Enterprise resource planning unit 2 ERP solutions and functional modules

Enterprise resource planning unit 2 ERP solutions and functional modules Anna university BA 7301 2017-2018

1. Ba 7301 Enterprise relationship Planning unit 2: erp solutions and functional modules Prepared and presented by, N. Ganesha Pandian, Assistant professor, Madurai School of management. II year III Semester Academic year 2017-2018 1

2. contents Overview of ERP software solutions Small, medium and large enterprise vendor solutions BPR and best business practices Business process management Functional modules

3. ERP software: Build or buy There are basically two ways of building ERP solutions: Make a new software Buy software Option 1: Make [using internal resources] Option 2: Buy Option 3: Make [using External resources]

4. ERP: small, medium and large enterprise vendor solutions SME stands for “small, medium enterprises” Most of the MNCs and big size companies have already implemented ERP solution from on of the top three vendors: SAP, Oracle and Microsoft Enterprise software beneficial to large- and mid- sized companies in a wide range of environment from manufacturing to distribution and engineering and service

5. Small sized were not ready to invest a large amount for buying software The other solid reason for ERP vendor to move in the direction of SMEs; millennium decade is the decade when Generation X are reaching their late 30’s and early 40’s leading towards becoming entrepreneur's while Generation Y phasing in and having the need to work independently leading to initiate their own business

6. ERP systems implementation barriers for sme’s Costs Time People (resources) User trainings and system friendliness Business process management IT department and IT infrastructure

7. Business process re-engineering BPR (Business Process Reengineering) not just change – but dramatic change and dramatic improvements. To achieve the overhaul of organizational structures, management systems, job description, performance measurements, skills development, and training were it should be used by the information technology.

8. Phases of BPR According to Peter F. Drucker “Reengineering is new, and it has to be done.”  Begin organizational change Building the reengineering organization Identifying BPR opportunities Understanding the existing process Reengineering the process Blueprint the new business system Perform the transformation

9. Business Engineering and best business practice Business process – sustainable benefits overtime improve business performance. In Finance Support each organization’s unique environment and requirement. Distil lengthy, complex, multi-step process into fewest number of steps. o Consistently handles all document types (electronic paper, fax) Automate the streamline new processes

10. ERP has changed the nature of IS Function and IT professionals Job of the information system function primarily one of designing, developing, and implementing software. Now design and development function are outsourced ERP has changed the nature of jobs in functional areas such as Manufacturing. Estimates – hardware, software, professional services and internal staffs for full implementation and two years of post-implementation support.

11. Best process in the Manufacturing Sectors ERP systems have become more affordable, effective and -- to a significant degree -- essential, but manufacturers need to pause before joining the headlong rush toward implementation. Companies that do not ready themselves before implementing ERP find it nearly impossible to fully utilize their new systems, and risk upsetting their organizational culture with chaotic implementation phases.

12. Contd… We will see the manufacturers, regardless of their specialty, can prepare for ERP adoption by benchmarking the organization against peers and then removing all non-value-adding activities from the supply chain. To establish best business practices before adopting ERP, process manufacturers first need to develop a comparison between their organizations and their peer group through benchmarking.

13. Business Process Management A business process is the set of activities required to accomplish a common goal. The activities may be performed by people or systems and are completed either sequentially or in simultaneously

14. Types of Business Processes Complexity Duration Volume Industry Department

15. The Process Lifecycle

16. The BPM life cycle Process design System configuration Process enactment Diagnosis

17. Overview of ERP modules There are many ERP modules in ERP software solution. Each ERP software module corresponds to a major functional area of an organization. Generally it includes, modules for material purchasing, inventory control, product planning, product distribution, tracking the order, financial ERP module, accounting, marketing, and human resource.

18. Financial Module Pay checks Checks for vendors Customer invoice Purchase orders Stock reports And other regular forms and reports

19. Contd… Modules are General Ledger Fixed assets Sales order processing Accounts receivable Accounts payable Inventory control Purchase order processing Payroll

20. Marketing Module Main goal of the marketing function in any organization is to satisfy the needs and wants of its customer. Marketing personnel engage in activities such as planning and developing new services, advertising, promoting, selling, storing and distributing the goods and services; providing financing and credit to customer; and conducting market research.

21. Modules in Marketing Micromarketing and data warehouse system Telecommunication Direct mail advertising system Point of Sales (POS) Delivery Tracking and Routing system Electronic shopping and Advertising

22. Contd… Virtual Shopping Electronic Kiosks Internet advertising Sales Force automation system Prospect Information system Contact Management System Other Sales Force Automation System

23. Manufacturing (Production)Module Production information system support decision making for the operations allocation, and planning of production resources. Operational production system – continuous flow production, job order production, project production.

24. Modules in manufacturing Purchasing system Receiving system Quality Control System. Shipping system Cost Accounting system Inventory Control System. Automated material handling systems. Computer Aided Design and Manufacturing system Image Management systems Material Selection system Shop floor scheduling system Mass Customization and Agile manufacturing system

25. Human Resource Module Human resource department are responsible for many factors to human resource management industry recruiting, assessment, selection, placement, training, performance appraisal, compensation and benefits management promotion, termination, occupational health, safety, employee services, compliance with legal constraints, helping managers with human resource problems and providing top management with information for strategic planning.

26. Contd… HRIS – includes system that help managers keep track of the organization ‘s position and employees, conduct performance evaluation, provide alternative or flexible scheduling, recruit new employees, place employees, train employees, reduce employees, terminate employees, provide employees benefits and provide reports to government agencies.

27. Modules in Hr Position Control System Employee Information System Performance management system Government Reporting System Applicant Selection and Placement System Training System

28. SALES AND DISTRIBUTION Increased efficiency in sales and distribution is a key factor to ensure that companies retain a competitive edge and improve both profit margins and customer service. In helping business to ‘beat them on delivery’, the sales and distribution module of many ERP vendors offer a comprehensive set of best-of breed components for both order and logistics management.

29. Modules in sales and distribution Sales queries, such as inquiries and quotations. Sales orders Outline agreements, such as contracts and scheduling agreements Delivery/ shipment Invoicing/Billing After sales support.

30. Contd… During sales order processing, the following basic functions are carried out: Inquiry handling Quotation preparation and processing Contracts and contact management (order management). Monitoring the sales transaction Checking the availability

31. Contd… Transferring requirements to material planning (MRP). Scheduling the delivery Calculating the pricing and taxes Checking credit limits Invoicing / Billing Creating, printed or electronically transmitted document.

32. Typically, a Sales and Distribution module will contain the following subsystem: Master Data Management Order Management Warehouse Management Shipping Billing Pricing Sales Support Transportation Foreign Trade

33. Quality Management Quality management refers to the set of actions taken by an organization to ensure that it creates and delivers high-quality products. In order to do so, organizations must comply with national and international rules and regulations related to product quality, but they often also create and use internal requirements for quality control.

34. Contd… Inventory Quality Management Production Quality Management CAQ and CIQ Quality Management Module-Functions Computer-integrated Quality Management (CIQ)

35. Plant Maintenance Module Plant maintenance provides technical and business reports and various presentation options, Ex – Organizational unit, location, execution period for the task or system or manufacturing.

36. Contd… The major subsystems of a plant Maintenance module are: Preventive Maintenance Control Equipment Tracking Component Tracking Plant Maintenance Calibration Tracking Plant Maintenance Warranty Claims Tracking

37. Materials Management Module The Material Management module optimizes all purchasing processes with workflow-driven processing functions, enables automated supplier evaluations, lower procurement and warehousing costs with accurate inventory and warehouse management and integrates invoice verification.

38. Contd… The main modules of the Material Management module are: Pre-purchasing Activities Purchasing Vendor Evaluation Inventory Management Invoice Verification and Material Inspection.

39. The end of chapter