Course Code: SWE - 304

Enterprise System Engineering

Lecture # 8
Dr. Syed Saood Zia
Assistant Professor

6th Semester
Software Engineering Department
Sir Syed University of Engineering & Technology
Table of Content

• Enterprise Resource Planning Systems

• Introduction
• Characteristics of ERPs
• Advantages of ERP
• Disadvantages of ERP

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Enterprise
• ERP Systems
Systems

03
ERPs - Introduction

• An ERP software applications package is a suit of pre-engineered, ready-to-

implement integrated application modules catering to all of the business
functions of an enterprise and which possesses the flexibility for configuring
and customizing dynamically the delivered functionality of the package to suit
the specific requirements of the enterprise.

• ERP enables an enterprise to operate as an integrated enterprise-wide,

process-oriented, information-driven real-time enterprise.

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ERPs - Introduction

• ERP systems can provide this comprehensiveness and flexibility because, at

the heart of the system, resides a CASE-like repository that stores all details
of these pre-developed applications.

• These details include every single data item, data table, and software
program that is used by the complete system.

• The success of ERP packages is based on the principle of reusability.

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ERPs - Introduction

• Implementation of an ERP within an enterprise was no longer a problem of

technology; it was a business problem.

• ERP systems have been the harbingers of a paradigm shift in the role of the
IS/IT function within an enterprise.

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ERPs - Information and Material Flows in

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Characteristics of ERPs

The distinguishing characteristics of ERP are • ERP enables the real-time enterprise.
as follows:
• ERP elevates IT strategy as a part of the
• ERP transforms an enterprise into an business strategy.
information-driven enterprise.
• ERP represents a major advance on the
• ERP fundamentally perceives an enterprise earlier manufacturing performance
as a global enterprise. improvement approaches.
• ERP reflects and mimics the integrated • ERP represents the new departmental
nature of an enterprise. store model of implementing
computerized systems.
• ERP fundamentally models a process-
oriented enterprise. • ERP is a mass-user-oriented application
environment.
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Characteristics of ERPs

• ERP transforms an enterprise into an information-driven enterprise.

• All computerized systems and solutions in the past were using past-facing
information merely for the purpose of referring and reporting only.

• ERP began treating information as a resource for the operational requirements of

the enterprise.

• Information resource as made available by ERP systems can be reused and shared
multiply without degradation.

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Characteristics of ERPs

• ERP fundamentally perceives an enterprise as a global enterprise.

• ERP systems cater to corporate-wide requirements even if an enterprise is

involved in disparate businesses such as discrete industries (manufacturing,
engineering, etc.); process industries (chemicals, paints, etc.); and services
industries (banking, media, etc.).

• ERP enables the management to plan, operate, and manage such conglomerates
without any impediments of mismatching of systems for different divisions.

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Characteristics of ERPs

• ERP reflects and mimics the integrated nature of an enterprise.

• ERP in a masterstroke eliminated all wait times associated with all intracompany
interactions. Integration as embodied in ERP eliminates many a non-value-added
process.

• With its laser-like focus on best-of-business practices, ERP demonstrates glaringly

the essential futility of routine bureaucratic mechanization within enterprises; it
brings in consistency, discipline, and fast reaction times in the operations of a
company.

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Characteristics of ERPs

• ERP fundamentally models a process-oriented enterprise.

• ERP packages still carry the legacy of the data-oriented view, the parallel
view of business process and business rules is gaining prominence rapidly.

• This can also be seen to be the reason for the rapidly maturing groupware
and workflow subsystems within the core architecture of current ERP
systems.

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Characteristics of ERPs

• ERP enables the real-time enterprise.

• The real-time responsiveness of the enterprise enables enterprises to have the powerful
capability of concurrent processing.

• Enterprises can obtain tremendous efficiencies and throughputs because of this ability
to administer in parallel many a related processes that are not interdependent either
fully or partially.

• ERP systems can perform all business processes concurrently because of ready
availability of all of the relevant, complete, and consistent information at the same time.

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Characteristics of ERPs

• ERP elevates IT strategy as a part of the business strategy

• The real focus of IS/IT systems is on how to give the enterprise a competitive edge;
such is part of the business necessities and priorities.

• Because of the complexity of increasing business change and uncertainty, good IS/IT
abilities is business strategy incarnate

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Characteristics of ERPs

• ERP represents a major advance on the earlier manufacturing performance

improvement approaches.
• ERP is the latest in the succession of approaches that have been adopted throughout
the history of enterprises for the improvement of enterprise-level performances.

• ERP systems have realized the failed dream of improvements that were expected from
the MRP II-based manufacturing resources planning systems of the 1970s.

• ERP systems provide the basic platform for devising techniques and tools for better
implementations of the earlier approaches.

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Characteristics of ERPs

• ERP represents the new departmental store model of implementing

computerized systems.
• An ERP is the analog of the great departmental store of functionalities or
processes required within an enterprise.

• ERP makes the transition from the world of carefully engineered and running
systems to, as it were, the world of consumers where the value of the delivered
functionality is based not on its pedigree but only on what, how, where, and when
it can be used gainfully.

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Characteristics of ERPs

• ERP is a mass-user-oriented application environment.

• In ERP, end users are truly involved with the operations of the business.

• Because of the intense involvement of a sizable portion of the workforce of the

company with the ERP implementation right from the beginning, the probability
of them embracing the system and not struggling against it is much higher.

• They also act as the advocates and facilitators during and after the
implementation phase.

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Advantages of ERPs

• Optimization of business processes. • The performance of all work units that

• Accurate and timely access to reliable make up their business because better use
information. time is increased.
• The ability to share information between • To improve performance and save time,
all components of the organization. optimize the control and analysis of
management decisions there in the long
• Elimination of unnecessary operations and
term, reduced costs for the company.
data.
• In terms of customer service, because the
• Reduction of time and costs of litigation
response time is reduced attention to
• Then, as each module of the ERP them.
system enters the same real-time • When a company has an ERP system is
database, another advantage is that no more competitive in the environment in
duplicate records or playback operations, which it operates.
i.e., redundancy is avoided.

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Disadvantages of ERPs
• The installation of the ERP system is costly. ERP consultants are very expensive take approximately 60%
of the budget.

• The success depends on the skills and experience of the workforce, including education and how to
make the system work properly.

• Resistance in sharing internal information between departments can reduce the efficiency of the
software.

• The systems can be difficult to use.

• Change of staff, companies can employ administrators who are not trained to manage the ERP system
of the employing company, proposing changes in business practices that are not synchronized with the
system. 19
 Disadvantages of ERPs

• Having an ERP system has many advantages, but does not guarantee the total success of the
company. Organizational culture, know how to involve staff and anticipate changes that will suffer the
organization using this system of administration, are important elements for the completion of the
implementation.

• The effectiveness of the ERP system may decrease if there is resistance to share information between
business units or departments. Due to strong changes that implementation of the ERP system brings
in the culture of work, there may be poorly trained or disinterested in making use of the same staff.

• The benefits of having an ERP system are not presented immediately with the implementation of the
software, they will be evident long after the system is running.
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Summary

• Enterprise Resource Planning Systems

• Introduction
• Characteristics of ERPs
• Advantages of ERP
• Disadvantages of ERP

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