Title: Enterprise Systems
1Enterprise Systems
2Important information in Chpt 1?
3Process vs Function
- Business process
- Collection of activities that take one or more
inputs and creates an output that is of value to
the customer (internal or external) - Business function
- Specific activities usually carried out by a
functional area because it has the expertise to
do so - Functional area grouping of similar job types /
area of knowledge
4History behind functional areas
- Prior to industrial revolution, production done
in job shop environment on custom basis - With increasing demand and size of organizations
that went along with mass production, needed to
restructure to gain efficiency - Important concepts
- Max Weber bureaucracy power is ascribed to
positions - Fredrick Taylor scientific management one
best way to accomplish a task - Henri Fayol chain-of-command authority
discipline (organizational power) and task
specialization / job separation
5Why have functional areas?
- Beginning of departments
- Disaggregated work into narrowly defined tasks to
increase efficiency - Re-aggregate people performing those tasks into
departments - Install managers to administer them
- Operating across functions
- Organized work as a sequence of separate tasks
- Employed complex mechanisms to track progress
6Porters Value Chain
In many ways the most interesting stage of the
collapsed value chain is product delivery, which
requires integrating several different
information systems order entry, purchasing,
materials resources planning, and distribution
management.
7Porters Value Chain
No company has yet accomplished the
large-scale integration of functions and systems
required to fully manage product delivery.
8Process Example
- Develop a process flow chart for the sales order
process - Customer places order ? Company posts payment
9Order-to-Cash(plus a little more see above)
10Order-to-cash at Fitter Snacker
Reconcile sales order, pick list shipping notice
Reconcile pick list, pack list physical items
Shipping IS
11Optimizing business function vs process -
purchasing
- Purchasing activity purchase large quantities
- Reduced price per unit
- Reduced ordering costs
- Increased inventory holding costs
- Purchasing as part of inbound logistics to
support production - Purchase quantity based on what is needed for
production and when it is needed
12Information Flows
Customers
Marketing
Accounting/ Finance
HR
Operations
Suppliers
13Important information in Chpt 2?
14Evolution of ERP Systems
- Accounting
- Applications
- General ledger
- Accts receivable
- Manufacturing
- Applications
- Inventory control
- BOM processing
15Potential benefits from ERP
- Integration between functional areas
- Integration between different locations
- Reduced number of systems to maintain and reduced
number of interfaces - Real-time information for decision-making
- Improved processes via best practices
- Time for strategic rather than tactical focus