and raise general consensus.
Expensive Cost mat vary from thousands of dollars to
millions. Business process reengineering
costs may be extensively high.
Conformity of the modules The architecture and components of the
selected system should conform to the
business processes, culture and strategic
goals of the organization.

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 Disadvantage How to overcome?
Vendor Dependence Single vendor Vs multi-vendor
consideration, option for “best of breeds”
long-term committed support
Features and Complexity ERP systems may have too many features
and modules, so the user needs to
consider carefully and implement the
needful only.
Scalability and Global Look for vendor’s investment in R&D, long
outreach term commitment to product and services,
consider, consider Internet-enabled
systems.
Extended ERP capabilities Consider Middle-ware and extended
modules SCM.
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 SAP-AG (Systeme, Anwendungen und Produkte in
Datenverarbeitung) - Flagship products R/3,
mySAP.com
 Oracle Corporation – Flagship Product
“Oracle Applications”
 PeopleSoft INC. – Flagship Product
“PeopleSoft8”
 The Baan Company – Flagship Product
“BaanERP”
 J.D. Edwards and Company –Flagship
Product “OneWorld”

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 ERP is an IT project.
 Computer-Systems
 Data Punching
 Onlyrelated to manufacturing
organizations.
 MRP
 MRPII
 ERP

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 Business Performance Improvement
▪ Cycle Time Reduction
▪ Increased Business Agility
▪ Inventory Reduction
▪ Order Fulfillment Improvement
 Support Business Growth Requirements.
▪ New Product/Product Lines, New Customer
▪ Global Requirements.
 To Provide Flexible, Integrated, Real Time
Support.
 To Eliminate Limitations In Legacy Systems.
 To Take Advantage Of Untapped Market.

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 Business Integration
 Flexibility
▪ Different languages, currencies
▪ Accounting Standards
 Better Analysis & Planning
Capabilities.
 Use of latest Technology
▪ Internet
▪ Computer aided Acquisition & logistics Support
▪ Electronic Commerce

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 ERP Package selection
 Wrong Product
 Incompetent & haphazard
implementation
 Inefficient or ineffective usage.
 Change of job description
 Resistance
▪ Fear
▪ Skills
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