Page 20 - DCAP302_ENTERPRISE_RESOURCE_PLANNING

Enterprise Resource Planning

notes Best practices were also a benefit of implementing an ERP system. When implementing an ERP
system, organizations essentially had to choose between customizing the software or modifying
their business processes to the “Best Practice” function delivered in the vanilla version of the
software.
Typically, the delivery of best practice applies more usefully to large organizations and especially
where there is a compliance requirement such as IFRS, Sarbanes-Oxley or Basel II, or where
the process is a commodity such as electronic funds transfer. This is because the procedure of
capturing and reporting legislative or commodity content can be readily codified within the ERP
software, and then replicated with confidence across multiple businesses who have the same
business requirement.
Where such a compliance or commodity requirement does not underpin the business process,
it can be argued that determining and applying a Best Practice actually erodes competitive
advantage by homogenizing the business as compared to everyone else in the industry sector.

Task Take an example of any courier company (ABC Couriers) and discuss the
benefits of ERP at ABC couriers.

1.10 Business modeling

ERP is nothing but total business solution. The entire enterprise could be managed by ERP, as it
gives integrated and closed loop solutions. Before integrating the whole organizational functions
a business model is planned.
Infact, formation of the business model is one of the basic activities in an ERP project. Business
modeling is developed on the basis of organization’s goals, objectives and strategic plans.
The business processes are under control of different individuals in the organization. Business
model is a representation of the business – integrated system, which is having several
interconnections and interdependences of several processes and subsystems. It helps for seamless
integration through supply chain management, resource management, integrated data model
technology and other functional department. This results in all resources function fully managed
and well organized.
A good business model represents the actual mirror image of the business. It defines the various
business functions of an organization, how several business functions are integrated and what
are their interdependences.
The business model is represented in graphical form using data flow diagrams, system diagrams
and flow charts. Business model helps to create the data model of the system. A business model
focus on the representation of the business as one large system showing the interconnections
and interdependencies of various subjects and business processes. The business model is not a
mathematical model.
Creating an integrated data model is critical step in the ERP implementation. While designing
the data model for ERP system, one should keep in mind, the information integration and
process procedure automation. The data model reflect the day – to – day transaction of the entire
organization and can give a snapshot of the organization at any given time. The integrated data
model derived from the business model should successfully depict and integrate the data.

14 LoveLy professionaL university