Management Information System
Group Members:
ERP RESEARCH ASSIGNMENT
2. A PRESENT DAY ERP SYSTEM
Enterprise resource planning (ERP) refers to a business management software that enables an organization to utilize a combination of integrated applications in managing in operating their business. It paves a way for the automation of the majority of standard office functions that are technology oriented. They include human resource management and other related services. The ERP software brings together all the operational aspects such as sales and marketing, manufacturing, development, and product planning. In simpler terms, an ERP software is an application designated for use by large businesses. It needs committed experts to customize it and conduct an analysis of huge data volumes. The team of ERP experts also handle any deployments and upgrades.
On the other hand, there are ERPs for small business institutions. Such software is usually less sophisticated in comparison with those of bigger firms. An ERP application typically constitutes of several enterprise modules. One purchase each of the modules separately by their firm’s technical requirements and their particular capabilities. Each faculty (module) focuses on one field of the business processes. For instance, a particular faculty only deals with marketing or product development.
A firm can utilize an ERP application in managing the back-office functions that include managing payrolls and the human resources, lowering their purchasing costs, financial purposes, and accounting, assessing their business requirements and reducing redundancy. Other functions include standardizing the key procedures, automating the life cycles of the employees, enhancing project planning, improving the precision of financial data, configuring prices, and managing the supply chain. The commonest modules include those for human resource management, finances, marketing, accounting, distribution, inventory control, purchase of material, and general product planning.
With the sophistication of the present day ERP systems, the methodology is gaining popularity each day. They now help managers in implementing activities that incorporate the necessary modules for business intelligence and CRMs in a single package. The primary objective of acquiring an ERP system is to afford a single information dissipation point that is shareable to all the firm’s sections. Initially, the ERP field underwent a slow development rate. However, since 2000, the advancements in the technological advancements concerning ERPs have been very rapid. The following are the new trends affecting the ERP Enterprise application.
Two-tier ERPs
Businesses attempted to come up with an all-incorporating ERP system. Such a system would cater for all the facets of different firms. However, some tragic fails made enterprise adopt the two-tier ERP system.
Social ERP
ERP vendors have added their packages in the various social media. They have since made tremendous profits emanating from the popularity that social media such as Facebook offer.
Cloud ERP
There has been a gradual but steady advancement in the enterprise cloud. However, the majority of ERP operators haven’t placed any data cloud.
Mobile ERP
Employees and executives desire a real-time information access in spite of their location. Firms are now embracing mobile ERPs in their dashboards, reports, and other principal duties.
4. THE PROBLEMS THAT AN ERP SYSTEM SOLVES
Enterprise Resource Planning (ERP) can solve several problems in one’s business. Below are a few of the most known problems that an ERP system can solve efficiently.
Poor Communications that lower the Efficiency of Daily Activities
If a firm suffers poor information delivery between its various departments, the efficiency of operation will automatically go down. If an employee, for instance, does not pass some message, or delays to do so, the firm may lose orders. The organization might end up serving the clients unsatisfactorily. Such acts would, in turn, cause the loss of customers. An ERP system can adequately help to prevent the losses of opportunities. An ERP can unite business tasks to become a single package that processes all the input.
An ERP guarantees us of no delay in the delivery of messages to the appropriate parties. There is a minimal transitional time from one task to the next (Kapp et al., 2010). A De Facto ERP, for instance, is extremely effective in fulfilling a client’s order. Once an operator enters a sales order, it triggers a forthwith alert to the warehousing department (Babu et al., 2004). The team can now pick and transfer the order to the client.
Time-consuming and Repetitive Manual Data Entry
As an institution grows, the workers become more and more busy. Manual data input processes more time-consuming and prone to errors, especially in large quantities. In accounting, for example, a single typing error can bring forth terrible negative repercussions. An ERP system counters each of the troubles concurrently. The system automates tasks and reduces the possibility of errors. It, therefore, frees the workers to continue with other duties. It generates invoices, financial forecasts, and sales orders automatically.
Despair accruing from Frequent System Update Requirements
When the various department use different software, the system in entirety becomes very time-consuming and complicated. It becomes difficult, for instance, for the sales’ team to inform those in the warehousing of the newest orders. Maybe, the stock is not sufficient. An ERP software into one database. The process is called information centralization. Such centralization enables anybody to access any data from all departments, avoiding any inconveniences. There is no need to conduct multiple updates of systems since one update works for all. The firm runs its chores on a single software minimizing the frequent needs for system upgrades.
The Desire to know more about one’s clients
Most of the business firms ling to know more about their clients. An ERP system helps in keeping the track of one’s customers. Without a proper and organized recording system, serving a client becomes quite difficult. The ERP software allows workers to record communications and transactions amongst themselves. The storage of data in one database facilitates the dealings amongst the servants and the clients. Transaction histories are a vital component as it opens up chances for up-selling and even cross-selling. With an ERP, a firm makes more profits due to better and empowered services.
Difficulty in Making Decisions due to Complexity
The more readily available accurate information is, the easier it becomes for the leadership to make the right and timely choices. An ERP system makes it possible for all market, sales, and cost data to reach the manager instantly. Therefore, the decision-making process is always simpler. The De Facto ERP’s intelligence module enables us to run on-demand or scheduled reports on any available data. The report can be geographical, graphical, tabular or interactive in form.
7. THE CHALLENGES IN IMPLEMENTING AN ERP SYSTEM
There are several obstacles in implementing an ERP system. They fall into three chief classes as follows.
Decision-making Challenges
Making an appropriate decision on the following matters remains to be a master challenge to managers who desire to implement ERP systems of business management.
Difficulty in choosing the system that lifts the competitive position of the firm.
The gainsay in determining which of the systems uphold the organization’s culture and structure.
The challenge of establishing the scope of ERP’s implementation.
Difficulty in choosing between the alternative versions available.
People
Most of the members of organization tend to resist changes especially if they come to overhaul their culture.
The members of the organization may have differing objectives of ERP implementation. Some may want to implement it so that they become idle and unavailable for their activities. However, the same people are unwilling to take pay cuts for the reduce duties.
Inadequate expertise to implement and maintain the ERP system.
The fear of the job insecurity that ERP systems bring forth.
Tackling the inflexibility from centralization may reduce the morale of the employees.
Upgrades
Upgrading always comes with additional costs. The cost of upgrade may be unaffordable for the organization.
Upgrades might be more complicated to use than the previous versions. Such complexities may warrant some extensive research by the operators to cope up with the changes.
The changes affect all the departments. There is a need, therefore, to update all the sections to avoid data losses.
10. DISTINCTION BETWEEN SAP AND ERP PRODUCTS
ERP is a management system for businesses. It consists of some integrated software modules. It helps in running of daily business activities. The work with a shared database that concurrently performs several functions. It is useful for various business processes or units. The package allows flow throughout the company. On the other hand, Systems, Applications, and Products (SAP) are the largest software company globally. It provides distribution, manufacturing logistics, and financial solutions. Whereas the rest of the ERP products cover every functional field, SAP only accommodates sales services only.
References
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