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Enterprise Resource Planning (ERP) Systems Chapter Extension 9.

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Presentation on theme: "Enterprise Resource Planning (ERP) Systems Chapter Extension 9."— Presentation transcript:

1 Enterprise Resource Planning (ERP) Systems Chapter Extension 9

2 ce9-2 Study Questions Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Q1: What is the purpose of ERP systems? Q2: What are the elements of an ERP solution? Q3: How are ERP systems implemented? Q4: What types of organizations use ERP? Q5: How do the major ERP vendors compare?

3 ce9-3 Primary purpose: integration of purchasing, human resources, production, sales, and accounting data into a single system. Allows real time global updates whenever a transaction happens. Critical business decisions can be made using latest data. Q1:What Is the Purpose of ERP Systems? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

4 ce9-4 Pre-ERP Information System: Bicycle Manufacturer Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Does not include accountingFive non-integrated databases

5 ce9-5 ERP Information System Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

6 ce9-6 How does sales department determine an order is “large”? By dollars? By volume? Who approves customer credit (and how)? Who approves production capacity (and how)? Who approves schedule and terms (and how)? What actions need to be taken if customer modifies an order? How does management obtain oversight on sales activity? Some Questions Procedures Need to Answer or Resolve Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

7 ce9-7 Sales Dashboard Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

8 ce9-8 ERP Projects Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Few organizations develop their own ERP software Daunting and expensive: –Multi-year projects, millions of dollars, and hundreds of employees, consultants and vendor personnel.  SAP ERP databases contain over 15,000 tables!

9 ce9-9 Q2:What Are the Elements of an ERP Solution? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall ERP Application programs ERP Business process procedures ERP Databases ERP Training and Consulting

10 ce9-10 True ERP Must Integrate: ( Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Supply chain Manufacturing CRM Human resources Accounting

11 ce9-11 ERP Solution Components Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall ERP Application Programs –Configurable vendor applications ERP Databases –Trigger –Stored Procedure

12 ce9-12 ERP Solution Components (Cont’d) Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall ERP Business Processes and Procedures –Adapt to predefined, inherent processes and procedures, or design new ones? ERP Training & Consulting –Training to implement –Top management support, preparing for change, dealing with resistance –Training to use

13 ce9-13 Example of SAP Ordering Business Process Blueprint Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

14 ce9-14 Example of SAP Ordering Business Process Blueprint (cont’d) Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

15 ce9-15 Q3:How Are ERP Systems Implemented? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Major tasks in implementation of an ERP application

16 ce9-16 Model current “as is” processes Identify relevant ERP blueprint processes Compare as-is models with blueprints, note differences Find ways to eliminate differences Prepare detailed plan Train users processes, procedures, ERP features and functions Conduct simulation tests new system Convert to new system Magnitude of ERP Implementation Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall SAP blueprint contains over a thousand process models.

17 ce9-17 Q4:What Types of Organizations Use ERP? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

18 ce9-18 Worldwide consolidation of financial statements on a timely basis Inherent ERP procedures adaptable to many cultures Multiple currencies and languages, manage international transfers of goods in inventories, work with international supply chains ove_globalization_efficiency_of_your_organizationhttp://advice.Cio.Com/puneesh/deploy_erp_to_impr ove_globalization_efficiency_of_your_organization International ERP Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

19 ce9-19 Q5:How Do the Major ERP Vendors Compare? Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

20 ce9-20 ERP Vendor Market Ranking Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Epicore MS DynamicsInforOracleSAP Revenue (2009) $410M+$1.3B~$2B>$2B$11.9B Market Share (2005) 1%4%2%20%42%

21 ce9-21 Top ERP Vendors and Customer Size Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall

22 ce9-22 The Future: ERP in the Cloud Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Oracle and SAP acquiring companies with cloud-based products Cannot plunge into cloud-based solutions without causing considerable organizational turmoil Companies need to move applications to cloud, while providing thin-client and native mobile applications

23 ce9-23 Active Review Copyright © 2014 Pearson Education, Inc. Publishing as Prentice Hall Q1: What is the purpose of ERP systems? Q2: What are the elements of an ERP solution? Q3: How are ERP systems implemented? Q4: What types of organizations use ERP? Q5: How do the major ERP vendors compare?

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