TALK ON ENTERPRISE RESOURSE PLANNING

9/22/2009 1
 AGENDA
•WHAT IS THIS ERP?
•EVOLUTION OF ERP
•ERP & BPR
•GOING ERP WAY.
•ERP SOFTWARE MARKET
•ERP VENDOR SLECTION DIFFICULTIES.
•SAP R/3
•ERP IMPLEMENTATION ISSUES.
•BENEFITS
•FUTURE TRENDS
•ERP LIFE CYCLE
•PITFALLS
•BARRIERS TO BENEFIT.

9/22/2009 2
ERP IMPLEMENTATION IN AN ORGANISATION BRINGS TO
GETHER DIFFERENT BUSINESS FUNCTIONS,DIFFERENT
PERSONALITIES,PROCEDURES,IDEOLOGIES AND
PHOLOSOPHIES IN TO ONE PLATFORM WITH AN AIM TO POOL
KNOWLEDGE BASE TO EFFECTIVELY INTEGRATE & BRING
WORTHWHILE AND BENEFICIAL CHANGES THROUGHOUT
THE ORGANISATION BY EVALUATING “AS IS “ SITUATION AND
DECIDING WOULD BE SITUATION.

9/22/2009 3
 •ERP IS A FULLY INTEGRATED BUSINESS MANAGEMENT SYSTEM
COVERING FUNCTIONAL AREAS OF AN ENTERPRISE LIKE
LOGESTIC,PRODUCTION,FINANCE ACCOUNTING & HUMAN
RESOURCES.
•ERP IS GLOBAL ,TIGHTLY INTEGRATED CLOSED LOOP
BUSINESS SOLUTION PACKAGE.
•ERP IS ONE DATABASE , ONE APPLICATION & ONE USER
INTERFACE FOR THE ENTIRE ENTERPRISE

9/22/2009 CONTD.. 4
•ERP SYSTEM IS A PACKAGED BUSINESS SOLUTION THAT IS
DESIGNED TO AUTOMATE AND INTEGRATE BUSINESS
PROCESSES ,SHARE COMMON DATA AND PRACTICES ACROSS
THE ENTERPRISE AND PROVIDE ACCESS TO INFORMATION IN A
REAL TIME ENVIRONMENT

•IN TRADITIONAL SYSTEM -TRANSACTIONS ARE BUILT AROUND

THE STRONG BOUNDARIES OF SPECIFIC FUNCTIONS WHEREAS
IN ERP , TRANSACTION IS A PART OF INTER-LINKED
PROCESSES THAT MAKES UP THE BUSINESS.

9/22/2009 CONTD.. 5
ERP
• INFORMATION SYSTEM TO SUPPORT THE FUNCTIONAL
UNITS OF AN ENTERPRISE
• IT BRINGS NEW CULTURE,COHESION & VIGOR TO THE
ORGANISATION
• NO NEED TO CHASE THE INFORMATION,CHECK COMPLIANCE
TO RULES OR CONFORMANCE TO BUDGET.
• ORGANISATION MAY BE MULTIPLANT,MAULTILOCATION,
GLOBAL OPERATION SPANNING THE CONTINENTS
• LEAD TO SIGNIFICANT COST SAVINGS BY CONTINUOUSLY
MONITORING THE ORAGNISATIONAL HEALTH.
• FUNDAMENTALLY ERP INTEGRATES THE DIFFERENT
PROCESSES NECESSARY IN A BUSINESS IN TO
CENTRALIZED POOL THAT FACILITATES DATA SHARING
AND ELIMINATES REDUNDANCY.

9/22/2009 …CONTD.. 6
ERP
•IT IS AN INTEGRATED SUIT OF APPLICATION SOFTWARE MODULES
PROVIDING OPERATIONAL,MANAGERIAL AND STRATEGIC
INFORMATION FOR IMPROVING PRODUCTIVITY,QUALITY AND
COMPETITIVENESS.

•ERP PROVIDES TIMELY AND ACCURATE PRODUCTION

ORIENTED INFORMATION FOR LONG-RANGE PLANNING AND
DAY–TO–DAY OPERATIONAL PLANNING & CONTROL.

•ERP MAY BE CUSTOMISED ACCORDING TO THE ORGANIZATION’S

PROCESS THROUGH THE ERP’S TOOL SET.WORKFLOW CAN BE
SETUP TO AUTOMATE APPROVAL PROCESSES THROUGH CHAINS
OF COMMANDS.ONCE INSTALLED , THE USER ONLY ENTERS DATA
AT ONE POINT,AND THE INFORMATION IS TRANSFERRED
THROUGH PROCESSES TO OTHER MODULES.

9/22/2009 CONTD.. 7
ERP
•PERFORMS CORE ACTIVITIES & INCREASING CUTOMER SERVICES
THEREBY AUGMENTING THE CORPORATE IMAGE.

•AUTOMATIC INTRODUCTION OF LATEST TECHNOLOGY LIKE

EFT,EDI,INTERNET,INTRANET,VIDEO CONFERENCING,E-COMMERCE,
E-BUSINESS ETC.

•PROVIDES DSS,EIS,DATA MINING ETC.

9/22/2009 8
 •RESEARCH IN TO U.S. FORTUNE 1000 COMPANIES FOUND
THAT OVER 60% HAVE IMPLEMENTED AN ERP SYSTEMS

•A REPORT BY COMPUTER ECONOMICS INC. STATED THAT

THAT 76% OF MANUFACTURERS,35% OF INSURANCE AND
HEALTH CARE COMPANIES & 24% OF FEDERAL GOVERNMENT
AGENCIES ALREADY HAVE AN ERP SYSTEM OR ARE IN THE
PROCESS OF INSTALLING ONE.

9/22/2009 9
WHY ERP?
•GLOBALIZATION AND SHORTEN PRODUCT CYCLE
•UNPRECEDENTED LEVELS OF COMPETITION
•BEST BUSINESS PRACTICES IN THE INDUSTRY.
•CONTINUOUS DESIGN IMPROVEMENTS, MANUFACTURING
FLEXIBILITY, SUPER EFFICIENT LOGESTIC CONTROL AND
BETTER MANAGEMENT OF ENTIRE SUPPLY CHAIN OUTSIDE.
•AGGRESSIVE COST CONTROL INTIATIVES.
•NEED TO ANALYSE COSTS/REVENUES ON A PRODUCT OR
CUSTOMER BASIS
•FLEXIBILITY TO RESPONE TO CHANGING BUSINESS
REQUIREMENT.
•MORE INFORMED MANAGEMENT DECISION MAKING.
•CHANGING IN WAYS OF DOING BUSINESS.

9/22/2009 10
 FACTORS THAT MAKES ERP
EFFECTIVE
•ESTABLISH THE NEED AND SET THE STAGE FOR ERP
•SET PERFORMANCE MEASURES AND REVIEW THEM
•ASSESS VALUE TO THE COMPANY
•VIEW ERP AS AN INTEGRATED PROCESS

9/22/2009 11
 EVOLUATION OF ERP
• EVOLVED FROM THE MATERIALS REQUIREMENT PLANNING(MRP)
SYSTEMS OF THE 1970’S AND MANUFACTURING RESOURSES
PLANNING(MRP2) SYSTEMS OF THE 1980’S
• MRP SYSTEMS AIMED TO BRING DOWN THE LARGE INVENTORY
LEVELS.
• GLOBAL COMPETITION OF NINETIES HAD MOVED TOWARDS AGILE
MANUFACTURING OF PRODUCT , CONTINUOUS IMPROVEMENT OF
PROCESSES & BPR
• CALLED THE INTEGRATION OF MANUFACTURING WITH OTHER
FUNCTIONAL AREAS INCLUDING ACCOUNTING,MARKETING,
FINANCE & HR DEPARTMENT
• ERP IS SUCH INTEGRATED INFORMATION SYSTEMS BUILT TO MEET
THE INFORMATION SYSTEMS AND DECISION NEEDS OF AN
ENTERPRISE SPANNING ALL THE FUNCTIONS OF THE
MANAGEMENT.

9/22/2009 12
EVOLUATION OF ERP

•MRP II, WHICH IS A COMPANY- WIDE MANAGEMENT SYSTEM

AIMING AT LOWERING COSTS AND INVENTORIES &
INCREASING PRODUCTIVITY AND CUSTOMER SERVICES,
IS A MANAGEMENT CONCEPT WHILE ERP IS ITS
TECHNICAL SUBSET.
•WHILE ERP CAN BE IMPLEMENTED IN ISOLATION , THE
COMPLETE BENEFIT CAN BE GAINED IF THE ENTIRE
REENGINEERING PROCESS IS FOLLOWED.

9/22/2009 13
 BUSINESS PROCESS
• A COLLECTION OF ACTIVITIES THAT TAKES ONE OR MORE KINDS OF
INPUT AND CREATES AN OUTPUT THAT IS OF VALUE TO THE
ORAGNISATION.
• A PROCESS IS SIMPLY A STRUCTURED,MEASURED SET OF
ACTIVITIES DESIGNED TO PRODUCE A SPECIFIED OUTPUT FOR A
PARTICULAR CUSTOMER OR MARKET.IT IMPLIES A STRONG
EMPHASIS ON ‘HOW’ WORK IS DONE WITHIN AN ORGANISATION ,
IN CONTRAST TO A PRODUCT FOCUS EMPHASIS
ON ‘WHAT’?

9/22/2009 14
BUSINESS PROCESS

•TO FACILITATE AN EFFECTIVE IMPLEMENTATION, BUSINESS

PROCESS ENGINEERING NEEDS TO BE INTIATED FOR THE
PURPOSE OF “GAP ANALYSIS” TO DETERMINE WHAT CHANGES
ARE NEEDED IN THE COMPANY OR IN THE ERP SYSTEM.

9/22/2009 15
ERP & BPR
•BPR IS FUNDAMENTALLY RETHINKING AND RADICAL REDESIGN
OF PROCESSES TO ACHIVE DRAMATIC CHANGE.

•BPR IS REINVENTING AND NOT ENHANSING.

•BUSINESS PROCESS REENGINEERING IS A FORMAL TECHNIQUE

TO RE-ASSESS THE EXISTING PROCESSES AND DEVISE NEW
PROCESSES.

• ERP IMPLEMENTS THE ORGANISATIONAL PROCESES TO

REENGINEER THE BUSINESS PROCESSES BEFORE ITS
INTRODUCTION.

• OR DE-ENGINEERING I.E DERIVING CORE BUSINESS PROCESS

CHANGE FROM ERP PACKAGES.

9/22/2009 16
 Preparing the organization for ERP
•ERP IN AN ORGANISATION IS A MAJOR TASK WITH FAR-REACHING
IMPLICATIONS

•ERP IS HIGH-END MISSION CRITICAL APPLICATION WITH

SIGNIFICANT INVESTMENTS IN HARDWARE,SOFTWEARE &
NETWORK.

•CULTURE FOR COMPUTING IS A MUST.

•ERP NEEDS MOSTLY CUSTOMISATION RATHER THAN SOFTWARE

BUILDING.

•CUSTOMISATION CAN BE DONE MUCH FASTER & BETTER BY A

“DOMAIN EXPERT”.

•SIEMENS,TELCO AND MEHINDRAS HAVE DECIDED TO TURN THEIR

IS DEPARTMENT IN TO SEPARATE COMPANY.
9/22/2009 17
PEOPLE MUST FEEL EMPOWERED AND ENCOURAGED
TO INITIATE CHANGES IN THE SYSTEM FOR
ENHANCED EFFECTIVENESS AND THE PROCESS
TO REQUEST THIS CHANGES MUST ALSO BE
SIMPLE & WELL UNDERSTOOD.

9/22/2009 18
GOING THE ERP WAY

•ERP IS AN OPPORTUNITY FOR BUSINESS RE-ENGINEERING.

ORGANIZATION GETS THE OPPORTUNITY TO RESTRUCTURE AND
REORGANISE PEOPLE AND DEPARTMENTS TO MEET NEW
CHALLENGES AND GLOBAL COMPETITION.AS SUCH , IT CALLS
FOR ATTITUDINAL CHANGES WHICH WILL HELP IN A SMOOTH
TRANSITION,LEARNING BEST PRACTICES, AND ADOPTING THEM
INTO THE BUSINESS.THESE CHANGES WILL REAP GOOD PROFITS
IN A SHORT TIME.

..CONTD..
9/22/2009 19
GOING THE ERP WAY

•ERP SOFTWARE IS TESTED AND USED IN MANY

ORGANISATIONS IN DIFFERENT SITUATIONS ACROSS
BOUNDARIES.IN MOST CASES ERRORS ARE ON ACCOUNT OF
INCORRECT DATA,POOR UNDERSTANDING,OR IMPROPER
TUNING OF THE PACKAGE.ONE CAN’T ENTER TRANSACTIONS
UNLESS ALL CROSS BUSINESS RULES HAVE BEEN FULLY
DEFINED.THIS WILL ENSURE DISCIPLINE IN THE WORKING OF
THE ENTIRE ORGANISATION.

9/22/2009 CONTD.. 20
 GOING THE ERP WAY
•ONCE DATA IS ACCEPTED,IT WILL FURNISH THE RIGHT
INFORMATION AT ALL LEVELS AT ALL PLACES
•IT IS POSSIBLE TO IMPLEMENT THE ERP PACKAGE IN
THREEBROAD SEGMENTS-MANUFACTURING,FINANCE AND
DISTRIBUTION.HOWEVER SOME PACKAGE,LIKE SAP,DO NOT ALOW
SUCH AN APPROACH & WILL CALLS FOR BUILDING BRIDGES FROM
& TO LEGACY SYSTEMS AND , CAN IN SOME CASES BECOME A
COSTLIER SITUATION.
•ERP IS TOOL TO SUPPORT BUSINESS AND THEREFOR CLOSE
LINKAGE TO BUSINESS MUST BE REVIEWED AND MONITORED TO
ENSURE THAT THE REQUIRED INFORMATION IS MADE AVAILABLE
TO THE RIGHT PEOPLE AT THE RIGHT COST AND IN THE RIGHT
FORMAT SO AS TO GAIN COMPETITIVE EDGE IN THE ERA OF
GLOBAL COMPRTITION.IT IS OBSERVED THAT,WHEN A BUSINESS
CROSSES BOUNDARIES OF THE NATION AND BECOMES
MULTINATIONAL,IT HAS NO OTHER OPTION BUT TO USE ERP SO
AS TO STANDARDIZE OPERATIONS WORLDWIDE.

9/22/2009 21
ERP SOFTWARE MARKET
• IT IS ABOVE 65 BILLION USD
LEADING GLOBAL PLAYERS ARE
1. SAP R/3 FROM SAP CORPORATION
2. ORACLE APPLICATIONS FROM ORACLE CORPORATION
3. BaaN IV FROM BaaN SOFTWARE
4. PEOPLE- SOFT FROM PEOPLESOFT
5. MFG/PRO FROM QAD CORPORATION
6. MARSHAL FROM RAMCO (INDIAN COMPANY)
7. MAMIS FROM MASTEK (INDIAN COMPANY)
8. CIMPRO FROM DATA LOGIX
9. BPCS FROM BUSINESS PLANNING & CONTROL SYSTEMS
10.JD EDWARDS
11.LAWSON
12.SCOOPSOFT
13.MAPICS XA(LEGACY APPS) FROM MARCAN CORPORATION
14.PRISM (PROCESS INDUSTRY) FROM MARCAN CO.
15.SYSTEM 21 FROM JBA

9/22/2009 22
ERP VENDOR SELECTION DIFFICULTIES
• TIME
ERP SELECTION EXERCISE CAN CONSUME ENORMOUS TIME AND
MANPOWER IN IDENTIFYING EVALUATION CRITERIA & GENERATING
INFORMATION ON ALTERNATIVES.
• COST
• FINDING OBJECTIVE DATA
• LACK OF STRUCRED EVOLUTION PROCESS
• THE DECISION ONCE MADE IS NOT EASY TO REVESE
• PRODUCT EVALUATION REQUIRES ANALYSIS ON
1. FUNCTIONALITY
2. TECHNICAL ARCHITECTURE
3. COST
4. COST/BENEFIT ANALYSIS
5. EASE OF IMPLEMPLENTATION
6. SERVICE & SUPPORT
7. ABILITY TO EXECUTE
8. FUTURE ROAD MAP
9. TECHNICAL TREND
10. VENDORS VISION

9/22/2009 23
ERP-AS A SOFTWARE SOLUTION
THE ERP SOFTWRAE CAN BE EITHER CUSTOM DEVELOPED OR
CAN BE BOUGHT AS PACKAGE

PARAMETER CUSTOM DEVELOPED PACKAGE SOLUTION

FUNCTIONAL MEDIUM HIGH

SPREAD

FUNCTIONAL MEDIUM HIGH

SOPHISTICATION

SCOPE FOR BPR MEDIUM HIGH

…CONTD.
9/22/2009 24
ERP-AS A SOFTWARE SOLUTION

PARAMETER CUSTOM DEVELOPED PACKAGE SOLUTION

TECHNOLOGY HIGH HIGH

TIME HIGH MEDIUM

COST HIGH MEDIUM

TRAINNING MEDIUM MEDIUM

9/22/2009 …CONTD.. 25
ERP-AS A SOFTWARE SOLUTION

PARAMETER CUSTOM DEVELOPED PACKAGE SOLUTION

IMPLEMENTATION MEDIUM MEDIUM

EASE

PROVENNESS LOW HIGH

MAINTENANCE & LOW HIGH

SUPPORT

9/22/2009 26
CAPABILITIES

TIME
FIRSTWAVE SECONDWAVE NEXTWAVE

9/22/2009 27
THE POTENTIAL OF ERP SYSTEM CAN BE CLASSIFIED UNDER
THREE GROUPS: INTEGRATE,OPTIMISE, AND INFORMATE

•INTEGRATE IS WHERE A COMPANY IS ABLE TO INTEGRATE

THEIR DATA AND PROCESSES INTERNALLY AND EXTERNALLY
WITH CUSTOMERS & SUPPLIERS

•OPTIMISE BENEFITS INCLUDES THE STANDARDISATION OF

BUSINESS PROCESSES INCORPORATING BEST BUSINESS
PRACTICE.

•INFORMATE IS THE ABILITY TO PROVIDE CONTEXT RICH

INFORMATION TO SUPPORT EFFECTIVE DECISSION MAKING.

9/22/2009 28
 SAP R/3 (SYSTEMS,APPLICATIONS & PRODUCTS in DATA
PROCESSING)

•IMPLEMENTED AT MAJOR COMPANY LIKE TATA’S,MAHINDRA’S,

RIL’S, KIRLOSKAR’S,SIEMEN’S,HP,LG,P&G ETC.
•STARTED BY A TEAM OF THREE EX-IBM ENGINEERS IN 1972, SAP-AG
IS A 30YEAR OLD GERMAN BASE COMPANY.
•32% MARKET SHARE WORLDWIDE
•FOURTH- LARGEST INDEPENDENT SOFTWARE SUPPLIER IN THE
WORLD
•MORE THAN 10000 INSTALLATIONS WORLDWIDE IN OVER 90
COUNTRIES
•FORTUNE 500 COMPANIES HAVE ENDORSED SAP SO WELL THAT
10 OF THE TOP 10 COMPANIES,EIGHT OF THE TOP 10 COMPANIES
WITH HIGHEST PROFITS, AND SEVEN OF THE TOP 10 COMPANIES
WITH HIGHETS ROI USE SAP R/3.

9/22/2009 29
……CONTD..
 SAP R/3
• IT HAD PHENOMENAL FUNCTIONALITY BY WAY OF VARIOUS
MODULES
LIKE
1. SD (SALES & DISTRIBUTION)
2. MM (MATERIALS MANAGEMENT)
3. PP/PI (PRODUCTION PLANNING-PROCESS INDUSTRY)
4. FICO (FINANCIAL ACCOUNTING & CONTROL)
5. PM (PLANT MANAGEMENT)
6. PC (PROCESS CONTROL)
7. QM (QUALITY MANAGEMENT)
8. SAP-HR (HR FUNCTION)
ETC..
• SAP R/2 RELEASE IN 1979 & FLAGSHIP PRODUCT SAP R/3
RELEASED IN 1992.

9/22/2009 ……CONTD.. 30
 SAP R/3
•AVAILABLE FOR ALL LEADING OS PLATFORMS SUCH AS VMS,UNIX,
OS/400,MVS,WINDOWS-NT ETC.
•RDBMS SOFTWARE LIKE ORACLE,INFORMIX AND MORE
RECENTLY MS-SQL SERVER.
•SUPPORTS DISTRIBUTED COMPUTING TO INTEGRATE DIVERSE
HARDWARE AND , SOFTWARE.
•USES STANDARD PROTOCOLS LIKE MESSAGE SWITCHING,
REMOTE PROCEDURE CALLS(RPC) ETC.
•INTEGRATES STANDARD WORK FLOW SOFTWRAE LIKE
LOTUS NOTES,INTERFACES WITH EDI,E-MAILS AND DESK TOP
SOFTWRAES LIKE MS WORD & MS-EXCEL.
•ROBUST , STRONG & MATURE PRODUCT
•INCLUDES THE BEST BUSINESS PRACTICES,GLOBALACCOUNTING
NORMS,CURRENCIES,TRADING PRACTICES &
MULTILINGUAL SUPPORT -AROUND IN 14 LANGUAGES.
•SPENDS 10 % OF ANNUAL BUDGET ON R&D

9/22/2009 31
SAP R/3
•REPORTED REVENUES OF DM 6 BILLION PA & AROUND 62
PERCENT INCREASE YEARLY

•NETWEAVER AND THE UNDERLYING ENTERPRISE SERVICES

ARCHITECTURE(ESA) ARE A MAJOR PART OF SAP’S MESSAGE
FOR UPGRADATION OF EXSITING R/3 CUSTOMERS TO THE
mySAP PRODUCT LINE.
NETWEAVER TAKES IN TO CONSIDERATION ALL THE ASPECTS
ASSOCITED WITH INTEGRATION – PEOPLE,PROCESS AND
INFORMATION INTEGRATION

-EXISTING SAP R/3 CUSTOMERS CAN USE NETWEAVER.

THE MAJOR VENDOR OF ERP SYSTEMS IS SAP WITH
APPROXIMATELY 50% OF THE MARKET IN U.S.A.IT WAS
DETERMINED THAT 9 OUT OF THE TOP 12 IT USERS WERE SAP
CUSTOMERS AND 45% OF THE TOTAL LIST WERE ALSO SAP
USERS.

9/22/2009 32
 EIGHT REASON TO USE SAP
1. GLOBAL BASIS
2. FASTER SPEED
3. FLEXIBILITY FOR CHANGES (BUSINESS & IT)
4. AGILITY
5. EXTENDED SUPPLY CAHIN MANAGEMENT
6. REACH NEW OPPORTINITY
7. KNOWLEDGE SHARING
8. CREATIVITY FOCUS

VISIT SAPFANC.COM FOR INTERACTION WITH OTHER SAP FANS

TO GET EXPOSURE TO SAP MARKET & “TIPS AND TRICKS” IN SAP SOFTWARE

9/22/2009 33
 “WE CAN NOW CLOSE OUR BOOKS OF ACCOUNT
AND
BALANCESHEET WITHIN 15 DAYS OF THE PERIOD
ENDING AS COMPARED TO
THREE-AND-A-HALF MONTHS
PRIOR TO
THE SAP IMPLEMENTATION”

…. GLEN MARK PHARMACEUTICALS LIMITED

9/22/2009 34
ERP IMPLEMENTATION
CRITICAL SUCCESS FACTOR OF IMPLEMENTATION

TOP MANAGEMENT COMMITMENT

•DRIVING & SUPPORTING THE PROJECT
•PROVIDING THE NECESSARY RESOURCES
•SETTING REALISTIC EXPECTATION
•MONITORING THE PROGRESS & BRINGING IN SERIOUSNESS
•EMPOWERING PEOPLE TO USHER IN CHANGE
•RESOLVING POLICY & RESORCE CONFLICTS
•IMBIBING TRUST IN THE SYSTEM

END USER INVOLVEMENT

ONGOING EDUCATION & TRAINNING
METICULOUS DATA MANAGEMENT
USER EXPECTATION MANAGEMENT

9/22/2009 35
9/22/2009 36
BENEFITS OF ERP
•COMMON REPOSITORY
•IMPROVED CAPACITY UTILIZATION
•INFORMED MANAGEMENT DECISION MAKING
•INCREASED PRODUCTIVITY ACROSS THE BOARD
•IMPROVED CUSTOMER SERVICES AND RETENTION
•DEFINING MATRICS,MEASURING & BENCH MARKING
•WORKING CAPITAL REDUCTION-
•IMPROVED FINANCIAL MANAGEMENT
•ENTERPRISE EXTENSION TO EMBRACE ENTIRE SUPPLY CHAIN
•BREAKDOWN OF BUREAUCRATIC AND POLITICAL
INTERDEPENDENSE .
•TRANSPARNCY
•OVERALL ORGANISATIONAL LOOK-A-HEAD CAPABILITY AND
CONTROL AS OPPOSED TO FUNCTIONAL CONTROL.
•READYMADE FUNCTIONALITY
•WELL TESTED

9/22/2009 …..CONTD.. 37
BENEFITS OF ERP
•HIGH LEVEL OF DOCUMENTATION
•BASED ON BEST PRACTICES & STANDARDISED
IMPLEMENTATION OF THE SAME.
•SEAMLESS FLOW OF INFORMATION ACROSS THE MODULES.
•AVOIDING REINVENTING THE WHEELS
•MAKES ORGASNISATION IT DRIVEN
•PROVIDES INTEGRATED WORKING ENVIRONMENT
•REDUCE DATA DUPLICATION AND REDUNDANCY
•INTEGRATION WITH MESSAGING GROUPWARE SOLUTION
•DATA STANDARDIZATION ACCURACY ACROSS THE ENTERPRISE
•ON-LINE/REAL TIME INFORMATION THROUGHOUT ALL THE
FUNCTIONAL AREAS OF AN ORGANISATION

9/22/2009 ….CONTD.. 38
BENEFITS OF ERP
•INFORMATION ENTERED ONCE IN A SYSTEM
•BEASED ON RELIABLE FILE STRUCTURE
•PROVIDES FUNCTIONALITY TO INTERACT WITH OTHER MODULES
•PROVIDES TOOLS FOR ADHOC INQUIRES.
•THE ANALYSIS AND REPORTING THAT CAN BE USED FOR LONG
TERM PLANNING
•EASE OF EXPANSION/GROWTH AND INCREASED FLEXIBILITY.
•FASTER.MORE ACCURATE TRANSACTION
•HEADCOUNT REDUCTION
•CYCLE TIME REDUCTION
•IMPROVED INVENTORY/ ASSET MANAGEMENT
•FEWER PHYSICAL RESOURCES/BETTER LOGISTIC
•INCREASED REVENUE.

9/22/2009 39
ERP LIFE CYCLE

STAGE-1 ERP READINESS ASSESSEMENT

STAGE-2 PREPARING THE ORGANISATION FOR ERP
STAGE-3 ERP FEASIBILITY STUDY
STAEG-4 PROCESS MODELLING AND DOCUMENTING THE
‘AS IS’ PROCESSING AND ‘TO BE ‘ PROCESSING
(ALONGWITH BPR)
STAGE-5 DETAILED PLAN FOR ERP IMPLEMENTATION
(INCLUDES ERP SOFTWRAE SELECTION,SELECTION
OF IMPLEMENTATION PARTNER, IMPLEMENTATION
TECHNOLOGY –’BIG BANG’ OR ‘MODULAR
IMPLEMENTATION’ AND THE FINAL AND PRECISE
EXTENT OF IMPLEMENTATION.
STAGE-6 DETAILED IMPLEMENTATION INCLUDING
DEVELOPMENT.QUALITY ASSURANCE &
PRODUCTION SYSTEM.
9/22/2009 40
….CONTD..
 ERP LIFE CYCLE
STAGE-7 PREPARING TO ‘GO LIVE’ INCLUDING DATA
MIGRATION.
STAGE-8 GOING LIVE
STAGE-9 PERFORMANCE ASSESSEMENT,DOCUMENTATION,
AND FUTURE PLAN.

GO-LIVE FUTURE PLAN

9/22/2009 READINESS 41
PITFALLS

• LONG IMPLEMENTATION TIME-TYPICALLY 12-18 MONTHS.

• COMMUNICATION GAP
• INABILITY OF MOST APPLICATIONS TO SUPPORT CONTINUOUS
IMPROVEMENT AND CHANGE MANAGEMENT.
• INABILITY TO TAKE ADVANTAGE OF SHARED EXPERIENCES.
• INADEQUATE TRAINNING & DOCUMENTS

9/22/2009 … CONTD. 42
PITFALLS
•MANY ERP PROJECTS HAVE RUN IN TO ROUGH WEATHER
OR HAVE EVEN FAILED,NOT BECAUSE OF ERP CONCEPT OR
ERP SOFTWARE PACKAGE BUT PRIMARILY DUE TO LACK OF
APPROPRIATE APPROACH. A TYPICAL ENTERPRISE WIDE
IMPLEMENTATION REQUIRES SKILLS OF VARIED
DIMENSIONS SUCH AS FUNCTIONAL AND BUSINESS KNOWLEDGE,
SOFTWARE PROJECT MANAGEMENT,DATA BASE & NETWORK
MANAGEMENT,STRATEGIC CONSULTING,EDUCATION & TRAINNING,
TECHNICAL CONSULTING LIKE PROPER HARDWARE
EAVALUTON ETC.
•ADDITIONAL FACTOR THAT IS CONTRIBUTING TO FAILED
IMPLEMENATION INCLUDES LACK OF MANAGEMENT COMMITMENT,
FAILURE TO INCLUDE KEY PERSONNEL ON THE PROJECT TEAM,
POORLY WRITTEN OR INCOMPLETE NEEDS ANALYSIS REPORT,
AND ISSUES SUCH AS POLITICAL INTRIGUE,CONFLICT,HIDDEN
AGENDAS AND PEOPLE ISSUE.

9/22/2009 43
BARRIERS TO BENEFIT REALISATION

LACK OF DISCIPLINE

LACK OF CHANGE MANAGEMENT

INADEQUATE TRAINING

POOR REPORTING PROCEDURES

INADEQUATE PROCESS ENGINEERING

MISPLACE BENEFIT OWNERSHIP

INADEQUATE INTERNAL STAFF

POOR PRIORITISATION OF RESOURCES

9/22/2009
CONTD.. 44
BARRIERS TO BENEFIT REALISATION

POOR SOFTWRAE FUNCTIONALITY

INADEQUATE ONGOING SUPPORT

POOR BUSINESS PERFORMANCE

UNDER PERFORMED PROJECT TEAM

POOR APPLICATION MANAGEMENT

UPGRADES PERFORMED POORLY

CONTD..
9/22/2009 45
BARRIERS TO BENEFIT REALISATION

IT CAN BE OBSERVED FROM THIS DATA

THAT LIMITED BENEFIT ATTAINMENT
FOR ERP IMPLEMENTATION HAD LITTLE
TO DO WITH LACK OF SOFTWARE
FUNCTIONALITY OR MAJOR TECHNICAL
ISSUES , BUT WERE PREDOMINATELY
PEOPLE ISSEUES.

9/22/2009 46
 ERP IS THE NEED OF THE HOUR AND IS THE ONLY
ANSWER PRESENTLY TO IMPROVE BUSINESS
PROCESSES
AND
COMPETITIVENESS.

9/22/2009 47
 FUTURE TRENDS IN ERP
•WEB-ENABLED ERP

•COMPONENT ERP

•INTEGRATION WITH SUPPLY CHAIN & E-COMMERCE

9/22/2009 48
 LOOK FOR
‘WHAT IT CAN DO?’
BEFORE
‘WHAT IT SHOULD DO?’

9/22/2009 49
 WHAT ERP DOES NOT DO IS
TO
FULFILL ALL WISHES.

9/22/2009 50
9/22/2009 51