Page 12 - DCAP302_ENTERPRISE_RESOURCE_PLANNING

Enterprise Resource Planning

notes ERP systems saw a large boost in sales in the 1990s as companies faced the Y2K problem in
their legacy systems. Many companies took this opportunity to replace their legacy information
systems with ERP systems. This rapid growth in sales was followed by a slump in 1999, at which
time most companies had already implemented their Y2K solution.
1.3.1 the ideal erp system

An ideal ERP system is when a single database is utilized and contains all data for various
software modules. These software modules can include:
1. Manufacturing: Some of the functions include; engineering, capacity, workflow
management, quality control, bills of material, manufacturing process, etc.
2. Financials: Accounts payable, accounts receivable, fixed assets, general ledger and cash
management, etc.

3. Human Resources: Benefits, training, payroll, time and attendance, etc
4. Supply Chain Management: Inventory, supply chain planning, supplier scheduling, claim
processing, order entry, purchasing, etc.
5. Projects: Costing, billing, activity management, time and expense, etc.

6. Customer Relationship Management: Sales and marketing, service, commissions, customer
contact, calls center support, etc.
7. Data Warehouse: Usually this is a module that can be accessed by an organizations
customers, suppliers and employees.

1.3.2 implementation of an erp system

Implementing an ERP system is not an easy task to achieve, in fact it takes lots of planning,
consulting and in most cases 3 months to 1 year +. ERP systems are extraordinary wide in scope
and for many larger organizations can be extremely complex. Implementing an ERP system will
ultimately require significant changes on staff and work practices. While it may seem reasonable
for an in house IT staff to head the project, it is widely advised that ERP implementation
consultants be used, due to the fact that consultants are usually more cost effective and are
specifically trained in implementing these types of systems.
One of the most important traits that an organization should have when implementing an ERP
system is ownership of the project. Because so many changes take place and its broad effect on
almost every individual in the organization, it is important to make sure that everyone is on
board and will help make the project and using the new ERP system a success.

Usually organizations use ERP vendors or consulting companies to implement their customized
ERP system. There are three types of professional services that are provided when implementing
an ERP system, they are Consulting, Customization and Support.

Consulting Services: Usually consulting services are responsible for the initial stages of ERP
implementation, they help an organization go live with their new system, with product training,
workflow, improve ERP’s use in the specific organization, etc.
Customization Services: Customization services work by extending the use of the new ERP
system or changing its use by creating customized interfaces and/or underlying application
code. While ERP systems are made for many core routines, there are still some needs that need to
be built or customized for an organization.
Support Services: Support services include both support and maintenance of ERP systems. For
instance, trouble shooting and assistance with ERP issues.

6 LoveLy professionaL university