1. Introduction to ERP

2. History of organizational systems
Calculation systems
Functional systems
Integrated systems

3. Calculation systems 1950-80 Single purpose
Eliminate tedious human work
Examples: Payroll, General ledger, Inventory
Technology used: Mainframes, magnetic tapes, batch processing

4. A System/370 Model 145 (1970’s)

5. Printer
800 lines/minute with 48 character train, 136 columns with 6 or 8 lines per inch spacing

6. Functional systems 1975-20?? Use computers to improve operations
Applications: Human resources, order entry, manufacturing resource planning
Technologies: Mainframes, PC’s, LAN’s

7. Minicomputer

8. Functional systems Typically contained within a department
Islands of automation
Applications independently developed and deployed
Driving force: availability of mini-computers

9. Functional system applications
Human resources System
Accounting and finance systems
Sales and marketing System
Operations management System
Manufacturing Systems

10. Human Resources Recruiting Compensation Assessment
Development and Training
Planning

12. Accounting and Finance
General Ledger
Financial Reporting
Costing
Budgeting
Accounts Payable
Accounts receivables

14. Sales and Marketing Lead tracking Sales forecasting
Customer management

16. Operations
Order management
Inventory management
Customer service

18. Manufacturing
Inventory
Planning

20. Types of Organizational information Systems
Administrative systems
Scheduling / Transaction systems
Value oriented systems
Reporting and controlling systems
Analysis and information systems
Planning and decision support systems
(From Business Process Engineering by A.W. Scheer)

22. Problems with function based application
Sharing of data between systems
Data duplication
Data inconsistency
Applications that don’t talk to one another
Limited or lack of integrated information
Isolated decisions lead to overall inefficiencies
Increased expenses

23. Solution to disparate systems?
Integration
Consolidation
Right-sizing
Business Process Redesign
Enterprise wide system

24. Integrated systems or Enterprise Resource Planning System

25. ERP - Definition
ERP is a process of managing all resources and their use in the entire enterprise in a coordinated manner

26. ERP system: Definition
ERP is a set of integrated business applications, or modules which carry out common business functions such as general ledger, accounting, or order management

27. What is ERP? Enterprise Resource Planning
Support business through optimizing, maintaining, and tracking business functions
Broken down into business processes
HRM
Distribution
Financials
Manufacturing

28. What makes ERP different
Integrated modules
Common definitions
Common database
Update one module, automatically updates others
ERP systems reflect a specific way of doing business
Must look at your value chains, rather than functions

29. Benefits of ERP Common set of data
Help in integrating applications for decision making and planning
Allow departments to talk to each other
Easy to integrate by using processed built into ERP software
A way to force BPR (reengineering)
Easy way to solve Y2K problem

30. Vendors

31. Difficulty in implementation
Very difficult
Extremely costly and time intensive
Typical: over $10,000,000 and over a year to implement
Company may implement only certain modules of entire ERP system
You will need an outside consultant

32. Common Pitfalls Do not adequately benchmark current state
Did not plan for major transformation
Did not have executive sponsorship
Did not adequately map out goals and objectives
Highly customized systems to look like old MRP systems

33. Survey of ERP implementations
Done by ittoolbox.com in 2004

34. Overview 375 IT and business professionals
52% anticipate budget increases for new ERP implementations/new modules
SAP and PeopleSoft/J.D. Edwards were cited as the most popular ERP packages
46% indicated that the main challenge to successful ERP implementations was inadequate definition of requirements and resistance to change

35. How would you characterize your budget for new ERP implementations/new modules deployments for 2004 compared to your budget in 2003?

36. Who is directly responsible for determining your ERP implementations/new modules deployments?

37. Who are the other key decision-makers/influencers in decisions to add new ERP packages/new modules?

38. Do you currently have an ERP package?