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ENTERPRISE SYSTEMS
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Enterprise Systems
Systems that span the enterprise
Systems that span functional areas,focus on executing business
processes across the business firm,and include all levels ofmanagement.
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CENTRALISEDDATABASE
SALES &MARKETING
FINANCE &ACCOUNTING
MANUFACTURING
& PRODUCTION
HUMANRESOURCES
Cash in handAccounts receivableCustomer creditRevenue
Hours workedLabour costJob skillsTraining
OrdersSales forecastReturn requestPrice changes/Pricing
Materials stocksPurchasesProduction schedule
Shipment dates
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Enterprise Systems
It helps businesses become moreflexible and productive bycoordinating their business processes
more closely and integrating groupsof processes, focusing on efficientmanagement of resources and
customer service.
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Enterprise Systems
Four major enterprise applicationsare:
Enterprise systems
Supply chain management systems
Customer relationship managementsystems and
Knowledge management systems
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Enterprise Systems-ERP
Enterprise systems, also known as ERPsystems integrate the key businessprocess of an entire firm into a single
software system that enablesinformation to flow seamlesslythroughout the organization.
These systems focus primarily oninternal processes but are nowintegrated with customers and
vendors.
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Supply Chain Management
(SCM) Systems
Helps in managing relationship withsuppliers
The ultimate objective is to get theright amount, right quality, rightplace at least amount of time andwith lowest cost.
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Company Distributor Retailer
Customer
Supplier
Supplier
Tier I
Supplier
Tier II
Supplier
Orders, return requests, repair andservice requests, financing & payments
Bullwhip Effect: The information aboutdemand gets distorted with slight rise indemand at every level, so each has enough
just in case inventory stockpile.
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Manufac-turer
Distributor Retailer CustomerSupplier
Push-Based Model
Manufac-turer
Distributor Retailer CustomerSupplier
Pull-Based Model
Supply toforecast
ProductnBased on
forecast
InventoryBased on
forecast
StockBased on
forecast
Purchasewhat is on
shelves
Supply toorder
Produceto order
Autoreplenish
warehouse
Autoreplenish
stock
Customerorders
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Customer Relationship
Management (CRM) Systems
Helps the firms in maintaining therelationships with their customers
Helps firms to identify, attract andretain the most profitable customers,provide better service to existingcustomers
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CUSTOMER
SALESTelephone salesWeb salesRetail store salesField sales
MARKETINGCampaign dataProduct & PackagingData analysis
SERVICESCall center data
Web self-service dataPhysical Services dataInstallation reports
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Knowledge Management
Systems (KMS)
Firms success not only depends onphysical assets but also on someintangible assets like knowledge and
experience.It is believed that half of the stock marketvalue are dependent on the intangibleassets.
Today, Knowledge is an central productiveand strategic asset.
Potential sources of competitive advantage
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Storing and Sharing knowledge
Examples:
Collecting suggestionsExperiences & best practices
Online learning modules
Online Circulars etc.
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KMS
KM is a set of processes to create,store, transfer, and apply knowledgein the organisation.
Three major types of knowledgemanagement systems:
Enterprise-wide KMS
Knowledge work systems
Intelligent techniques
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Enterprise-wise KMS
Enterprise-wise KMS are firmwideefforts to collect, store, distribute,and apply digital content andknowledge.
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Knowledge work systems
It support the creation of newknowledge and its integration intothe organization.
Ex. CAD, virtual reality systems(interactive simulations of real world),financial modeling and analysis etc.
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Intelligent TechniquesAre used to capture tacit knowledge
Artificial intelligence (attempt to emulate humanbehavior),
data mining,
expert system (limited domain of human expertise
by capturing experts knowledge), neural networks (attempts to find pattern and
relationships in massive amounts parallel tohuman brains),
fuzzy logic(rule based tech that use approximateor subjective values).
Used for knowledge discovery.
Ex.: Discovering new trends of customer,
automate various tasks
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ERP Defined
An enterprise resource planning system is afully integrated business managementsystem that integrates the core business
and management processes to provide anorganization a structured environment inwhich decisions concerning demand,supply, operations, personnel, finance,
logistics etc. are fully supported byaccurate and reliable real-time information.
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Evolution
MRP (Material Resource Planning):developed in 1970s. For bringing efficiencyand material planning in manufacturingsector, became quite popular in mid-
1970s. Focus was on material planningleaving other factors like personnelplanning, distribution planning etc.
MRP II: This new system incorporatedfinancial accounting, HRM, distributionmanagement etc.
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EvolutionERP: It is evolved from MRP II. MRP has alsonumber of drawbacks, the most important beinglack of effective integration of the functionalareas to share the resources effectively. It was also backend focused, that is generating
and retrieving data from internal companyinformation, processing these and therebycreating solutions for decision makers.
It also evolved progressively and need tohandle front-end and outward systems also.
ERP II: It is defined by E&Y as ERP II= SCM +CRM SCM: Supply chain management
CRM: Customer Relationship Management
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Benefits of ERP
Better use of organisationalresources
Lower operating costs
Proactive Decision MakingDecentralised Decision Making
Enhanced customer satisfaction
Flexibility in business operationsAdjusting as per the environmental
requirements
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ERP IMPLEMENTATION
The process involves the followingbroad activities:Defining need for ERP
Engaging consultant for ERPimplementation
Reengineering business process
Identifying and evaluating ERP packages
Installing hardware and network
Implementing ERP package
C G S
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ERP PACKAGESERP packages are integrated software
packages covering all businessfunctions that support the ERPoperations.
SAP: Developed by SAP AG, Germany.Most versatile ERP package that looks atthe entire business as a single entity. Ithas highest market share globally as well
as in India.SAP: System Analysis and Program
Development, now Systems, Applicationsand Products in Data Processing
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SAP R/3 has following modules:AM Assets Management
CO Controlling
FA Financial Accounting
HR Human resources
MM Materials management
PM Plant Management
PP Production Planning
QM Quality Management
SD Sales and Distribution
WF Business work flow
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SAP's products focus on EnterpriseResource Planning (ERP). The
company's main product is SAP ERP.The current version is SAP ERP 6.0and is part of the SAP Business Suite.
Its previous name was R/3.
The "R" of SAP R/3 stood for realtime.
The number 3 related to the 3-tierarchitecture: database, applicationserver and client (SAPgui)
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Other ERP PackagesOracle Applications: Developed by Oracle Corporationspecially after acquiring Peoplesoft Corp.(www.oracle.com)
Ramco Marshal: Developed by Ramco Systems
MFG/ PRO: Developed by QAD (www.qad.com)
BaaN ERP: Developed by BaaN (www.baan.com)
eBPCS: Developed by Sytems Software Associates
(www.ssax.com)
ActivEra: developed by J D Edwards(www.jdedwards.com)Scala
Mastek Etc
http://www.oracle.com/http://www.oracle.com/http://www.baan.com/http://www.jdedwards.com/http://www.jdedwards.com/http://www.jdedwards.com/http://www.baan.com/http://www.oracle.com/