ERP & E-supply Chain Management – In the first hand you must understand what supply chain management (SCM) is. Traditional SCM used the telephone, fax and regular mail to keep contact between suppliers and customers. It involved lots of time and costs. With the advent of computer technologies support for supply chain relationship became Electronic Data Interchange (EDI) systems. But EDI is an inter-organizational process, so business partnerships have been shown to be very important in the adoption and use of EDI.
Supply Chain Management (SCM) in today’s Internet environment, especially the e-business is important to create significant competition advantages to firms and business partners worldwide. Since the objectives and goals are essential factors in the use of supply chain management in the e-business.
ERP being a business tool that manages day-to-day business process and is usually comprised of several modules such as financial module, distribution module, production module and supply chain management module as well as many other modules. Each of these modules share information that is housed within the database structures on which the ERP system was coded. ERP helps to break down barriers between departments within a company.
At a broader context, you must understand that ERP is an integrated system which holds many modules and SCM could be considered as one of the modules.
ERP and Accounting Software – Accounting package handles only individual business functions of accounts whereas Enterprise Resource Planning – ERP package handles the entire range of business functions of an organization.
ERP system is a fully integrated business management system covering functional areas of an enterprise like Finance, Human Resources, Production, Sales and Logistics etc. It organizes and integrates operation processes and information flows to make optimum use of resources such as men, material, money and machine. ERP is a tightly integrated closed loop business solution package.
ERP system enhances a manufacturer ability to accurately schedule production, fully utilize capacity, reduce inventory, and meet promised shipping dates.
A Cloud ERP system means traditional ERP solutions hosted off-site. It is also flexible and scalable. The system has the capability to access real-time data from anywhere without using complicated and costly remote-access software.
On the other hand SaaS (Software-as-a-Service) model offerings are typically smaller. This is normally best for organizations with limited complexity, size and global presence. ERP system providers host SaaS on their own infrastructures instead of locating the systems on-premise at the purchasing organization.
In SaaS model, the vendor will have the full control of the application and not the customer where as in Cloud ERP system your data and your application can be placed on server that you control. Both these models provide instant gratification, taking mere minutes to be up and running.
Data mining and Data warehousing – Modeling the investigated system and discovering relations that connect variables in a database are the subjects of data mining. Modern data mining system self learn from the previous history of the investigated system, formulating and testing hypotheses about the rules, which this system obeys.
When concise and valuable knowledge about the system of interest had been discovered, it can and should be incorporated into some decision support system, which helps the manager to make wise and informed business decisions.
Below are all the questions that can probably be answered if information hidden among megabytes of data in your database can be found explicitly and utilized.
Implementing a data warehouse provides significant benefits – some tangible, some intangible. The benefits include the following:
As far as a manufacturing organization is concerned, these are the most important factors affecting profitability and success. If this data could be captured and validated as the activities are happening, everyone in the organization will have accurate, timely information for decision-making.
eresource ERP enables a single, logical portal to capture an
d validate this information as it is happening on the production floor. When using the web-based ERP system eresource, data will be captured and validated in real time, summarized and instantly available to decision makers throughout the organization, wherever they may be and whatever role they may play.
Today’s manufacturing solutions should enable shop floor workers to be knowledge workers. They should have a system that is capable of doing everything needed at his fingertips to set up the work center quickly and accurately and to make, count and measure parts or assemblies. Drawings, setup instructions, material requirements, customer alerts, inspection specifications and more should be available in electronic form on the shop floor. Alerts can be triggered immediately if a dimension or operating parameter is out of specification. Also when operators makes errors it could be identified on the spot and corrective actions can be taken immediately.
Customization of ERP software becomes necessary in every part of the technology and because of this technology development most of the organizations tend to customize their software as per their requirement. Customization is the process of fitting the chosen ERP software to the needs of a specific organization.
Whenever the processes represented in the ERP software differ significantly from the processes used by the firm one has two options. First is to build the organizational process into the ERP software through customization. The second one is to change the practice followed by the firm to suit the process native to the ERP software.
As integration of business functions is one of the key strength of ERP system, the integration process begins at the contact with a potential customer. Therefore, this process of customer ordering is at the heart of the ERP software system.
In an ERP system the integration of sales and distribution to capture the order and ship the goods, material management to control the inventory, financial accounting to manage the billing and flow of cash, controlling to measure the profitability of operations and production planning to ensure an economical flow of goods to inventory and customers.
ERP training courses are usually of short duration and these training sessions can bring many benefits to participants who have some functional experience about an ERP system.
Courses are usually conducted for modules such as finance, manufacturing, sales and marketing and material management. ERP vendors integrate ERP courses as part of their training program and curriculum is designed to suit as per the knowledge each section of students such as beginners, IT students, professionals and corporate.
The ERP course curriculum is designed to suit all categories of participants as they get exposed to the various aspects of the ERP software in a graded fashion. They will able to understand the concept in a comprehensive way. First level will consist of the activities and business processes which occur in accompany. Second level, the relationship between each activity, the business process and data recorded should be taught. At the third level the curriculum will be included the department wise data entry forms and the relationship with the activities shown. And at the fourth level, participants will be taught how the data entered in the data entry forms is shown in reports. At the last level, the macro features such as creation of masters, editing, deleting etc will be explained.
ERP and e-business – E-business stands for ‘electronic business’, which involves communications and doing business electronically through the Internet. E-business is defined as the use of electronically enabled communication networks that allow business enterprises to transmit and receive information.
It can significantly improve business performance by strengthening the linkages in the value chain between businesses (B2B) and consumers (B2C). Besides increasing efficiency in selling, marketing and purchasing, e-Business achieves effectiveness through improved customer service, reduced costs and streamlined business processes. Furthermore, e-Business creates a strategic, customer-focused business environment for shared business improvements, mutual benefits and joint rewards.
Companies use the Internet to implement customer relationship management (CRM) and supply chain management (SCM) capabilities, which enabled them to link their operations seamlessly with customers and suppliers.
For example, a beverage manufacturer with 40% growth and Rs. 700 crore in annual sales revenue sells its products through 150 distributors nationwide as well as general stores and cafes in the country. By using ERP system and e-Business platform, the salespersons can track sales and promotions through the Internet and are provided assistance and suggestions to enhance their performance. The sales persons and distributors have access to commission reports and they can track and adjust sales orders. Through consolidating its financial, compensation, sales and depletion data into a single report, the organization prevents out-of-stock and partial shipments. The increased need for more labour force to handle customer service issues in the past was also eradicated by integrating ERP system with e-Business.
Both Enterprise Resource Planning – ERP and TQM – Total Quality Management share similar goals – customer satisfaction, productivity improvement, increased competitiveness, waste reduction, effort duplication and so on. ERP system will help in achieving these goals when used in conjunction with TQM.
Here ERP has the role of an enabler of the TQM principles and philosophies. ERP is also benefited by the implementation of TQM. Effective use of TQM creates better performing ERP systems. TQM brings problem solving techniques and continuous improvement opportunities for all ERP systems. The effective use of TQM helps companies obtain the maximum return on investment from expensive investments.
Therefore, the organizations applying or targeting TQM in their businesses, ERP software has become an essential necessity.
