Ch. 10 MIS

Extended ERP Modules

- Customer Relationship Management - Supply Chain Management - Business Intelligence - E-Business

Major Causes of ERP Implementation Failure

-Failure to involve affected employees in the planning and development phases and in change management processes -Trying to do too much too fast in the conversion process -Insufficient training in the new work tasks required by the ERP system The failure to perform proper data conversion and testing for the new system

Core ERP Modules

-Financial Management -Operations Management -Human Resource Management

E-Business

Customers and suppliers demand access to ERP information including order status, inventory levels, and invoice reconciliation. Furthermore, they want this information in a simplified format that can be accessed via the Web. As a result, these modules provide two channels of access into ERP system information—one channel for customers (B2C) and one for suppliers and partners (B2B).

Difficult to Implement

ERP systems can be extremely complex, expensive, and time consuming to implement.

Business Intelligence

These modules collect information used throughout the organization, organize it, and apply analytical tools to assist managers with decision making.

Supply Chain Management

These modules manage the information fl ows between and among stages in a supply chain to maximize supply chain efficiency and effectiveness. They help organizations plan, schedule, control, and optimize the supply chain from the acquisition of raw materials to the receipt of finished goods by customers.

Operations Management

These modules manage the various aspects of production planning and execution such as demand forecasting, procurement, inventory management, materials purchasing, shipping, production planning, production scheduling, materials requirements planning, quality control, distribution, transportation, and plant and equipment maintenance.

Financial Management

These modules support accounting, financial reporting, performance management, and corporate governance. They manage accounting data and financial processes such as general ledger, accounts payable, accounts receivable, fixed assets, cash management and forecasting, product-cost accounting, cost-center accounting, asset accounting, tax accounting, credit management, budgeting, and asset management.

Customer Relationship Management

These modules support all aspects of a customer's relationship with the organization. They help the organization to increase customer loyalty and retention, and thus improve its profitability. They also provide an integrated view of customer data and interactions, helping organizations to be more responsive to customer needs.

Human Resource Management

These modules support personnel administration (including workforce planning, employee recruitment, assignment tracking, personnel planning and development, and performance management and reviews), time accounting, payroll, compensation, benefits accounting, and regulatory requirements.

Source Data Automation

a process in which organizations try to automate the TPS data entry as much as possible because of the large volume involved.

drill-down report

allows users to click on an item in a report and be able to access underlying details about that item. E.g., sales by store and then drill down by salesperson

Transaction

any business event that generates data worthy of being captured and stored in a database (e.g., product manufactured, a service sold, a person hired, and a payroll check generated)

Online Transaction Processing (OLTP)

business transactions are processed online as soon as they occur and system performs these tasks in real time by means of online technologies.

Exception Reports

include only information that falls outside certain threshold standards.

Enterprise Application Integration (EAI) System

integrates existing systems by providing software, called middleware, that connects multiple applications allowing existing applications to communicate and share data.

ERP II Systems

interorganizational ERP systems that provide Web-enabled links among a company's key business systems—such as inventory and production—and its customers, suppliers, distributors, and other relevant parties.

Business Processes Predefined by Best Practices

may require companies need to change their existing business processes to fit the predefined business processes incorporated into the ERP software.

Production Process

occurring only in companies that produce physical goods, this process follows one of two strategies: make-to-stock and make-to-order.

Procurement Process

originates when a company needs to acquire goods or services from external sources, and it concludes when the company receives and pays for them.

Detailed Reports

provide high levels of detailed data, often in support of summary reports.

Summary reports

provide summarized information, with less detail.

key indicator report

summarizes the performance of critical activities. E.g., cash flow and cash on hand

Transaction Processing System (TPS)

supports the monitoring, collection, storage, and processing of data from the organization's basic business transactions, each of which generates and collects data continuously, in real time.

Enterprise Resource Planning (ERP) Systems

systems designed to correct a lack of communication among the functional area IS and they adopt a business process view of the overall organization to integrate the planning, management, and use of all of an organization's resources, employing a common software platform and database.

Batch Processing

the firm collects data from transactions as they occur, placing them in groups or batches then prepares and processes the batches periodically.

Order Fulfillment Process

(order-to-cash process) process in which the company sells goods to a customer originating when the company receives a customer order, and concluding when the company receives a payment from the customer.