ERP Enterprise Resource Planning

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ERP(Enterprise Resource Planning)
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Introduction

• An ERP system is a very useful tool for refining
  a businesses processes. A properly implemented
  ERP system can help a company improve its
  effectiveness and up its profit. There are many
  parts in an ERP system, all of which are designed
  to work together.

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Objectives

• Give a general definition of what an ERP system
  is and what it does.
• Inform you about ERP standards
• Give examples of businesses using ERP systems
• Talk about outsourcing ERP applications

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What is an ERP system?

• ERP systems are accounting-oriented information
  systems for identifying and planning the
  enterprise-wide resources needed to take, make,
  distribute and account for customer orders.

www.hyperdictionary.com
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What is an ERP system?(cont)

• Though ERP is specifically designed around an
  enterprise, resource planning is usable by any
  company or business regardless of size.

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Are there any standards?

• Unable to find any world wide standards.
• Companies/businesses create their own standards
  according to their company.

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Are there any standards?(cont)

• Policies and standards and the associated forms
  continue to improve through additions and
  revisions
• UFL regularly performs updates to its ERP system
  to keep it current and efficient

http//www.ufl.edu
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What kind of company can benefit from an ERP
system?

• There are many companies and businesses that can
  benefit from utilizing an ERP system

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Moret, Ernst Young management consultants

• Moret, Ernst Young management consultants is a
  large Dutch management and computer consulting
  firm
• Grew very rapidly in recent years
• Needed a more efficient way to keep track of
  recruits and new hires

Enterprise Resource Planning (ERP)
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The MacManus Group

• The MacManus Group is a global communication firm
  that developed and maintained a myriad of
  customized financial and human resource systems.
• In 1996 the firm was growing so rapidly these
  systems were no longer sufficient.

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The MacManus Group(cont)

• needed a high degree of functionality and
  integration to improve responsiveness both to
  customers and to its own business units
• The MacManus Group decided to purchase software
  from Peoplesoft

Enterprise Resource Planning (ERP)
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Sybase Inc.

• Sybase Inc is a developer of database, middleware
  and desktop-to-enterprise tools
• They needed a method to reach their corporate
  goal to provide customers with an open,
  adaptable information systems architecture that
  enables the development and delivery of complete
  information solutions that facilitate rapid
  business change

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Sybase Inc.(cont)

• Sybase Inc incorporated a software developed by
  PeopleSoft
• PeopleSofts software seemed perfect to show the
  power of the new Sybase SQL server

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The federal government

• Half of all U.S. federal, state and local
  government agencies still rely on such systems,
  and about 70 percent of those are looking to
  implement ERP in the next five years

Feds, States Lean on ERP as E-Gov Pillar
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The federal government(cont)

• As citizens become more web-savvy, an increasing
  demand for online governmental services is
  expected
• People are demanding easier access to
  governmental information

Enterprise Solutions (ERP) for Government
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The federal government(cont)

• ERP is an end-to-end solution that can enable
  governments to reduce costs and help you
  streamline your administrative processes while
  maintaining a high level of citizen satisfaction

Enterprise Solutions (ERP) for Government
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Governments

• Every week, the governor of Minnesota gets
  13,000 e-mails from the public
• 75 percent of Australians file income taxes
  online
• Brazilians vote electronically in all national
  and local elections

ERP Integration Enterprise Portals e-Government
comes of Age
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Governments(cont)

• Enterprise portals allow governments to extend
  knowledge management and business processes in
  previously unimaginable ways
• U.S. General Services Administration implemented
  its GSA Advantage! trading portal and saw an 80
  percent costs reduction

ERP Integration Enterprise Portals e-Government
comes of Age
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Governments(cont)

• Integrates legacy systems from formerly
  incompatible silos
• Enables groups to organize and share information
  from different applications
• Reduces costs and errors associated with manual
  processes for tagging and indexing with
  integrated search, categorization and
  auto-indexing tools

ERP Integration Enterprise Portals e-Government
comes of Age
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Governments(cont)

• Simplification of information access through
  single sign-onto network applications
• Reduction of training and support costs through
  use of common look and feel interfaces

ERP Integration Enterprise Portals e-Government
comes of Age
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Governments(cont)

• Increase in revenues by slashing transaction
  processing and overhead costs, boosting
  efficiency
• Provision of the highest levels of security to
  enable departments and agencies to collaborate
  and share data seamlessly and safely

ERP Integration Enterprise Portals e-Government
comes of Age
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Governments(cont)

• Ability to scale to accommodate growing numbers
  of users to meet even the heaviest traffic loads
• These key functions serve to provide the user of
  the e-government system endless usability and
  scalability.

ERP Integration Enterprise Portals e-Government
comes of Age
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Spice of the science club
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Four main components for starting an e-government
portal process

• Portal architecture
• Portal services
• Portal foundation
• Integration tools

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Portal architecture

• Enterprise portals can be built on intranet,
  extranet or internet web sites
• Though every portal is a web site, not every web
  site is a portal
• its basic building blocks are portal services, a
  portal foundation and integration tools

ERP Integration Enterprise Portals e-Government
comes of Age
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Portal services

• A personalized presentation layer gives legacy
  systems one look and feel
• The portal site should have access to all of your
  processes and along with tools to gather,
  organize, refine and disperse data without the
  user needing to know where it came from

ERP Integration Enterprise Portals e-Government
comes of Age
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Portal foundation

• The system has to have secure and continuous
  availability.
• Users get access to all designated enterprise
  applications and information with a single
  sign-on.
• The sign-on has several levels of access control.

ERP Integration Enterprise Portals e-Government
comes of Age
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Portal foundation(cont)

• The different levels have the capability of
  meeting the requirements for top secret
  clearances.

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Integration tools

• Integration tools, along with adapters and
  integration servers, ensure effective data
  transfer and enable companies to accelerate
  time-to-market by eliminating the need for
  extensive hand-coding, providing reliable
  connections between mainframe and legacy systems

ERP Integration Enterprise Portals e-Government
comes of Age
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Key security features

• An 128-bit encrypted Secure Socket Layer (SSL)
  that meets the most stringent security standards
• Encryption of all communications between a
  users browser and the portal, regardless of
  physical location, and the ability to store data
  in encrypted form

ERP Integration Enterprise Portals e-Government
comes of Age
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Key security features(cont)

• Levels of accountability to match transaction
  importance, with protection ranging from auditing
  to requiring digital signatures
• Enforcement of workflow security checks and
  balances-for example, providing rules to ensure
  that if one person requests a check, a person
  must approve disbursement

ERP Integration Enterprise Portals e-Government
comes of Age
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Key security features(cont)

• Integration with other security frameworks, such
  as Lightweight Directory Access Protocol (LDAP),
  VeriSign and Entrust

ERP Integration Enterprise Portals e-Government
comes of Age
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Incremental transition

• Develop a first release of your portal quickly
• Pilot the portal to a limited audience
• Implement lessons learned to add features
• Deploy the portal in stages to larger and more
  diverse audiences

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Give me a big smile ?
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ERP outsourcing

• What is ERP outsourcing?
• Why would a company outsource?
• What are the possible negative impacts of
  outsourcing?

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What is ERP outsourcing?

• ERP outsourcing is the use of another company,
  especially one specialized in ERP processes and
  procedures, to help improve some or all
  structures of a company.

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Why would a company outsource?

• With a predictable monthly payment, a company
  can solve all of the problems of running an
  application.
• Outsourcing can be a strategic, competitive
  move.

ERP outsourcing Can it meet market demands?
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What are the possible negative impacts of
outsourcing?

• such organizations built their reputations on
  upscale IT handholding that could and did
  take over entire data centers including staff.

ERP outsourcing Can it meet market demands?
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Two major arguments of the outsourcing decision

• Transaction Cost Theory (TCT)
• Resource Based Theory (RBT)

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Transaction Cost Theory (TCT)

• Organizations compare the production and
  transaction costs for internal and external
  provision.

Rethinking ERP-Outsourcing Decisions
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Resource-Based Theory

• Organizations evaluate their own IS resources
  and capabilities in comparison to the market,
  giving consideration to their strategic
  potential. The discovery of deficits within the
  company leads to consideration of market
  utilization with regard to complimentary
  resources and capabilities.

Rethinking ERP-Outsourcing Decisions
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Outsourcing propositions

• There are 6 propositions that should help shape a
  businesses structural model

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Proposition 1

• The more firm specific the knowledge is to
  perform the tasks within an IS function, the
  higher the risks associated with outsourcing the
  function

Rethinking ERP-Outsourcing Decisions
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Proposition 2

• The higher the risks associated with outsourcing
  an IS function, the less this function will be
  outsourced

Rethinking ERP-Outsourcing Decisions
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Proposition 3

• The higher the degree of special technological
  knowledge to perform the tasks within the IS
  function, the higher is the perception of
  internal knowledge deficits compared to external
  service providers.

Rethinking ERP-Outsourcing Decisions
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Proposition 4

• The higher the perception of internal knowledge
  deficits compared to external service providers
  in performing the tasks within an IS function,
  the more this function will be outsourced

Rethinking ERP-Outsourcing Decisions
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Proposition 5

• The higher the risks associated with outsourcing
  an IS function the lower will be the strength of
  proposition 4.

Rethinking ERP-Outsourcing Decisions
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Proposition 6

• Ways of risk reduction will lower the strength
  of proposition 1.

Rethinking ERP-Outsourcing Decisions
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Phases and tasks in the lifecycle of an ERP system

• The four phases of the ERP system lifecycle
• Acquisition
• Implementation
• Stabilization
• Operation and Improvement

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Acquisition phase

• Define specification
• Select ERP package

Rethinking ERP-Outsourcing Decisions
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Implementation phase

• Define target concept, including a detailed
  description of the business processes to be
  supported
• Install IT-infrastructure and ERP-software
  package
• Configure and possibly modify the ERP package
  also documentation

Rethinking ERP-Outsourcing Decisions
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Implementation phase(cont)

• Build interfaces to other systems data
  conversion
• Test and rectify errors
• Train end-users
• Roll out and switching to productive operations

Rethinking ERP-Outsourcing Decisions
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Stabilization phase

• Rectify errors in ERP system or
  IT-infrastructure
• Modify business routines
• Improve systems performance
• Repeat training or provide additional training

Rethinking ERP-Outsourcing Decisions
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Operation and Improvement Phase

• Implement updates or new releases
• Support users and provide delta training
• Operate ERP-system (IT-infrastructure and
  ERP-Basis)
• Continuous process improvement and respective
  system tailoring

Rethinking ERP-Outsourcing Decisions
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Knowledge categories in the lifecycle of the ERP
system

• IS-Infrastructure and ERP basic knowledge
• Programming knowledge
• ERP-Functionality knowledge
• Legacy-system knowledge
• Best practice knowledge
• Business Process knowledge
• Usage knowledge

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IS-infrastructure and ERP basic knowledge

• Knowledge of technical tasks in the ERP lifecycle
• Learned through training

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Programming knowledge

• Knowledge of the language the ERP system is
  written in
• Needed to modify the ERP system
• Learned through handbooks and courses

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ERP-functionality knowledge

• This knowledge refers to the functionality
  available in ERP software packages that reflects
  the reference processes depicted in the software

Rethinking ERP-Outsourcing Decisions
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Legacy-system knowledge

• This refers primarily to individually customized
  applications
• Data is often converted or the systems work
  together

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Best-practice knowledge

• best standard procedure for business processes
  and the appropriate organizational structure

Rethinking ERP-Outsourcing Decisions
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Business process knowledge

• This knowledge includes the unique manner in
  which business processes are performed within an
  individual firm.

Rethinking ERP-Outsourcing Decisions
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Usage knowledge

• This category consists of the knowledge
  regarding the correct use of the ERP
  applications.

Rethinking ERP-Outsourcing Decisions
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Knowledge categories

• All are required for an efficient ERP system

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What we covered

• Definition of an ERP system and what it does
• Discussed what I discovered about ERP standards
• Gave examples of some businesses who use ERP
  systems and how
• Discussed outsourcing ERP applications

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Im Done ?

• Please feel free to ask questions