ERP

Enterprise Resource Planning

The ERP has been defined by many firms and individuals that can be summarized as follows:

ERP is a business management system which utilizes components of both computer software and hardware that a company can use to collect, store, manage and interpret data from many business activities.

Business benefits of ERP:

a) Synchronization: End-to-end business function integration

b) Accessibility: All key business information in one place

c) Responsiveness: Real-time workflow and reporting tools

d) Decisiveness: Informed decision making

e) Consistency: Everyone in the company is on the same page

f) Efficiency: Elimination of most or all side systems and manual calculations

In today’s tough economic climate all organizations need to improve efficiency and, even in midsize firms that usually mean coordinating large quantities of information. This requirement isn’t trivial: even if the organization has switched from seeking growth to focusing on survival, the ability to capitalize on every opportunity and defend existing markets is intrinsically governed by the quality of information available to employees and the flexibility of systems and processes to respond to changing conditions.

To survive and thrive in the current tough economic climate, midsize organizations need to be in a position to exploit every business opportunity and defend their established markets. To achieve this they need integrated information and flexible processes. Previously, ERP software was beyond the reach of most midsize organizations, but the advent of rapid ERP implementation programs means they can reap the benefits of ERP systems without the associated drawbacks of complexity and expense. But organizations must take due care in choosing the right software vendor and integration partner and have full confidence in the partner to deliver the system on time and within budget. The design of the software, the quality of the integration tools and the experience of the integration partner all have a vital role to play.

The primary needs for ERP Implementation are:

·         To integrate, automate and simplify business processes

·         Increased management accountability and transparency

·         To eliminate redundancy in existing process

·         To generate reports that comply with industry standards

·         To increase information analysis capabilities

The different stages in which implementation of ERP is carried out in any organization is termed as an ERP Implementation life cycle. Generally, the steps involved are as follows.

·         Pre-evaluation of available packages

During the pre-evaluation phase, ERP vendors available in the market are screened based on business requirements. ERP packages that don’t suit the business requirements are eliminated.

·         Evaluation of chosen package

During the package evaluation phase, selected package is evaluated against requirements across departments.

·         Requirement analysis

A detailed requirement analysis is done, involving different managers from across the departments. Requirement analysis helps list down all the functionalities required to ensure efficient processes across the organization.

·         Project planning

Based on the analysis of requirements and functionalities, a detailed project plan is laid out. This involves senior management team and ERP experts. Designs are finalized; key resources to be involved in the project are identified in various departments; special arrangement is also made to tackle contingencies

·         Business process re-engineering

Once the planning is done, business process re-engineering takes place. Implementing ERP will impact the job responsibilities of lot of employees. So, new roles and responsibilities are to be assigned to employees. Processes are to be re-structured and integrated with ERP tools.

·         Training the staff & management

Post implementation and integration, staff and managers are to be trained properly so that they get good practice. Consultants will help employees to get hands on experience of the ERP tools.

·         Testing and Analysis

At last, the tools that are implemented are tested rigorously. Issues arising during the testing phase are fixed and required changes are made.

SAP and Oracle are the major ERP software manufacturers which cater to diversified industry sectors ranging from small to large-scale industries.

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