Information Systems in Organizations Running the Business: Enterprise Systems (ERP)

Administrivia Learn IT #2 Mid Term One (µ - 60 / σ – 12)

Where are We?

Build Your Own Study Guide What Is ERP? What Is ERP? What are 3 key points from this reading? What are 3 important details from this reading? Students will be called upon at random

Build Your Own Study Guide Wikipedia: ERP Wikipedia: ERP What are 3 key points from this reading? What are 3 important details from this reading? Students will be called upon at random

Evolution of ERP – MRP (Materials Resource Planning) – what to order – MRPII (Manufacturing Resource Planning) – automate the factory – ERP (Enterprise Resource Planning) – automate everything 70s80s90s00s MRPII MRP ERP

Core Business Processes Four traditional business functions: – Marketing and sales – Supply chain management – Accounting and finance – Human resources Not distinct independent silos, but instead highly interrelated Business processes cross boundaries of business functions.

This is a problem! Why?

We want to shift to this!

What is an ERP system? Business processes that span multiple functional areas Single System Single Database Many modules One copy of data Costs Benefits Risks Integration Partner Executive Support Change SAP, Oracle and Microsoft ?

What is an ERP? Enterprise Resource Plan(ning) – Complete integrated enterprise systems where all modules sit under a single database In principle, it is a once shot system that manages and integrates all technology vital to the organization under a single technology hood.

Why Do Firms Do This? Purpose is to implement best practices! – What is a best practice? Huge Benefits? – Real time data – BI Forecasting – Information Transparency Audit – Strips Waste

How

Remember Swim Lane Diagram? Who does what and when?

Legacy Systems SalesWarehouse Accounting

What kind of non-value added work is created when inventory data or credit data is old? Does your customer view your organization as the “well oiled machine”?

Enterprise System Sales + Warehouse + Accounting How many copies of data do I have? How much better is my decision making with a single copy of all data? How much non-value added work do I eliminate when inventory and credit data are current? How much happier are your customers when they are dealing with the “well oiled machine”?

Exercise On the following slide, identify all of the system interfaces: – What system needs to talk to what other system – One line per data flow

ENTERPRISE SYSTEMS In-Class Activity…

I Googled Break and This Came Up

ERP Challenges Adoption – People HATE change! Configuration is complex – Vanilla vs. Customization Implementation is extremely complex – Mega-failures with ERP implementations in the mid-90s – Many companies went out of business as a result Costs - Training, Learning Switching Internally focused – Need supply chain and customer relationship management too

A note on customization What is the purpose of implementing an ERP? Two answers: – Integrated data – Implementing best practices Why would we ever customize something?

Build Your Own Study Guide Putting the Enterprise into the Enterprise System Putting the Enterprise into the Enterprise System What are 3 key points from this reading? What are 3 important details from this reading? Students will be called upon at random

ERP Benefits A single database providing superior, real- time, data-driven decision making Standardizing business processes based on industry best practices – Force business process reengineering Reduced operating costs – Rohm and Haas saved $200 million/year

Leaders in the ERP Space SAP Oracle Microsoft Dynamics New cloud based ERP providers?

SAP ERPSAP CRMSAP SCM

Build Your Own Study Guide 9 Tips for Selecting and Implementing an ERP System 9 Tips for Selecting and Implementing an ERP System What are 3 key points from this reading? What are 3 important details from this reading? Students will be called upon at random

Making it Happen Executive Sponsor – TMT Buy In Driven by the business, not by IT Requires experts from all of the functional areas Top-tier Integration Partner Training, training, training Testing, testing, testing Don’t cut corners! – It could cost you a fortune – It could cost you your business

P2P EXERCISE – WE ARE NOT GOING TO DO THIS ONE – FEEL FREE TO DO IT ON YOUR OWN In-Class Activity…

Recap Today we talked about ERP – Where did it come from – What are the benefits – What are the risks – How to succeed during implementation – When to customize – When to leave things alone

Exams I think multiple choice exams are a waste – They don’t test your grasp of concepts I have advocated for a change and there is an option. I will poll you next week 1) Continue with the style we have (consistent across all sections) 2) Short answer exam (when I say short I mean short)