MODULE 3
Enterprise Resource Planning
ERP is a package software solution that addresses the enterprise needs of an organization by
tightly integrating the various functions of an organization using a process view of the
organization.
1.ERP software is ready-made generic software; it is not custom-made for a specific firm.
ERP software understands the needs of any organization within a specific industry segment.
Many of the processes implemented in an ERP software are processes such as order
processing, order fulfillment, shipping, invoicing, production planning, BOM (Bill of
Material), purchase order, general ledger, etc., that are common to all industry segments.
2. ERP does not merely address the needs of a single function such as finance, marketing,
production or HR; rather it addresses the entire needs of an enterprise that cuts across these
functions to meaningfully execute any of the core processes.
3. ERP integrates the functional modules tightly. It is not merely the import and export of
data across the functional modules. The integration ensures that the logic of a process that
cuts across the function is captured genuinely. This in turn implies that data once entered in
any of the functional modules (whichever of the module owns the data) is made available to
every other module that needs this data. This leads to significant improvements by way of
improved consistency and integrity of data.
4. ERP uses the process view (Process view of work is defined as the understanding that
work can be viewed as a "process" that has inputs, steps, and output(s) and that interfaces
with other processes within an organization) of the organization in the place of function view,
which dominated the enterprise software before the advent of ERP.
ERP- features
1. Integration
2. Automation
3. Data Analysis
4. Reporting
5. Financial Management
6. Customer Relationship Management (CRM)
7. Sales and Marketing
8. Human Resources (HR)
9. Supply Chain Management (SCM)
10. Manufacturing
1. Integration
ERP integration is where an ERP software is connected with other applications and/or
systems, with a goal to share data across these systems to improve productivity and insights.
In short, connecting ERP software to other systems such as e-Commerce applications or EDI
tools creates a single source of truth.
,ERP systems are widely desired due to their ability to communicate with every application in
the same ecosystem, or with other existing business software. Having a fully integrated ERP
software means you have a suite of applications that are built to work together.
Many businesses find themselves in the market for an ERP software for the integration alone.
They may be running two disparate systems (such as an accounting software and a production
scheduling software) and are looking to combine the two into one. This is beneficial for
companies that have a variety of departments that need to connect with each other to avoid
data duplication, repeat orders, or to avoid bottlenecks through a reduction in human error.
2. Automation
ERP integrations can help streamline processes across multiple departments and workflows.
This is known as automation. This will help limit the required manual input and the time it
takes for tasks to be completed.
ERP software was originally developed to automate and link the processes of manufacturing
operations–connecting departments by automating processes when certain steps or
procedures became complete. This helps knock down previous barriers organizations used to
have when it came to silos.
Before, companies would have to wait for other workstations or departments to complete
their work before they would be able to complete their own tasks, as they relied on the
physical passing of information around. With an ERP system, businesses processes can be
automated and data kept in a centralized location–letting all users access it whenever needed.
3. Data Analysis
A business may use reports in order to answer questions about the strength of the business,
but where does the data come from that is included on these reports? With every area of your
business working under a unified ERP software, data on day-to-day operations can be shared
across multiple entities and departments. Data can also be broadcast to multiple streams and
allow companies to get real-time feedback for better decision-making.
Anytime a transaction occurs in your organization, whether an operational movement such as
inventory control or a financial transaction such as payment for a sale, this data can be
accessed by production, operations, and finance departments. Companies looking to stay
ahead of their competition collect as much data as possible which can later be displayed into
visual and accessible formats.
4. Reporting
Reporting falls into the category of business intelligence, or a tool designed to gather and sort
historical data, create engaging visuals, and help analyze and report your findings. This
feature can be called many different things or appear in may different forms. Examples
include dashboards, data visualization, Gantt charts, pie charts, bar graphs, and more.
Reporting features occur in all types of business software, and reports can be created from
nearly every type of data. This includes contact management, marketing success levels, sales
activity, and lead management.
The main goal of a reporting features is to improve reporting by offering intuitive reporting
interfaces and visual data display capabilities. Business intelligence tools are helping
companies base key decisions on information derived from financial and non-financial key
performance indicators. Better reporting can empower both executives and stakeholders to
make more informed business decisions such as enhancing how you run your business and
identifying problems before they occur.
5. Financial Management
, Financial management helps business track income and expenses and plan for growth.
Commonly referred to as accounting, financial management modules are designed to help
businesses make better spending decisions, create accurate financial reports, and manage
assets. Because of this, accounting can be thought of as a subset of ERP software.
While many differences between ERP and accounting software exist, accounting tends to
only provide features such as accounts payables, accounts receivables, general ledger
accounts with reporting, and payroll. Meanwhile, ERP software provides all of the above as
well as applications for supply chain management, inventory management, human resources,
and eCommerce.
6. Customer Relationship Management (CRM)
CRM features provide an integrated tool set for managing customer data and tracking
interactions with customers. CRM software complexity varies between programs, as it may
include some combination of dedicated lead management, service tracking, order
management, and marketing functionality.
CRM capabilities help give an integrated view of your customers and prospects so businesses
can get an integrated view of customers and prospects–allowing you to get the most out of
marketing, sales, and customer service efforts.
The use of CRM features within an ERP software can lead to more effective identification of
new prospects, reduce time and labor costs involved with managing customer information,
and assist with customer upselling.
7. Sales and Marketing
Sales forecasting and providing sales quotes are a large part of your overall sales
management and marketing efforts. Sales forecasting applications utilize historical data and
sales funnel status tracking to create better projections for future sales. Sales quotes provide
the ability to create, share, and track customer facing sales quotation documents.
Sales and marketing features within ERP software can also include point of sale (POS)
capabilities to facilitate in-person or register-based customer payments, order entry to create
sales orders and communicate order requirements throughout the organization,
and eCommerce capabilities to help host online product catalogs and shopping carts.
8. Human Resources (HR)
While more commonly found as a standalone solution, most ERP software will include some
level of human resource capabilities. These capabilities store employee information and
automates tasks involving the people in your organization, such as employee scheduling,
recruitment, and boosting employee productivity. HR features in an ERP software help your
organization achieve it’s goals by allowing managers to better allocate employee time and
resources to become a more productive and profitable business through better employee
record keeping and increasing employee performance.
Human resources also encompasses payroll capabilities, which offers functionality for all
employee payment tasks, including calculation of periodic wages, application of deductions,
payment processing (check writing or direct deposit), and generation of governmentally
required payroll forms. Tying in with payroll is time tracking, which is useful for recording
employee time both for payroll, as well as human resource management purposes.
9. Supply Chain Management (SCM)
Enterprise Resource Planning
ERP is a package software solution that addresses the enterprise needs of an organization by
tightly integrating the various functions of an organization using a process view of the
organization.
1.ERP software is ready-made generic software; it is not custom-made for a specific firm.
ERP software understands the needs of any organization within a specific industry segment.
Many of the processes implemented in an ERP software are processes such as order
processing, order fulfillment, shipping, invoicing, production planning, BOM (Bill of
Material), purchase order, general ledger, etc., that are common to all industry segments.
2. ERP does not merely address the needs of a single function such as finance, marketing,
production or HR; rather it addresses the entire needs of an enterprise that cuts across these
functions to meaningfully execute any of the core processes.
3. ERP integrates the functional modules tightly. It is not merely the import and export of
data across the functional modules. The integration ensures that the logic of a process that
cuts across the function is captured genuinely. This in turn implies that data once entered in
any of the functional modules (whichever of the module owns the data) is made available to
every other module that needs this data. This leads to significant improvements by way of
improved consistency and integrity of data.
4. ERP uses the process view (Process view of work is defined as the understanding that
work can be viewed as a "process" that has inputs, steps, and output(s) and that interfaces
with other processes within an organization) of the organization in the place of function view,
which dominated the enterprise software before the advent of ERP.
ERP- features
1. Integration
2. Automation
3. Data Analysis
4. Reporting
5. Financial Management
6. Customer Relationship Management (CRM)
7. Sales and Marketing
8. Human Resources (HR)
9. Supply Chain Management (SCM)
10. Manufacturing
1. Integration
ERP integration is where an ERP software is connected with other applications and/or
systems, with a goal to share data across these systems to improve productivity and insights.
In short, connecting ERP software to other systems such as e-Commerce applications or EDI
tools creates a single source of truth.
,ERP systems are widely desired due to their ability to communicate with every application in
the same ecosystem, or with other existing business software. Having a fully integrated ERP
software means you have a suite of applications that are built to work together.
Many businesses find themselves in the market for an ERP software for the integration alone.
They may be running two disparate systems (such as an accounting software and a production
scheduling software) and are looking to combine the two into one. This is beneficial for
companies that have a variety of departments that need to connect with each other to avoid
data duplication, repeat orders, or to avoid bottlenecks through a reduction in human error.
2. Automation
ERP integrations can help streamline processes across multiple departments and workflows.
This is known as automation. This will help limit the required manual input and the time it
takes for tasks to be completed.
ERP software was originally developed to automate and link the processes of manufacturing
operations–connecting departments by automating processes when certain steps or
procedures became complete. This helps knock down previous barriers organizations used to
have when it came to silos.
Before, companies would have to wait for other workstations or departments to complete
their work before they would be able to complete their own tasks, as they relied on the
physical passing of information around. With an ERP system, businesses processes can be
automated and data kept in a centralized location–letting all users access it whenever needed.
3. Data Analysis
A business may use reports in order to answer questions about the strength of the business,
but where does the data come from that is included on these reports? With every area of your
business working under a unified ERP software, data on day-to-day operations can be shared
across multiple entities and departments. Data can also be broadcast to multiple streams and
allow companies to get real-time feedback for better decision-making.
Anytime a transaction occurs in your organization, whether an operational movement such as
inventory control or a financial transaction such as payment for a sale, this data can be
accessed by production, operations, and finance departments. Companies looking to stay
ahead of their competition collect as much data as possible which can later be displayed into
visual and accessible formats.
4. Reporting
Reporting falls into the category of business intelligence, or a tool designed to gather and sort
historical data, create engaging visuals, and help analyze and report your findings. This
feature can be called many different things or appear in may different forms. Examples
include dashboards, data visualization, Gantt charts, pie charts, bar graphs, and more.
Reporting features occur in all types of business software, and reports can be created from
nearly every type of data. This includes contact management, marketing success levels, sales
activity, and lead management.
The main goal of a reporting features is to improve reporting by offering intuitive reporting
interfaces and visual data display capabilities. Business intelligence tools are helping
companies base key decisions on information derived from financial and non-financial key
performance indicators. Better reporting can empower both executives and stakeholders to
make more informed business decisions such as enhancing how you run your business and
identifying problems before they occur.
5. Financial Management
, Financial management helps business track income and expenses and plan for growth.
Commonly referred to as accounting, financial management modules are designed to help
businesses make better spending decisions, create accurate financial reports, and manage
assets. Because of this, accounting can be thought of as a subset of ERP software.
While many differences between ERP and accounting software exist, accounting tends to
only provide features such as accounts payables, accounts receivables, general ledger
accounts with reporting, and payroll. Meanwhile, ERP software provides all of the above as
well as applications for supply chain management, inventory management, human resources,
and eCommerce.
6. Customer Relationship Management (CRM)
CRM features provide an integrated tool set for managing customer data and tracking
interactions with customers. CRM software complexity varies between programs, as it may
include some combination of dedicated lead management, service tracking, order
management, and marketing functionality.
CRM capabilities help give an integrated view of your customers and prospects so businesses
can get an integrated view of customers and prospects–allowing you to get the most out of
marketing, sales, and customer service efforts.
The use of CRM features within an ERP software can lead to more effective identification of
new prospects, reduce time and labor costs involved with managing customer information,
and assist with customer upselling.
7. Sales and Marketing
Sales forecasting and providing sales quotes are a large part of your overall sales
management and marketing efforts. Sales forecasting applications utilize historical data and
sales funnel status tracking to create better projections for future sales. Sales quotes provide
the ability to create, share, and track customer facing sales quotation documents.
Sales and marketing features within ERP software can also include point of sale (POS)
capabilities to facilitate in-person or register-based customer payments, order entry to create
sales orders and communicate order requirements throughout the organization,
and eCommerce capabilities to help host online product catalogs and shopping carts.
8. Human Resources (HR)
While more commonly found as a standalone solution, most ERP software will include some
level of human resource capabilities. These capabilities store employee information and
automates tasks involving the people in your organization, such as employee scheduling,
recruitment, and boosting employee productivity. HR features in an ERP software help your
organization achieve it’s goals by allowing managers to better allocate employee time and
resources to become a more productive and profitable business through better employee
record keeping and increasing employee performance.
Human resources also encompasses payroll capabilities, which offers functionality for all
employee payment tasks, including calculation of periodic wages, application of deductions,
payment processing (check writing or direct deposit), and generation of governmentally
required payroll forms. Tying in with payroll is time tracking, which is useful for recording
employee time both for payroll, as well as human resource management purposes.
9. Supply Chain Management (SCM)
