12.1. describe the role information plays in enterprise resource planning system.
12.2. identify the primary forces driving the explosive growth of enterprise resource planning system.
12.3. explain the business value of integrating supply chain management, customer relationship management and enterprise resource planning system.
Enterprise Resource Planning (ERP)
- ERP serve as the organization's backbone in providing fundamental decision making support.
- at the heart of all ERP systems is a databases.
- it is because when users enters or update information in one module, it is immediately and automatically updated throughout the entire system.
Bringing the Organization Together.
- In most organizations, information has traditionally been isolated within specific departments, whether on an individual database, in a file cabinet, or on an employee's PC.
- Disadvantages are :-
- updates issues which is not standardize.
- information redundancy
- inaccurate information across databases
- Different formats of information in the different databases.
- inability to access other department information and not being provided with a 360 degree view of the organization.
- Different customer information in different databases.
- Customer contact from multiple departments with different messages.
- ERP integrates all the information and create a centre of information.
- ERP enables employees across the organization to share information across a single, centralized databases.
- Disadvantages :-
- Not as flexible and far more difficult to change
- Might not meet all department needs as well as an individual specific system.
- Multiple access levels increases security issues
- Ethical dilemmas from accessing different department information - such as payroll.
- Integrating SCM, CRM, and ERP
- SCM, CRM, and ERP are the backbone of e-business.
- Integration of these applications is the key to success for many companies.
- Integration allows unlocking of information to make it available to any user, anywhere and anytime. meaning that it is easy to get information.
- Many ERP vendors offer SCM and CRM components.
- These modules are typically not as functional or flexible as the modules offered by industry leaders who specialized in SCM and CRM
- an ERP vendor who are more specialize in that system can offer SCM and CRM together with the ERP system.
- -this system will tend more to ERP than SCM and CRM.
- - CRM and SCM has their own vendor who has speciality in that system only.
Integration tools
- Many companies purchase modules from an ERP vendor, an SCM vendor, and a CRM vendor and must integrates the different modules together.
- Middleware - several different types of software which sits in the middle of and provide connectivity between two or more software applications.
- Enterprise application Integration (EAI) Middleware - packages together commonly used functionality which reduces the time necessary to develop solutions that integrates applications from multiple vendors.
Enterprise Resource Planning (ERP)
- ERP systems must integrate various organization processes and be :
- Flexible - must be able to quickly respond to the changing needs of the organization.
- Modular and open - must have an open system architecture, meaning that any module can be interface with or detached whenever required without affecting the other modules.
- Comprehensive - must be able to support a variety of organizational functions for a wide range of businesses.
- Beyond the company - must support external partnerships and collaboration effort.
- SAP boasts 70000 installations and 35 million users worldwide.
-SAP is an ERP vendors.
- ERP solutions are growing because :-
- ERP is a logical solution to the mess of incompatible applications that had sprung up in most businesses.
- ERP addresses the need for global information sharing and reporting.
- ERP is used to avoid the pain and expenses of fixing legacy systems.
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