ENTERPRISE RESOURCE

PLANNING
 AGENDA
• Introduction to ERP
• Components/Modules of ERP
• Implementation of ERP
• Advantages,Disadvantages
• Various Players
• Future Growth
• Business Case
 DEMANDS ON THE
INDUSTRY
• Better products at lower costs
• Tough competition
• Need to analyze costs /
revenues on a product or
customer basis
• Flexibility to respond to
changing business
requirements
• More informed management 3
WHAT ARE THE
PROBLEMS??

4
Solving these Problems will
Keep You Ahead Of
Competition!!

5
E R P - T h e E n a b le r

6
 WHAT IS ERP?
ERP is a solution which


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

– performs core Corporate activities

and increases customer service
augmenting corporate Image
 DEFINITION OF ERP

Business solution that addresses all

the needs
of an enterprise with the process view

of an
organization to meet the

organizational goals
and integrate all the functions of the

Enterprise.

8

BRIEF HISTORY OF ERP
 WHY ERP??

•
• 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
expectations
• To be Competitive & for survival 10
•
 GOAL OF ERP
To im p ro ve a n d
stre a m lin e


in te rn a lb u sin e ss
p ro ce sse s, w h ich
typ ica lly
re q u ire s
re e n g in e e rin g o f
cu rre n t b u sin e ss
p ro ce sse s
 ERP OPTIONS
•
• OPTION 1 – MAKE [Using Internal
resources]


• OPTION 2 – BUY


• OPTION 3 – MAKE [Using External

resources]
•
 ERP :
MODULES/COMPONENTS
 ERP MODULES
• A massive software architecture
• Suited for typically large enterprises
• Envelops broad range of enterprise-
wide functions
• Divided functionally into various
modules for flexibility and ease of
use
• Integration is the key to information
centricity
•
 BASIC ERP MODULES
• Finance module
• Human Resource module
• Production module
• Purchasing module
• Sales and Marketing module
• Inventory module

 Finance module
• Gathers financial data from various
functional departments
• Generates financial reports
• Functionality of general ledger,
accounts payables and receivables,
treasury management etc.
Human Resource module
• Streamlines management of human
resources and human capital
• Complete employee database from
attendance to appraisals
• Integration with knowledge
management systems for optimum
employee expertise utilization
•
 Production module
• Evolution of manufacturing
requirements planning (MRP)
• Optimizes utilization of
manufacturing capacity, parts,
components and materials
• Uses historical production data and
sales forecasting
 Purchasing module
• Streamlines procurement of required
raw materials
• Automates potential supplier
identification, price negotiation,
awarding purchase order to
supplier
• Integration with production planning
and inventory modules
 Inventory module
• Facilitates processes of maintaining
the appropriate level of stock in
warehouse
• Identifying inventory requirements,
setting targets, providing
replenishment techniques and
options, reconciling and reporting
inventory status
• Integration with finance, sales and
purchase modules enables
 Sales and Marketing
module
• Order placement, order scheduling,
shipping and invoicing
• May be closely integrated with
ecommerce website of the
organization
• Online store offering as part of Sales
module
• Integration with CRM supports lead
generation, direct mailing
campaigns etc.
 ERP IMPLEMENTATION
• Organizational Revolution


• Extensive Planning


• Reposition the company



• Transform business practices

•
•
 ERP IMPLEMENTATION
• Role of Top management


– Well defined vision and clarity

– Lead the change and guide the teams
– Build cohesive team across borders
– Ensure Organizational commitment



 ERP IMPLEMENTATION


• Two Implementation Process



– Reengineer the company’s existing way of

doing business to the best practices
–
– Customise the ERP software
• Higher implementation costs
• Maintenance costs/ Upgrade expenses
 ERP IMPLEMENTATION
• Integration
– Use of Middleware
– Dependence on upgrades in ERP
software
– Rapid information flow
– Ripple effect of mistakes
– Monitor transactions and rectify
mistakes
– Awareness amongst employees for
ensuring proper information flow
– Information sharing and control
–
 ERP IMPLEMENTATION
• Consultants
– ERP implementation requires following
skills:
• Functional
• Technical
• Interpersonal
• Implementation time
– Phase-in approach module wise
– Average time is 14 months with 150
consultants
– Depends upon
• Number of modules
• Scope of implementation
• Extent of customization
• Number of interfaces
 ERP IMPLEMENTATION
• Implementation Costs
– Hiring Consultants
– Retention of employees
– Implementation time


• ERP vendors
– Selection of suitable vendor
– Track record, staff, global presence
 ERP IMPLEMENTATION
• Employees selection
– Internal experts aware of company’s
processes and industry practices
–
• Employee morale
– Concerns are long working hours and
stress
– Support and motivation from top
management
 required



 ERP IMPLEMENTATION
STAGES
• Analysis
– Discussion with functional experts and
preparing Project Scope document
• Design
– Prepare Functional report, Design document,
Test scripts, Interface plan
• Build
– System configuration
• Transition
– Training users, Acceptance testing, Live
system replication,
• Production
– Data migration, Official handholding
–
ADVANTAGES OF ERP
DISADVANTAGES OF ERP
DISADVANTAGES OF ERP
 ERP Vendor
Classification
Tier I Tier II Tier III

SAP Epicor Compiere

Oracle Infor Netsuit

Microsoft Sage Activant

Dynamics Soluntions Inc.
Market Share

SOURCE :http://panorama-consulting.com/resource-center/2010-erp-vendor-a
 SAP
• German for "Systems, Applications and
Products"
• Largest ERP provider
• Targets large organizations
• Significant presence in midsize
organizations
• Integrated industry centricity of its ERP
offering is key to SAP success in ERP
• Two brands, one with the deepest
functionality available
• Priced at higher end
 SAP


• Latest offering - SAP ECC 6.0

– SAP ERP Financials
– SAP ERP Operations
– SAP ERP Human Capital Management
• Companies using SAP- Intel, Chevron,
NASA, Coca-Cola , P&G,
Schlumberger, BHEL



 Oracle
• World's second largest business
applications maker
• Over 37,000 application customers
• Four primary brands, two with deep
functionality
• Different platform under each brand
• A lot of standalone, unintegrated
industry-centric point products
• Priced at the high end
•
 Microsoft
• ERP darling for SMB (small and
midsize business) organizations
• Multiple ERP products
• Partners heavily with Microsoft
developer community
• Covers breadth of the industry
• MS/.Net/SQL technology
• Low to moderately priced
•
 Infor
• 3rd largest global ERP maker
• Over 70,000 customers
• Several different ERP systems
• Strong distribution
• SCM is a speciality
• Partners heavily with IBM and IBM
distributors
• Low to moderately priced
•
 Epicor
• Long history of reputable products
• Over 20,000 customers, 140 countries,
30 languages
• Several strong industry solutions
• Good after sales support
• MS/SQL/SOA technology
• Lowest TCO (Total Cost of Ownership)
and total per user cost of software,
services and maintenance for mid-
size companies
•
Advantage ERP
 Advantages of ERP
• Use of Spreadsheets made Obsolete
• Real Time data made accessible
• Allows quick decision making
• Provides automated & up-to-date
business functionalities
• Provides easy integration of legacy &
upgraded Business applications
• Streamlines business operations
•
GHCL : ERP success story
 Business Process :
 Complicated that required co-
ordinated planning, scheduling &
monitoring each stage of production

 Objective to incorporate ERP :
 To integrate various businesses &
provide support for decision making
across all levels
 To automate & streamline
transactional systems & material
resource planning, manufacturing &
dispatch
 P ro b le m s F a ce d b y G H C L


 Spreadsheets were in use prior to ERP

implementation to manage various
stages of manufacturing
 No Real Time Data about Business
operations was available
 Generating MIS reports on monthly stocks,
quality, product planning & BOM took a
lot of time

 BENEFITS OF IMPLEMENTING ERP

 SAP’s mySAP incorporated by GHCL
 check & monitor material
consumption in any department at
plant level
 Production plans of any department
readily available at any time
 Daily production report directly
generated & made available
 Production status of any sales order
available with the current status
 Top management can retrieve any
information at any time through
VPN connectivity
 Benefits of ERP
• On- time delivery of orders to
customers
• Prompt availability of the status of
order placed to the customer
• Enterprises becoming more time
sensitive
• Provides better marketing
opportunities
• Better decision making by the
management made possible
CHALLENGES POSED
 Challenges
• Information Security
 Relevant authorisation provided
• Cost of ERP
 All ERP companies targeting the Small &
Medium Size Business & developing
applications that are efficient and cheap
• Impact of Recession
 Post-recession is the most aggressive
growth phase
 companies strategize & incorporate
changes for Business betterment with future
growth perspective
 SMB - ERP

S u cce ss S to rie s
 Secant Technologies
• A 4-crore Ludhiana company
deployed ERP in 2005
• Local vendor, Disha Informatics
implemented ERP
• Time taken : 8 months
• Cost involved : Rs. 8.5 lakh
• Impact: 50% y-o-y

SOURCE :http://www.channelbusiness.in
 Veeras Infotek
• Based in Chennai, deployed
Navision(ERP)
• Helped evaluate employee
performance
• Cost involved: Rs. 10 lakh
• Growth: Almost double in 3 years
time
•

Source : http://www.channelbusiness.in
Analyzing SAP-ERP's
success in TISCO
 TISCO profile
• Founded in 1907

• Part of the Tata Group

• Leading steel giant in the country

 TISCO profile
• Dedicated to
– providing laudable services to
the stakeholders
– improving on the quality
– thriving for innovations and
improvements constantly
 ERP Implementation
• TISCO deserves lot of credit for
implementing ERP
• many organizations in the global
level have given up the very idea of
ERP
– lots of failures associated
– Implementation did in wrong manner
have caused havoc to organizations
• Choose ERP in the right time and
implemented it in a proper manner
• Implemented it into the whole
systems in one single spree
• Net results of their ERP software
have been described to be path
breaking and a trendsetting one
 Why ERP in TISCO
• Two major problems
– Not customer friendly
– The systems were outdated and the
modalities of operation were too
complex and not error free
 The Process
 Challenges
– Had to choose top ERP software
– 8 months set for implementation
was a major challenge



• Business process was divided into
two main segments
– Core functions were denoted to be
major ones
– Supporting functions were named
minor ones
• A plan of action on the proposed
ERP's impact was drafted 
• All efforts to ensure that the change
did not produce any sort of
resentment
 The Outcome
• Produced in terms of financial
technical and managerial
parameters
• Effective handling and speed delivery
resulted in greater sales
• Drastic fall in the amount owned to
creditors
• Increased the productivity
 FUTURE MOVES
• Determined not to stop ERP or attain
a saturation point
• Working on to improve and increase
the scopes of ERP software
THANK YOU