M0254 - ERP

(Enterprise Resources Planning)

Session 5
Sales and Marketing Information System

Ir. Ekananta Manalif, MM, MKom (D2664)

Jurusan Sistem Informasi Universitas Bina Nusantara
Marketing and Sales
 Determine pricing
 Take customer orders
 Create sales forecast

M0254 Enterprise Resources Planning ©2004

M0254 Enterprise Resources Planning ©2004
Learning Objectives
 Describe the unintegrated sales processes of
company (Fitter Snacker’s).
 Explain why unintegrated Sales and Marketing
information systems lead to company-wide
inefficiency, higher costs, lost profits, and customer
dissatisfaction
 Discuss sales and distribution in ERP system, and
explain how integrated data sharing increases
company-wide efficiency
 Describe the benefits of Customer Relationship
Management software, a useful extension of ERP
software

M0254 Enterprise Resources Planning ©2004

Marketing Personnel make decision
on:
 What products should we produce?
 How much of each product should we
produce?
 How are our products best promoted and
advertised?
 How should our products be distributed?
 What price should we charge?

M0254 Enterprise Resources Planning ©2004

Problems with Fitter Snacker’s
Sales process:
 Sources:
 Three unintegrated systems
 Sales Order System
 Warehouse System
 Accounting System
 Manual handling of transactions
 Information not available in “real time”

M0254 Enterprise Resources Planning ©2004

Fitter Snacker’s Sales Process

Sales Warehouse
Order
Pick,
Quote Pack and
Sales Ship

Fitter Snacker’s
Sales Process
Receiving
Returns Accounting Invoice

Payment

M0254 Enterprise Resources Planning ©2004

Sales Quotations and Orders
 Sales call
 Hand-written quote on 3 sheet form faxed to sales
office
 Customer calls 800 number to place order

M0254 Enterprise Resources Planning ©2004

Sales Quotations and Orders
Problems
 Salesperson error in preparing quote manually
 Customer call reaches sales office before faxed quote
 Faxed copy is illegible
 Delivery data requires call to warehouse
 Warehouse provides delivery date estimate

M0254 Enterprise Resources Planning ©2004

Sales Quotations and Orders
Problems
 Initial credit check uses paper process
 Credit check for established customers using
accounting printout that may be a week old.

M0254 Enterprise Resources Planning ©2004

Warehouse/Order Filling
 Packing lists/shipping labels manually sorted
 Small order process and large order process
 Inventory managed by Access database

M0254 Enterprise Resources Planning ©2004

Warehouse/Order Filling
Problems
 Picker may not report breaking case down for
small order
 Perishable product requires low inventories
 Out of stock decision:
 Partial shipment
 Change production schedule
 Wait until full order can be shipped

M0254 Enterprise Resources Planning ©2004

Accounting and Invoicing
 Sales order data transferred by disk to
PeachTree program 3 times per week
 Clerks must make manual adjustments for
partial shipments and other errors.
 Invoices may not always match actual product
shipped

M0254 Enterprise Resources Planning ©2004

Payment and Returns Problems
 Customers don’t always include copy of invoice
with payment
 Invoice may not match payment-reconciliation
required
 Returned Material –Paper process, sometimes
no RMA #
 Improper “dunning” letters

M0254 Enterprise Resources Planning ©2004

Sales and Distribution with ERP
 Sales and Distribution Process

Sales Order Processing

Pre-Sales Activities Inventory Sourcing

Payment
Billing Delivery

M0254 Enterprise Resources Planning ©2004

Pre-Sales Activities
 Inquiry or Quote (binding)
 Marketing Activities
 Tracking Contacts
 Sales Calls
 Visits
 Mailings

M0254 Enterprise Resources Planning ©2004

Sales Order Processing
 Activities required to record a sales order
 Incorporate data from inquiry or quote
 Automated Pricing and Discounting
 Automate Credit Check

M0254 Enterprise Resources Planning ©2004

Inventory Sourcing
 Check of inventory, orders and production to
see if order can be delivered when customer
desires
 Includes shipping and considers
weekends/holidays

M0254 Enterprise Resources Planning ©2004

Delivery
 Releasing documents to warehouse to initiate
pick, pack and ship
 Sequenced and grouped for warehouse
operation efficiency
 Materials Management module carries out
picking, packing and shipping

M0254 Enterprise Resources Planning ©2004

Billing
 Sales order data copied to invoice
 Can be printed and mailed, faxed or
transmitted electronically
 Accounting records updated

M0254 Enterprise Resources Planning ©2004

Payment
 Payment may be physical check or electronic
 Cash debited and customer account credited
 Quick processing avoids credit check problems

M0254 Enterprise Resources Planning ©2004

Sales Order Entry in ERP

Sold-to party
P.O. Number
Required Delivery Date
Material
Order Quantity

M0254 Enterprise Resources Planning ©2004

Master Data
 Master data is stored in a central database
that is accessed by all modules
 Customer Master Data and Material Master
Data are primary data sources for Sales Order
Processing

M0254 Enterprise Resources Planning ©2004

Organizational Structures
 Organizational structures allow the ERP
system to control the sales order process –
pricing, minimum orders, etc.
 Distribution Channel defines the way that
materials move between the company and
customers
 Wholesale Distribution Channel
 Direct Sales Channel

M0254 Enterprise Resources Planning ©2004

Document Flow in ERP

All documents related to

original sales order

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Document Flow
 Sales order process creates numerous
documents
- Sales Order - Invoice
- Delivery - Payment
- Goods Issue - RMA
 Document Flow links all documents related to
a sales order

M0254 Enterprise Resources Planning ©2004

Discounts in ERP System

Sold-to party
P.O. Number
Required Delivery Date
Material
Order Quantity

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Discount Pricing in ERP
 ERP system can be accommodate various
discounting schemes
 Calculates correct discount based on customer
and material

M0254 Enterprise Resources Planning ©2004

Integration of Sales and
Accounting
 Sales order processing transactions make
appropriate accounting entries at time of
transaction-automatically

M0254 Enterprise Resources Planning ©2004

Customer Relationship
Management (CRM)
 ERP provides means to manage all data
relating to a customer to improve the quality of
the interaction
 CRM Activities include:
 One-to-One Marketing
 Sales Force Automation
 Sales Campaign Management
 Marketing Encyclopedias
 Call Center Automation

M0254 Enterprise Resources Planning ©2004

CRM Benefits
 Lower Costs due to better use of sales and
marketing resources
 Higher Revenue by improving the effectiveness
of marketing efforts
 Improved strategy and performance
measurement by changing management and
staff focus

M0254 Enterprise Resources Planning ©2004

Chapter Summary
 Fitter Snacker’s unintegrated information
systems lead to inefficiencies and reduced
customer satisfaction
 An ERP system like SAP’s R/3 views sales as a
process, providing timely, accurate data and
automating error-prone tasks

M0254 Enterprise Resources Planning ©2004

Chapter Summary
 Configuration decisions must be made during
installation to match the company’s practices
and policies
 The ERP system’s central database maintains
master data used by all areas of the company
 CRM software builds on ERP data to improve
marketing effectiveness

M0254 Enterprise Resources Planning ©2004