SLM-03 Enterprise Resource Planning System
SLM-03 Enterprise Resource Planning System
You will be given time to complete all performance tasks and activity provided
on the LMS as listed below:
1. Watch the video lecture
2. Read the SLM
3. For further study: - Watch this video with this url:
https://youtu.be/c9HfNg4a_Og
4. For the Lecture Activities: Accomplish performance tasks using work sheet
provided and online task for Module 3 Performance Task No 3 Short
Answer Essay [PT3]
For the Laboratory Activities: Please refer to Laboratory Activity No. 2 and
complete Machine Problems 4 - 11
(For further instructions, refer to your Google Classroom and see the schedule
of activities for this module)
Note: The insight that you will post on online discussion forum using Learning Management
System (LMS) will receive additional scores in class participation.
For offline classes, please refer to the following learning guide questions:
Offline Activities 1. What is ERP and ERP Systems?
(e-Learning/Self- 2. How is ERP connected to the course System Integration and
Paced) Architecture 1?
3. How does ERP Systems impacts modern businesses?
Module Content Topics Covered for Module 3: Enterprise Resource Planning System
Inventory management and control: The history of ERP can be traced back to
the first inventory control (IC) and manufacturing management applications of
1960s. These first applications for the manufacturing were generally limited to
IC and purchasing, which was due to the origins of these applications in the
accounting software. The accounting, with its definition based around generally
accepted standards, had been one of the first business functions to be
computerized and the first applications for the manufacturing were created as
by-products of accounting software driven by the desire of the accountants to
know the value of the inventory.
demand, then looked at the production schedule needed to meet that demand,
calculated the raw materials needed to meet the required production levels,
and
ISO finally,
9001:2015 projected the cost of those raw materials. For a company with many
Certified
The Gartner Group introduced the term Enterprise Resource Planning (ERP)
in the early 1990s. The ERP evolution implies an extension of MRPII with
enhanced and added functionality, encompassing functions that are not within
the traditional focus of MRPII, such as, decision support, supply chain
management, maintenance support, quality, regulatory control, and health and
safety compliance. Today, ERP is the foundation of businesses domestically and
globally. It is used as a management tool and gives organizations a great
competitive advantage. As e-business becomes business as usual, sharing
accurate real-time information about orders and inventory is critical to success.
Now, business needs to move that information across a supply chain. A new
term to describe the enterprise systems for the 21st century: ERP II, has been
introduced.
Thus, every time an organization has to upgrade the ERP system, the IT staff
will have to upgrade the application and upgrade the modifications.
Modifications will have to be reengineered into the system when they are
incompatible with the new version. On the other hand, if the organization
The functional model was very useful for decades, and it was successful in the
United States where there was limited competition and where flexibility and
ISO 9001:2015 Certified
rapid decision making were not requirements for success. In the quickly
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changing markets of the 1990s, however, the functional model led to top-heavy
and overstaffed organizations incapable of reacting quickly to change. The time
was right to view a business as a set of cross-functional processes, as illustrated
in Figure 3.3. In this organizational model, the functional business model, with
its separate silos of information, is gone. Now information flows between the
operating groups without top management’s involvement.
In a process-oriented company, the flow of information and management
activity is “horizontal” across functions, in line with the flow of materials and
products.
This horizontal flow promotes flexibility and rapid decision making. Michael
Hammer’s 1993 landmark book, Reengineering the Corporation: A Manifesto for
Business Revolution, stimulated managers to see the importance of managing
business processes. Books like Hammer’s, along with the difficult economic
times of the late 1980s, led to a climate in which managers began to view ERP
software as a solution to business problems. In recent years, further impetus
for adopting ERP systems has come from companies’ efforts to be in
compliance with the Sarbanes-Oxley Act of 2002, a federal law passed in
response to the accounting fraud discovered at large companies such as Enron
and WorldCom, among others. The law, which is covered in more detail in the
succeeding module, requires companies to substantiate internal controls on all
information.
In the next section, you will learn about the development of the first ERP
software. SAP was the first company to develop software for ERP systems and
is the current market leader in ERP software sales. As of 2011, SAP has over
109,000 customers, 53,000 employees, and sales of $12.5 billion annually.
1,000th system. SAP also became SAP AG, a publicly traded company.
SAP R/3
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In 1988, SAP realized the potential of client-server hardware architecture and began
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development of its R/3
system to take advantage of client-server technology. The first
version of SAP R/3 was released in 1992. Each subsequent release of the SAP R/3
software contained new features and capabilities. The client-server architecture used
by SAP allowed R/3 to run on a variety of computer platforms, including UNIX and
Windows NT. The SAP R/3 system was also designed using an open architecture
approach. In open architecture, third-party software companies are encouraged to
develop add-on software products that can be integrated with existing software. The
open architecture also makes it easy for companies to integrate their hardware
products, such as bar-code scanners, personal digital assistants (PDAs), cell phones,
and global information systems with the SAP system.
PeopleSoft: PeopleSoft was founded by David Duffield, a former IBM employee who,
like SAP’s founders, faced opposition to his ideas from IBM management. PeopleSoft
started out offering software for human resources and payroll accounting, and it
achieved considerable success, even with companies that already were using SAP for
accounting and production. In fact, PeopleSoft’s success caused SAP to make
significant
ISO modifications to its Human Resources module. In 2003, PeopleSoft
9001:2015 Certified
strengthened its offerings in the supply chain area with its acquisition of ERP software
vendor
Level JD Edwards.
I Institutionally Accredited Then, in late 2004, Oracle succeeded in its bid to take over
PeopleSoft. Today, PeopleSoft, under Oracle, is a popular software choice for managing
human resources and financial activities at universities. Currently Oracle offers
PeopleSoft’s ERP solution under the PeopleSoft Enterprise Applications name; it offers
JD Edwards ERP solutions as JD Edwards EnterpriseOne and JD Edwards World.
Oracle: Oracle is now SAP’s biggest competitor. Oracle began in 1977 as Software
Development Laboratories (SDL). Its founders, Larry Ellison, Bob Miner, and Ed Oates,
won a contract from the Central Intelligence Agency (CIA) to develop a system, called
Oracle, to manage large volumes of data and extract information quickly. Although the
Oracle project was canceled before a successful product was developed, the three
founders of SDL saw the commercial potential of a relational database system. In 1979,
SDL became Relational Software, Inc., and released its first commercial database
product. The company changed its name again, to Oracle, and in 1986 released the
client-server Oracle relational database. The company continued to improve its
database product, and in 1988 released Oracle Financials, a set of financial
applications. The financial applications suite of modules included Oracle Financials,
Oracle Supply Chain Management, Oracle Manufacturing, Oracle Project Systems,
Oracle Human Resources, and Oracle Market Management. Oracle Financials was the
foundation for what would become Oracle’s ERP product.
SAP ERP: SAP ERP software (previous versions were known as R/3, and later, mySAP
ERP) has changed over the years, owing to product evolution—and for marketing
purposes. The latest versions of ERP systems by SAP and other companies allow all
business areas to access the same database, as shown in Figure 2-4, eliminating
redundant data and communications lags.
to real-time stock data, a salesperson taking an order can confirm the availability of
the desired material. When the salesperson enters the sales order into the system, the
order
ISO data
9001:2015 are immediately available to Supply Chain Management, so Manufacturing
Certified
can update production plans, and Materials Management can plan the delivery of the
order.
Level If the sales
I Institutionally order data are entered correctly by the salesperson, then Supply
Accredited
Chain Management personnel are working with the same, correct data. The same sales
data are also available to Accounting for invoice preparation.
Earlier in this module, you learned how software modules work. Figure 3.5 shows the
major functional modules in the current SAP ERP system, also known as SAP ECC 6.0
(Enterprise Central Component 6.0), and depicts how the modules provide integration.
The basic functions of each of the modules are as follows:
The Sales and Distribution (SD) module records sales orders and scheduled
deliveries. Information about the customer (pricing, address and shipping
instructions, billing details, and so on) is maintained and accessed from this
module.
The Materials Management (MM) module manages the acquisition of raw
materials from suppliers (purchasing) and the subsequent handling of raw
materials inventory, from storage to work-in-progress goods to shipping of
finished goods to the customer.
The Production Planning (PP) module maintains production information.
Here production is planned and scheduled, and actual production activities are
recorded.
FIGURE 3.5 Modules within the SAP ERP integrated information systems environment
The Quality Management (QM) module plans and records quality control
activities, such as product inspections and material certifications.
The Plant Maintenance (PM) module manages maintenance resources and
planning for preventive maintenance of plant machinery in order to minimize
equipment breakdowns.
The Asset Management (AM) module helps the company manage fixed-asset
purchases (plant and machinery) and related depreciation.
The Human Resources (HR) module facilitates employee recruiting, hiring,
and training. This module also includes payroll and benefits.
The Project System (PS) module facilitates the planning for and control over
Two financial modules, Financial Accounting (FI) and Controlling (CO), are shown in
Figure 3.5 as encompassing the modules described above. That is because nearly
The Financial Accounting (FI) module records transactions in the general
ledger accounts. This module generates financial statements for external
reporting purposes.
The Controlling (CO) module serves internal management purposes, assigning
manufacturing costs to products and to cost centers so the profitability of the
company’s activities can be analyzed. The CO modulesupports managerial
decision making.
The Workflow (WF) module is not a module that automates a specific
business function. Rather, it is a set of tools that can be used to automate any of
the activities in SAP ERP. It can perform task-flow analysis and prompt
employees (by email) if they need to take action. The Workflow module works
well for business processes that are not daily activities but that occur
frequently enough to be worth the effort to implement the workflow module—
such as preparing customer invoices.
In summary, ERP integrates business functional areas with one another. Before ERP,
each functional area operated independently, using its own information systems and
methods for recording transactions. ERP software also makes management reporting
and decision making faster and more uniform throughout an organization. In addition,
ERP promotes thinking about corporate goals, as opposed to focusing only on the goals
of a single department or functional area. When top management is queried on the
reasons for implementing ERP systems, the overriding answer is control. With the
capability to see integrated data on their entire company’s operation, managers use
ERP systems for the control they provide, allowing managers to set corporate goals
correctly.
processes that are performed periodically. In those cases, however, the company no
longer has accurate data available in real time across the enterprise. Thus, a company
must
ISO be sure
9001:2015 the decision to use multiple vendors—or to maintain a legacy system—is
Certified
based on sound business analysis, not on a resistance to change. Software upgrades of
nonintegrated
Level systems are made more problematic because further work must be
I Institutionally Accredited
done to get software from different vendors to interact. SAP’s NetWeaver development
platform (discussed in Chapter 8) eases the integration of SAP ERP with other
software products.
Any large software implementation is challenging—and ERP systems are no
exception. There are countless examples of large implementations failing, and it is easy
to understand why. Many different departments are involved, as are the many users of
the system, programmers, systems analysts, and other personnel. Without top
management commitment, large projects are doomed to fail. More implementation
issues are discussed in Module 7.
After a company chooses its major modules, it must make an incredible number
of decisions on how to configure the system. These configuration options allow the
company to customize the modules it has chosen to fit its needs. For example, in the
Financial Accounting (FI) module, a business might need to define limits on the dollar
value of business transactions that certain employees can process. This is an
important consideration in minimizing the risk of fraud and abuse, and is just one
example of the many decisions facing a company at the start of a major ERP
implementation.
such powerful programs. For a Fortune 500 company, software, hardware, and
consulting costs can easily exceed $100 million. Large companies can also spend $50
million
ISO 9001:2015 toCertified
$100 million when it is time to upgrade to a newer version of their ERP
software. Full implementation of all modules can take years. In fact, most companies
view
Level ERP implementations
I Institutionally Accredited as an ongoing process, not a one-off project. As
implementations are completed in one area of a company, other areas may begin an
implementation or upgrade a previous implementation.
The modular design of SAP ERP is based on business processes, such as sales
order handling, materials requirement handling, and employee recruiting. When data
are entered into the system, data in all related files in the central database are
automatically updated. No further human input is required to make the changes.
Before the development of SAP ERP, companies often sought vendors to write
software to fit their business processes. As SAP accumulated experience developing
information systems, however, the company began to develop models of how certain
industries’ business processes should be managed. Thus, SAP ERP’s design
incorporates best practices for a wide variety of processes. A best practice is the best,
most efficient way of handling a certain business process. If a company’s business
practices do not follow one of the best practices incorporated in the SAP ERP design,
then the business must redesign its practices so it can use the software. Although some
customization is possible during implementation, many companies find they must still
change some of the ways they work to fit the software.
SAP and Oracle have significant competition for small-business customers from a
number of smaller ERP software companies such as Sage Business Solutions, Exact,
Infor,
ISO andCertified
9001:2015 Epicor. In 2000, software giant Microsoft acquired Great Plains, a provider
of ERP software, as an entry into the small-business ERP market. Microsoft currently
hasIfive
Level ERP products
Institutionally Accredited offered under the Microsoft Dynamics label.
companies study their needs and then hire an external team of software consultants to
help choose the right software vendor(s) and the best approach to implementing ERP.
Working
ISO as a team with the customer, the consultants apply their expertise to
9001:2015 Certified
selecting an ERP vendor (or vendors) that will best meet their customer’s needs.
To Level
After
sumI Institutionally
recommending
it up this module
Accredited a vendor,
has the
presented
consultants
highlight
will typically
significant
recommend the software
highlights suchmodules
as: best suited to the company’s operations, along with the configurations within
those modules that are most appropriate. This preplanning should involve not only the
It seems obvious today
consultants and that a businessIT
a company’s should have integrated
department, but the software
management of all functional
to manage all functional
business areas as well.areas. An integrated ERP system, however, is
an incredibly complex hardware and software system that was not
feasible until the 1990s. Current ERP systems evolved as a result of
3.6 The Significance and Benefits of ERP Software and Systems
three things:
o the The significanceofofthe
advancement ERPhardware
lies in its and
manysoftware
benefits. technology
Recall that integrated information
systems can lead to more efficient business processes that cost less than those in unintegrated
(computing power, memory, and communications) needed to
systems. In addition, ERP systems offer the following benefits:
support• the ERPsystem,
allows easier global integration. Barriers of currency exchange rates,
o the development
language, and of a culture
vision ofcan
integrated information
be bridged systems,
automatically, so data can be integrated
and across international borders.
o the reengineering
• ERP integrates of companies
people to shift
and datafrom a functional
while eliminating focus
the need to update and
to a business-process
repair many separate focus. computer systems. For example, at one point, Boeing had
450 data systems that fed data into its production process; the company now
has a single system for recording production data.
• ERP allows management to actually manage operations, not just monitor
them. For example, without ERP, getting an answer to “How are we doing?”
requires getting data from each business unit and then analyzing that data for
a comprehensive, integrated picture. The ERP system already has all the data,
allowing the manager to focus on improving processes. This focus enhances
management of the company as a whole, and makes the organization more
adaptable when change is required.
An ERP system can dramatically reduce costs and improve operational efficiency. For
example, EZ-FLO International, Inc., a family-run plumbing products manufacturer and
distributor, had been experiencing double-digit growth and needed a scalable business
platform to support its global growth. The company selected SAP Business All-in-One
customized for wholesale distribution. As a result of the integrated process
capabilities, EZ-FLO has been able to greatly improve its inventory management
processes and has eliminated its annual inventory count, which used to take 100
employees two days to complete.
Performance Tasks
*use the worksheet provided, for online classes please see visit the LMS for online discussion instructions
For the Laboratory:
1. Watch the video, follow and perform the instructions on this particular week we have
laboratory exercises: Laboratory Exercises 6 - Laboratory Exercises 8
2. Watch the video, follow and perform the instructions on this particular week we have 7 Machine
Problems: Machine Problem 4 - Machine Problem 11 and upload the file on the submission link.
Video to watch: Excel Basics 6: Customize Quick Access Toolbar (QAT) and Show New Ribbon Tabs (10:17 min)
Video to watch: Excel Basics 7: Keyboard Shortcuts Are Fast! (08:15 min)
Video to watch: Excel Basics 8: Default Data Alignment In Excel & How it Can Help (09:25 min)
Practice file for Video/Class Project to download: EB06-08QATKeyboardsDefaultAlign.xlsx
Handout to download (pdf notes): Office2016Class18-20-ExcelBasics06-08QATKeyboardDefaultAlign.pdf
Machine Problem 4: HW # 1 - 3 at the end of the Excel workbook for this video.
Laboratory Exercise 9: Excel Basics 9
Video to watch: Excel Basics 9: Number Formatting as Façade & the ROUND Function ( 28:49 min)
Start file for Video/Class Project to download: EB09-NumberFormattingAndROUND.xlsm
Handout to download (pdf notes): Office2016Class21-ExcelBasics09-NumberFormattingAndROUND.pdf
Machine Problem 5: HW # 1 - 2 at the end of the Excel workbook for this video.
For offline classes: Compile your work per week and follow the sample naming convention online. Week 1 –
Lecture Deliverables please use this: ActivityCode-Section-LastNameFirstName: eg. PT2-BSIT3A-VILLARICA-
MIA
For offline classes: Compile your work per week and follow the sample naming convention online. Week 1 –
Laboratory Deliverables please use this SECTION-LASTNAME-FIRSTNAME- ActivityCode.xlsx : eg. BSIT3A-
VILLARICA-MIA- MP4.xlsx
Answer is appropriate to the Clear sense of order. Begins with a Develops each point with many specific Uses technical or scientific
question. Content is factually thesis or topic sentence. Supporting details. Answers question completely. terminology appropriately and
correct. points are presented in a logical correctly. No major grammatical
4 progression. or spelling errors.
Answer is appropriate to the May lack a thesis sentence, but points Each point supported with some details Accurate word choice. No more
question. Content may have are presented in a logical progression. and evidence. All important points than 2 major errors and a few
3
one or two factual errors. included. minor errors.
2 Content relates peripherally Logic of argument is minimally Sparse details or evidence. Question Ordinary word choice; use of
to the question; contains perceivable. Points presented in a only partially answered. scientific terminology avoided.
significant factual errors. seemingly random fashion, but all Some serious errors (but they
support argument. don’t impair communication).
Content unrelated to Lacks clear
ISO 9001:2015 organizational plan.
Certified Statements are unsupported by any Limited vocabulary; errors
question. Reader is confused. detail or explanation. Repetitious, impair communication.
1
Level I Institutionally Accredited incoherent, illogical development.
Formulas The formulas were used Most of the numbers that Some of the numbers Only 1 or 2 of the numbers
wherever appropriate. needed to be calculated that needed to be that needed to be calculated
There were no numbers were done by formulas. calculated were done by were done by formulas.
typed in to do any formulas.
calculations.
Organization The spreadsheet is very The spreadsheet is a little The spreadsheet appears The spreadsheet is all over
organized and very easy to difficult to read. Some of to have some order. It the place. The data is not
read. the data and the chart are can be read, but is very organized and the graph
scattered or cluttered. difficult. does not accompany the
data.
Required Data All the information is The spreadsheet is The spreadsheet is The spreadsheet is missing
present and it good form. missing 1 or 2 items. missing 3 or 4 items. 5 or more items.
Graph The graph is present and The graph is present and The graph is present, but There is no graph.
represents the data is in good form with data, does not represent the
appropriately. but lacks a couple key data.
figures.
Formatting The graph has all the The graph is missing one The graph is missing 2 of The graph is missing all the
Requirements headings, column labels, of the requirements the requirements. formatting requirements.
number labels, and is easy
to read.
Extra Formatting The graph has extra The graph has extra The graph has a couple The graph has no extra
features that makes the features, but it makes the extra features, but it formatting features.
graph more attractive and graph more difficult to makes the graph difficult
is still easy to read. read. to read.
Learning Resources
1. Monk, ISO
E.,9001:2015
& Wagner, B. (2013). Concepts in enterprise resource planning / Ellen F. Monk,
Certified