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Enterprise Applications and Relation Management

IE5083

OCTOBER 3, 2020
H. CHATHURA SURANGA PEIRIS
MS20922634
Table of Contents
No table of contents entries found.
Executive Summary
Task 1: Why ERP? Need for Enterprise Resource Planning

Nowadays most of the organizations are becoming bigger and they are looking to manage a wide range of business functions business processors withing a centralized system. Therefore, Enterprise Resource Planning (ERP) software tools facilitate integrating various functional areas such as Sales, Marketing, Accounting Manufacturing, Human Resources, Supply chain management. Furthermore, ERP software support to connect isolated functional applications such as Payroll, Inventory as well as coordinate business information and management reports. If any of the organizations used legacy applications and isolate applications for each
function that could be effected a negative impact on the business processes, functional areas, and sharing information.

Figure 1Business functions of each area [1]

And organizations require an ERP system since they face may of problems such as productivity issues, frequently change the business model, require advanced functionality, Lack of audit compliance. The ERP system contributes to enhancing the operation of those activities. When integrating all activities into one ERP system capable to manage effectively those activities as well as when merged functional applications could be reduced the dependence of other systems and improve communication and workflow in between people.
According to the functional areas in organizations need to manage end to end business processes. Therefore Enterprise resource planning (ERP) system assistant to streamlines entire business processes and helps to business process reengineering.
For example, Biscuit manufacturing company sold their product through Sales, Marketing and it linked to supply change management of their ERP system. Therefore the company can effectively perform business processes through the ERP system. Also, assistance order management, procuring materials, view payments status, order status, check invoices, market research, promotions campaigns. Further ERP module support to collect and sharing orders to receive invoices and delivery notes integrated with suppliers or partners ERP system.
Based on the above scenario manufacturing firms have a lot of business processes involved with partners, suppliers, and customers. That ERP system may help to handle customer complaints, product development, expand manufacturing capacity, hiring employees, and evaluate performance based on product sales information.
Manufacturing organization needs a suitable supply chain management system it provides order raw materials from suppliers to receive the material for production as well as delivering products to customers. And also help to the production plan and future sale forecasts, employee recruitments, material utilization for each product. And also the ability to maintain a good relationship between support service and major functional departments. Those more modules such are core and extended ERP models that help to complete core ERP solutions for manufacturing companies.

Figure 3 typical modules in an ERP system for a manufacturing company.[3]

Furthermore, when increasing production and product demand companies should maintain inventory levels such and stock in, stockout, as well as an organization, needs to manage raw material and production levels. therefore organizations are capable of saving money by reducing overproduction, overstock, and materials. Even ERP system provides different roles for end-users auditors and consultant to do daily works to complete specific business context.therfore that system facilitates to view a variety of information such as purchasing, cash requirement, employee records, pending payments, logistics, and supplier data.
Most of the companies do the financial audit and system audit annually as well as auditors need to look at some reports such as general ledgers, trial balance, purchasing process, imports /exports, balance sheet. these reports can generate from the ERP system. Then auditors will provide best practices for improving organization performance, business processes. And also the system would maintain the accuracy, reliability, security, and privacy of the data. therefore organizations can reduce business overhead costs.
When Does a Company Need an ERP System?
Considering business's challenges of manufacturing organizations identify and line with the ERP system to solve many business problems since ERP system might help to determine actual financial performance and it could support identify those difficulties such as delivery delays, issue of correct forecast and plan production requirements, customer dissatisfied, high shipping costs. The following major reasons clarify when organizations require ERP systems
[4]
 Changing the business model
A legacy system no longer effectively supports a new line of business and no sufficient internal controls and procedures to engage with global business.

 Desire for growth

Existing systems and processes are may not be capable to manage while increasing the number of users and transactions.

 Need for advanced functionality

The company's current software might not be able to manage new business procedures and practices. Because the new business model requires advanced reporting and functional features.

 Too many business systems supporting processes

If companies running different systems then become complexity, system outage and dependencies of resources for IT maintenance, customizing systems, upgrading system, and applying patches and updates.

 Lack of compliance
When requires the government an instructional compliance requirements ERP system to be recorded and accounted for in regulatory compliance and it can maintain in the ERP system and databases.

Benefits of ERP Software

Many benefits allow the to business implementing an ERP system and provided more clarification above the ERP system that integrated an information system how can lead to an increasingly efficient business process that reduces less than an unintegrated system. Also, ERP offers the following benefits.
 Data Reliability
ERP system can integrate with could platform and data that able to access anytime any different location
 Customer Service
It allows sales or marketing people to track the status of their campaign which is published through social media, email campaign
 Flexible Systems
The modern ERP system can customize and flexible to fits all functions of daily business operations. And also add a new function when the business grows.
 Regulatory Compliance
ERP systems are designed to keep track of regulations and monitor implementation changes. Also, keep up to date with rules, legislation, guidelines, and standards as they contribute to business processes.
 Increased Productivity
It provides to save time and increase productivity and redundant processes help to spend other time on another project or other tasks.
 Customized Reporting
ERP software facilitates reporting capabilities to generate customized reports every angle to when reports require top-level management and daily processes.
 Mobility
ERP data can access anywhere people work with different devices such as laptop, Tab, Mobile phone
 Streamlined Processes
 ERP software can automate cross-department business processes, providing those using the solution with reliable, real-time information, all while reducing manual duty, which also has the potential to lead to errors.
 Accurate Forecasting
This allows software users, and companies as a whole, to think ahead and prepare correctly from inventory and sales to financials and customer support what they need. However better forecasting, companies can minimize business costs efficiently, saving money, and being a more proactive overall unit.
 Improved Process Efficiency
ERP allows to streamlining business processes, the advantages of introducing an ERP system in an enterprise will also enhance daily business operations, making it easier and more effective for businesses to obtain data, no matter what department they work in.

Figure 4 Benefits of Implementing ERP System

Task 2: There is no linkage with Enterprise Resource Planning (ERP), Business Process Re-engineering (BPR), and IT of the system. Do you agree with the above statement? Explain ERP, BPR, and IT Systems & justify the answer
Task 3: Elaborate the future trends and directions in ERP in the light of new markets and new technologies?

Referring to concepts in ERP by (F. Monk, E. and Wagner, B., n.d. Concepts In Enterprise Resource Planning, Fourth Edition. 4th ed, p,27)

“In the late 1990s, the year 2000, or Y2K, problem motivated many companies to move to ERP systems. As it became clear that the date turnover from December 31, 1999, to January 1, 2000, could wreak havoc on some information systems, companies searched for ways to consolidate data, and ERP systems provided one solution”

Overview of ERP Market

There are several ERP systems provides around the world wild such as SAP ERP, Microsoft Dynamic Navision, Oracle, Peoplesoft, Epicor, Fujitsu, and Netsuite. These SAP ERP and Oracle is the one who leading partners in Globally. However, both SAP and Oracle competition for small business ERP software organizations such as Sage Business solution, Exact, Infor, and Epicor.

In 2020, these four ERP companies such as Oracle, SAP, Sage, and Infor dominate the market. And also, Infor had the lowest number of market shares and was the youngest company on this, founded in 2002. Meanwhile, this year, SAP won two spots on our list, with AI and machine learning endorsing both of their products' big ERP trends.

Figure 5 Top ERP Systems by Market Share [4]

New Technology of ERP

Cloud-based ERP
When moving with global technology transformation organizations are offering a wide range of functionality with enterprise ERP solutions. Because scalable with business processes and needs organizations require ERP solution access any time anywhere. therefore ERP vendors are offing could base ERP models to customers to fulfill their requirements and they try to provide faster service and efficient information systems as well as integration investment less than other ERP competitors. That ERP cloud technology solutions reduce cost in capital expenditures and IT resources utilization, flexibility, and maintenance, as well as ERP cloud
technology solutions, improve availability, security and disaster recovery will reduce the amount of business impact.
The advantages of cloud-based ERP are various and also provide small companies with the most assistance. Also, cloud-based ERP technologies make it possible for small companies not to manage to own infrastructure, reducing the need for in-house IT significantly.
Figure 6 SAP Business One Sales Dashboard[5]

RADIO FREQUENCY IDENTIFICATION (RFID)

RFID technology cost-effective and efficient tools capable of tracking and identification of items that can be a tag to a product, product bundle, or small package and the tool helps to extensively streamline data capturing.RFID tag can be identified using as RFID reader where the items are store and it can count the number of items inside the bundle or package. This tool helps to manage inventory as well as facilitate to enter records of goods inwards and outwards into the ERP system. RFID reader that broadcasts radio waves and receives back signals from the tag.most of companies tracked materials using bar code readers since that label can be
damaged or destroy in bad weather and sometimes the reader does not scan bar code while laser point does not directly touch with bar code. That technology can be applied for manufacturing, pharmaceutical because easy to check to manage warehouse inventory stockroom and it can identify the missing item and stock level.
By reducing and removing manual processing, RFID technology facilitate to control process accuracy and helps to minimize labor to enhance precision. It also allows for real-time and current information to be collected and provided throughout the entire supply chain.
Business Intelligence
While growth in business data requires to analyze a large amount of data. Therefore business analytics techniques using tools such as data mining, data extract, and data querying provide visual reports to decision-makers.

(F. Monk, E. and Wagner, B., n.d. Concepts In Enterprise Resource Planning, Fourth Edition. 4th ed, p,219)
“The growth of data-generating technologies such as RFID, combined with improvements in BI tools, has led to significant growth in the BI market. Before 2008, almost all of SAP’s ERP business came from traditional ERP suite applications.However, in the period from 2008 to 2011, the percentage of the business that came from BI rose to 50 percent”
 Figure 7 SAP Business Intelligence (BI) framework [7]

The Internet of Things

That technology transfers data over a network without human involvement that high-level architecture solutions help to an organization which is manufacturing and distribution customers. IoT devices and sensors capability to feeding data back to update ERP application which is hosted in an on-premises datacenter or cloud. When IoT devices interconnected with the ERP system easily identify issues because it sends alerts when requiring maintenance. Also, that technology provides monitoring and tracking of high-value assets, goods, or equipment in the supply chain as well as IoT ability to provide real-time information. When integrating ERP
with IoT its immediately feed data into the ERP system that possible for all workers involved in the supply chain to remain aware and take effective action.

Figure 8 Internet of Things (IoT) solution Architecture [7]

Task 4: State the significance of CRM?

A customer is a key person of any organization, should good relationship customer satisfaction, customer loyalty, and customer retention these factors directly affect company revenue. Customer relationship management (CRM) software tool facilitates the to companies centralize optimize and streamline their interactions with customers to ensure a consistent message.CRM software help to manage relationships with their customers as well as customers' satisfaction level. Even coordinate the efforts of the marketing, sales, and customer service and support departments by integrating customer-facing processes. And many organizations develop
marketing strategies to attract their customers to provide these benefits events, cashback offers, credit, and debit card discounts, reward points, and foreign tours. That could be helped to build on stronger relationships with customers.

“Customer Relationship Management (CRM) is an organizational strategy to develop mutually profitable long term relationships with the customer.”
“Theodore Levitt elaborated by saying, “The purpose of business is to create and keep a customer.”[8]

Figure 9 Concept of CRM [8]

Why a CRM System is important for an organization

customer relationship functionality that important end-to-end marketing, lead generation, sales, and analytics. And the system can help an organization to increase profitability, productivity, and improve customer service. this system very important for the sales department because they following up on leads from time to time as well the system will provide reminders to the sales team for follow-up customer needs. It allows organizations to gain insight into their customer's behavior and improve their business operations to ensure that customers are served in the best possible way.
Business benefits of CRM

 Increased revenues through improved effectiveness due to expected needs based on historical trends.
 More efficient identification of needs by understanding specific customer requirements.
 By highlighting and recommending solutions or upgrades, cross-selling other goods.
 Improved loyalty and retention of customers, ensuring that your strong reputation in the market continues to expand.
 Increased value and reduced costs associated with maintaining and serving your current clients, enhancing your overall performance, and reducing total sales costs.
 Improved profitability by focusing on the most profitable customers and dealing in more cost-effective ways with the unprofitable.
When developed customer management system organizations begin to successfully look after its current clients, resources can be centered on attracting new customers and expanding business as well as discover possible opportunities and expand the consumer base. Also, the company can know about consumers, customer preferences change over time, and technology will make it easier to find out more about consumers.