What is ERP?

ERP is a business software system that allows organization to

• Automate and Integrate majority of Business Processes

• Share Common data and practices
• Produce and Access Information in a real-time environment

1
What is ERP?

ERP is a business software system that helps organization with

• Supply-chain
• Inventory management
• Customer order-management
• Production Planning
• Distribution
• Accounting
• Human Resource Management

2
Evolution of ERP

Time System Purpose

1970 Material Requirement Planning manufacture of
Planning (MRP) products and inventory
based on demand
1980 MRP II Capacity planning OMAC
1990 MRP with MES Shop floor activity
Late 1990 ERP Integrated manufacturing
with supply chain, suppliers
to mfg to distribution to
Customer
2000 and beyond ERP with E-business Online and across service
industry as well

3
 Systems before and after ERP
Before ERP After ERP
Information Systems
Databases

Interfaces
Information

Applications

Processes
Co-ordination

4
 Systems before and after ERP
Before ERP After ERP
Information Systems Stand-alone, disjointed
Databases Data have different
meanings, duplicate
data, non-integrated
Interfaces Different interfaces
Information Redundant, Inconsistent

Applications Different applications,

different technologies
Processes Incompatible
Co-ordination Lack of co-ordination

5
 Systems before and after ERP
Before ERP After ERP
Information Systems Stand-alone, disjointed Integrated
Databases Data have different Integrated, data have
meanings, duplicate same meaning
data, non-integrated
Interfaces Different interfaces Common Interfaces
Information Redundant, Inconsistent Consistent, Real-time to
the best possible extent
Applications Different applications, Single application
different technologies
Processes Incompatible Consistent
Co-rdination Lack of co-ordination Co-ordination across
business functions

6
Typical Issues in an Organization

•Same data referred by different codes – Material, Product, Customer

•Cost of excess Inventory
•Overdue accounts receivable
•Purchasing without requisition and cost center
•Inadequate cost analysis
•Consolidation of data across branches, countries
•Multiple data files, maintenance becomes costlier
•Ineffective communication with suppliers, Customers, Employees

7
Typical Benefits of ERP

•Faster information and response time

•Better Order Management
•Financial closure (Quarter End/ Year End) is faster
•Improved interaction with Customers, Suppliers, Employees
•Better Cost Management
•Improved inventory levels
•Better processes, reduced manpower

8
Why do companies implement ERP?

•Global integration
•Integration with customer
•Better data management and compliance - IPO
•Replace legacy systems
•Improve operational efficiency
•Strategic advantage

9
ERP Vendors

•SAP
•Oracle
•BAAN of Netherland (Now part of Infor)
•JD Edwards (Now part of Oracle)
•Peoplesoft (Part of Oracle)
•SAGE
•Epicor
•Microsoft Dynamics
•Net Suite
•RAMCO

10
Business Benefits of ERP

11
Business Benefits of ERP

12