Nterpris e Esource Lanning

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Enterpris

e
Resource
Planning
What is ERP?
Enterprise Resource Planning

ERP is a solution, which


facilitates company-wide integrated
information systems, covering all
functional areas

performs core Corporate activities and


increases customer service enhancing
Corporate Image
The Current Scenario
Enterprise Resource Planning

Islands of Information
Difficult to get timely & accurate information
Heterogeneous Hardware & Software
platforms & practices
Poor connectivity between different
organizational locations
Sticking with obsolete technology
Resist to change
Lack of proven man-power to develop
integrated software
Information Islands
Why ERP?
Enterprise Resource Planning

For Management – to know what is happening


in the company
One solution for better Management
For cycle time reduction
To achieve cost control & low working capital
To marry latest technologies
To shun the geographical gaps
To satisfy the customers with high expectation
To be Competitive & for survival
ERP - Definition
Enterprise Resource Planning

“Software solution that addresses the


Enterprise needs, taking a process view of
the overall organization to meet the goals,
by tightly integrating all functions and
under a common software platform”
ERP – Expectations
Enterprise Resource Planning

Integrating all the functions

Integrating the systems running in all the locations

Transparency of information using a single


data source across the organization

Software must be responsive


Modular
Flexible
Easy to add functionalities
Provide growth path
Scope of ERP
ERP scope has expanded dramatically and usually
includes:
 Manufacturing
 Supply Chain Management
 Financials
 Projects
 Human Resources
 Customer Relationship Management
 Data Warehouse

Large organisations want to implement standard


processes and systems across divisions and
subsidiaries
ERP offers attractive, integrated solutions
The market for these solutions is huge. 
Advantages of ERP
Elimination of redundant data and procedural
operations.
Flexibility to allow for customization.
Easier access to the reliable information company
wide.
Compulsive use of best practices because of
software.
Increased efficiency hence reduced costs.
Adaptability to a changing business environment.
Reduced cycle timings.
Functional integration among various modules.
Disadvantages of ERP
It is very expensive and time taking to
implement.
Time consuming and costly maintenance.
Availability of many options, so may lead to
the confusion and the correct use of the
system may not be done.
The system is very complex.
implement ERP
systems

Obtain the right mix of people,


processes and technology!!
ERP Implementation
1. Definition and Analysis
Hold discussions with various functional
personnel to establish the actual number of
systems operating at client site, what they are
used for, why and how often
Produce the Project Scoping Document
outlining current situation, proposed solution
and budgeted time
Challenge : REQUISITE EXPERTISE - No two
clients are the same
ERP Implementation
2. Design
Prepare various functional reports -
specifies current scenario and wish list
Prepare Design document which specifies
how the system is going to work
Prepare test scripts to be followed on
system testing
Map out the interface paths to various
modules
Challenge : INFORMATION SHARING -
Availability of staff
ERP Implementation
3. Build
Configure system as per set up document
specifications i.e. transfer conceptual
model into reality
Test system to verify accuracy (preliminary
tests)

Challenge : TECHNICAL ENVIRONMENT


- System functionality
ERP Implementation
4. Transition
Train users on their specific areas
Assist in test data compilation and
system testing by users
Finalise the Live system and captured
opening balances

Challenge : USER RESISTANCE


Understanding and acceptance
data preparation
ERP Implementation
5. Production
Official hand holding
Effectiveness assessment
Business and Technical Direction
recommendations
ERP
Solutions
using internal resources
Critical Success Factors
Tailor-made ERP solutions

 The firm & optimistic approach of the Management


- on adapting the ERP product driven methodologies
- on customization
- on monetary commitments
 The dedicated Team
 Good Training
?
 Strict adherence to the Project schedules
 Right technical infra-structure
 Change Management
Pitfalls & Points of concern
Tailor-made ERP solutions

 Costly comparing to custom-built options


 Lot of hidden costs
 Chances of cost & time overrun are high
 The Level of customization/Indianization
 Compulsion to pay for redundant modules/features
 Vigorous involvement of all during implementation
 Non-availability of special practices like Customer
Complaint, Logistics
 Linking historical data – offline & painful
 The requirement of Change Management is a must
 Dependency on outsiders is high
 IT department – Poor grip on the Implemented systems
Custom-built
ERP
Solutions
using external resources
The Critical Success Factors
Custom-Built ERP solutions

• Clear Vision & support of the Management


• Capabilities of the software development vendor
• Scope & Expectations finalization towards
meeting the ERP concepts
• Strict implementation schedules & periodical
monitoring
• The involvement of the IT & functional teams
Points of Concern

 Software development vendor selection


 Requirement/scope finalization [high chances of
retaining the islands as it is]
 Less chances of Value addition
 Not time tested
 Chances of Prolonged project duration

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