The ABCs of ERP Enterprise Resource Planning By

The ABCs of ERP (Enterprise Resource Planning) By Sanjay Anand April 2004 1

About Me • 20 years business and technology experience of which 10 years is in ERP ranging from Programmer to Partner • J. D. Edwards One. World (now People. Soft) Certified Professional (Consultant) and Instructor (Trainer) • Worldwide Consultant of the Year, Valuable Teamwork, Special Achievement, Pioneer, Foundation etc. Awards • Expertise in all Functional (Business) and Technology Phases of ERP Implementations and Project Lifecycles • Clients included Domestic (US) and Global (US, Europe, Asia) Fortune 500 and Global 2000 companies • MSc in Technology, MS in Computers (BITS Pilani); MBA in Management, MS in Finance (Boston College) 2

What is ERP? • Combination of Business & Technology – Business Management Practices – Information Technology Solutions • That Integrates – Company Functions/Departments – Business Processes and Goals • And Replaces – Old Standalone Computers – Paper and Manual Processes ERP is a unified and integrated technology framework that runs your business 3

Examples of ERP • Tier 1 (2/3 of Market) – – – SAP Baan Oracle People. Soft J. D. Edwards • Tier 2 (1/3 of Market) – Lawson – Great Plains – And Many Others 4

Modules of ERP • Financials – – – General Ledger Accounts Receivable Accounts Payable Fixed Assets Contract/Service Billing • Distribution – – – – Sales Order Management Purchasing/Procurement Inventory Management Warehouse Management Transportation Mgmt Customer Service/CRM Customer Self Service • Manufacturing – – – – Shop Floor Control Product Data Mgmt Resource/Capacity Plan Materials Planning Work Orders Quality Management Product Configuration • HR and Payroll – – – Human Resources Payroll and Benefits Recruitment Labor Rules Employee Self Service 5

Industries Using ERP • Traditional Manufacturing – – – – Aerospace Defense Automotive Chemical Pharmaceutical Consumer Goods Oil and Gas • More Recent Additions – – – – Banking & Insurance Healthcare Public Administration Education Retail Utilities Telecommunications 6

Benefits of ERP • • • Improved and Streamlined Work Process Integrated Financial and Other Information Streamlined and Efficient Supply Chain Data Availability for Decision Making Speed up Manufacturing Processes Timely and Accurate Information Improved Customer Response Time Improved Competitive Advantage Reduced Paper and Human Errors Single Database and Unified View 7

Disadvantages of ERP • Evident Costs of ERP – Time • Installation, Setup, Configuration, Training – Money • Hardware, Software, Consulting Services • Hidden Costs of ERP – Technical • Integration, Testing, Customization, Conversions – Human • Training, Consulting, Culture, System Performance 8

ERP Metrics • Inventory – Increased Turnover – Less Obsolescence – Cycle Count Accuracy • Distribution – – Favorable Pricing Order Fulfillment Rate Accurate Orders Reduced Returns • Technology – Less IS Overhead – Centralized System – System Availability • Customers – – Increased Loyalty Faster Deliveries Brand Recognition CRM & Self Service 9

Implementing ERP • Big Bang Method – Entire Company cuts over simultaneously – Used to be popular; very high risk approach • Slam Dunk Approach – Vanilla non-customized instant implementation – Instant ROI but subsequent BPR challenging • Phased-in Method – One Company Function/Department at a time – Most popular method today; controlled risk • ‘Franchising’ Approach – Separate ERPs, consolidated Financials – Works best for disparate business units 10

Scope and Scale of ERP • J. D. Edwards – – – 2, 300 applications 2, 600 tables 3, 800 reports 5, 800 programs 11, 000 dictionaries • People. Soft – 3, 000 applications – 3, 200 tables – 4, 000 reports • Typical Scale – – – ’ 00 s of users ‘ 000 s of customers Scores of interfaces ‘ 000 s of transactions GBs of data • Integrations – CRM, SCM, EAI etc. – B I, D W, K M etc. – B 2 B, B 2 C, B 2 G etc. 11

Questions and Answers • • • Enterprise Resource Planning Information Technology Industry Opportunities and Employment US-India Offshore Outsourcing Any Other Topics of Interest Speaker’s Contact Information Phone / Fax: +1 -909 -363 -8619 E-mail: sanjay@anands. com 12