ERP Business Functions and Business Processes A straight forward lesson designed to simplify thinking related to how a complexAuthor Tom Matys ERP System worksDPR105: Mgmt Info Systems
Business Functional Areas• Marketing & Sales (M/S)• Supply Chain Management (SCM)• Accounting & Finance (A/F)• Human Resources (HR)
Business Functions• M/S: Fulfilling and identifying the customer’s needs, pricing, product research, determine future needs, pricing.• SCM: Purchasing, manufacturing, inventory management, Production Planning, materials requirements planning (MRP)• A/F: Financial & Managerial Reporting, Accounts Payable, Accounts Receivable, Billing,• HR: Hiring, training, payroll, salary research, employee benefits, promote business ethics
Business Process• A set of multi-step activities that produce desired outcomes.• ERP is a collection of processes.• Processes consist of interdependent steps in an ERP System.• The steps in a process are completed in different functional areas.• Each process starts with a trigger. Inputs Process Outputs
Four Concepts of a Process1) Triggers2) Tasks3) Data4) Outcome
QuestionWhat is a common trigger in the ERP system that initiates a process?
AnswerCreate documentCreating a document is a trigger that can start off a process that needs to be completed in several different steps, in several different areas.
Business Processes are Cross-Functional M/S SCM A/F
Processes are executed in SAP ERPusing the modules that are specific to the process 9
Cross-Functional Nature of the Order Management Process Check Quote Commit Produce Deliver Bill Collect Credit Sales & Distribution Production Planning Financial Materials Mgmt10 Accounting
11 Sales Function Accounting Function Purchasing Function Customer Order Process Production Function Process View of Business Logistics Material Order Process Function
Supply Chain Management• Inputs – Product sales data – Production plans – Inventory levels• Outputs – Raw material orders – Packaging orders – Resource expenditure data – Production and inventory reports16
Accounting and Finance• Inputs – Payments from customers – Accounts receivables data – Accounts payables data – Sales data – Production and inventory data – Payroll and expense data• Outputs – Payments to suppliers – Financial reports – Customer credit data18