ERP Software

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ERP Software

  1. 1. Enterprise Resource Planning Nayan Sagar [email_address] Copyright @ sysoptima.com and Wikipedia.com
  2. 2. Introduction <ul><li>ERP is the acronym of Enterprise Resource Planning. ERP utilizes ERP software applications to improve the performance of organizations' resource planning, management control and operational control. ERP software is multi-module application software that integrates activities across functional departments, from product planning, parts purchasing, inventory control, product distribution, to order tracking. ERP software may include application modules for the finance, accounting and human resources aspects of a business. </li></ul><ul><li>The initials ERP originated as an extension of MRP (material requirements planning; later manufacturing resource planning) and CIM (Computer Integrated Manufacturing). It was introduced by research and analysis firm Gartner in 1990. </li></ul><ul><li>ERP software is made up of many software modules. Each ERP software module mimics a major functional area of an organization. Common ERP modules include modules for product planning, parts and material purchasing, inventory control, product distribution, order tracking, finance, accounting, marketing, and HR. </li></ul>
  3. 3. Architecture <ul><li>An ERP system has a service-oriented architecture. In computing, service-oriented architecture (SOA) provides methods for systems development and integration where systems package functionality as interoperable services. A SOA infrastructure allows different applications to exchange data with one another. </li></ul><ul><li>An ERP system has a service-oriented architecture with modular hardware and software units or &quot;services&quot; that communicate on a local area network. The modular design allows a business to add or reconfigure modules (perhaps from different vendors) while preserving data integrity in one shared database that may be centralized or distributed. </li></ul>
  4. 4. Modules <ul><li>Manufacturing </li></ul><ul><li>Supply chain management </li></ul><ul><li>Project management </li></ul><ul><li>Customer relationship management </li></ul><ul><li>Production Planning Module </li></ul><ul><li>Purchasing Module </li></ul><ul><li>Inventory Control Module </li></ul><ul><li>Sales Module </li></ul><ul><li>Marketing Module </li></ul><ul><li>HR Module </li></ul><ul><li>Financial Module </li></ul><ul><li>Accounts Payable / Accounts Receivable </li></ul>
  5. 5. History <ul><li>ERP (Enterprise Resource Planning) is the evolution of Manufacturing Requirements Planning (MRP) II. From business perspective, ERP has expanded from coordination of manufacturing processes to the integration of enterprise-wide backend processes. From technological aspect, ERP has evolved from legacy implementation to more flexible tiered client-server architecture. </li></ul><ul><li>Time Line </li></ul><ul><li>1960 Inventory Management & Control </li></ul><ul><li>1970 Material Requirement Planning (MRP) </li></ul><ul><li>1980 Manufacturing Requirements Planning (MRP II) </li></ul><ul><li>1990 Enterprise Resource Planning (ERP) </li></ul>
  6. 6. Benefits <ul><li>Help reduce operating costs </li></ul><ul><li>Facilitate Day-to-Day Management </li></ul><ul><li>Support Strategic Planning </li></ul><ul><li>Integration among different functional areas to ensure proper communication, productivity and efficiency </li></ul><ul><li>Design engineering (how to best make the product) </li></ul><ul><li>Order tracking, from acceptance through fulfillment </li></ul><ul><li>The revenue cycle, from invoice through cash receipt </li></ul><ul><li>Managing inter-dependencies of complex processes bill of materials </li></ul><ul><li>Tracking the three-way match between purchase orders (what was ordered), inventory receipts (what arrived), and costing (what the vendor invoiced) </li></ul><ul><li>The accounting for all of these tasks: tracking the revenue, cost and profit at a granular level. </li></ul>
  7. 7. Disadvantages <ul><li>Customization of the ERP software is limited. </li></ul><ul><li>Re-engineering of business processes to fit the &quot;industry standard&quot; prescribed by the ERP system may lead to a loss of competitive advantage. </li></ul><ul><li>ERP systems are expensive. </li></ul><ul><li>User adaptability for ERP is not easy. </li></ul><ul><li>Switching the whole application in new environment and infrastructure is not easy and costly even. </li></ul><ul><li>The blurring of company boundaries can cause problems in accountability, lines of responsibility, and employee morale. </li></ul><ul><li>Resistance in sharing sensitive internal information between departments can reduce the effectiveness of the software. </li></ul><ul><li>The use of ERP is limited where organizations have multiple departments with separate, independent resources, missions, chains-of-command. </li></ul><ul><li>The system may be too complex measured against the actual needs of the customers. </li></ul><ul><li>ERP Systems centralize the data in one place, example customer , financial data. This can increase the risk of loss of sensitive info, if there is any security breach </li></ul>
  8. 8. Thank You..  Nayan Sagar [email_address] Copyright @ sysoptima.com and Wikipedia.com

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