MISO L005 Understanding ERP


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MISO L005 Understanding ERP

  1. 1. ENTERPRISE SYS.:<br />ManagementInformation Systemsin Organizations<br />S.C. to ERP to CRM<br />Prepared by: Jan Wong<br />
  2. 2. The Learning Outcomes<br />At the end of this session you should be able to:<br />the essentials of enterprise systems and computerized supply chain management<br />EXPLAIN<br />The various types of Supply Chains, its major problems and innovative solutions<br />DESCRIBE<br />The need for integrated software and how ERP does it<br />DISCUSS<br />DISCUSS<br />CRM and its support by IT<br />
  3. 3. <ul><li>It is comprised of a set of applications that automate routine back-end operations:
  4. 4. such as financial management
  5. 5. inventory management
  6. 6. Scheduling
  7. 7. order fulfillment
  8. 8. cost control
  9. 9. accounts payable and receivable
  10. 10. It includes front-end operations such as:
  11. 11. POS
  12. 12. Field Sales
  13. 13. Service
  14. 14. Increases efficiency, improves quality, productivity, and profitability.</li></ul>ERP and Supply Chains<br />“ERP or enterprise systems control all major business processes with a single software architecture in real time”<br />
  15. 15. ERP and Supply Chains<br />
  16. 16. <ul><li>It includes:
  17. 17. Purchasing, payment flow, materials handling, production planning & control, logistics & warehousing, inventory control, and distribution
  18. 18. When it is managed electronically it is referred to as an e-supply chain
  19. 19. Supply Chains contribute to increased profitability and competitiveness
  20. 20. Supply Chain Flow types:
  21. 21. Materials flows
  22. 22. Information flows
  23. 23. Financial flows</li></ul>Supply Chains<br />“Flow of materials, information, payments, and services from raw material suppliers, through factories and warehouses (Value Chain), to the final consumer (Demand Chain)”<br />
  24. 24. Supply Chains<br />Automotive supply chain<br />
  25. 25. SUPPLY CHAIN COMPONENTS<br />The supply chain involves three segments: <br />Upstream: where sourcing or procurement from external suppliers occur<br />Internal: where packaging, assembly, or manufacturing take place<br />Downstream: where distribution or dispersal take place, frequently by external distributors.<br />It also includes the movement of information and money and the procedures that support the movement of a product or a service.<br />Organizations and individuals are also part of the chain<br />
  26. 26. SUPPLY CHAIN PROBLEMS<br /><ul><li>Demand forecasts are a major source of uncertainties
  27. 27. Competition
  28. 28. Prices
  29. 29. Weather conditions
  30. 30. Technological development
  31. 31. Customer confidence
  32. 32. Uncertainties exist in delivery times
  33. 33. Machine failures
  34. 34. Road conditions
  35. 35. Shipments
  36. 36. Quality problems may also create production delays</li></li></ul><li>SUPPLY CHAIN SOLUTIONS<br /><ul><li>Optimal Inventory Levels
  37. 37. Supply Chain Coordination and Collaboration
  38. 38. Supply Chain Teams
  39. 39. Various IT-Assisted Solutions
  40. 40. Wireless technology (RFID)
  41. 41. Optimal shipping plans
  42. 42. Strategic partnerships with suppliers
  43. 43. Just-in-time</li></li></ul><li>SUPPLY CHAIN SOLUTIONS<br />
  44. 44. Communication, Collaboration, Relationship building & Management<br />Manual methods include: phone, fax, and mail<br />Why Integrate with E-Commerce?<br />ERP is complex and inflexible, deal with back-office processes<br />SUPPLY CHAIN COLLABOR-ATION MANAGEMENT<br />Why?<br />“Every company that has business partners has to manage the relationships with them. Information needs to flow between the firms and constantly updated and shared”<br />
  45. 45. SUPPLY CHAIN COLLABORATION MANAGEMENT<br /><ul><li>Integration allows collaboration and communication to take place.
  46. 46. Usually corporate portals are used</li></li></ul><li>Integration Examples:<br />Electronic Data Interchange (EDI) is typically used by large corporations<br />Transfer business documents<br />EC Partner Relationship Management (PRM) functions include:<br />partner profiles<br />partner communications<br />lead management (of clients)<br />targeted information distribution<br />connecting the extended enterprise<br />partner planning<br />centralized forecasting<br />group planning<br />e-mail <br />price lists<br />SUPPLY CHAIN COLLABOR-ATION MANAGEMENT<br />Why?<br />“Every company that has business partners has to manage the relationships with them. Information needs to flow between the firms and constantly updated and shared”<br />
  47. 47. Companies go global (disperse the value chain) for a variety of reasons: <br />Lower costs of materials, products, services and labor<br />Availability of products that are unavailable domestically<br />The firm's global strategy<br />Technology available in other countries<br />High quality of products<br />Intensification of global competition<br />The need to develop a foreign presence to increase sales<br />Fulfillment of counter trade<br />GLOBALSUPPLY CHAINS<br />“Supply chains that involve suppliers and/or customers in other countries”<br />“Global supply chains are usually longer than domestic ones, and more complex therefore involves higher risks and uncertainties”<br />
  48. 48. Material requirements planning (MRP) essentially integrates production, purchasing, and inventory management of interrelated products.<br />Manufacturing resource planning (MRP II), enhanced MRP methodology by adding labor requirements and financial planning.<br />Enterprise resource planning (ERP) further integrates the transaction processing as well as other routine activities in the entire enterprise.<br />Integrations continues along several paths<br />Functional areas<br />Combining transaction processing and decision support<br />Business intelligence <br />CRM software<br />COMPUTER-IZEDSUPPLY CHAINS<br />“The supply chain process is intertwined with the computerization of its activities”<br />Why?<br />“People have wanted to automate the processes along the chain to reduce cost, expedite processing, and reduce errors”<br />
  50. 50. Benefits:<br />Can digitize some products<br />Can replace all paper documents <br />Can replace faxes and telephone calls with electronic messaging <br />Enhances collaboration and information sharing<br />Typically shortens the supply chain and minimizes inventories<br />Facilitates customer service<br />Introduces efficiencies into buying and selling<br />Enables faster, cheaper, and better communication, collaboration, and discovery of information<br />E-COMMERCE&SUPPLY CHAINS<br />“Emerging as a superb tool for providing solutions to problems along the supply chain. Many supply chain activities, from taking customers' orders to procurement, can be conducted electronically”<br />
  51. 51. E-COMMERCE & SUPPLY CHAINS<br />
  52. 52. Tangiblebenefits: <br />Inventory reduction<br />Personnel reduction<br />IT cost reduction<br />Transportation logistics cost reduction<br />Maintenance reduction<br />Procurement cost reduction<br />Productivity improvement<br />Order management improvement<br />Financial-close cycle improvements<br />Cash management improvements<br />Revenue/profit increases<br />On-time delivery improvement<br />SUPPLY CHAIN BENEFITS<br />“Emerging as a superb tool for providing solutions to problems along the supply chain. Many supply chain activities, from taking customers' orders to procurement, can be conducted electronically”<br />
  53. 53. Intangiblebenefits: <br />Standardization<br />Flexibility<br />Information visibility<br />New/improved processes<br />Rapid assimilation of data into the organization<br />Reduction in duplication of entries<br />Customer responsiveness<br />Business performance<br />Controls and reconciliation are enhanced<br />Globalization<br />SUPPLY CHAIN BENEFITS<br />“Systems can be integrated internally and externally. <br />Internal integration: Integration between applications inside a company<br />External integration: Refers to integration of applications among business partners.”<br />
  54. 54. 3 Major Types of CRM:<br />Operational CRM <br />Related to typical business functions involving customer services, order management, invoice/billing, and sales/marketing automation and management. <br />Analytical CRM <br />Involves activities that capture, store, extract, process, interpret, and report customer data to a corporate user, who then analyzes them as needed. <br />Collaborative CRM <br />Deals with all the necessary communication, coordination, and collaboration between vendors and customers.<br />CUSTOMER RELATIONSHIP MANAGEMENTCRM<br />“Realizing that customers are vital to success, it focuses on building long–term and sustainable customer relationships that add value both for the customer and the company”<br />
  55. 55. The scope of e-CRM (3 Levels):<br />Foundational service<br />This includes the minimum necessary services such as Web site responsiveness (e.g., how quickly and accurately the service is provided), site effectiveness, and order fulfillment.<br />Customer-centered services<br />These services include order tracking, product configuration and customization, and security/trust. These are the services that matter the most to customers.<br />Value-added services<br />These are extra services such as online auctions and online training and education.<br />ELECTRONIC CRM<br />“Started in mid-1990s when customers began using web browsers”<br />
  56. 56. Customer Service on the Web <br />Search and Comparison Capabilities<br />Free Products and Services<br />Technical and Other Information and Service<br />Allowing Customers to Order Products and Services Online<br />Letting Customers Track Accounts or Order Status<br />Tools for Customer Service<br />Personalized Web Pages<br />FAQs<br />Chat Rooms<br />E-Mail and Automated Response<br />Call Centers<br />Troubleshooting Tools<br />Wireless CRM<br />CRMACTIVITIES<br />“To form a better relationship and to create a pleasant experience with the customers ”<br />
  57. 57. THE EVOLUTION<br />
  58. 58. THINGS TO TAKE NOTE OFF<br />What are supply chains and why is it important?<br />Common problems and solutions for supply chains<br />Types of supply chain collaborations and it’s benefits<br />Understanding CRM – it’s scope and activities<br />
  59. 59. ERP, SUPPLY CHAINS, CRM<br />
  60. 60. IT’S TIME FOR SOME DISCUSSIONS!<br />Define and list three (3) examples of enterprise systems<br />Define supply chain and supply chain management (SCM). Describe the major components of a supply chains. List the benefits of effective SCM<br />Describe MRP and MRP II<br />Define ERP and describe its functionalities<br />Define CRM. List the major types of CRM. What is e-CRM?<br />
  61. 61. IT’S TIME FOR ANIN-CLASS ACTIVITY!<br />Get into groups of 5-6 members<br />Design a CRM system that applies to your company by:<br />Utilizing a minimum of 3 tools<br />Justifying how each tool is vital (i.e. how will it work) in your CRM system<br />
  62. 62. Coming soon… next class<br />ManagementInformation Systemsin Organizations<br />IT STRATEGY<br />Looking at various IT Strategies used in organizations today!<br />