SEMINAR REPORT

on
ENTERPRISE RESOURCE PLANNING

Submitted by,
Vipin V Panicker
(Reg. No. 122159)

In partial fulfilment of
the requirement for the degree of
MASTER OF BUSINESS ADMINISTRATION

School of Management and Business Studies

Priyadarshini Hills P.O,
Kottayam-686560
2021-23
 Index
CHAPTER
TOPIC PAGE NO.
NO.

1 INTRODUCTION 1

Foundations for understanding ERP Systems 1

A Brief History of ERP 2

What is ERP Software? 2

What does ERP Software do? 2

Why use ERP Software? 2

What are the drawbacks of ERP Systems? 3

Business Benefits of ERP 3

The Challenges of Implementing ERP System 4

2 POPULAR ERP VENDORS 5

SAP ERP 5

ORACLE PEOPLESOFT 5

OPEN ERP 5

3 CASE STUDIES OF ERP 6

Western Digital 6

Walmart 7

Fulton and Roark 7

4 CONCLUSION 8

5 REFERENCES 9
 Enterprise Resource Planning 1

INTRODUCTION
Enterprise Resource Planning (ERP) is the practice of consolidating an enterprise’s planning,
manufacturing, sales and marketing efforts into one management system. It combines all
database across departments into a single database that can be accessed by all employees. It is
a software that is built to organizations belonging to different industrial sectors, regardless of
their size and strength. The ERP package is designed to support and integrate almost every
functional area of a business process such as procurement of goods and services, sale and
distribution, finance, accountings, human resource, manufacturing, production planning,
logistics & warehouse management. ERP is a business management software is usually a suite
of integrated applications that a company can use to collect, store, manage, and interpret data
from many functional areas including-
➢ Financial Accounting − Deals with financial transactions and data.
➢ Human Resource − Deals with information related to employee of an organization.
➢ Customer Relationship Management − Deals with capturing and managing customer
relationship, facilitating the use of customer experience to evaluate the knowledge
database.
➢ Sales and Distribution − Deals with order placement, delivery, shipment and invoicing.
➢ Logistics and Warehouse Management − Deals with storage of products and shipment.
➢ Manufacturing and Material Management − Deals with the production and production
planning activities.
➢ Supply Change Management − Deals with the movement of products, storing, managing,
and controlling supplies.
➢ Business Intelligence − Analyses data and converts the same to information.
Computers have become so complex and commonplace in organizations, it is much easier to
integrate all of the data and processing software modules and hardware into one large unit that
is easier to access and control. This is called Enterprise Resource Planning, or ERP. Normally
ERP systems use the same database throughout an entire company to store various types of
data for different computerized functions. When first developed, ERP systems were used only
for large manufacturing companies. Today, they benefit all sizes of companies, even those that
are quite small.[1][2][3][4]
Foundations for Understanding ERP Systems
During early phases of development, integrated solutions were designed for particular process
areas such as –
➢ Material Management − the integrated system was known as Material Requirement
Planning (MRP)
➢ Manufacturing − the integrated system was known as Manufacturing Resource Planning
However none of the integrated systems came with a complete solution for an organization
covering major business process areas.
In early 1990‘s, the Gartner Group first used the acronym ERP. By mid–1990‘s, ERP systems
addressed all the core enterprise functions. In the early stages, most of the ERP solutions were
focused on automating back-office functions that were not directly affecting customers or
general public. Later, front office functions such as customer relationship management and e–
business systems were integrated. [1][2][3][4]
 Enterprise Resource Planning 2

A Brief History of ERP

The term ERP was coined in 1990 by Gartner, but its roots date to the 1960s. Back then, the
concept applied to inventory management and control in the manufacturing sector. Software
engineers created programs to monitor inventory, reconcile balances, and report on status. By
the 1970s, this had evolved into Material Requirements Planning (MRP) systems for
scheduling production processes. In the 1980s, MRP grew to encompass more manufacturing
processes, prompting many to call it MRP-II or Manufacturing Resource Planning. By 1990,
these systems had expanded beyond inventory control and other operational processes to other
back-office functions like accounting and human resources, setting the stage for ERP as we've
come to know it.
Today, ERP has expanded to encompass business intelligence while also handling "front-
office" functions such as sales force automation (SFA), marketing automation and ecommerce.
With these product advancements and the success stories coming out of these systems,
companies in a broad range of industries—from wholesale distribution to ecommerce—use
ERP solutions. Moreover, even though the "e" in ERP stands for "enterprise," high-growth and
mid-size companies are now rapidly adopting ERP systems. Software-as-a-Service (SaaS)
solutions—also referred to as "cloud computing"—have helped fuel this growth. Cloud-based
solutions not only make ERP software more affordable; they also make these systems easier to
implement and manage. Perhaps even more importantly, cloud ERP enables real-time reporting
and BI, making them even valuable to executives and staff seeking visibility into the business.
As a result, companies of all sizes and a wide range of industries are transitioning to cloud ERP
systems. In fact, Forrester predicts that SaaS-based ERP adoption will rise 21 percent annually
through 2020. When you stop to consider the benefits of ERP, it's easy to see why it's become
so popular and why its use will continue to grow so rapidly. [1][2][3][4]
What is ERP Software?
ERP software has its roots in the Nineties manufacturing industry, where earlier forms of the
applications were used for manufacturing resource planning (MRP) and computer integrated
manufacturing (CIM). However, ERP has grown to cover all core functions of a business,
regardless of its industry sector. As a result, both private and public sector organisations now
use ERP systems in some form or other. ERP applications tend to be modular in nature, sharing
vital business information which is held on a central database repository, or repositories.
[1][2][3][4]
What does ERP Software do?
ERP systems typically carry out financial and business planning functions, which might
formerly have been carried out by many smaller standalone applications. Examples of ERP
system modules include: product lifecycle management, supply chain management (for
example purchasing, manufacturing and distribution), warehouse management, customer
relationship management (CRM), sales order processing, online sales, financials, human
resources, and decision support system. [1][2][3][4]
Why use ERP Software?
One major benefit of having a single modular ERP system is that it can unite and link together
multiple processes and parts of the business, making the business run more efficiently. By
automating various functions, you can also benefit from having, for example, good order
tracking, from acceptance through to fulfilment. In terms of the revenue cycle, you can track
invoices through to cash receipts.
 Enterprise Resource Planning 3

ERP systems also centralise the data in one place, which can eliminate the problem of
synchronising changes between multiple systems, and allows business managers to get a more
accurate view of the business information. Having a single data repository can also lower the
risk of losing sensitive data, if you use appropriate data security and authorisation. [1][2][3][4]
What are the drawbacks of ERP Systems?
ERP systems can prove to be complex and difficult to customise, keeping in mind the actual
complexities and idiosyncrasies of each individual business itself. Many firms fail to
adequately invest in ongoing training for the involved IT personnel, and there is often a lack of
corporate policy to protect the integrity of the data in the ERP systems and the ways in which
it is used. Business processes frequently have to be re-engineered to fit the new ERP system,
and this can lead to problems with processes and staff. Also, ERP systems can be very
expensive. This has led to a newer breed of simpler ERP systems for smaller enterprises which
carry a lower cost, and many established ERP vendors now offer managed ERP services,
offered over the web. Finally, the fact that ERP systems centralise the data in one place can
increase the risk of loss of sensitive information in the event of a security breach.[1][2][3][4]
Business Benefits of ERP
1. Competition: It’s true that ERP software requires a major investment, but there’s also an
even bigger cost in not making the investment. While some manufacturers choose to stick
to the tried-and-true methods of the past, others seek technology solutions. Manufacturers
cannot afford to put off an ERP implementation while their competition invests in ERP and
starts reaping the many benefits
2. Efficiency: An ERP solution eliminates repetitive processes and greatly reduces the need
to manually enter information. The system will also streamline business processes and
make it easier and more efficient for companies to collect data, no matter what department
they’re working in.
3. Forecasting: Enterprise resource planning software gives your users, and especially
managers, the tools they need to create more accurate forecasts. Since the information
within ERP is as accurate as possible, businesses can make realistic estimates and more
effective forecasts.
4. Collaboration: Nobody wants to run a soloed business with each department functioning
separate from the other. Collaboration between departments is a crucial and often necessary
part of the business. With the data entered into ERP systems being centralized and
consistent, there’s no reason why departments can’t work together. The software also
touches on almost every aspect of a business, thus naturally encouraging collaborative,
interdepartmental efforts.
5. Scalability: Structured ERP systems allow the addition of new users and functions to grow
the initially implemented solution over time. When your business is ready to grow or needs
more resources, enterprise resource planning software should be able to facilitate that
growth.
6. Integrated Information: No more issues with data spread across separate databases; all
information will be housed in a single location. This means you can integrate platforms like
your CRM software with the ERP system, keeping data consistent, accurate, and unique.
Know your customer, their orders, and your inventory, all in one place.
7. Cost Savings: With one source of accurate, real-time information, ERP software reduces
administrative and operations costs. It allows manufacturers to proactively manage
operations, prevents disruptions and delays, breaks up information logjams and helps users
 Enterprise Resource Planning 4

make decisions more quickly. If you’ve chosen the right solution for your business, and the
right vendor who meets your needs, you’re bound to see a powerful ROI.
8. Streamlined Processes: As manufacturers grow, their operations become more and more
complex. Manufacturing software automates business operations cross-departmentally,
providing accurate, real-time information to everyone utilizing the solution. ERP increases
efficiency and productivity by helping users navigate complex processes, preventing data
re-entry, and improving functions such as production, order completion and delivery.
Streamlined, efficient processes throughout.
9. Mobility: An advantage of ERP solutions like WorkWise ERP software is having access
to a centralized database from anywhere you work. Home, office, wherever, through our
mobile-friendly solution and application.
10. Reporting: ERP software helps make reporting easier and more customizable. With
improved reporting capabilities, your company can respond to complex data requests more
easily. Users can also run their own reports without relying on help from IT, saving your
users time to use toward other projects. .[1][2][3][4]
The Challenges of Implementing ERP System
With the rise of e-business and the need to be more productive, ERP systems are gaining
extensive interest from entrepreneurs. An ERP system allows an organization to run a
synchronized configuration that connects all the business processes. It helps an enterprise to
gain competitive advantage by saving resources and responding to an ever-changing business
environment. But there are some challenges that one needs to take into account before
implementing an ERP system.
1. ERP Vendors: In this competitive environment, selection of the perfect product is
necessary to achieve productivity gains. There are over 500 ERP applications in market.
While selecting the perfect ERP application for a business, one should know the vendor’s
previous projects, industry vertical and experience.
2. Commitment from the Top Management: Senior managers play a crucial role in any
ERP implementation. Their involvement is extremely necessary for the success of a project.
Any form of ignorance may cause ineffective decisions and delayed operations.
3. Adequate Training: After the implementation of an ERP system, resentment from
employees is common. This could heavily degrade the productivity of processes. Special
training and motivation before the implementation is very helpful. This would give the
teams, some time to get familiar with the software.
4. Implementation Time: Many companies don’t realize the time consumption of an ERP
implementation process. An ERP system is implemented step by step and because it is very
standard, it needs to be designed to a particular business, to handle the processes just the
way the company needs them.
5. Proper Project Management: Companies, who want to implement the ERP system, need
to assign their best employees for successful implementation. Generally, companies
appoint external help as well but internal employees are preferred.
6. Implementation Cost: The entire cost of an ERP implementation is much greater than the
initial costs. The total cost depends on customization cost. Greater the customization,
higher will be the final implementation cost.
7. Employee Retention: It’s been observed that despite of training, many employees leave
the organization after the implementation of ERP system. This can immensely affect the
growth rate of a company.
 Enterprise Resource Planning 5

8. Sufficient Testing: Testing of ERP system doesn’t ‘t mean whether it’s working smoothly
or not, but to be delighted by its performance and to see whether it’s up to your needs.
Insufficient testing of the system can attract costly unplanned updating.
9. Maintenance Cost: An ERP system has maintenance costs attached to it. If managed
casually, it has the power to fracture an organization. It requires time to time maintenance
which adds up to the recurring cost.
10. Investment in Internal Hardware: Working on a slow system can be very unproductive
and frustrating. ERP applications require sufficient storage and high work performance.
Low investment in internal hardware may result in various software issues. ERP has gained
recognition because of competitive factors, such as an ever-increasing number of mergers
and globally aggressive rivals. A successfully planned and managed ERP system can
increase customer satisfaction and enhance employee productivity. It can adequately
increase the company profits with minimum resource. .[1][2][3][4]

POPULAR ERP VENDORS

1. SAP ERP
It is an enterprise resource planning software developed by the German company SAPAG
which was founded in 1972. SAP ERP incorporates the key business functions of an
organization. The latest version of SAP ERP (V.6.0) was made available in 2006. The most
recent SAP enhancement package 8 for SAP ERP 6.0 was released in 2016. It is now
considered legacy technology. It supports multiple currencies, tax-laws, fiscal years and
accounting systems. The business processes included in SAP ERP are:
➢ Operations (Sales & Distribution, Materials Management, Production Planning,
Logistics Execution, and Quality Management),
➢ Financials (Financial Accounting, Management Accounting, Financial Supply Chain
Management),
➢ Human Capital Management (Training, Payroll, e-Recruiting) and
➢ Corporate Services (Travel Management, Environment, Health and Safety, and Real-
Estate Management)
SAP ERP consists of several modules, including Financial Accounting (FI), Controlling, Asset
Accounting, Sales & Distribution, SAP Customer Relationship Management, Material
Management, Production Planning, Quality Management, Project System, Plant Maintenance,
Human Resources, Warehouse Management. The 12 modules listed above contain sub-
modules to provide complete functionality. For example, FI module has the following sub-
modules: General Ledger, Accounts Receivable, Accounts Payable, Legal consolidation and
accounting information system. These modules provide complete framework for defining
accounting system of an organization and carry out transactions. SAP ERP can work with
Oracle, SQL server, Ingress or Sybase. It also provides login-based access and can be installed
on Windows or Linux and their various operating systems. .[1][2][3][4][5]

2. ORACLE PEOPLESOFT
It was founded in 1987 by Ken Morris and David Duffield, with a focus on HRMS (Human
Resource Management Systems). In 1995 it added solutions specific to academic
institutions to its offerings. It also offers ERP solutions for manufacturing organizations. It
is also known for their educational ERP solution. It existed as an independent organization
until its acquisition by Oracle Corporation in 2005. The modules of PeopleSoft for
 Enterprise Resource Planning 6

academic’s institutes: Academic advertisement, Financial aid, Campus self-service,

Gradebook, Student administration, financials and records, contributors relations, Hostel
management system, Recruiting and admissions.[5]
3. OPEN ERP
Open-source ERP is an enterprise resource planning (ERP) software system whose source
code is made publicly available. The open-source model allows companies to access the
ERP system's code and customize it using their own IT department instead of paying extra
for vendor customization services and licensing, as is typically the case with closed source
programs. For open-source ERP software to be a viable option, companies must have an IT
staff with considerable ERP development and programming skills. In-house ERP support
capabilities are also important, as customizations are often not covered under vendor-
operated software support. Open-source ERP can be particularly attractive to small to mid-
sized businesses (SMBs) that want to upgrade or customize their ERP systems without
paying large licensing and support fees. There are a number of flexible, feature-rich, and
cost-effective open-source ERP systems such as ADempiere, Apache OFBiz, ERPNext,
Odoo, Axelor ERP etc. [6]

CASE STUDIES OF ERP

Companies look to software providers for help in managing all kinds of enterprise resources.
Some of the biggest needs fall in the categories of accounting, financial analysis, human
resource management, client relations, manufacturing, supply chain, and inventory
management. Some of the largest solution providers include Oracle, IBM, SAP, Salesforce,
and Microsoft. Below are a few ERP success stories to help understand some companies’
biggest challenges and goals in this area

1. Western Digital
Western Digital is a technology company with offerings in the areas of data, data storage, data
systems, and data solutions. A merger of Western Digital, SanDisk, and HGST was a big
challenge for the company around 2019. With the merger, Western Digital wanted to centralize
ERP so that all three companies could better work together. After final deliberations among
two providers, the company went with the Oracle ERP Cloud. This choice also followed with
an Oracle Suite of products that included solutions for performance management and analytics,
all integrated together. The major benefits of the Oracle choice included integrations from the
three businesses across the following:
• Cost centre management,
• Information technology,
• Human resource management,
• Payroll processing,
• Streamlined systems for forecasting business analytics and forecasts,
• Workforce planning,
• Comprehensive dashboards and automated reporting,
• Improved customer relationship analysis,
• Systems all running efficiently in the cloud for easier accessibility and document
management.[7]
 Enterprise Resource Planning 7

2. Walmart
As of August 2022, Walmart is one of the top fifteen largest companies in the United States by
market capitalization. Sales for the company in FY 2022 were over $570 billion. The company
operates globally with brick-and-mortar supercentres, discount stores, and neighbourhood
markets. It owns hundreds of brands, including the well-known Sam’s Club. To successfully
keep its shelves stocked it works with thousands of suppliers. Its e-commerce business is also
a behemoth, with a long list of online seller partnerships. The sheer size of Walmart’s business
is one of its greatest advantages, but also challenges when it comes to ERP. Walmart works
with many ERP providers. In 2018 however, it announced a strategic partnership for building
out a digital transformation through Microsoft AZURE. Benefits of the Microsoft Azure
relationship include:
• Building out a cloud-based enterprise system that serves as the framework for managing
all of its resources.
• The capability to plug-in existing ERP applications to the Microsoft Azure framework.
• Integration of Microsoft 365Broader and more efficient opportunities for e-commerce.
• Broader opportunities for automated warehousing capabilities.
• Use of artificial intelligence for supplier relationships.
• Integration with SAP Hana and other legacy inventory management solutions
• Integration with blockchain-based solutions that are evolving.[7]

3. Fulton and Roark

Fulton & Roark, a retailer of men’s grooming products, is an example of a successful ERP
implementation. Prior to upgrading to full-featured ERP, the North Carolina-based business
tracked its inventory in a spreadsheet and its financial data in desktop accounting software,
Sage Live. When the company began doubling sales year-over-year, leadership felt its current
processes weren’t keeping up. Spreadsheets couldn’t account for changing inventory costs, and
the accounting software didn’t have the workflows necessary to record the cost of goods sold
(COGS), an important financial metric. As a result, the Fulton & Roark team did double data
entry — manually. To centralize all work in one place, the company’s co-founders
implemented NetSuite ERP. After a three-week implementation process, changes were
immediate, according to team members. Finally, the Fulton & Roark team was able to:
• Catch and correct bookkeeping mistakes related to inventory.
• Stop working with external accountants, growing both unit and dollar volumes significantly
with no extra headcount.
• Increase sales roughly 50% year-over-year without increasing headcount.
• Get a more accurate picture of margins and inventory, which helped grow its ecommerce
operation.
The company’s story also emphasizes a major success factor: Getting management committed
to an ERP project. In this case, the co-founders initiated the project, which consultants say
often spurs employee adoption.[8]
 Enterprise Resource Planning 8

CONCLUSION
Enterprise Resource Planning (ERP) is a system that integrates business functions by managing
and organizing organizational data and information. ERP is the most reliable system for the
management of data, ensuring its reliability, uniformity, transparency and visibility across the
organization. It provides easy to the organizations in maintaining the business data and ensure
the access to the integrated valuable business information to all the members of the
organizations. ERP software manages important data in an efficient way, avoiding its
redundancy and validating the entire process. The appropriate management of information
helps the organization in saving the cost and increasing productivity. It also assists in
integrating the organizational units which further fosters the communication process and
prompt sharing of information among the organizational members leading to improved
organizational process and better decision making at every level.
There are as many reasons for successful ERP implementations as there are for failed projects.
However, success seems to be measured by whether or not the project came in on time and
under budget. Whereas, fully utilizing the system to achieve improved business practices
appears to be ignored. Performance measures must be developed and standardized to give
organizations a clearer picture of the benefits derived from Enterprise Resource Planning
implementation. Much has been written about and learned from some well-publicized
successes and failures in ERP implementations. Some of it has even been directly
contradictory. However, most agree on some basic rules:
• Establish the business processes prior to selecting the software.
• Staff the project team with members of the user community in addition to IT staff.
• Develop an implementation plan and stick to it.
• Train the users thoroughly on the process changes and flow of information in addition to
the actual software.
• The project doesn’t end with “go-live”, but must be continually monitored.[9]
 Enterprise Resource Planning 9

REFERENCES

[1]. D P Goyal, Management Information Systems–Managerial Perspective, MacMillan

[2]. Laudon & Laudon, Management Information Systems, Pearson
[3]. Mary Sumner ―Enterprise Resource Planning, Pearson
[4]. Goyal ―Enterprise Resource Planning TMH
[5]. Veena Bansal, Enterprise Resource Planning, Pearson
[6]. https://www.techtarget.com/searcherp/definition/open-source-ERP
[7]. https://www.investopedia.com/articles/investing/111214/lg-case-study-successful
enterprise-resource-planning-system.asp
[8]. https://www.netsuite.com/portal/resource/articles/erp/erp-implementation-case-
study.shtml
[9]. Patricia Barton, Enterprise Resource Planning-Factors Affecting Success and Failures
(November 25, 2001), University of Missouri-St Louis