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What is ERP ERP Before and After ERP Evolution of ERP Implementation Advantages Disadvantages What drives ERP

Business solution that addresses all the needs of an enterprise with the process view of an organization Covers all organization. basic functions of an

To meet the organizational goals and integrate all the functions of the Enterprise

Eliminates the need for external interfaces previously required between system. Combined the data of formerly separate applications – greater reporting capabilities. Facilitates standardization and lower maintenance.

Evolution of ERP
1960’s - Systems Just for Inventory Control 1970’s - MRP – Material Requirement Planning (Inventory with material planning & procurement) 1980’s - MRP II – Manufacturing Resources Planning (Extended MRP to shop floor & distribution Mgnt.) Mid 1990’s - ERP – Enterprise Resource Planning (Covering all the activities of an Enterprise) 2000 onwards – ERP II – Collaborative Commerce (Extending ERP to external business entities)

To implement ERP systems, companies often seek the help of an ERP vendor or of third-party consulting companies. These firms typically provide three areas of professional services:
– consulting – customization – support

The Consulting team is typically responsible for your initial ERP implementation and subsequent delivery of work .

The consulting team is also responsible for planning and jointly testing the implementation.

Consulting involves three levels:
Systems architecture designs the overall dataflow for the enterprise including the future dataflow plan. Business process consulting studies an organization's current business processes and matches them to the corresponding processes in the ERP system, thus 'configuring' the ERP system to the organization's needs. Technical consulting. It involves programming. Most ERP vendors allow modification of their software to suit the business needs of their customer.

Customization is the process of extending or changing how the system works by writing new user interfaces and underlying application code. Such customizations typically reflect local work practices that are not currently in the core routines of the ERP system software.

Once your system has been implemented, the consulting company will typically enter into a Support Agreement to assist your staff to keep the ERP software running in an optimal way.

Readymade solutions for most of the Problems. Integration of all functions ensured. Easy enterprise wide information sharing. Suppliers and Customers communication can be online. Automatic adaptation to new technology.

Success depends on the skill and experience of the workforce, including training Customization of the ERP software is limited. This may involve changing of the ERP software structure. ERP systems can be very expensive to install Systems are too restrictive and do not allow much flexibility in implementation and usage.

• Option 1 – MAKE [Using Internal resources] Developing a custom-built ERP package, specific to the requirements of the organization, with the help of the inhouse IT department • Option 2 – BUY Going for Tailor-made ERP packages available in the market like SAP, Oracle applications, Baan, PeopleSoft etc • Option 3 – MAKE [using External resources] Developing a custom-built ERP package, specific to the requirements of the organization, with the help of a software solution provider.

• Business
• • • • Customer Satisfaction Business Development - new areas, products, services Ability to face competition Efficient processes required to push the company to top gear

• IT
• Present Software does not meet business needs • Legacy systems difficult to maintain • Obsolete hardware/software difficult to maintain

In Short ERP is “Software solution that addresses the Enterprise needs, taking a process view of the overall organization to meet the goals, by tightly integrating all functions and under a common software platform”

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