1. Enterprise Resource Planning & Business Intelligence

2. PART 1: ERP

3. What is ERP? Enterprise Resource Planning
Argued on resource and planning
Agreed upon on enterprise!
Integrate all departments into one system
Highly complex infrastructure
Payback if installed and run correctly
ERP as integrator
Tightly coupled in 90s

4. Improving Business Performance with ERP
Best demonstrates value at order-fulfillment
Value results from complete integration
Have all the necessary information
Automatic routing to other departments
ERP makes efficient, NOT simple!
Every must wake up
A test of accountability, responsibility and communication

5. Improving Business Performance with ERP(Cont’d)
People are resistant to change
ERP is asking for change
Gain value if:
Use ERP to improve processes
No value if:
Just improve the system, not the process
ERP could also slow you down!

6. Fixing Integration Problems With ERP
Hopes in the early 90s
ERP can … and at the same time can not!
Fix integration in a theoretical way
‘Everything is done here’ attitude
Mid and late 90s
Realize that ERP is just a chunk of systems
No anticipated integration from vendors
ERP is what it promises to save you from!
We are seeing gradual change!

7. Fixing Your Business With ERP
Integrate financial information
Different versions of the truth
Integrate customer Order Information
Easier communications, planning, tracking and shipping
Standardize Manufacturing
Increase productivity and decrease headcount
Reduce Inventory
Improves flow and visibility
Standardize Human Resource
Benefits, services, etc

8. Fitting ERP into Your Business
Most packages are comprehensive
But each industry has its uniqueness
If it doesn’t support your needs
1. Change the process to accommodate the software
2. Modify the software to fit your processes
Can send costs out of control faster than any IS investments

9. How Much Does an ERP Cost?
Varies…. Numerous variables play a role
Rule of thumb
6 X cost of licensing
ERP cost stats:
Average cost: 15M
Range: 400 K – 300 M
Average TCO per person: >50K
Payback is modest
8 months waiting time
1.6 M

10. Hidden Costs 1. Training 2. Testing and Integration 3. Customization
Most underestimated
Not just learning the interface
Tip: Double or triple budget
2. Testing and Integration
Add-ons such as SCM
Tip: choose the same vendor
3. Customization
Playing with fire
No vendor support
Tip: Avoid if possible

11. Hidden Costs (Cont’d) 4. Conversion and Analysis 5. People
Messy data
Prepare for data warehousing
5. People
Consultants will lock you in
Consultants will steal your ERP people
6. ROI and Depression
ROI takes time
25% admits drop in performance

12. ERP Failures Because it is a flow of best practices
Need to adopt
Resistance is the start of failures
Install or Not?
How should it be installed?
Modify?
Software or habit?

13. Organizing ERP Project
1. Big Bang Approach
Most ambitious and difficult
Drop legacy… install ERP
2. Franchising Approach
Most common
Multiple instances of ERP
3. Slam Dunk Approach
Grow into your ERP

14. Organizing ERP Project (Cont’d)
Consider single instance if:
Have common business processes
Need to replace older systems
Have multiple instances from one vendor
Consider layering if:
Have Unique processes
Considering other investments (deeper)
Aiming for an easily integrated environment

15. PART 2: Business Intelligence

16. What Is Business Intelligence?
It is a theory
A set of processes
Purpose
To collect and analyze business information
Familiar?
It includes the technology
Used to generate knowledge

17. BI Processes Crucial need for information Recent uses of BI
Could go as far as being the differentiating factor
Information gained internally and externally
Key is to help businesses achieve short-term and long term goals

18. The BI Technology
Used to enhance data into information then into knowledge
Software is used to help make “better” business decisions
A generic concept?
Think CRM, DSS, EIS…
Any software that ease the ways to gather and analyze large quantities of unstructured data

19. What Started BI? The past…
Analogy to the Art of War
Full knowledge of your strength and weaknesses as well as your competitors’
In the past…
Struggle to collect data
Business decisions based on intuition
This is the differentiating factor.. Real Vs Intuition

20. What Started BI (With Automation…)
As businesses automates
Sporadic data
Long time to integrate, clean and analyze
Long term goals are no longer based on intuition
What about short term?

21. What Started BI (Recent devlopment)
With recent development in Enterprise Apps, computing power, EAIs, etc…
Data collection is better and easier
What about data analysis?
So we hear OLAP
Generates ad-hoc reports which analyzes the data
Cross analyze and ‘drillable’ capabilities
Superfast!!!

22. Key Performance Indicator
Metrics used within BI solutions
To quantify objectives and performance
Assess the present state
KPIs are measurable and quantified per something
Ex: Revenue per customer (like CRM) from Rp. 100,000 to Rp. 200,000 by 2008

23. The Typical KPI Either around customers or balances
Profitability, acquired, status, turnovers
Balance
Outstanding, bad debts, delinquencies
Anything quantifiable can be KPI, the point is:
Consistent and correct data
Timely Availability
Time is becoming more of a concern nowadays
For short term decisions

24. OLAP Is online analytical processing
Provide answers to analytical queries
Dimensional in nature
Exists as a configuration in a database!
FASMI – Fast Analysis of shared multidimensional information

25. OLAP Functionalities Takes the source data and create OLAP Cubes
Tremendous speed
.1% than relational
Cubes are premade data sets that aggregates several dimensions
Can get large… therefore only some are aggregated while others calculated on demand!

26. Types of OLAP Multidimensional (MOLAP) Relational (ROLAP)
“Classic” and most typical
Relational (ROLAP)
Works with relational Databases
Hybrid (HOLAP)
Implements both MOLAP and ROLAP
Each has benefits and downfalls
Molap is better for small data
Rolap is more scalable

27. The OLAP Cube Extension of 2 dimensional relationship
Used to analyze “n” dimensions of data
Can analyze from different dimensions
Re-orientation
Slicing enabled
To pinpoint what produced the difference
More than three dimensional
Be careful on further readings
Consistency is main issue
Replace nulls with 0s

28. Understanding the OLAP Cube (The square and the cube)
Start with a typical report
Now you have a square
Let’s add the months
It is a cube
12 excel sheets… analyze that!

29. Understanding the OLAP Cube (N dimensional)
Let’s add customers
N dimensions
Now let’s we can slice
Automatically generated reports
Usually in excel

30. Understanding the OLAP Cube (formulas and hierarchies)
You can even add formulas
Pre-calculated so it is fast
Data becomes redundant
Usually hierarchies are added
For other categories
So user can aggregate per category
Do not visualize
    Total         Writing Materials            Pens            Pencils            Erasers         Storage Media            Diskettes            CD-Rs            CD-RWs 

31. BI Facts (Industry growth)
Growing industry… 12% from 04-05
Gartner: BI is top spending priority with increase of 4.8% in 06
Forrester: 45% of those surveyed plans to buy BI solutions
Cost varies greatly (like CRM)
So does implementation time

32. BI Facts (Costs and ROIs)
Cost is not the main issue
Explains the rush into BI
ROI is positive
Can be as fast as 2 months
Can reach ROI from reports savings in toner, paper and wear and tear.
Solutions vary from 250K, 750K, into millions. Cheaper solutions do exist
Emergence on open source BI solutions
Ventana: “adoption in open source BI is progressing more rapidly than ever understood”

33. Issues on BI Implementation
Lack of user awareness
Make it as easy as possible
Avoid under-utilization
Slow enhancements
Requests are scary, but realize that it is a positive signal!
Vendor dependence (Or IT)
Enable users to generate reports… IT is slow, speed is crucial!

34. Once you have the knowledge… Manage it!
KM is ways to manage, gather and use the knowledge
To improve outcomes and organizational learning!
It is a concept! Technologies are:
Document management, expert systems, intranets and portals, content management, e learning tools, conferencing, collaborative apps, and even blogs and wikis
Anything that produces a platform to gain and share knowledge to achieve goals!