Enterprise Resource Planning
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Enterprise Resource Planning

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Enterprise Resource Planning Presentation Transcript

  • 1. Enterprise Resource Planning Selected Slides from Jacobs et al, 9 th Edition Operations and Supply Management Chapter 14 Edited, Annotated and Supplemented by Peter Jurkat
  • 2. Enterprise Resource Planning (ERP) Systems
    • Enterprise Resource Planning Systems is a computer system that integrates application programs in accounting, sales, manufacturing, and other functions in the firm
    • This integration is accomplished through a database shared by all application programs
    • Goal is to have a single master data base (except for partitions and replications) so that the entire enterprise is working off the same, continuously updated, data
    14-
  • 3. McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved . Major Vendors Do not grow your own ERP unless you want to get into the ERP business!!!
    • Usually based on three tier architecture interconnected with private/public network
      • client (desktop, laptop, hand held, largely common across organizations)
      • Application servers (apply the business logic – many common, some unique)
      • Back- end data base (permanent storage carefully controlled – data base management system common, data unique)
  • 4. SAP R/3 System Functional Components R/3 System Functional Components 14- Corporate Services Human Capital Resources Operations Financials
  • 5. SAP R/S 3
    • Financials
    • Financial (retrospective) and managerial accounting (prospective)
    • Internal Controlling and Audit
    • Financial Supply Chain Management
    • Human Capital
    • Payroll
    • Benefits administration
    • Applicant data administration
    • Personnel development planning
    • Workforce planning
    • Schedule & shift planning
    • Time management
    • Travel expense accounting
  • 6. SAP R/S 3
    • Operations
    • Materials management
    • Plant maintenance
    • Quality management
    • Production planning & control
    • Project management system
    • Corporate Services
    • Asset management
      • Investments
      • Real estate, property
      • machinery
    • Building operations and maintenance
    • Travel planning, reservations
  • 7. SAP R/S 3
    • Operations
      • Customer relationship management (CRM)
      • Manufacturing
      • Supply chain management (SCM)
      • Supplier relationship management
      • Product life cycle management
      • Mobile business applications
    • User extensions using NetWeaver:
      • application builder from SAP for integrating business processes and databases from a number of sources (vendors and home grown)
      • common brand name for all the SAP products that follow the SAP R/3 ERP software
      • delivers two completely independent (and incompatible) development frameworks
    • Can run entirely on SAP servers
  • 8. ERP in the Service Sector
    • ERP systems have been developed for health care, government, retail stores, hotels, and financial services
    • Also called efficient consumer response (ECR) systems
    • Objective is to tie sales to buying, inventory, logistics, and production
  • 9. The Good News: ERP Systems
    • provides integration of the supply chain, production, and administration – can reduce transaction costs and increase speed and accuracy of communication
    • creates commonality of databases
    • can incorporate improved best processes – e.g. , JIT and systems integration
    • increases communication and collaboration between business units and sites
    • has an off-the-shelf software database
    • can be implemented module by module
    • may provide a strategic advantage for a limited time
  • 10. The Bad News: ERP Systems
    • Are very expensive to purchase and even more so to customize
    • May require major changes in the company (and you know how easy that is!!) and its processes to implement
    • Can be so complex that many companies cannot adjust to it
    • Involve an ongoing, possibly never completed, process for implementation
    • Require expertise in limited supply with ongoing staffing problems
    • But it may be a necessary evil for competitive purposes