Enterprise Resource Planning systems
ENTERPRISE RESOURCE PLANNING SYSTEMS
The organization of work is divided into 7 parts where each part includes some sub-questions:
The first introductory part contains two questions where the first questions contain the scope and objectives of the work, and second question contains a general description of ERP systems.
The second part includes a short description and characteristics of each of these systems (MRP - MRPII - ERP), and how MRP evolved to become MRPII, and then to ERP existing today.
The third part contains a short description of the companies which I made a case study.
The fourth part says how to select a suitable ERP system, and phases of implementation of ERP systems.
The fifth part outlines some examples of companies that are downsizing their products and some differences in functions between the small and big ERP systems. Also contains some examples of where ERP is used outside manufacturing.
The sixth part contains a summary of the current major ERP software vendors on the market.
The seventh part has to do with an overall conclusion of the assignment.
ERP, implementation, Benefits
Severe market competition has radically changed the business environment as a result companies need to reduce total costs, maximize return on investment, shorten lead times, and be more responsive to customer demands. Highly dynamic markets express their need for effective enterprise information systems to improve competitive advantage. Enterprise resource planning (ERP) is more and more important in modern business because of its ability to integrate the flow of material, finance, and information about supporting organizational strategies.
1.1 Objectives and scopes of the work, background.
The aim of this work is to learn how ERP systems took effect by early adopters in the industry and how they have been evolved. Also we learn about the level of technical knowledge on the ERP systems, because we learn about their technology, and application in industry and business. Finally, we get informed about the largest ERP suppliers on the market today and how much the implementation of such systems cost.
1.2 General description and historical and statistical data
The acronym ERP which mean information systems of company resources management. An ERP is a set of software applications that can monitor the central and remote facilities of an enterprise. These integrated information systems attempt to automate business processes related to economic, management of supply chain, manufacturing and electronic commerce. So this enables the integration of all applications of a company seeking to improve operating procedures designed to increase productivity and save operational funds.
To ERP is a composition by integrated software applications through a database linking procedures cases enterprise in a technological infrastructure of a system consisting of:
1.Synchrones architects client / server
3.Grafiki User communications - system
Businesses have a wide scope of applications and processes throughout their functional units; producing ERP software systems that are typically complex and usually impose significant changes on staff work practices. Implementing ERP software is typically too complex for "in-house" skill, so it is desirable and highly advised to hire outside consultants who are professionally trained to implement these systems. This is typically the most cost effective way. There are three types of services that may be employed for - Consulting, Customization, Support. The length of time to implement an ERP system depends on the size of the business, the number of modules, the extent of customization, and the scope of the change and the willingness of the customer to take ownership for the project. ERP systems are modular, so they don't all need be implemented at once. It can be divided into various stages, or phase-ins. The typical project is about 14 months and requires around 150 consultants. A small project (e.g., a company of less than 100 staff) can be planned and delivered within 3-9 months; however, a large, multi-site or multi-country implementation can take years. The length of the implementations is closely tied to the amount of customization desired.
To implement ERP systems, companies often seek the help of an ERP vendor or of third-party consulting companies. These firms typically provide three areas of professional services: consulting; customization; and support. The client organization can also employ independent program management, business analysis, change management, and UAT specialists to ensure their business requirements remain a priority during implementation
Data migration is one of the most important activities in determining the success of an ERP implementation. Since many decisions must be made before migration, a significant amount of planning must occur. Unfortunately, data migration is the last activity before the production phase of an ERP implementation, and therefore receives minimal attention due to time constraints. The following are steps of a data migration strategy that can help with the success of an ERP implementation:
1. Identifying the data to be migrated
2. Determining the timing of data migration
3. Generating the data templates
4. Freezing the tools for data migration
5. Deciding on migration related setups
6. Deciding on data archiving
Historical Data of ERP
1960s Enterprise Resource Planning (ERP) is born in the early 1960s from a joint effort between J.I. Case, the manufacturer of tractors and other construction machinery, and partner IBM. Material Requirements Planning or MRP is the initial effort. This application software serves as the method for planning and scheduling materials for complex manufactured products.
1970s Initial MRP solutions are big, clumsy and expensive. They require a large technical staff to support the mainframe computers on which they run.
1972 Five engineers in Mannheim, Germany begin the company, SAP (Systemanalyse und Programmentwicklung). The purpose in creating SAP is to produce and market standard software for integrated business solutions.1975 Richard Lawson, Bill Lawson, and business partner, John Cerullo begin Lawson Software. The founders see the need for pre-packaged enterprise technology solutions as an alternative to customized business software applications.1976 In the manufacturing industry, MRP (Material Requirements Planning) becomes the fundamental concept used in production management and control.
1977 Jack Thompson, Dan Gregory, and Ed McVaney form JD Edwards. Each founder takes part of their name to create the company moniker. Larry Ellison begins Oracle Corporation.
1978 Jan Baan begins The Baan Corporation to provide financial and administrative consulting services.
1979 Oracle offers the first commercial SQL relational database management system.
1980 JD Edwards begins focusing on the IBM System/38 in the early 1980s. MRP (Manufacturing Resources Planning) evolves into MRP-II as a more accessible extension to shop floor and distribution management activities.
1981 Baan begins to use Unix as their main operating system.
1982 Baan delivers its first software product. JD Edwards focuses on the IBM System/38.
1983 Oracle offers both a VAX mode database as well as a database written entirely in C (for portability).
1984 Baan shifts the focus of their development to manufacturing.
1985 JD Edwards is recognized as an industry-leading supplier of applications software for the highly successful IBM AS/400 computer, a direct descendant of the System/38.
1987 PeopleSoft is founded by Dave Duffield and Ken Morris in 1987.
1988 PeopleSoft's Human Resource Management System (HRMS) is developed.
1990 Baan software is rolled out to 35 countries through indirect sales channels. The term ERP (Enterprise Resource Planning) is coined in the early 1990's when MRP-II is extended to cover areas like Engineering, Finance, Human Resources, and Project Management.
1991 PeopleSoft sets up offices in Canada. This leads the way to their presence in Europe, Asia, Africa, Central and South America, and the Pacific Rim.
1995 Baan grows to more than 1,800 customers worldwide and over 1,000 employees.
1999 JD Edwards has more than 4,700 customers with sites in over 100 countries. Oracle has 41,000 customers worldwide (16,000 U.S.). PeopleSoft software is used by more than 50 percent of the human resources market. SAP is the world's largest inter-enterprise software company and the world's fourth largest independent software supplier overall. SAP employs over 20,500 people in more than 50 countries. To date, have been implemented at approximately 4,800 sites around the world.
2001 - 9/11 occurs creating a drop in demand for new ERP systems
2002 Most ERP systems are enhancing their products to become “Internet Enabled” so that customers worldwide can have direct access to the supplier's ERP system.
2004 - Services Oriented Architecture (SOA) becomes a standard that ERP vendors work towards. This software architecture allows different systems to communicate between one another.
The sales increase of ERP shows its acceptability .In 1989 total sales for MRPII was 1.2 billion dollars and represented one third of total software sales in USA.Oi global sales for the 10 leading provider of ERP was 2.8 billion 1995, 4.2 billion in 1996 and 5.8 billion in 1997.Only SAP sold 3.3 billion in 1997. (See Figures 1 and 2)
Source: George Ioannou , INTEGRATED MANAGEMENT OF OPERATING RESOURCES , STAMOULI S.A
The horizontal line of the chart i have dates from 1991until 1999.
Source: George Ioannou , INTEGRATED MANAGEMENT OF OPERATING RESOURCES , STAMOULI S.A
The horizontal line of the chart i have dates from 1991until 1999
2.1 Short description and Characteristics of each of these systems.
Material Requirements Planning (MRP) is a software based production planning and inventory control system used to manage manufacturing processes. Although it is not common now-a-days, it is possible to conduct MRP by hand as well.
The MRP is a system close loop that focuses on two dimensions of production control the quantities and synchronizes. To system must determine the appropriate quantities of production of all components of the end products sold in ingredients used to synthesize the final product, up the raw materials must acquire the production. Have to determine the timing of production to the required delivery date.
Two basic characteristics of MRP:
1. MRP derives demand for components, subassemblies, materials, etc., from demand for and production schedules of parent items.
2. MRP offsets replenishment orders (purchase orders or production schedules) relative to the date when replenishment is needed.
Information Needed for MRP
Information Obtained from MRP
* Demand for all products.
* Lead times for all finished goods, components, parts and raw materials
* Lot sizing policies for all parts
* Opening inventory levels
* Safety stock requirements
* Any orders previouslyplaced
* Planned orders: replenishment orders to be released at a future time
* Order release notice: notices to release planned orders
* Action notices: notices to expedite, de-expedite, or cancel orders, or to change order quantities or due dates
* Priority reports: information regarding which orders should be given priority
* Inventory status information
* Performance reports such as inactive items, actual lead times, late orders, etc.
1. Master Production Schedule
2. Product Structure
3. Ιinventory Levels
1. Purchasing Requirements
2. Transfer Requirements
3. Production Requirements
A simple sketch of an MRP system is shown in figure: Source: www.npteliitm.ac.in
Manufacturing Resource Planning (MRP II) is defined by APICS as a method for the effective planning of all resources of a manufacturing company. Ideally, it addresses operational planning in units, financial planning in dollars, and has a simulation capability to answer "what-if" questions and extension of closed-loop.
This is not exclusively a software function, but a marriage of people skills, dedication to data base accuracy, and computer resources. It is a total company management concept for using human resources more productively.
The characteristics of the MRPII system is that you can run and other functions such as: demand management, forecasting, planning capacity, the main plan of production, management and capacity requirements of integrated production control at all stages.
Enterprise Resource Planning (ERP) is an industry term for the broad set of activities that helps a business manages the grave parts of its business. The information made available an ERP system provides visibility for key performance indicators (KPIs) required for meeting corporate objectives. ERP software functions can be used to manage product planning, parts purchasing, inventories, interacting with suppliers, providing customer service, and tracking orders. ERP can contain application modules for the finance and human resources aspects of a business. Typically, an ERP system uses or is integrated with a relational database system.
The characteristics of the ERP are:
- Seamless Integrate the major of business's process
- Process the majority of an organization's transactions.
- Use a data warehouse.
- Allow access to data in “real time”.
- Integrated transaction processing and planning activities.
- Financial information is often generated automatically by ERP systems based on the data previously entered, without further human instruction.
- It is difficult to make changes after an ERP system has been implemented.
- ERP requires business process reengineering as a precursor to its introduction because ERP systems are centre round world best exercise business rules.
- Before starting implementation, the phase of GAP analysis must be completed to reduce the cost of Implementation.
- An ERP system should be flexible to respond to the changing needs of an organization.
- ERP system has to have open system architecture. This means that any module can be interfaced or detached whenever required without affecting the other modules.
- It should be support hardware platforms for the companies having heterogeneous collection of system. It have to support some third party add-ons also.
- It must have collection of the best business processes applicable world-wide.
- Last but not list, it must simulate the reality of business processes on the computers. In no way it should have the control beyond the business processes and it must be able to assign accountabilities to the users controlling the system.
2.2 Evolution MRP - MRPII - ERP today.
The production systems in the 1960s gave attention to stock control, so the firms have been able to keep high stock levels to satisfy all customers and be compentitive.In 1970 firms were unable to hold large stocks, so this led the companies the development of the system for estimating the material requirements which called MRP while this system has helped companies plan production, it had some major drawbacks such as:
* The problem with MRP systems is the integrity of the data. If there are any errors in the inventory data, the bill of materials (commonly referred to as 'BOM') data, or the master production schedule, then the outputted data will also be incorrect. Most vendors of this type of system recommend at least 99% data integrity for the system to give useful results.
* Another problem with MRP systems is the requirement that the user specify how long it will take a factory to make a product from its component parts (assuming they are all available). Additionally, the system design also assumes that this "lead time" in manufacturing will be the same each time the item is made, without regard to quantity being made, or other items being made simultaneously in the factory.
* A manufacturer may have factories in different cities or countries. It is no good for an MRP system to say that we do not need to order some material because we have plenty thousands of miles away. The overall ERP system needs to be able to organize inventory and needs by individual factory, and intercommunicate needs in order to enable each factory to redistribute components in order to serve the overall enterprise.
So this led in 1980 due to increase use of computers which allowed the development functions that were linked to economics activities companies, so created in 1980 a new information system which called MRPII (Manufacturing Resource Planning) which combine the management of materials financial management.
Transition from MRPII to ERP happened during 1980-90. The basic MRP II system design was suffering from a few inherent drawbacks such as limited focus to manufacturing activities, assumption of the mass or repetitive production set ups, and poor budgetary and costing controls.
The shortcomings of MRP II and the need to integrate new techniques led to the development of a total integrated solution called ERP, which attempts to integrate the transactions of the organization to produce the best possible plan. Today we see further development in the ERP concept and evolution web-based ERP.
CHAPTER 3: ERP EMPLEMENTATION.CASE STUDY 1-CASE STUDY 2
CASE STUDY 1
Syngenta Hellas is a multinational company which was founded in 1992 and headquartered in Switzerland and employs 19,000 employees' word. In GREECE created in 2000 and employs 48 workers, the factory located in Oinofyta.
1. Products and services: Pharmaceuticals products
2. Revenue: Euro 4,126,933
3. Web site:WWW.SYNGENTA.COM
4. Implementation partner: SAP
The system and the computer based procedures are currently used in SYNGENTA HELLAS have been analyzed. The most of these procedures are very helpful and effective combination of ACCESS and EXCEL programming in order to organize the departments' work and produce the require reports.
Although it is well understood the big number of problems can be occurred since these applications are not integrated with other systems. This means that most of data originating from other systems must be manually get updated. This problem occurs between different systems as well.
Also, the existing system is characterized by a significant number of errors and problems. The systems reliability is poorly and there is a high probability of a corruption fault. Moreover the system does not include fault tolerance facilities which would allow the system to remain operational after a system fault or possible corruption.
Finally, if the company will continue to operate under the existing system, the data flow will remain depended on applications which can be only controlled and operated by their creator.
All these can be summarized in the following points:
· We need the flexibility
· Major gaps in functionality
* Gap in operations and information cycles
· Low system reliability
This phase consists of two steps. In the first step, a project team was formed. It consisted of top managers or decision makers, executive managers, stockholders, functional experts, users or their representatives. The project team then had to model business processes and reengineer them as much as possible.
During the processes analysis period, the functional characteristics of required ERP software are recognized to some extent. In the second step, as much information about ERP vendors and systems as possible were gathered from all possible sources including the internet, magazines, exhibitions and so on. Initial requirements of the desired system were submitted to the vendors' representatives and they were requested to respond to related questions included in questionnaires or checklists.
After receiving their responses, the clearly unqualified vendors were eliminated based on the responses. Therefore the project team after a detailed examination some ERP vendor took the decision that SAP platform is better solution for the company, it can very expensive solution but it was very ratability.
Interrogation all business units and functions, where the key users of each unit together with the responsible consultant, analyse and document all working scenarios in detail and finally propose the parameterisation and functionality of the system to be implemented. The problems that occurred in this stage were:
* The key users used to refer to the common daily practice and forgot to refer exceptions that occurred once or twice per year, as a result the full parameterisation of the system be prevented.
* The proposed system functionality, as was presented by the consultant, was hard to understand by the key users because of their lack of basic knowledge of software engineering practices.
At this phase the documented blueprints were converted into software implementation and each scenario was tested separately to the key user and the consultant. The problem in this phase was again the crosschecking in cooperation between different business areas.
In this phase a sample of data had loaded to the system in order to check the interoperability of the functions and the working scenarios thoroughly. The main problem of this phase was the time span allocate, as it was not possible to arrange a complete set of data, as demanded by SAP functionality. In order for an integration test to be successful and checked in detail, the users should dedicate at least a two month period checking the system compared to their working requirements. This phase was very important because it allows modification before final operation of the system.
The final phase of data migration involves raw data preparation, check and validation, uploading and final verification. This is the most difficult part of the implementation especially when a company has a lot of raw materials, customers and vendors. Because SAP implementation has the ability to organize any data under various hierarchies and groupings.
* Planning: Production orders are processed faster, resulting in better control for the work-in-process inventories
* Communication: Efficient Communication between the difference departments of company, so we have accurate transmission data.
· Improved Customer Service: The great degree of integration has as a result the better synchronization amongst forecasting, production planning and logistics/inventory planning. This sequentially, has led to better customer service and to a smaller amount of lost sales, while sales people are now focussed on selling products rather than apologising for company insufficiencies.
· Strategic Decisions
CASE STUDY 2
AS(automation systems) is a small constructive company, which founded in 1996 and is located in Thessalonikh.The company employs 15 employees from who 10 are Automation Engineers. The Automation Systems is the first company which implemented in Greece a full-automated production control system in the dairy industry, with a surprising low cost and it keeps on offering new technologies.
Revenue: 2.097.189, 39 for the year 2008
The problems which constrained the company to put an ERP were:
The first problem was the use of various software packages and documents that led to less effective and time-consuming processes. The data were introduced to several applications with the danger of finally loosing the information. The accounting application in use since 1996, failed in integrating the cost, profit, and revenue information needed from a growing company. The flow of information between the departments was really poor.
There was a high administrative cost concerning issuing results which lack in accuracy. The usage of older programs was not particularly far from the handwritten registration process of a corporate transaction. In addition, the means of storage of that program was less safe. i.e. float discs. Afterwards, it is extremely important that that program was not functional as the keyboard was necessary for conducting many commands and thus, applications, whereas the mouse pad was not used.
From the above problems, the company started to do market research for the establishment of new ERP systems for cost accounting management, having visited many IT companies, finally selecting momentum ERP software which established was company Logismos Information Systems.
BENEFITS FROM ERP IMPEMENTATION
In terms of operations, ERP made us re-organize many processes and aim in finding the best possible. Moreover, the majority of processes were integrated. There was a great improvement in the quality of the financial information as well. Financial planning became a much effortless procedure, having all the necessary information from all the departments in a common base. The flow of the information between the departments became much easier and more efficient.
1) better assessment of the stock of the Company
2) calculation of cost of sales accurately
3) better pricing
4) calculation of gross profit per item
5) calculation of traffic flow reserve
6) look like, your options appear in the form of a list of options, with easy to use and operator friendly environment.
7) Reports modulated by the operator and create shortcuts
8) bridges data exchange with other programs for further processing. e.g. excel
The information about case study 2 obtained by account manager of the company.
CHAPTER 4: ERP SELECTION AND IMPLEMENTATION
4.1 How to select a suitable ERP system:
According to the studies by both companies and any other information the installation of information system bear many changes in the function of company. So the selections a suitable information system which cover the needs of businesses and improves the efficiency of the company is a basic process.
I believe that the first basic step to select a information system and according to information from the study of companies is that any company that wants to install an information system makes an open competition where ERP software vendors send their tenders.
Should be research by the company how far they satisfy all their functions across the system?
Research how far the system can correspond in various trade activities.
Research now far the system have the ability to adapter the characteristics of company.
Research how far the investment is optimized.
In retrospect the above the crucial factors for the selection of an ERP system are:
Careful selection of software that correspond future needs of business. Designing a supplier which includes some procedures such us: To obtain lists of potential vendors:
• use internet searches
• contact your accountant
• contact colleagues
• contact consultants
• contact industry associations
• look at trade journals for articles and advertisements
• attend trade shows
Find a good reseller
The reseller or Value Added Reseller (VAR)/implementer can make a big difference. Often, companies selecting new systems spend a lot of time analyzing the product and the vendor but not enough time analyzing the capabilities of the VAR.
You will be amazed at how much you learn and how little some of the vendors know their customers. Have a checklist of questions to ask so that you don't forget anything. See below for a more detailed discussion on reference checking. Tell the reference a little about yourself before asking any questions so that they have a level of comfort with you.
Know the Total Cost of Ownership (TCO)
You need to understand all the costs including license fees, implementation, support, hardware, networks and communications before making a decision.
Rich end to end Functionality:
Select an ERP solution which covers almost all the major requirement of companies in one single solution, i.e. Financial Management, Sales/Marketing, customer relationship management, Purchase order Management, Trade & Logistics, Inventory Management, Production Planning & Control, Human Resource Management and MIS System for Promoters, Directors, Senior Management, and Head of the Departments.
Adaptable & Customizable:
Select an ERP which should always be Adaptable and Easily Customizable, which helps organization to
Select an ERP on which your company can work locally as well as globally, which means it should be able to meet not only all statutory and Local regulatory requirements , wherever it is being used, but should be able to handle multiple languages, multiple currency scenarios too. It should also allow intercompany postings, consolidate reporting, automatic currency conversion, and should be easily deployable with international scope.
Select an ERP Solution which should be Easy to use, easy to Implement and easy to maintain.
4.2 Phases of Implementation.
Initially the installation and life cycle of a system ERP different not only in implementation but the level of company. So it is important for workers and suppliers and those involved in the project to get a complete picture of the implementation of any system. There are sundries stages of ERP implementation system which are:
1. Pre evaluation Screening
Once the company has decided to install the ERP system, the search for the package must start as there are hundreds of packages it is always better to do a thorough and detailed evaluation of a small number of packages, than doing analysis of dozens of packages. This stage will be useful in eliminating those packages that are not suitable for the business process.
2. Evaluation Package
This stage is considered an important phases of the ERP implementation, as the package that one choice will decide the success or failure of the project. Implementation of an ERP involves huge investments and it is not easy to switch between different packages, so the right thing is ‘do it right the first time'. Once the packages to be evaluated are identified, the company needs to develop selection criteria that permit the evaluation of all the available packages on the same scale.
3. Project Planning
This is the phase that designs the implementation process. It is in this phase that the details of how to go about the implementation are decided. Time schedules deadlines, etc for the project are arrived at. The plan is developed, roles are identified and responsibilities are assigned. It will also decide when to begin the project, how to do it and it completion.
4. GAP analysis
This is considered the most pivotal phase for the success of ERP implementation. This is the process through which the companies create a complete model of where they are now, and in which direction will they opt in the future. It has been estimated that even the best packages will only meet 80% of the company's requirements. The remaining 20% presents problematic subjects for the company's reengineering.
It is in this phase that human factors are taken into consideration. While every implementation is going to involve a significant change in number of employees and their job responsibilities, as the process becomes more automated and efficient, it is best to treat ERP as an investment as well as cost cutting measure.
6. Team training
Training is also an important phase in the implementation, which takes place along with the process of implementation. This is the phase where the company trains its employees to implement and later, run the system.So it is vital for the company to choose the right employee who has the right attitude people who are promt to change, learn new things.
This is the phase where one tries to break the system. One has reached a point where the company is testing the real case scenarios. The system is configured and now you must come up with extreme cases like system overloads, multiple users logging on at the same time, users entering invalid data, hackers trying to access restricted areas and so on.
8. Post implementation
One the implementation is over, the vendor and the hired consultants will go. To reap the fruit of the implementation it is very important that the system has big acceptance. There should be enough employees who are trained to handle problems those crops up time to time. The system must be updated with the change in technology. The post implementation will need a different set of roles and skills than those with less integrated kind of systems.
CHAPTER 5: ERP SUITABILITY
5.1 Many ERPs software vendors are downsizing their products:
The ERP software companies in order to make their product more flexible and user-friendly care of that consist of subsystems, so that each company can install any application need.
Suppliers aimed to downsizing their products to attract small companies that need small ERPs to improve their operation.
Some Subsystems which create the ERP software vendors are:
* Sales, Purchasing and Transportation Management
* Financial Management
· Fixed Assets Management
· Project Management
· Inventory Management
· Human Resource Management
The differences in functions of a small inDynamics by Industry and Business Sizeformation system than a larger system are that:
* The small ERP system has fewer maintenance costs.
* Also is more flexible the operation and use.
* The employees need little time education to learn a small ERP system, so it is more economical for the company.
5.2 ERP s FOR MANUFACTURING AND SERVICES
Today the ERP software is used outside manufacturing such us:
* Software Industry
I will mention a few examples of whether the use ERP software has helped the Hospitality and Software Industry:
How ERPs helped Hospitality?
Hospitality industry is an extremely competitive area. Hospital companies that experience ERP failure needs to analyze the reasons properly. It is important to have an extra edge and constantly , update in order to thrive in the Industry. ERP has gone a long way in helping this industry to give the impetus for better functioning.
Even though there were facilities like intercom telephone and computer reservation in hotels and travel agency respectively their operations were eased with the intervention of enterprise resource planning. This tool helped them to get the needed information at the right time and at the right place. Flowchart and ERP have a close resemblance.
The added advantage of enterprise resource planning is that they enabled individual departments to take the required actions independently. Even if they had to consult some other department it was not necessary as the information were available by a click of mouse. This differentiates it from the companies that experience ERP failure.
Helps to obtain concrete and constant information
Prior to the intervention of ERP there was lot of confusions among departments in a hotel when it came to final billing. The ultimate beneficiary was the customer in the case of wrong billing. Since ERP helped to maintain a common database these troubles have been removed.
Helps to decide rewards and performances
ERP has been instrumental in analyzing the contribution of a particular department or enterprise. Prior to ERP it was very difficult to make assessments on the basis of performance.
ERP has helped the hoteliers and tourist agents to know individual or organizational contribution by referring the particular parameter in the functional database.
How ERP helps in Software sector?
Enterprise resource planning is software that helps in the day to day functioning of the software industry. ERP's function and benefits have a lot of significance as far as this sector is considered. In one sense it is very easy for the Software industry to make use of the application as they are purely IT oriented in terms of functional and technical expertise. In addition ERP renders multiple benefits to the software sector.
Facilitates better functioning
An ERP software vendor helps the software sector to function in a better and more productive manner. In fact ERP features are like adding a feather in the existing hat of the industry. Even though there are inherent communication facilities in the computer systems ERP added value to them by increasing the scope of their application and additional services by its specialty namely connectivity and coordination.
Execution of deadlines
The IT industry is well known for the high pressures and tough environment. People of all cadres work on tough assignments and in stipulated time. The projects usually involve a lot of coordination and that too from the senior management to the managers and from them to the executives and programmers and all within the shortest span of time.
The time factors have cost the fortunes of many companies and have even made the others to pay hefty penalties in lawsuits for non compliance of the project within the time. There seemed to be no end to the harassment faced by them in the name of quick bucks. It is not fair to question them because any business faces deadlines and there can be justification in giving the shortest possible time in an industry equipped with the latest facilities.
There was no clue on where things went wrong. ERP software vendors have helped to change this to a considerable extent by offering the apt solutions for coordination and execution of the projects in a shorter time and swifter manner. It only helped to perform at a faster rate and eased the pressures faced by It Companies that were more or less pathetic. ERP package software was the only remedy to them. In fact even they did could not initially understand why are so popular.
Ensures proper usage
This point is not only an advantage of the IT industry but also the advantage of the IT industry to ERP. IT industry enjoys an advantage with regards to using ERP. The point is that the employees will not require much of training or orientation on basic issues since they are technical and any sane person working on the software programs must already be aware of the same. On the other hand when it comes to highly complex issues they will be able to grasp it immediately with ease as they are from technical background. This is like two way traffic.
CHAPTER 6: ERP SUPPLIERS
The market today there are several vendors, Greek and foreign companies ERP software, the most important of these are:
Foreign companies ERP software are:
SAP is a multinational software development and consulting corporation, which provides enterprise software applications and support to businesses of all sizes globally. Headquartered in Walldorf, Germany, with regional offices around the world, SAP is (as of 2009) the largest software enterprise in Europe and the fourth largest software enterprise in the world. The company's best known product is its SAP Enterprise Resource Planning (SAP ERP) software.
Founded and headquartered in Newcastle upon Tyne, United Kingdom, the company initially grew organically, but more recently has grown primarily through acquisitions. It now operates worldwide. The company's US headquarters are in Irvine, California, the Canadian headquarters are in Vancouver, Canada and the French and Continental European headquarters are in Paris, France.
Microsoft Corporation is a multinational computer technology corporation that develops, manufactures, licenses, and supports a wide range of software products for computing devices. Headquartered in Redmond, Washington, USA, its most profitable products are the Microsoft Windows operating system and the Microsoft Office suite of productivity software.
SSA Global Technologies (previous NASDAQ symbol: SSAG) was a company developing Enterprise resource planning (ERP) software. On May 15, 2006, SSA Global announced that it would be acquired by Infor Global Solutions.
Ellison took inspiration from the 1970 paper written by Edgar F. Codd on relational database management systems (RDBMS) named "A Relational Model of Data for Large Shared Data Banks". He had heard about the IBM System R database from an article in the IBM Research Journal provided by Ed Oates (a future co-founder of Oracle Corporation). System R also derived from Codd's theories, and Ellison wanted to make his Oracle product compatible with System R, but IBM stopped this by keeping the error codes for their DBMS secret. Ellison co-founded Oracle Corporation in 1977 under the name Software Development Laboratories (SDL). In 1979 SDL changed its name to Relational Software, Inc.
Epicor develops a range of enterprise software targeted at midmarket companies primarily in the manufacturing, distribution, retail, hospitality and services industries. The company is headquartered in Irvine, California and was founded in 1984 as Platinum Software Corporation. In the late 1990's, executives made some strategic acquisitions to help evolve Platinum from a provider of financial accounting systems to a provider of end-to-end enterprise solutions.
Greeks ERP software companies are:
SEMANTIC H Semantic founded in 1997. The bulk of the work is to develop business software and computerized business.
MUNDO The Company Mundo is based in Thessaloniki and is active in technology to develop, promote and provide high level IT solutions, quality and technology.
SINGULAR LOGIC The Singular Logic is one of the strongest Software Group and integrated solutions informatics in Greece.
LOGISMOS INFORMATION SYSTEMS S.A The company is founded under the name MECHANOLOGISTIKI LTD.Logismos creates the first Computer Service Bureau in which the first private sector's computer (IBM Main Frame) in Northern Greece is installed. The Bureau provides its services 24 hours a day. In that perspective, Logismos actually constitutes the IT department of its customers (banks and corporations).
Now I will mention some prices implementing ERPs depending on the size of company:
Because of this correlation between size of company and total costs, our side-by-side comparison includes the average number of users by software vendor. Although both SAP and Oracle were represented by a significant number of smaller companies, the predominance of larger companies drives the average number of users much higher than Lawson, QAD and Infor. However, even though we saw the general cost per user dropping with larger installations, Oracle and SAP customers paid on average more than companies with smaller numbers of users from our other 3vendors.
Number of users
Source: Aberdeen Group
Since the average size of our 5 vendors varied significantly, we have attempted to provide some close comparisons based on our overall averages by company size and general numbers of users. Table 3 places each vendor between the next lower average number of users and the next higher from Table 1. We observe Inform, Lawson and QAD significantly beating the averages that bracket their average numbers of users, while SAP and Oracle are significantly higher.
CHAPTER 7: CONCLUSIONS AND PROSPECTS
We can come to the conclusion, according to the above analysis, that the implementation of ERP systems not only in Industrial sector, but also in other sectors, it is highly essential to the improvement of competitiveness among industrial and other sector's companies. So, ERP suppliers continuously multiply in number and they update their services in order to approach more and more businesses which are involved in a demanding and changing competitive economic environment.
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(www.erwire.com accessed in 7/12/2009)
Davenport, T. (2000), Mission Critical: Realizing the Promise of Enterprise Systems, Harvard Business School Press, Cambridge, MA.
George Ioannou, (2006), Integrate Systems Management operational, 379 papers, stamoulis.
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