2 - erp general
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What is ERP
Enterprise Resource Planning
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An inform ation system or process integrating allmanufacturing and related applicat ions for an ent ireenterprise.
ERP systems permit organizations to manage resourcesacross the enterprise and completely integrate allfunctional and m anufacturing systems.
ERP - Defin it ion
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ERP solut ions seek t o streamline and
int egrate operat ion processes and inform at ion
flow s in the company t o synergise t he resourcesof an organisation namely men, m aterial,
money and machine t hrough informat ion.
ERP Solut ions
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Agenda
Evolut ion of ERP
Need for ERP
Features of ERP
Component s of ERP
BPR & ERP
Select ion of ERP
I mplementation Steps and Phases of ERP
Benef it s of ERP
Well Know n ERP Systems
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In the ever growing business environment the following demandsare placed on the industry :
o Aggressive Cost control initiatives
o Need to analyze costs / revenues on a product or customer basis
o Flexibility to respond to changing business requirements
o More informed management decision making
o Changes in ways of doing business
o Difficulty in getting accurate data, timely information and improperinterface of the complex natured business functions
Evolution of ERP
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Diverse applications and planning systems have been introduced into the businessworld for crossing these hurdles and for achieving the required growth.
They are:
Management Information Systems (MIS)
Integrated Information Systems (IIS)
Executive Information Systems (EIS)
Corporate Information Systems (CIS)
Enterprise Wide Systems (EWS)
Material Resource Planning (MRP)
Manufacturing Resource Planning (MRP II)
Money Resource Planning (MRP III)
OUT OF ABOVE SYSTEMS ERP EVOLVED AS THE LATEST SYSTEM FOR ALLBUSINES SYSTEMS
Evolution of ERP
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In a rapidly changing environment,
- it is impossible to create and maintain a custom designed softwarepackage which will cater to all their business requirements.
- and also be completely up-to-date.
Realizing the requirement of user organizations some of the leadingsoftware companies have designed Enterprise Resource Planningsoftware which will offer an integrated software solution to all thefunctions of an organisation.
Need for ERP
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o ERP facilitates company-wide Integrated Information System covering allfunctional areas like Manufacturing, Selling and distribution, Payables,Receivables, Inventory, Accounts, Human resources, Purchases etc.
o ERP performs core Corporate activities and increases customer serviceand thereby augmenting the Corporate Image.
o ERP bridges the information gap across the organisation.
o ERP provides for complete integration of Systems not only across the
departments in a company but also across the companies under the samemanagement.
o ERP is the only solution for better Project Management.
Features of ERP
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o ERP allows automatic introduction of latest technologies likeElectronic Fund Transfer(EFT), Electronic DataInterchange(EDI), Internet, Intranet, Video conferencing, E-Commerce, RFID, Bar Coding etc.
o ERP eliminates the most of the business problems like Material
shortages, Productivity enhancements, Customer service, CashManagement, Inventory problems, Quality problems, Promptdelivery etc.
o ERP not only addresses the current requirements of thecompany but also provides the opportunity of continuallyimproving and refining business processes.
o ERP provides business intelligence tools like Decision SupportSystems (DSS), Executive Information System (EIS), Reporting,Data Mining and Early Warning Systems (Robots) for enablingpeople to make better decisions and thus improve theirbusiness processes
Features of ERP
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To enable the easy handling of the system the ERP has been divided into thefollowing Core subsystems:
o Sales and Marketing
o Master Scheduling
o
Material Requirement Planningo Capacity Requirement Planning
o Bill of Materials
o Purchasing
o Shop floor control
o Accounts Payable/Receivable
o Logistics
o Asset Management
o Financial Accounting
Components of ERP
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The In t egrat ed Supply Chain
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In tegerat ion Of In format ion Sys tem s
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Business Process Re-engineering is a pre-requisite for going ahead with apowerful planning tool like ERP.
An in depth BPR study has to be done before taking up ERP.
Business Process Re-engineering brings out deficiencies of the existingsystem and attempts to maximize productivity through restructuring andre-organizing the human resources as well as divisions and departments
in the organisation
Business Process Engineering evolves the following Steps:
o Study the current system
o Design and develop new systems
o Define Process, organisation structure and procedure
o Develop customize the software
o Train people
o Implement new system
The principle followed for BRP may be defined as USA Principle(Understand, Simplify Automate)
BPR and ERP
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THE USA PRINCIPAL
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A Model Design
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How do We St art For ERP
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Selection of ERP
Evaluation and selection an ERP involves checking :-
o All functional aspects of the Business are duly covered
o All the business functions and processes are fully integrated
o All the latest IT trends are covered
o The vendor has customizing and implementing capabilities
o
The business can absorb the cost The ROI is optimum
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Implementation Steps of ERP
The normal st eps involved in implement at ion of an ERP
are - below :o Proj ect Planning
o Business & Operat ional analysis including Gap analysis
o Business Process Reengineer ing
o I nstallation and configur ation
o Project t eam t raining
o Business Requirement mapping
o Module configurat ion
o System int erfaces
o Data conver siono Custom Document ation
o End user t raining
o Acceptance t esti ng
o Post im plementation/ Audit support
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Implementation Phases of ERP
The above st eps are grouped and sub-divided int o four maj or phases namely
1) Detailed discussions,
2) Design & Customisat ion,
3) Implementat ion
4) Production.
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Phase Tasks and Deliverables
1. Detailed Discussion Phase:
Task :-
Project initialization
Evaluat ion of current processes, business pract ices
Set-up proj ect organizat ion
Deliverables :-
Accepted norm s and Condi t ions
Proj ect Organisation chart
I dent i ty w ork teams
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Phase Tasks and Deliverables
2. Design and customisation Phase:
Task :-
Map organisat ion
Map business process
Define functions and processes
ERP soft w are configurati on and
Build ERP system modif icati ons.
Deliverables :-
Organisation structur e
Design specification
Process Flow Diagrams
Funct ion Model
Configuration recording
System modif icat ion.
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Phase Tasks and Deliverables
3. I mplementat ion Phase:
Task :-
Create go-live plan and documentat ion
I ntegrate applications
Test t he ERP customisat ion
Train users
Deliverables :- Test ing environment report
Custom isation Test Report
I mplementation report
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Phase Tasks and Deliverables
4. Product ion Phase:
Task:-
Run Trial Product ion
Maintain Systems
Deliverables:-
Reconciliat ion report s Conversion Plan Execut ion
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Advant ages Of ERP Pac k age
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Zero Dow nt im e
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o Increased control of invoicing and payment processing andthereby boosting productivity and eliminating reliance on computerpersonnel for these operations.
o Reduce paper documents by providing on-line formats for quicklyentering and retrieving information.
o Improves timeliness of information by permitting, posting daily
instead of monthly.
o Greater accuracy of information with detailed content, betterpresentation.
o Improved Cost Control
o Faster response and follow up on customers
o More efficient cash collection, say, material reduction in delay inpayments by customers.
o Better monitoring and quicker resolution of queries.
Benefits of ERP
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o Enables quick response to change in business
operations and market conditions.o Helps to achieve competitive advantage by improving
business process.
o Improves supply-demand linkage with remote locations
and branches in different countries.o Provides a unified customer database usable by all
applications.
o Improves International operations by supporting avariety of tax structures, invoicing schemes, multiplecurrencies, multiple period accounting and languages
o Improves information access and managementthroughout the enterprise.
o Provides solution for problems like Y2K and Single
Monitory Unit(SMU)
Benefits of ERP
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Summary
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LEADIN G ERPs
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o Baan
o CODA
o IBM
o JD Edwards
o Marcarn
o Oracle
o People soft
o Ramco
o SAP
o Software 2000
Some Well Known ERP Systems
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Thank You
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