Case Study 3 Operate a Manufacturing Company EGN
- Slides: 73
Case Study 3: Operate a Manufacturing Company EGN 5621 Enterprise Systems Collaboration (Professional MSEM) Fall, 2011
Objective The objective of the Manufacturing introductory ERPsim is to provide a quick hands-on experience of an integrated business process through an ERP manufacturing ERPsim, which combines basic operation functions, such as planning, sales, production, procurement, marketing, investment, and financial accounting for learning how to make business strategy and business decisions.
Corporate Roles Designation CEO (Team Leader) ◦ Watch financial statement ◦ Check Price market report ◦ Check summary sales report ◦ Check sales and market data ◦ Check inventory Report Marketing & Sales Manager ◦ Maintain selling prices ◦ Make marketing expense planning ◦ Check sales report ◦ Check summary sales report ◦ Check Price market report 3
Corporate Roles Designation Production & Planning Manager ◦ Create planned independent Requirements ◦ Run MRP ◦ Convert planned order to production orders ◦ Check production schedule MM Manager ◦ Generate Purchase orders from purchase requisitions ◦ Track purchase orders ◦ Check MRP results ◦ Check individual stock level ◦ Check inventory Report 4
Operations in the cash-to-cash cycle
The Virtual Business Environment Simulation of a market Automation of administrative tasks Simulation of the passing of time
Organizational elements
Organizational elements
Organizational elements
Organizational elements
Data model of the main master data used in the simulation game
Definition of master data (1/2)
Definition of master data (2/2)
List of master data to create for the simulation
Muesli Cereals Wheat Nuts Blueberries Oats Raisins Strawberries
Your 6 products 40% wheat 40% oat 20% nut 1 box 1 bag 40% wheat 40% oat 20% raisin 1 box 1 bag 40% wheat 40% oat 20% blueberry 1 box 1 bag 50% wheat 50% oat 1 box 1 bag 40% wheat 40% oat 20% strawberry 1 box 1 bag 35% wheat 35% oat 10% raisin 10% nut 5% strawberry 5% blueberry 1 box 1 bag
Data model of product Y$$-F 06
German market North DC 10: 2 retailers DC 12: 19 retailers West DC 10: 3 retailers DC 12: 17 retailers South DC 10: 7 retailers DC 12: 23 retailers
Muesli Manufacturing Association Label Regulation
Input Cost at low seasonal price
Number of stores by geographical area
DC 10 Hypermarkets Buy only large boxes (1 kg) Payment delay of 20 steps More sensitive to price Less sensitive to advertising Will have a stronger preference for 3 particular products during the simulation
DC 12 Grocery chains Buy small boxes (0. 5 kg) and large boxes (1 kg) Payment Will delay of 10 to 15 steps have a stronger preference for 4 particular products during the simulation
DC 14 Independent grocers (will be used in Extension ERPsim) Only buy small boxes (0. 5 kg) Less price sensitive Sensitive to advertising Payment delay of 5 to 15 steps Will have a stronger preference for 3 particular products during the simulation
Number of retailers per Locations
Risk premium on credit ratings
Production improvements (will be used in extension ERPsim)
Review of the major rules You don’t change the recipe of a product in the mfg introduction game Customers preferences do not change throughout the game, hence you may learn from their past behavior The company displaying the highest shareholder’s equity at the end of the simulation wins the game You must behave ethically at all times The end of game inventory will be value at cost price in the final balance sheet. Therefore, you shouldn’t sell under cost at any time during the game.
Elements of a winning strategy Use the ERP system efficiently Do not run out of stock Delays and production capacity constraints are important elements of the game Team organization is more important than you think
Game layout 30 min 30 steps
Rules of the game • • • Each round will be of 30 steps (approx 1 min per step) End-of-round inventory is carried over to the next round You can sell a product only if you have it in stock You compete against the other teams and importers Your objective is to maximize profit
Participant’s job aid
Let’s get started! • Create your team : • Max 4 persons : User 1 to User 4 • Up to 26 company : A to Z • Log in using user name and passwords giving by your teacher
Client 265 Login : intro_$# $ = Team, # = User 1 to User 4 Password: ERPSIM Login information
SAP Menu & Navigation
Introductory Game: Round 1 30 min 30 steps
Cost, inventory & initial pricing Material $$-F 01 $$-F 02 $$-F 03 Nut Muesli Blueberry Strawberry 1. 0 kg. Muesli Name 1. 0 kg. $$-F 04 $$-F 05 $$-F 06 Raisin Muesli 1. 0 kg. Original Muesli 1. 0 kg. Mixed Fruit Muesli 1. 0 kg. Raw material Cost € 1. 53 € 1. 97 € 1. 38 € 1. 36 € 1. 76 Standard cost € 2. 48 € 3. 09 € 2. 50 € 2. 65 € 2. 89 Initial price 10 12 € 4. 24 € 4. 49 € 5. 18 € 5. 43 € 3. 92 € 4. 17 € 3. 87 € 4. 12 € 4. 75 € 5. 00 100, 000 100, 000 Initial stock
The Introductory game: Round 1 (30 steps- days) • • • You have initial inventory for each finished product (100, 000 for each) You only can sell your products in Q 1. You can’t buy any raw materials in Q 1. You can’t make plan and produce any finished goods in Q 1. You need to maintain the price of your 6 products and invest in marketing. You need to know how to : • Maintain price list and make plan for marketing investment • Watch available stock • Monitor sales orders
Participant’s job aid & Menu
Check product costing
Maintain Prices for DC 10 & 12
Marketing expense
Stock in material overview
Check sales summary report
Check sales order report
Check market report
Check Financial Statements
The Introductory game: Round 1 (30 steps – 30 days) We start the simulator for 30 steps
Introductory game: Round 2 30 min 30 steps
The Introductory game: Round 2 (30 steps- days) • • You finished goods will be carried over to the round 2 if your still have inventory in the end of the round 1. You have two planned orders in total 100, 000 for each product. You have initial raw materials which are enough to make 100, 000 of your each product. You need to decide the sequence for conversion of your planned orders to production orders. You can’t buy any raw materials in Q 2. You can produce your products in Q 2 by converting planned orders to production orders. You continue to maintain your prices and make investment in market.
Parameters of the game
Participant’s job aid & Menu
Release production order
Release Production Orders (CO 41)
Check Production Schedule
The Introductory game: Round 2 (30 steps - days) We start the simulator for 30 steps
Introductory game: Round 3 30 min 30 steps
The Introductory game: Round 3 (30 steps- days) • • • You finished goods and raw materials will be carried over to the round 2 if your still have inventory in the end of the round 2. You can buy any raw materials in Q 3. You can produce your products in Q 3. You need to create independent requirement plan for your products, run MRP to create purchase requisitions and planned orders, convert purchase requisitions to production orders, and release planned orders to production orders. You continue to maintain your prices and make investment in market.
Participant’s job aid & Menu
Create Planned Independent Requirement for 6 Finished Products (MD 61)
Forecasting sales
Execute MRP
After the MRP run
Automatic Creation of Purchase Orders from Requirement (ME 59)
Convert purchase requisitions into purchase orders
Track purchase orders
Purchase Order Tracking(ZME 2 N)
Raw material cost per PO
Collective Conversion of Planned Order (CO 41)
Release production order
Release Production Orders (CO 41)
Check Production Schedule
The Introductory game: Round 3 (30 steps – 30 days) We start the simulator for the last 30 steps
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