Enterprise Resource PlanningERP Systems

Integrating the Organization from End to End

• SCM systems focus specifically on suppliers• CRM systems focus specifically on customers

The organization before ERP (lots of different systems)Isolated Information: each department maintained their own systems

Update issues Redundant/duplicate dataInaccurate and different customer information in different databasesDifferent information formats in the different databasesCan’t access information maintained by another departmentCan’t see a complete view of the entire organization

ERP: Bringing the Organization Together• ERP – integrates all departments and functions throughout

an organization into a single IT system (or integrated set of IT

systems) so that employees can make enterprise wide decisions by viewing enterprise wide information on all business operations (consistent enterprise wide information)

Keyword in ERP is “enterprise”

ERP systems focus on integrating all processes, departments and operations for the entire enterprise

We don’t need this ERP stuff. We already have enterprise wide software that we are all using. It is called a

SPREADSHEET.

Sales

Acctg

Enterprise Resource Planning• ERP systems collect data from across an organization and

correlates the data generating an enterprise wide view that is consistent and real-time. Everyone involved in sourcing, producing and delivering a company’s product works with the same information.

• Commondatabase

• CompleteData entryrequired

• Real time

• Consistent

• One truepicture

Components of ERP Software• Three most common core components focus on internal

operations (accounting/finance, production/materials management and HR)

• Extended components typically focus on external operations and require interactions with customers, suppliers and business partners outside of the organization.– Typically

Internet enabled.

Make sure that you know what each component

typically handles.Skipped details

slides follow

Enterprise Resource Planning (ERP)

• At the heart of all ERP systems is a database, when a user enters or updates information in one module, it is immediately and automatically updated throughout the entire system

Enterprise Resource Planning (ERP)

• ERP systems automate business processes

ERP Benefits 1. Having integrated systems helps eliminate the mess of incompatible

applications that many businesses had previously started to use (also didn’t have to fix those old legacy systems)

2. Integrate financial information and customer order information

3. Everyone working with the same information eliminates redundancies, reduces wasted time and removes misinformation

4. Standardize and speed up manufacturing processes, as well as reduce inventory

5. ERP addresses the need for global information sharing and reporting.

6. One of the greatest benefits of an ERP system is helping people understand how the organization is performing from an enterprise perspective. Provides organizations with information that was previously difficult (if not impossible) to obtain, allowing the organization to perform more efficiently and effectively.

ERP Risks (Costs)

• Costly in terms of money, time, amount of training required, and effort to implement.

One vendor risks: too costly to simply switch to another system. Company essentially held hostage.

Employees resist new way of doing things.Difficult to integrate new ERP system with existing systems.

Microsoft Business Solutions Great Plains Dynamics

#1 market share

Oracle: #2 market shareiSIS runs PeopleSoft

• Microsoft Dynamics Testimonials– Xbox– Microsoft Operations Puerto Rico– Giant Bicycle

• SAP Testimonials– Tasty Baking– Veeco Instruments– South Florida Water Management District