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Unit 10: Enterprise Resource Planning – I

Data integrity means to ensure correct data in the data base. There are many ways through Notes
which the integrity violation may occurs, like one employee entered wrong data/
information, software problem, etc. There are many way to stop the redundancy: some of
these are backing up data in another place, controlling the access of data with the security
system, using error detection technique, etc. ERP control the unauthorized access of data
and everything to protect data integrity.
2. Reduces data redundancy: Data redundancy means some data are kept in the multiple
locations or some data can be derived from other data. Duplicate information typically
hampers the total system. ERP enables to reduce data redundancy. Through ERP a company
can easily stop to store duplicate data in their system. When the company look that there
is a redundancy, then they can change it very easily.

3. Activity monitoring reduces Sabotages: ERP keeps track of all the change logs that are
made by an employee in an organization. If someone sabotages and changes the data in
some place then it may affect everywhere in the system.

Example: Let us think of a company that manufactures steel and sells it to different
companies. Now, if some employee changes the unit price of any item from 1 rupee to 50 paise,
then the same will be reflected in the total system. It is virtually impossible to remember each
and every item and its corresponding price. If this occurs then the company looses 50% of money
on that particular item. But using ERP the company can monitor every change through logs.
Hence, if someone tries to sabotage data, through ERP we can easily recognize that person.
4. Reduces time: The time factor is one of the most important part of an ERP system. ERP
reduces a huge amount of time for an organization. In the manual system, each and every
department is dependent on pen and paper work, so it can take a huge amount of time.
ERP reduces per activity time because there is no data redundancy and all the data are
easily accessible, so the data availability is very high. ERP reduce time for each and every
department.
Making Invoice: When a customer orders some item to a company, the accounts
department makes the invoice and sends it to the customer.
Purchase: ERP helps to generate the order for a particular item. It helps to search the
suppliers, so that company can easily find the supplier’s name, who supplies the item.
Also it is easy to return the item to the supplier if there is any dispute with it. ERP
makes low quotation in this competitive market. ERP also tracks who can supply the
product within time and who can’t. ERP helps the company to dispatch the product
timely. The availability of the stock is also maintained by the ERP software. By this the
company can reduce the over consumption, maintain minimum and maximum stock
level. Suppose a company/organization wants to generate 300 work order manually.
Each employee make one work order in one hour and the working hours for the
company is 8 hours/day. Then one employee can make 8 work orders in a day. Now
if the organization wants to make 300 work orders in a day then the company must
need minimum of 38 employees. But using ERP the employee can generate a work
order in one minute. Hence for making 300 work orders it takes 300 min. in this way
ERP can save huge amount of time and revenue also. To generate 300 reports in
manual way company has to recruit 38 employees, and pay their salaries. Using ERP
one employee can perform work of 38 employees and the company pays only one
person for doing this type of work. So the company makes the profit.
Manufacture: BOM (bill of materials) creation needs human elegancy and experience.
If there is an existing valid BOM is available, and any product to be sold, then ERP

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