Download - Enterprise Resource Planning
ERP
SIS
Lori Martel
Ramkin Shetty
Hahn Shin
Dinesh Sekar
ERP
SIS
Table of Contents
•Introduction•Organizational & Technological Change•Business Engineering Vs. Business Process Re-engineering
•Definition & ERP’s role in the Supply Chain•Business Aspects
•ERP: Vendors, Comparison, Characteristics of ERP, Applications and Advantages•SAP R/3 •Constraints: Business &Technical
•Technical Aspects•Layer Architecture•Application Architecture•Customization
•Industry Example: Quantum•Look into the Future
ERP
SIS
Introduction
Growing Competition
Decreasing Innovation Cycles
Market Globalizationneed
for flexible, integrated,and open software
Relationship Based Transactions
Different Manufacturing Environments
ERP
SIS
Introduction
• Changes in Structure– Functional Vs. Process Based Structure
• Value Chain Thinking
Personnel ProductDevelopment
Marketing& Sales
Production
Order Processing
ProductDevelopment
Customer Service
ERP
SIS
Introduction
• 70’s Standard Software, Mainframe Systems– Separate Applications for business functions
• 90’s Technological Trends– Client/Server Computing
– Innovative process integrated business solutions
– Open Systems
– Increasing computing speed, GUI’s
– Faster Data processing
– Data Integration
ERP
SIS
Introduction
BPR
BE
• Use of Prototyping/Modeling - Building Systems around Business
• Automating Business Processes through IT
•Use of Blueprinting - Designing & Integrating Business Processes
• IT used as a Strategic Tool
ERP
SIS
- ERP is a software package integrating organizational business processes & data across the company
ERP
SIS
Definition
Modelingall the processes
Integratingall the
information
Strategic useof IT
Integrated views
Quality,Cost,
Delivery
Effective useof
resources
EIS
DSS
TPS
MIS OA
ERP
SIS
ERP
ERP
ERP
Extended Supply Chain Management
Internal Supply Chain Management
CoordinatedManufacturing
PlantManagementMRP MRP
Role in Supply Chain
SupplyPlanning
Scheduling
DemandPlanning
Logistics
InternalSuppliers
InternalCustomers
ExternalSuppliers
ExternalCustomers
ERP
SIS
Business Aspects
34%
13%9%7%5%
5%
5%5%
3%3%
11%
SAP Computer AssoicatesSSA BaanJ.D. Edwards JBAOracle MarcamPeoplesoft QDAOthers
ERP
SIS
Business Aspects
Fun
ctio
nali
ty
Technology
* Oracle
J.D. Edwards *
Low
Low
High
High
* R/3
* CA
ReinforceReview
RemainRebuild
* Baan
* Peoplesoft
ERP
SIS
Characteristics
• NOT Multiple Packages Pieced together through Complex Interfaces
• Modeling Business Processes and Integrating through Software
Configuration - • 8,000 Tables set up by Programmers• Series of Switches• Requires Deep Understanding of Existing Business Processes
ERP
SIS
Business Aspects
Aerospace & Defense Automotive
Chemicals Consumer Products Financial Services
Healthcare High-Tech & Electronics
Oil & Gas Pharmaceuticals
Retail Telecommunications
Utilities
ERP
SIS
Business Aspects
• Largest vendor of standard business application• R/3: Real-Time Version 3.0• Client/Server enterprise application software• 6,000 companies, 50 countries• Companies in diverse businesses• 30 seats or installations with 3,000 end users• 800 predefined business processes
ERP
SIS
Business Aspects
• Business Components
• Business Objects
• Business Information Warehouse
• Business Engineer
• Integration Technologies (ALE)
- Finance, HR, Logistics
- Customer, Invoice
- Aggregate Internal & External Data
- Customization Tool
ERP
SIS
Business Aspects
Reference Model
• Data Model • Business Object Model • Organization Model • Process Model• Distribution Model
Event Driven Process Chain (EPC)
• Event• Function/Task• Organization• Communication
- Repository Holds the Reference Model, Industry Specific Models & Enterprise Models
ERP
SIS
Business Aspects
• Fast
• Flexibility
• Open
• Industry Specific
• Expandable
ERP
SIS
• Synchronous Transfer of Data
• Encourages Multi-Disciplined Teamwork
• Reduces Redundant Labor
• Provides Standard Based Development Environment• Process Engineering Cost Benefits• Flattens Organizations to Increase Agility
•Allows Companies to Adapt to New Business Opportunities
Business Aspects
ERP
SIS
Business Aspects
• Every $1 Spent in Software Licenses - $8 - $10 Spent on Consulting Support• Outside Consulting Fees can cost $1500/day• Requires Equipping employees with new skill sets• Hard to Keep Resources• Changing Business Processes to suit ERP/ can Effect the Organization’s Culture
• Very Expensive
• Can NOT Impose ERP Infrastructure on Company
ERP
SIS
• Lack of Flexibility
• Complexity & Rigidity
• High Implementation Time
• Difficult in Decentralized Environments
• Difficult Interfaces
• Steep Learning Curve
Business Aspects
ERP
SIS
Technical Aspects Layer Architecture
- Issues: Scalability, Portability, Interoperability & openness, Customizability, GUI, etc.
Middleware
Middleware
Development workbenchApplications
DictionaryProgrameditor
Interfacebuilder
Modelingtools
Repository
System software: GUI, DBMS, OS, N/W
ApplicationLayer
BasisLayer
ERP
SIS
Technical Aspects
Application Architecture
- Issues: 1. Independent from all types of computers(UNIX, Window NT, AS/400, etc.), DBMS(Informix Online, Oracle 7, ADABAS, DB2, MS SQL Server 6.0, etc.), GUI flatform(OS/2 Presentation Mgr.., OSF/Motif, Macintosh, Windows, etc) 2. Independent from the country specific rules, languages, etc.
IS
SD CO AM
MM
PP HRM PS
WFFI
QM PM DW
System model
Business model
Scope, Rules & Pattern
Business Kernel
Full Business
Specific Situation
DM
FM WFM
Repository
ERP
SIS
Technical Aspects
Customization: Support of initial implementation projects, follow-up projects, and release-change projects
- Issues: Integrated customizing functions, quality assurance, etc.
Implementation environment
Procedure model
Reference model:FM, PM, DM, IFM, OM,Comm. Model, Distr. Model
Implementation guides
Customized model
Documentation Release management
ERP
SIS
Industry Examples
Objectives– Available-to-Promise (ATP), the real-time
capability to take an order, schedule it to be
delivered anywhere in the world and confirm
delivery instantly
– Ability to determine what was actually in
inventory or in production and how much of it had
been promised to other customers
ERP
SIS
Industry Examples
Scope– Based on the full suite of Oracle Corp.'s
manufacturing and operations applications
– 750 users in 25 locations worldwide
– To adopt Big-bang approach• One of the largest distributed business systems to go live
worldwide at one time
– HP9000 hardware, HP UX operating system (10.1) and Oracle Release 10.4
ERP
SIS
Industry Examples
Pre-Implementation Assessment
– Legacy system-based MRP system in use
– Each division's business transactions in separate
databases by business unit, and by function
within a unit
– Databases couldn't share information
ERP
SIS
Industry Examples
Project Planning & Control– Project team members pulled from regular jobs &
relocated to “Building 12”
– “Building 12” essentially set up a scaled-down business model of Quantum
– Team members play-acted their real-life roles
– Improved business processes and wrote requirements for the new system
ERP
SIS
Industry Examples
Implementation Process– Packaged available applications & selected
Oracle applications– Consultants from Price Waterhouse and Oracle,
installed the software & began pilot projects– Complexity and magnitude of the project
quadrupled (Digital Disk drive division acquisition)
– Conference room pilots tests
ERP
SIS
Industry Examples
Human (HR) Side– Locally trained about 100 users from all over the
world and flew them into Milpitas to run a full-scale system simulation
– Sponsored massive user training - users had to pass a test before returning to their jobs
– Ran Internal PR campaign- Entailed group meetings, presentations,an intranet site and events emphasizing system's importance
ERP
SIS
Industry Examples
Project Statistics– October 1992 - May 1996
– 16 full time managers
– 100 person
multidisciplinary team
– 1,632 meetings
– 79 shouting matches
– 800GB of disk space – 18,064 miles of cable – 300,000 cups of coffee– 58,000 e-mails – 7,503 cases of beer – 1.62 million miles
of air travel
ERP
SIS
Future Aspects
• Supply Chain Management• Internet Enabled• Workflow Management• Resource Planning• Data Warehousing
• Targeting Small & Medium Enterprises• Addition of Simple GUI based development Tools• Strategic Alliances
- Andersen Consulting & SAP- IBM & J.D. Edwards- GE & Oracle
Business
Technology