Management Information System Unit 3- part 1

Unit III- ENTERPRISE

MANAGEMENT SYSTEMS

Content

Enterprise Management SystemsEMSERP SystemERP Basic ,Features, Benefits of the ERP,ERP Selection,ERP Implementation, EMS and MIS

Business Process OutsourcingWhat is BPOVoice BPOCall centerNon-voice BPOScope of BPOChallenges in BPO management.

Information Technology Architecture

Enterprise management System

What is Enterprise?

Large business community including all the players and partners in the business

General term, used for a corporate entity (any thing from Coffee house to Organization like TATA, Bajaj etc.)

It is a group of people with common goal, where has certain resources at its disposal to acquire that goal.

Let us consider a simple example of a company receiving a customers order. Once order is received, it requires processing. Following steps will be carried out to fulfill that order :

Acceptance and customer intimation

Ordering material

Booking the order

Scheduling the order on shop floor for production

Updating the business status

Informing MR for monitoring the marketing activities

What an Enterprise needs ?

Management of Data (through EDI – Electronic Data Interchange) for information Communication

Management of related systems and sub systems

Event monitoring , updating, Control

There are tools and Techniques available to answer all above needs, i.e. business needs an integrated solution, which is nothing but an EMS.

DMS

CMS

SMS

EDI

CAD /CAM

AMS

ERP

DesignOf

Engineering

Attendance

Capturing

Document

Management

Electronic

Commerce

Security

Communication

Components of an EMS

ERP plays the important role of running system on front. Whatever decision are made, mostly are through the system of ERP. ERP is supported by various other supports. This is the place where major decision making and their execution takes place.

EDI (Electronic Data Interchange) consists of direct computer-to-computer transmission among multiple firms of data in a machine readable, structured format.

AMS (Attendance Monitoring System) is required for personal planning of the employees in the organization. It also helps in availability and scheduling.

CAD/CAM/CAE (Computer Aided Design/ Computer Aided Manufacturing/ Computer Aided Engineering). This system handles the design, manufacturing and engineering functions in the organization. This provides drawing and design engineering information to ERP in the execution of manufacturing and purchase functions.

DMS (Document Management System). This system helps in keeping important document for viewing at later times. For the purpose of transaction handling this system some time have a facility of document modification, by giving text-editing facility.

CMS (Communication Management Systems). The ERP uses CMS as a tool for all its communication needs of recording an event. This system is used for tracking the important resource for action.

SMS (Security Management System). This system handles the security, entry access requirement of business operations.

ERP System

ERP SystemERP software is a family of software modules that support the business activities involved in these vital back-office processes. For example, ERP software for a manufacturing company will typically track the status of sales, inventory, shipping, and invoicing, as well as forecasting raw material and human resource requirements.Enterprise Applications/ Packages/ Suites/ Systems

connects all of the information, which flows through

a company to a single integrated set of systems. This is implemented in modules, which can be integrated. ERP may work with a wide variety of databases, hardware, and operating systems. Leading Vendors of ERP are SAP, Oracle.Originally. ERP packages were targeted at the manufacturing industry. Their goal is to integrate information across the company and eliminate complex links between computer systems.

The architecture is client/server and uses OO methodology for design and development of whole system. Key advantage of ERP is that it provides an integrated solution for all the requirements of the business. It takes care of organizational hierarchy of authoritiesBasically ERP solutions are based on Unix and Windows NT platform.

A typical ERP solution has following modules: -Marketing, Distribution and salesManufacturing processAccounting and financePersonal managementPlanning and controlPurchase and inventory

The modules are designed for following purposes: -Data capture from transactionsData transaction validationAnalysisUpdating and reporting of accounting.

All ERP packages give a facility to provide following types of standard report Employees attendance monitoringIncome tax

ERP BenefitsERP offers lots of benefits to the implementing organization. It helps for a manager to make decision at the right time. This is possible when entire organization is sharing information and interprets in same perspectives. The benefits of ERP can be classified in two categories: -

Tangible benefits (Those which can be measured in one form or other)Intangible benefits (Difficult to measure in absolute terms)

Reduction of lead-time : The elapsed time between placing an order and receiving is known as the lead-time. In order to reduce lead-times, the organization should have an efficient inventory management system. This inventory system is integrated with the purchase, production planning and production department. The ERP systems help in automating this task and thus make inventory management more effective and efficient.

Doubled businessIncrease of inventory turn to over 30%Cycle time cut to 80% :

Cycle time is the time between receipt of the order and delivery of the product. Make –to – orderMake –to - stock

Better customer satisfaction

Customer satisfaction means meeting or exceeding customer’s requirements for a product or service.Assessment of the degree of satisfaction is usually made on at least three measures.

1. Whether the product or service includes the features that are most important to the customer

2. Whether the company can respond to the customer’s demands in timely manner

3. Whether the product or service is free of defects and perform as expected. Web Enabled ERPTechnical Support

Improved vendors performanceReduced quality costs by better management of resources Increase flexibility :

Because competition is growing, companies must learn to respond more rapidly to customer’s wishes as well as changes in the market. They will need to design new product or redesign old products quickly and efficiently. Flexibility is a key issue

Improved information accuracy

Improved decision-making capabilities due to many use friendly tools available.Better HR utilization due to access to the information across the database.Communication is faster due to use of technologies such as EDI, E-mail, office automation and paperless office.Improved information accuracy

ERP FeaturesMaterials Related Features

Procurement and purchasing.Issue and receipt of goods.Stock management and valuationInventory control and analysis.Data integration.Enquiry processing.

Sales Related FeaturesOrder processing.Dispatching and invoicingOrder analysis and force carting.Sales analysis, budgets and controls.Product analysis.Sales forecasting and budgeting.

Production Related FeaturesMarker data management.Bill of materials (BOM).Work order scheduling, control and generation.Production planning.Collection of unit data for valuation and costing.

Business System FeaturesForecasting for products, services and markets.Business target allocation and fixing.Planning of business.Implementation and formulation of strategies.Management of information

Quality ControlData gathering system for quality against standard.Analysis of quality by material and process.Building quality assurance data for technical solution.Monitoring quality.

Phases of ERP ImplementationPre-evaluation screeningPackage EvaluationProject Planning Gap AnalysisRe-EngineeringConfigurationImplementation Team TrainingTestingGoing LiveEnd-user TrainingPost-implementation

Pre-Evaluation ScreeningOnce the company has decided to go for ERP systems, the search for the perfect package starts.But there are hundreds of ERP vendors of all sizes and shapes all claiming to have the solution that is ideal for you.Analyzing all the packages before reaching a decision is not a viable solution.It is also a very time consuming process.So it is better to limit the number of packages that are evaluated to less than five.Hence the company should do a pre evaluation screening to limit the number of packages that are to be evaluated by the committee pre evaluation process eliminates those packages not suitable for company's business processes.people soft is strong in HR and less so in manufacturing, BAAN is stronger in manufacturing than in finance

Package Evaluationthe package you select will decide the success or failure of the project. Generally there is no perfect package that will cover your each and every requirement the objective is to find a package that is flexible enough to meet the company's needs.Functional fit with the company's business processes.

Degree of integration between the various components of the ERP systems.Flexibility and ScalabilityComplexityUser friendliness.Quick implementationAvailability of regular upgrades Availability of reference sites.Amount of customization required.

Project Planning PhaseThis phase will decide when to begin the

project, how to do it and when the project is supposed to be completed. This phase will plan :What to do ?How to monitor the progress ?What control measure should be installed ?What correction actions to take ?

An ERP in charge and a committee should be appointed for all these.

Gap AnalysisThis is the process through which companies create a complete model of where they are now and in which direction they want to head in the future

There can be many methods to do this. For example :1. Identify a third party product that might fill the gap.2. Designing a custom program.3. Altering the ERP source code.

ReengineeringHuman factors are taken into account in

this phase.Business Process Reengineering (BPR)

emphasizes the human element of necessary changes within organization. This is more time consuming.

ConfigurationFirst a prototype - a simulation of the actual business processes of the company will be used.ERP consultants configure and test the prototype configuration tools

Implementation Team Trainingcompany trains its employees to implement and later run the system.The ERP vendors and the heard consultants will leave after implementation is over. But for the company to be self sufficient, it should have good in-house team that can handle the various situations.Thus it is very vital that company selects those employees who have right attitude people who are willing to change, learn new things and are not afraid of technology and have good functional knowledge.

TestingThis is the phase where you try to break

the system.System overloads, multiple users logging on at the same time with the same query users entering invalid data, hackers trying to access restricted areas and so on.The test cases must be designed specifically to find the weak links in the system and these bugs should be fixed before going live.

Going Live

The old system is removed and the new system is used for doing business.Data conversion is done, databases are up and running.Prototype is fully configured and tested and ready to go operational. So the system is live.

End User Training

Here the actual users of the system will be given training on how to use the system.Users are identified, there current skills are noted and accordingly are grouped.Then each group is trained on the new system.It is human nature to resist change. The company management should address the concerns and take necessary actions to avoid failure.

Post implementation (Maintenance Mode)

This phase is very critical. To reap the full advantage of ERP systems it should get enterprise wide acceptance.The system should be upgraded as and when new versions are introduced.The costs and benefits should be analysed first for this, as updating also needs user training and other factors.Projects for implementing the ERP systems get a lot of resources and attention. However an organization can only get the maximum value of these inputs if it successfully adopts and effectively uses the systems.

The Risks of ERP

Tied to a single vendorFlexibility limited by options offered by the vendorMay inappropriately force generic processesMay inappropriately force org. structure changesComplexity - particularly regarding mapping and standardizing processes across the organization.