Presentation is loading. Please wait.

Presentation is loading. Please wait.

Graduate Program in Business Information Systems BIS 581 Business Process Management Lectures 9-10 Aslı Sencer Department of Management Information Systems.

Similar presentations


Presentation on theme: "Graduate Program in Business Information Systems BIS 581 Business Process Management Lectures 9-10 Aslı Sencer Department of Management Information Systems."— Presentation transcript:

1 Graduate Program in Business Information Systems BIS 581 Business Process Management Lectures 9-10 Aslı Sencer Department of Management Information Systems

2 Business Process Management – 9-10 Integration with ERP Systems

3 Outline Magal and Word ! Essentials of Business Processes and Information Systems | © Types of Enterprises Systems Types of Data in ES SAP Overview Procurement Process Key Concepts and Assumptions Conceptual Framework – Physical Flow – Document and Data Flow – Information Flow – Financial Impact

4 Enterprise Systems Magal and Word ! Essentials of Business Processes and Information Systems | © Three stages of evolution – Stage 1: Stand-alone Mainframe Systems – Stage 2: Client-Server Architecture – Stage 3: Service-Oriented Architecture (SOA)

5 The New Stack – Process Is the Next Platform Magal and Word ! Essentials of Business Processes and Information Systems | © Client MainframeClient Server SOA Application Data Management Composites OS and Database OS DB Custom Application Punch Card or Terminal (10’s of users) Application OS PC or Internet (1000’s of users) Application OS Application OS Any Device (Millions of users) OS DB OS DB OS DB OS DB OS DB OS DB OS DB OS DB OS DB OS Composites OS Applications OS Applications OS

6 3-tier Client Architecture Magal and Word ! Essentials of Business Processes and Information Systems | ©

7 Types of Enterprise Systems Magal and Word ! Essentials of Business Processes and Information Systems | © The ES Application Suite – Enterprise Resource Planning (ERP) – Supply Chain Management (SCM) – Supplier Relationship Management (SRM) – Product Lifecycle Management (PLM) Other classifications – Best of breed vs. Niche applications – Software as a service (SaaS)

8 ERP Systems Evolved in 1990’s in parallel to advances in BPR and globalization. ERP’s are the world’s largest and most complex ES’s. Focus on internal operations of an organization, integrate functional and cross functional (intracompany) business processes. Typical ERP systems include – Operations (production) – Human resources – Finance and Accounting – Sales and Distribution – Procurement 8

9 Management of intercompany processes: SCM and SRM SCM connects the companies that supply the materials it needs to make its products. SCM help companies plan for their production demand requirements and optimize complex transportation and logistics for materials. SRM systems manage the overal relationships with the material suppliers. SRM systems contain functonality to manage the quotation and contracts processes. 9

10 CRM and PLM CRM systems connect a company’s ERP system to those of its customers. CRM systems provide companies with capabilities to manage marketing, sales and service for its customers. PLM systems help companies administer the process of research, design and product management. 10

11 The application suite Magal and Word ! Essentials of Business Processes and Information Systems | © Example: SAP, Oracle

12 SAP ERP Solution Map Magal and Word ! Essentials of Business Processes and Information Systems | © Shared Service Delivery SAP NetWeaver End-User Service Delivery Analytics Financial AnalyticsOperations AnalyticsWorkforce Analytics Financials Financial Supply Chain Management TreasuryFinancial Accounting Management Accounting Corporate Governance Human Capital Management Talent ManagementWorkforce Process ManagementWorkforce Deployment Procurement and Logistics Execution Procurement Inventory and Warehouse Management Inbound and Outbound Logistics Transportation Management Product Development and Manufacturing Production PlanningManufacturing ExecutionProduct Development Life-Cycle Data Management Sales and Service Sales Order ManagementAftermarket Sales and ServiceProfessional-Service Delivery Corporate Services Real Estate Management Enterprise Asset Management Project and Portfolio Management Travel Management Environment, Health, and Safety Compliance Mgmt. Quality Management Global Trade Services Copyright SAP AG 2008

13 SAP Supply Chain Management Magal and Word ! Essentials of Business Processes and Information Systems | © SAP NetWeaver Demand & Supply Planning Demand Planning & Forecasting Safety Stock Planning Supply Network Planning Distribution PlanningService Parts Planning Procurement Strategic SourcingPurchase Order ProcessingInvoicing Manufacturing Production Planning & Detailed Scheduling Manufacturing Visibility & Execution & Collaboration MRP based Detailed Scheduling Warehousing Inbound Processing & Receipt Confirmation Outbound ProcessingCross Docking Warehousing & Storage Physical Inventory Order Fulfillment Sales Order ProcessingBillingService Parts Order Fulfillment Transportation Freight Management Planning & Dispatching Rating & Billing & Settlement Driver & Asset Management Network Collaboration Real World Awareness Supply Chain Event ManagementAuto ID / RFID and Sensor Integration Supply Chain Visibility Strategic Supply Chain Design Supply Chain Analytics Supply Chain Risk Management Sales & Operations Planning Supply Network Collaboration Supplier CollaborationCustomer CollaborationOutsourced Manufacturing Supply Chain Management with Duet Demand Planning in MS Excel Copyright SAP AG 2008

14 SAP Supplier Relationship Management Magal and Word ! Essentials of Business Processes and Information Systems | © SAP NetWeaver Purchasing Governance Global Spend AnalysisCategory ManagementCompliance Management Sourcing Central Sourcing HubRFx / AuctioningBid Evaluation & Awarding Contract Management Legal Contract Repository Contract AuthoringContract NegotiationContract ExecutionContract Monitoring Collaborative Procurement Self-Service ProcurementServices Procurement Direct / Plan-Driven Procurement Catalog Content Management Supplier Collaboration Web-based Supplier InteractionDirect Document ExchangeSupplier Network Supply Base Management Supplier Identification & Onboarding Supplier Development & Performance Management Supplier Portfolio Management Copyright SAP AG 2008

15 SAP Product Lifecycle Management Magal and Word ! Essentials of Business Processes and Information Systems | © SAP NetWeaver Product Management Product Strategy and Planning Product Portfolio Management Innovation Management Requirements Management Market Launch Management Product Development and Collaboration Engineering, R&D Collaboration Supplier Collaboration Manufacturing Collaboration Service and Maintenance Collaboration Product Quality Management Product Change Management Product Data Management Product Master and Structure Management Specification and Recipe Management Service and Maintenance Structure Management Visualization and Publications Configuration Management PLM Foundation Product Compliance Product Intelligence Product Costing Tool and Workgroup Integration Project and Resource Management Document Management Copyright SAP AG 2008

16 SAP Customer Relationship Management Magal and Word ! Essentials of Business Processes and Information Systems | © Web Channel Interaction Center Partner Channel Management Trade Promotion Management Business CommunicationManagement Marketing Marketing Resource Management Segmentation & List Management Campaign Management Real-Time Offer Management Lead Management Sales Sales Planning & Forecasting Sales Performance Management Territory Management Accounts & Contacts Opportunity Management Quotation & Order Management Pricing & Contracts Incentive & Commission Management Time & Travel Service Service Order Management Service Contract Management Complaints & Returns In-House Repair Case Management Installed Base Management Warranty Management Resource Planning Copyright SAP AG 2008

17 Other classifications of ERP systems Magal and Word ! Essentials of Business Processes and Information Systems | © Today’s global comanies typically have an ES lanscape that includes custom and packaged applications from several vendors Best of Breed Applications: Isolated to one process or part of a process that evolves from departmental applications Ex: i2 is a popular SCM system. Ariba is a popular procurement system. Niche applications: Small and independent software vendors offer highly specialized niche app’s. Ex: Vendova is a small ISV that produces a pricing management tool to assist retailers in maximizing profit for retail sales. It pulls product and price info from several ES’s. Other classifications: – Size of enterprise: SAP and Oracle for companies with more than 1000 employees – Method of delivery: Install the hardware and software in the facility (three-tier or SOA configurations) versus salesforce.com and Netsuite deliver ES entirely from web.

18 Types of Data in ES Magal and Word ! Essentials of Business Processes and Information Systems | © Organizational Data Master Data Transaction Data

19 Organizational Data Magal and Word ! Essentials of Business Processes and Information Systems | © Define the organizational structure of the enterprise Includes definitions of: – Companies (subsidiaries, etc.) – Divisions based on, product or geographical hierarchy – Sales organizations – Purchasing organizations – Physical facilities: plants, warehouses, distribution centers – HR organization: Functional areas, reporting relationships Data rarely changes

20 Master Data Magal and Word ! Essentials of Business Processes and Information Systems | © Define key entities in an organization Customers – Basic information: name, address, contact information – Financial information: payment terms, methods – Sales information: delivery terms Vendors / suppliers – Similar information as customer Products – Basic data: description, weight, color – Purchasing data – Sales data – Manufacturing data

21 Master Data Magal and Word ! Essentials of Business Processes and Information Systems | © Employees – Basic data – Personal data: dependents – Payroll data – Tax data Data changes occasionally

22 Transaction Data Magal and Word ! Essentials of Business Processes and Information Systems | © Data that is the consequence of day-to-day transaction – Who, what, when, where, how, how much Sales – Customer, products, quantities, dates and times, location (shipping, delivery), sales person Purchase – Vendor, products, quantities, dates and times, location (delivery), sales person, requester Production – Materials, quantities, facilities, resources (machine, people), dates and times, locations (storage, production)

23 Super Skateboard Builders, Inc. Magal and Word ! Essentials of Business Processes and Information Systems | © History Product Line Customers Vendors Plant Layout Employees Information Systems

24 SSB, Inc. - Product List Magal and Word ! Essentials of Business Processes and Information Systems | ©

25 SSB, Inc. - Customer List Magal and Word ! Essentials of Business Processes and Information Systems | ©

26 SSB, Inc. - Vendor List Magal and Word ! Essentials of Business Processes and Information Systems | ©

27 SSB, Inc. - Plant Layout Magal and Word ! Essentials of Business Processes and Information Systems | ©

28 SSB, Inc. - Organizational Chart Magal and Word ! Essentials of Business Processes and Information Systems | © John Z. Boeve (President) Catherine VanderBos (Plant Manager) Charles Skivers (Shop Floor) Mark McKendry (Shop Floor) Patrick Stevens (Sales Manager) Shana Smith (Accountant) David Bloomberg (Warehouse Manager) Tom Jones (Warehouse) Martha Seward (Purchasing Manager) Maria Rivera (Office Manager)

29 SAP Overview Magal and Word ! Essentials of Business Processes and Information Systems | © Copyright SAP AG 2008

30 Physical Flow Magal and Word | Essentials of Business Processes and Information Systems | © What is the trigger? What are the steps? What is the purpose of each step? Who is involved in each step? How is communication and coordination accomplished

31 Magal and Word ! Essentials of Business Processes and Information Systems | © Procurement Process: Physical Flow

32 Document flow Magal and Word ! Essentials of Business Processes and Information Systems | © Purchase Requisition Purchase Order Packing List Goods Receipt Document Vendor Invoice and Payment Key questions regarding documents – What is the purpose? – What are the key data? General: Who, when, what, where Process / step specific: varies – How does data change across the process? – Who is responsible for the data?

33 Purchase Requisition Magal and Word ! Essentials of Business Processes and Information Systems | © Filled later by the purchasing department, based on the purchase order form.

34 Purchase Order Magal and Word ! Essentials of Business Processes and Information Systems | © Free-on-board (F.O.B ) point is the point at which ownership of the shipped material legally transfers from one company to the other. F.O.B. Point is either the shipping point or the destination. Payment Terms define how the company will pay the vendor. Net nn: nn specifies the number of days within which payment for the full amount of the invoice is due. x% mm/Net nn: x% discount is made if the payment is made within mm days; otherwise, full payment should be made within nn days. Materials may be shipped via ground shipment (trucs, etc.), air, train, sea.

35 Packing List Magal and Word ! Essentials of Business Processes and Information Systems | © When the vendor sends the shipment, a packing list or delivery document will accompany it, showing the details about the materials in the shipment. It does not include pricing information.

36 A Goods Receipt Document Magal and Word ! Essentials of Business Processes and Information Systems | ©

37 A Vendor Invoice Magal and Word ! Essentials of Business Processes and Information Systems | © Once the shipment is sent, the vendor will send an invoice, or bill for the material shipped to the accounting department for payment. Three-way match: The corresponding purchase order document, goods receipt document and invoice are matched. If the match is OK, the payment is made by check or Electronic funds transfer (EFT) Note of the Accounting Manager after the payment is made: Paid in full Check # /1/08

38 Information Flow Magal and Word ! Essentials of Business Processes and Information Systems | © Instance-Level Information – Status of a purchase requisition / order – Has a requisition been acted on? Has a PO been created and sent – Have goods been received for the requisition / order? When? Where are the goods? – If received, has an invoice been received? Paid? – If not received, when can we expect the goods? Ex: David wants to know the state of the purchase requisition he sent to Martha Process-Level Information – How well is the process doing? – How much time does it take on average? Per material? Per vendor? – Which vendors are prompt? Who habitually delivers late? – What do we buy most often? From with vendor(s)?

39 Financial Impact Magal and Word | Essentials of Business Processes and Information Systems | © Impact on balance sheet and income statement accounts Example: Procure $500 in materials. Process stepB/SI/S Purchase requisition Purchase order Goods receipt Vendor Invoice receipt Vendor payment

40 Role of enterprise systems in the procurement process Magal and Word ! Essentials of Business Processes and Information Systems | © Execute the Process – Create Purchase Requisition – Create Purchase Order – Receive Shipment – Receive Invoice and Send Payment Capture and Store Process Data Monitor the Process – Instance-Level Information Flow – Process-Level Information Flow

41 Enterprise systems in Procurement Magal and Word ! Essentials of Business Processes and Information Systems | ©

42 Purchase Requisition in SAP Magal and Word ! Essentials of Business Processes and Information Systems | ©

43 Purchase Order in SAP Magal and Word ! Essentials of Business Processes and Information Systems | ©

44 Goods Receipt in SAP Magal and Word ! Essentials of Business Processes and Information Systems | ©

45 Invoice Receipt in SAP Magal and Word ! Essentials of Business Processes and Information Systems | ©

46 Vendor Payment in SAP – Initial Screen Magal and Word ! Essentials of Business Processes and Information Systems | ©

47 Vendor Payment in SAP – Processing Magal and Word ! Essentials of Business Processes and Information Systems | ©

48 Process monitoring (Information flow) Magal and Word | Essentials of Business Processes and Information Systems | © Instance level – status information – Status of a purchase requisition / order (PO history) Process level – aggregate information – How is the process doing?

49 Purchase Requisition History Magal and Word ! Essentials of Business Processes and Information Systems | ©

50 Purchase Order History Magal and Word ! Essentials of Business Processes and Information Systems | ©

51 Process-Level Information Magal and Word ! Essentials of Business Processes and Information Systems | ©

52 Exercise Using Simulated SAP Magal and Word ! Essentials of Business Processes and Information Systems | © The exercises will require you to complete the steps in the procurement process that have been discussed in this chapter. In particular you will: – Create a purchase requisition for a number of trading goods – Convert the requisition to a purchase order – Enter a goods receipt into the system – Enter a vendor invoice into the system – Record a payment to the vendor


Download ppt "Graduate Program in Business Information Systems BIS 581 Business Process Management Lectures 9-10 Aslı Sencer Department of Management Information Systems."

Similar presentations


Ads by Google