Chapter 5 Output: ERP Reports, Data Warehouses and Intranets “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

ERP Input Issues and Tools Value Creating ERP Information Capabilities ERP reporting capabilities ERP query capabilities Data Warehouses Intranets Integrating ERP and Knowledge Management Capabilities “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Value Creating ERP Information Capabilities Information drives the processes “If the information breaks down, we break down” In contrast to classic accounting systems, where in some cases, reports are generated and never used Information is available faster Firms cut end of year closing time from three weeks to four or five days to 6 hours (Cisco)! “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Value Creating ERP Information Capabilities Information is available providing empowerment “Workers can look in the new system and make certain decisions for themselves -- and record them straight from the floor.” Information is integrated Systems are based relational database systems so data can be made made available in an integrated form “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Value Creating ERP Information Capabilities Information is Transparent If you don’t do your job, I can see that something hasn’t been done Accordingly, ERP systems facilitate elimination of asymmetries of information “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

ERP Reporting Capabilities ERP systems have a wide range of standard reporting capabilities. However, use of ERP systems can be hard to use for anyone other than expert users and firms may incur costs as a function of number of “seats.” As a result, firms have pursued other alternatives, such as database queries, data warehouses and intranets “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

ERP Database Query Capabilities Database Queries ERP systems sit on top of a relational database system, so queries can be built to provide report capabilities ERP systems have database query capabilities so that the database can be bypassed “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Downside of Queries In some cases, queries are treated as transactions. However, the more queries that run, the higher the probability that the system will become over loaded. reports are taking a heavy toll on ERP systems everywhere because for the first time hundreds, even thousands of employees are going to ERP’s single, integrated database and pulling out huge piles of data ... This is the number one technology fire that ERP project teams have to put out after the new system goes in. “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

What if reporting and query capabilities are not enough? Intranets Data Warehouses “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Intranets A number of firms, basically differentiate expert and casual user groups, allowing experts to have direct access to ERP systems and casual users intranet access to reports. Can be facilitated through Lotus Notes or Web technology. Typically, reports are updated each day “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Data Warehouses Data warehouses provide a way of facilitating generation of non-standard reports “We needed something that would allow an inventory manager to track inventory without running a report request through the IS department.” Typically on another computer so they don’t put strain on transaction processing systems “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Data Warehouses Data warehouses can serve as a meeting point between ERP and other applications “... the impacts of the (ERP) project were so much greater than expected .... Before the systems had tended to communicate directly with one another (i.e., point to point), a new approach would now be employed in which all data communication would take place via a data warehouse.” “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Integrating Reporting and Knowledge Management As firms have begun to employ database queries, data warehouses and intranets, ERP firms have pushed to maintain control The approach is to integrate knowledge management and some electronic commerce with the ERP systems “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Knowledge Management and ERP -- “Portals” Portals have many definitions, but generally are jumping off points for information and knowledge, aimed at specific users Can make a range of information available, including “discovered” knowledge “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

“Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Electronic Commerce and ERP Some ERP firms see portals as an opportunity to make information about related product information available to users through the portals E.g., mySAP.com has forms that vendors can fill in to make information about them available through the portals “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Chapter 6 Technology Enabled vs. Clean Sheet Reengineering “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

ERP and Reengineering “SAP implementation equals forced reengineering” “it’s rare when you don’t have to do some kind of reengineering” ERP is the “electronic embodiment of reengineering” “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Reengineering Tools and Technologies in 1994 (CSC Index 1994) Tool USA Europe None 41% 36% Process Value Analysis 36 27 Benchmarking 34 36 Competitive Analysis 25 28 Activity-Based Costing 20 17 Other 16 17 Currently, ERP is the dominant tool! “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Technology Enabled (Constrained) Reengineering “Enabled” vs. “Constrained” … Which term? Why? A particular technology (or portfolio of technologies) is chosen as a tool to facilitate reengineering. Thus, reengineering choices are a function of the technologies chosen. The technology drives the reengineering. “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Clean Slate Reengineering Process design starts with a clean slate Also referred to as “starting from scratch” Theoretically, no limits “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Somewhere Between the Two In actuality, there are few projects that are “purely” clean slate or technology enabled More of a spectrum Technology Enabled Clean Slate Most Firms “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Advantages of Technology Enabled ERP provides a tool to facilitate change ERP helps structure complex reengineering efforts Tools help explain and rationalize efforts ERP bounds the design, limiting overload Design is feasible There is Evidence that the design will work Designs likely are cost effective Designs likely can be implemented in a timely manner There is software available “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Advantages of Clean Slate Not constrained by a particular tool Not constrained to a limited set of processes Evolution is not limited by a particular technology Can develop a design that others cannot access There is evidence that firms think they should reengineer and then implement May be the only option “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Which Firm Should Use Which Approach? Depends on Firms Size Available Resources Time Pressure Strategic Gain Uniqueness of solution “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Firms with Deep Pockets Clean slate requires substantial resources In some cases, clean slate will lead to many starts and stops before the “final” design is found “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Firms with Time Clean slate takes longer so only firms that have the time can really do clean slate approaches. “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Firms for which Processes are a Strategic Advantage The more unique a firm in terms of its industry, processes, customers or other factors, the more likely that they see their specific processes as a competitive advantage, and thus use some clean slate approach. “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©

Firms that Seek a Unique Solution Technology enabled approaches are easily copied and diffused Clean slate approaches are not as rapidly or as easily copied. “Enterprise Resource Planning Systems”, D. E. O’Leary, 2000 ©