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ERP Software Solution: A Closer Look at What It Is

ERP Software Solution: A Closer Look at What It Is
Mike Piotrowski
ERP Solution

Information technology has not only transformed the way we live in modern society, but also the way in which we do business. Enterprise Resource Planning, often referred to as ERP, is becoming one of the most commonly used software systems in several industries and organizations. The object of this article is to provide pertinent highlights about exactly what ERP is.

The definition of Enterprise Resource Planning refers to not only software but also the business strategies employed as part of the implementation of ERP systems. This implementation makes use of various software applications in order to improve the performances of organizations in resource planning, control of operations, and control of management.

ERP software contains several software modules that work to integrate vital activities across operating departments. An ERP System not only includes the ERP Software but also the business processes and hardware that make this system work. These systems are more than the sums of their parts as the many components work together in order to achieve one common objective-to provide an organization with a greatly improved and streamlined business process.

History of ERP

ERP has been well over 20 years in the making. This system is the result of the trial, error, and growth of Manufacturing Requirements Planning (MRP) during the 80’s. MRP was the evolution of Inventory Management and Control, which was conceived during the 1960’s. ERP has grown beyond the coordination of manufacturing processes into the integration of back end processing on very large scales. From its origins as a legacy implementation ERP has morphed into a new and improved client-server architecture.

Benefits of ERP

This software attempts to bring all aspects of the business into one single enterprise-wide database or information system. This allows instantaneous information and communications to be shared between multiple departments. The primary benefit of this is a greatly improved efficiency in business operations. Implementing this system will not only help communications between departments but in day-to-day management functions as well. ERP is an ambitious design that also supports the resource planning part of corporate planning as this is often the weakest link in strategic planning as the result of the inadequate integration of ERP software with Decision Support Systems.

ERP Failures

It would be quite rude to conclude without at least mentioning the fact that failures in this system are occasionally reported in one of the four components of an ERP System. These systems are: ERP software, Business processes supported by the ERP System, Users of the ERP Systems, and the hardware and/or operating systems upon which the ERP applications are actually run. The failure of one or more of these components has the potential to cause the entire ERP project to fail.
Ontech Systems of Milwaukee Wisconsin, is committed to making a difference in your business through the productive use of computers, networks, software and the vast array of products and services we offer. Contact Mike Piotrowski, President of Ontech Systems to discuss a new ERP business solution for your company today.
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ETO ERP: Making the Wrong Choice

ETO ERP: Making the Wrong Choice
Roger Meloy

Enterprise Resource Planning (ERP) systems offer great benefits to engineer-to-order (ETO) companies looking to increase productivity and decrease cost. According to TR Cutler, spokesperson for the ETO Institute, ‘These benefits come as a result of a successful implementation, but not every implementation is successful.’ Cutler asserts that, ‘One reason some implementations are not successful is the selection of the wrong system.’

The ETO Institute has just published a white paper, ‘Why Do Companies Choose the Wrong System?’ This document is written with engineer-to-order companies in mind. It highlights the problems facing ETO companies trying to find and evaluate a new ERP system. The while paper provides some time and simple steps companies can take to reduce the chances of making a critical mistake. (www.etoinstitute.org)

Cutler, who authors regular columns for Industrial Connection magazine (www.industrialconnection.net) and InMFG magazine (www.inmfg.com) is looking for case study profiles of ETO manufacturing companies and their ERP experiences. ‘The good, the bad, the ugly. I want to know what ETO manufacturers think about the ERP selection process, what companies have served them well and which have not. This will provide an interesting profile for the members of the ETO Institute.’

The ETO Institute specifically highlights some of the problems ETO manufacturers face when searching for an ERP system. Go to www.etoinsititute.org and learn more. Registration is free of charge and more than a thousand ETO manufacturers are expected to join in 2005.

Thomas R. Cutler ETO Institute 954-486-7562 www.etoinstitute.org e-mail protected from spam bots

Improving governance with information systems

One of the key things that ERP Systems provide are process controls. This article examines the issues around IS governance.

Improving governance with information systems
CHRISTOPHER CHAMBERLAIN

Why do we need information systems (IS) governance? Technology specialists tell us that there isn’t a great deal more functionality we can get out of our computer equipment. The next five years will not bring another Internet … revolution or significant changes in equipment size. We should concentrate on getting more out of our existing equipment by using it in a better fashion. IS governance is a framework for better controls.

Controls in the last couple of years have gained an image in the commercial world of excessive overheads and reduced efficiency. That does not have to be the case but it needs an approach different from the existing Sarbanes-Oxley process. Perhaps the future methodology could include more business controls designed to achieve greater productivity and asset control. Logistic controls to help an entity maximise its investment return on inventory usage could be an example.

The modern corporation needs financial controls because

ERP – Army Style

Stumbling around the web, we came across a great ERP reference site. This site is the US Army’s ERP/SOA Resource Center. Its own description is as follows:
As the Army embarks on transforming its warfighting capabilities, it is imperarive that the Business Capabilities / Enablers / Processes transform to support the warfighter. ERP systems provide an integrated suite of Information Techonology applications that support the end-to-end business operations of an entire organization. The ERP Resource Center is designed to provide Enterprise Process Owners, Program Executive Officers, Program Managers, and others involved in the Business Transformation of the Army with detailed information, supporting documents, and tools and techniques regarding the use of ERP systems.

This site is filled with useful information.Â It is not helpful if you are a small company looking for an ERP system other than to guide you in an overview of what ERP is and does.Â There is a glossary online there too, but it is government focused.Â If however you are implementing a Tier 1 package, then this gives a lot of good information.

Causes of ERP Failures

Here is an article that zooms right into the reasons for why ERP implementations fail:

Causes of ERP Failures
by: Bruce Zhang

ERP is the acronym of Enterprise Resource Planning. Multi-module ERP software integrates business activities across various functional departments, from product planning, parts purchasing, inventory control, product distribution, to order tracking. ERP has transformed the way multi-billion dollar corporations conduct their businesses. Successful implementation of ERP systems could save tens of millions of dollars and increase employee satisfactions, customer satisfactions and sustain competitive advantages in every-changing marketplace. Corporate executives are often perplexed by the stories that how reputable corporations (Hershey Foods) have failed miserably and lost ten of millions of dollars in their ERP endures.

The failures of ERP projects are preventable if we can identify the common causes of the failures regardless the companies and industries that implement them.

An ERP system is the combination of ERP software, the business processes that the ERP transforms, the users of the ERP system, and the computer systems that run the ERP applications. The failures of a ERP project is often the result of the failures in one or more of those four components. The failures in computer systems (hardware and operating systems) are much easier to identify and to fix, so we’ll examine the failures in software implementation, business process and user acceptance.

Failure of ERP Software Implementation

Module-based ERP software is the core of ERP systems. Most ERP projects involve significant amount of customizations. Packaged ERP software modules have built-in functionality that work in a standard and simplified enterprise environment. However, every organization is unique in data requirements and business processes. It is the customizations that transform packaged ERP software into ERP software that meets organizations’ individual business processes and operations. Long and expensive customization efforts often result the pass of release deadline and budget overrun. Customizations may make the software more fragile and harder to maintain when it finally goes to production. Major changes may be required in the later stage of the implementation as a result of incomplete requirements and power struggles within organizations

Why New Systems Fail: An Insider’s Guide to Successful IT Projects

The integration of ERP systems (http://www.sysoptima.com/erp/erp_integration.php) with the IT infrastructures also challenges ERP project teams. The use of appropriate implementation methodologies can often make or break a ERP project. (http://www.sysoptima.com/erp/implementation_methodologies.php)

Failure of Accommodating Evolution of Business Processes

According to Anthony, R. A, business processes fall into three levels – strategic planning, management control and operational control. Organizations continuously realign their business processes of all levels in response to the ever-changing market environment. Many ERP systems aren’t flexible enough to accommodate evolution of business processes. many ERP system need a major overhaul in every a couple of years.

Failure of User Acceptance

The users of ERP systems are employees of the organizations at all levels. ERP projects usually modify the company’s business processes which create extra workload for employees who use them initially. They may not think that the workflow embedded in the software are better than the ones they currently use. Ongoing end-user involvement and training may ease the difficult in organization’s adaptation of new systems and new business processes.

About The Author

Bruce Zhang has over 10 years experiences in developing and implementing ecommerce and ebusiness systems in various industries.

He operates a website http://www.sysoptima.com that automatically aggregates the news and new articles in e-business (ERP, CRM,

Supply Chain Management and Knowledge Management) from over 50 sources daily (http://www.sysoptima.com/newsbot/) to help corporate executives, professionals and consultants to keep up with the latest development in enterprise software market. The website offers a knowledge base for understanding business software from a systems perspective.

Causes of ERP Failures

by Bruce Zhang

The failures of ERP projects are preventable if we can identify the common causes of the failures regardless the companies and industries that implement them.

: Image by Behrooz Nobakht via Flickr

ERP Failures -Software Implementation

ERP Failures – Failure of Accommodating Evolution of Business Processes

According to Anthony, R. A, business processes fall into three levels – strategic planning, management control and operational control. Organizations continuously realign their business processes of all levels in response to the ever-changing market environment. Many ERP systems aren’t flexible enough to accommodate evolution of business processes. Many ERP system need a major overhaul in every a couple of years.

ERP Failures – Failure of User Acceptance

Bruce Zhang has over 10 years experiences in developing and implementing ecommerce and ebusiness systems in various industries. He operates a website www.sysoptima.com that automatically aggregates the news and new articles in e-business (ERP, CRM, Supply Chain Management and Knowledge Management) from over 50 sources daily (www.sysoptima.com/newsbot/) to help corporate executives, professionals and consultants to keep up with the latest development in enterprise software market. The website offers a knowledge base for understanding business software from a systems perspective.

Another Related ERP Failures post

Causes of ERP Failures

ERP for the little guy

Chris Shaul

Most of the news and information you hear on the web or read in print about ERP relates to SAP, Oracle and other large systems. There is a derth of information on ERP for the small shop or for the under 10 million dollar manufacturer. What then do people do when they have graduated from Peachtree or Quickbooks? Is it possible to get a complete integrated system that manages their entire operations and finance areas?

Well fortunately, there are a few solutions that will not break the bank and will provide end-to-end functionality for a small manufacturer or distributor. These softwares are surprisingly complete. In fact, there are often features and functionality that beat the main-stream big systems.

One such system is called IntegrateIT This system provides a well rounded set of features that allow the small manufacturer the ability to run the company with a complete understanding of what is in inventory, what am I making today, what should I buy today, where is my cash position and am I profitable? Surprisingly, this software has modules that many larger ERP systems do not have, such as Field Service. It is amazing the amount of power that these smaller systems have. This link is one such example of how this system saved a company thousands of dollars.

Another solution is DBA Software. Having gone through a major rewrite of their core solution, they are both complete in functionality and have a very current underpinning of technology. This solution provides a very easy to use system for the smaller firm.

What makes these systems perfect for the smaller enterprise? The fact that they get more done with fewer screens. On a mid-tier solution, there maybe 2 to 5 screens needed to process a transaction such as entering a voucher or creating a work order. These smaller solutions tend to do it in one to two screens with all the information you need at your fingertips. The idea is that in larger companies, there is a delegation of work. In the smaller company, you may have one person wearing many hats and they need efficiency in transaction processing.

So the when you are thinking of integrated software solutions, remember that big isn’t necessarily an answer. Amazing things often come in small packages.

Chris Shaul is a Sr. IT Consultant and specializes about ERP selections and implementations.

The ERP comeback

Chris Shaul

ERP seems to be on the move again this year. Vendors are ramping up, customers are calling again, selection projects are beginning. Why now? With all of the things going on in the world, what is it that is driving the return of ERP and technology initiatives?

This can be attributed to several factors. First is the rush to implement prior to the year 2000. In the late 1990â€™s, every company was working to shore up their systems to prevent the dreaded millennium bug. Companies that couldnâ€™t patch or were not even sure about it, moved in droves to the ERP market. It was a frantic time. Now, six and seven years later, the lifecycle of those original ERP systems is coming due. Companies that implemented back then are now reconsidering their systems and are either performing major upgrades or migrating to new solutions.

Second was the freeze on IT spending in the post 9/11 era. After 9/11, companies invested in very little infrastructure and spent more of their budgets on IT security related issues. It is only of late that companies are loosening the purse strings again to invest in infrastructure and strategic systems.

Lastly, because of the IT downturn in the early part of the 2000â€™s, there has been a tremendous consolidation of software providers. Sage and Infor have quickly aquired a multitude of smaller software providers and are rebranding and in some cases consolidating their offerings for the small and medium enterprises. Microsoft and Oracle have recently gobbled up competing ERP offerings. Microsoft with the acquisition of Navision/Axapta, Great Plains, and Solomon. Oracle with the acquisition of JD Edwards and Peoplesoft. The result of this consolidation is a more focused message and a clearer landscape of providers. In the mid to larger enterprises, t is almost a choice of platform rather than options. You have the SQL Server camp and the Oracle camp. That is for a different article. But clearly, companies interested in choosing new software now have a smaller field of vendors to look at. Instead of a selection, it is now a choice of perhaps two ways to go.

This comeback is not without problems. Continue reading The ERP comeback