1. Why ERP is required ?

3. Let us take a look at a typical Business Process

4. Sends an urgent enquiry
to
Sales
Sales

5. Sends an urgent enquiry
To Sales
Sales has
no Real
Time
Inventory
Information

6. Sales sends request for
stock information to
INVENTORY (FG)
SALES

7. SALES
INVENTORY
(FG Store)
Checks for
Stock
Availability
Uses its decentralized
database/spreadsheet to
check out stocks available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there

8. SALES
INVENTORY
(FG Store)
Checks for
Stock
Availability
Uses its decentralized
database/spreadsheet to
check out stocks available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
This cycle might take more time than
what the Customer is
willing to wait before
going to the competition

9. SALES
INVENTORY
(FG Store)
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….

10. SALES
INVENTORY
(FG Store)
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contacts the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING

11. SALES
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
If the stock was
available in the
STORES,
well and good
However if the quantity
available is less then what
the customer needs…….
Sales person now contacts the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available

12. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available
CHILD PART
INVENTORY

13. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available
CHILD PART
INVENTORY
If the Child PartIf the Child Part
is not available ?is not available ?

14. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available
CHILD PART
INVENTORY

15. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available
CHILD PART
INVENTORY
This starts another loop involving the Purchase,
Raw Material Store, Production Shop and Vendor/Supplier
PURCHASE
RAW MATERIAL
STORE
PRODUCTION
SHOP
CHILD PART
NEEDS RAW
MATERIAL
SUPPLIER
If the Raw MaterialIf the Raw Material
is not available ?is not available ?

16. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less than what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
parts that are required by him to
produce the customer need are available
CHILD PART
INVENTORY
This starts another loop involving the Purchase,
Raw Material Store, Production Shop and Vendor/Supplier
PURCHASE
RAW MATERIAL
STORE
PRODUCTION
SHOP
CHILD PART
NEEDS RAW
MATERIAL
SUPPLIER

17. SALES
INVENTORY
(FG Store)
Physical checkout
of stock
Uses its decentralized
database/spreadsheet to
check out stock available
Most times, even if it shows the
stock in his database, he tends to
reconfirm physically if the stocks
are actually there
They conveys this
information
to the sales person
If the stock was
available in the
FG, well and good
However if the quantity
available is less then what
the customer needs…….
Sales person now contact the
production planning to check
as to when they can make
available the required quantity
PRODUCTION
PLANNING
The production planning person
now works out the plan to how
and when he can produce.
He checks up with the child part
inventory store to check if all the
part that are required by him to
produce the customer need are available
CHILD PART
INVENTORY
This starts another loop involving the Purchase,
Raw Material Store, Production Shop and Vendor/Supplier
PURCHASE
RAW MATERIAL
STORE
PRODUCTION
SHOP
CHILD PART
NEEDS RAW
MATERIAL
SUPPLIER

18. And imagine the chaos when you need to response to
multiple customers and for multiple items ?

19. By the time the issue has been clarified, the customer has
Already gone to the competitor

20. However in a Centralized
ERP.......
Things would be different.

21. 
All the required information would be available to the Sales
person at a click of the button.

Information can be passed to the customer online without
any delay

Decision for order finalization can be made immediately

Shortage of Materials, Machines, Man-powers etc can be
worked out immediately and

A confirmed delivery date can be given to the customer
With a Centralized ERP...........

23. Manufacturing

24. What to Produce?
How much to Produce?
When to Produce ?
Without Centralized ERP……..

25. Sends a request
to Sales to determine
the order position
Sales has
no Real
Time
Information
On Orders and
Leads

26. Sales
Sales use their some manual or spreadsheet
data to compile information &
forward to PM

27. PM forwards it to
PPC (Production Planning Control)
&
MPC (Material Planning Control)
to work out the child part requirement
We don't really know
how this is being derived
and authenticated
After receipt of this information ?

28. PM forward it to
PPC (Production Planning Control)
&
MPC (Material Planning Control)
to work out the child part requirement
He plans to load his machines based on.....
Again we do not know on
what basis

29. PM forwards it to
PPC (Production Planning Control)
&
MPC (Material Planning Control)
to work out the child part requirement
He then starts his production on machines…….
Fully prepared and ready for the interruptions based on
urgent needs from sales team

30. PM forwards it to
PPC (Production Planning Control)
&
MPC (Material Planning Control)
to work out the child part requirement
Invariably he ends up with no planning as all plannings
go awry... as the sense of the URGENCY & fire fighting
rules over all plans

31. Resultant
 Daily Fire fighting
 Frequent job changes
 Drop in production efficiencies
 High cost of RM wastage
 Machine time wastage
 Electricity and man power wastage
 Delivery and Supply failures
 Also chaotic & stressed up working

32. With a Centralized ERP...........
What to make?
How much to make?
When to make ?
On which machine to make ?

33. What to make?
How much to make?
When to make ?
On which machine to make ?
He knows the production time cycle.
He knows the Machine occupancy.
He knows the Man Power resources
needed & available.
He knows when to make.
He knows what to make.
He eliminates the chance of anybody
else raising the urgency ticket as all are
following the centralized ERP data

34. 
Smooth working

No loss of Machine Time (optimization)

No loss of Raw Material

No loss of Man power time

On time Delivery

Clear understanding of capacity available

Clear understanding of capacity required

Easy to plan for additional capacity
Resultant

35. Profit & Cost

36. Is it so ??
Company is not making sufficient Profits

37. Many a times,
in the absence of any reliable data,
this fact is also not realized
by the management
This becomes evident only
when the cash flow
gets restricted.
Need for additional Bank limit
is called for without
any increase in sales/revenue
Without a Centralized ERP…....

38. Incomes
Product selection
Production costsRaw Material cost
Expenses
CENTRALIZED
SYSTEM
ERP+
Profits
Financial costs
Centralized System
(or with an ERP)

39. An always updated, online, real time data is available
to keep the management informed as to
how much Profit & Loss they are making
It goes beyond this, to tell about Incomes & Expenses
It also informs as to which products are profitable and which are not
(by conducting PQA analysis & an in- depth product costing)
Once this information is available it becomes
easy for the management to decide which product to
Manufacture , which to discard, where to think of cost
reduction plan or where to approach the customer for a price increase

40. Resultant:

42. Stores

43. Without ERP……...
How much Quantity do I have?
Where is it kept ?
When was it last checked ?
What is my standard pack quantity ?
What is the Container ?
How do I control my Shelf Life items ?
How do I maintain FIFO, stock statements,
consumption pattern, Reorder Levels ?
How do I avoid losses, pilferage
and stock Deterioration ?

44. With ERP……...
I exactly know How much of what I have
and where it is located.
I control my Shelf Life items
so I have no expired materials
My ERP ensures FIFO,
provides all stock statements,
consumption patterns and
Dynamically sets Reorder Levels

45. With ERP………..
Issue for Production
work orders
Issue Multiple parts
on single click
for Assembly work
orders
Incoming Material Inwards Quality Store Master

46. Advantages with ERP
Item Ledger
Parts Availability &
Tracking
Accurate valued
Stock statements
RM Accountability Scrap Accountability
Control on Rejection
And
Pilferage

47. Purchase

48. Material Planning
without ERP
What to buy?
How much to buy?
When to buy?
What to make?
How much to make?
When to make?

49. Inadvertently the decisions are taken on higher quantity
to be on the safe side and to avoid production holdups
Also inadvertently, many items get missed out and are
noticed at the last minute when the production actually
gets held up
In absence of ERP these decisions are mostly taken
on gut feeling or visual look in the storage area
What and How much to source ?

50. No inventory of some items
Cash blockage, space blockage, dead stock….
….still having production holdups
Huge inventory of some items
Resultant: Delivery and Supply failures

51. With Centralized
ERP
With a press of a button

52. Materials Planning
Marketing
forecastOrders in hand
What Products/Models
to make
Sales trends
and averages
Stocks in hand
at various
locations

53. Planning for Product/Model
Release PO
Child Parts
available at
various locations
Child Parts
required
Child Parts
to source
Make* or Buy
Source to buy
Compare
What Products
/Models
&
How much
to make

54. Planning for Child Parts & Sub-assemblies
Release PO
RM
available at
various locations
Raw Material
required
RM
to source
Source to buy
Compare
What Child Parts
&
How many to make

55. No excess inventory of any items and
No shortage of any item
Improved Cash flow, No space blockage,
No dead stocks
& No production holdups
Planning only for needs..no excess stocks
Resultant: On time Delivery and Supply
with minimum inventory

57. HRD & Payroll

58. HRD issues
Absent-ism
Low
Productivity
Poor Skills Behavioral
Problems
Account-
abilityAttrition
Motivation
Have I missed
something ?
No sense
of
ownership
Poor
Involvement
Poor
Team work

59. Legal Compliance issues
ESIPF Bonus Leaves TDSOT Gratuity
Have I missed
something ?

60. ADP ( Associate Development Programme)
Ultimately all your competitors shall have the same or
similar technologies, machines and processes that you
have …......
Your winning edge will only be provided by the trained,
motivated and result oriented Manpower that you have.
Invest in ADP....invest in GAPOSM

62. Human Resource Development
with ERP
From Resource
Identification
Selection based on
JD & Online Test
Induction
Training
Probation period
Hand holding
Monitoring
Training
Skill Development
Monitoring of efficiency
Defines KRAs
Measuring PMS
Working with CFTs
Behavior Monitoring Scoring
Appraisal System

63. Payroll
With ERP
Over TimeBonus
Leaves
PF
TDS
ESI
SalaryGratuity
All complete with all reports....taking care of your MIS and Legal Compliance