ERP and Related Technologies
ERP is an abbreviation for Enterprise Resource Planning
and means, the techniques and concepts for the integrated
management of businesses as a whole, from the viewpoint
of the effective use of management resources, to improve
the efficiency of an enterprise
ERP systems serve an important function by integrating
functions - materials management, product planning, sales,
and accounting and others-into a single application.
ERP systems have three significant limitations: .
1.managers cannot generate custom reports or queries
without help from a programmer and this inhibits them
from obtaining information quickly, which is essential for
maintaining a competitive advantage.
2. ERP systems provide current status only, such as open
orders. Managers often need to look past the current status
to find trends and patterns that aid better decision making.
3. The data in the ERP application is not integrated with
other enterprise or division systems and does not include
There are many technologies that help to
overcome these limitations.
These technologies, when used' in conjunction
with the ERP package, will help in overcoming the
limitations of a standalone ERP system and thus,
help the employees to make better decisions.
Some of these technologies are
– Data Warehousing,
– Data Mining,
– Online Analytical Processing (OLAP),
– Supply Chain Management and so on.
With the competition in the ERP market getting
hotter and hotter, and ERP vendors searching for
ways to penetrate new market segments and
expand the existing ones, tomorrows ERP systems
will have most of these technologies integrated into
In this chapter, we will see how each of these
technologies are related to ERP systems
Business Process Re-engineering (BPR)
As Dr. Michael Hammer, the champion of BPR
puts it, business process re-engineering is the
fundamental rethinking and radical redesign of
business processes to achieve dramatic
improvements in critical, contemporary measures
of performance, such as cost, quality, service &
speed. And Thomas Davenport calls it a process
Management Information System (MIS)
MIS is computer based system which transfer collection,
collation and presentation information throughout
Not concerned with day-to-day operation
– Eg: Ticket reservation System, is transaction or data processing
system (TPS) which takes order and print the ticket.
– Whereas MIS measures the performance of each of the agent who
will sell tickets and produces regular reports about agents
MIS processes data that is generated by TPS and
other internal information sources
Users will request for reports and request are
taken by MIS programs.
Advantage of MIS:
– MIS provides strong transaction supports and record
– MIS supports different functional areas and uses
– Provide Structural information at different level of
organization and support time management
– Flexible enough to adapt changing need in organization.
Decision Support System (DSS)
Organization have to make several decision at
different level of management.
And managers use to spend lots of time in
analyzing and gathering information before making
To analyze certain certain complex decisions
where involves many factors as well as to provide
support to management, to make quality decision,
Decision Support System is requires.
DSS assist managers to gather and analysis the
information to meet certain decision.
DSS can make several forecasting and planned
models along with s/w and h/w with latest
technologies like Artificial intelligence.
DSS mainly supports decision making at the top
management level to make certain complex
DSS is interactive , user friendly software which is
useful for decision making.
DSS supports planning and forecasting model,
which has simulation also analytical tools are
available to decision makers to improve quality of
Executive Information System (EIS)
DSS and SIS are support system of MIS
Both are decision making, difficult to make out
But EIS is more sophisticated and better than
In today's competitive world, reaction is decreasing
and time to make decision is very less,
EIS can be more sophisticated solution.
It supports more senior level executives
– How decisions are taken by them which will affect
Takes under consideration the outside information
from competitor, consultant, newsgathering so on
EIS takes following into consideration:
Overall vision and mission of company and of company
and company goal.
Planning and objectives
Strategic control and monitoring of overall operations
Architecture of EIS
External Data DATA DATA
Graphs reports ESS
As time passes, the amount of data will increase
and this will affect the performance of ERp system.
So it is better to archive the operational dara once
its use is over.
Its is most valuable recourse so archive data is not
If work is over of operational data, it should be
removed from operational database.
– Eg: one financial year is over, daily transactional data
can be archived.
If volume of data increase in database,
performance of database and related application
We should separated operational data form non
We transfer this data in data warehouse
Data is stored for business analysis can be accessed
most effectively by separating it.
Data warehouse stores huge amounts of data
whereas data mining process data into valid
potential useful information
This information can be further use to make
Allow analyst to manage the process of extracting
knowledge and meaningful information from data
On-Line Analytical Processing (OLAP)
OLAP is designed for live ad-hoc data access and
OLAP has multidimensional database technology
and provides the technical basis for calculation and
analysis required by business intelligence
OLAP is design to deliver fast response to user.
Its takes few sec to analysis
OLAP is define in following words:
FAST ANALYSIS OF SHARED
– System delivers responses to users within few
– System copes with any business logic and
– System implements security to maintain
confidentiality of important data at different
– System must provide multidimensional
conceptual view of data with multiple
– Refine data that is accurate, timely and relevant to user.
Supply Chain Management
Supply chain is a network of facilities and
distribution options that performs the function of
procurement of materials, transformation of these
material into intermediate and finished products ,
distribution of these finished products to
Supply chain exist in both service and