1. What is the purpose of Enterprise Resource Planning?

Enterprise Resource Planning (ERP) is an integrated computer-based system used to manage internal and external resources, including tangible assets, financial resources, materials, and human resources. Its purpose is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders. Built on a centralized database and normally utilizing a common computing platform, ERP systems consolidate all business operations into a uniform and enterprise-wide system environment. Efficient, integrated information systems are very important for companies to be competitive An Enterprise Resource Planning (ERP) system can help integrate a companys operations Acts as a company-wide computing environment Includes a database that is shared by all functional areas Can deliver consistent data across all business functions in real time Enterprise Resource Planning (ERP) software can be described as a complete business software solution. It is aimed at the integration of all business processes and sub-processes into a single unified system. This system is formulated and implemented in an organization to effectively and efficiently achieve the business goals of the organization.ERP packages are implemented to manage the existing and prospective business plans and policies in an efficient manner under strict deadlines. It can be referred to as the ultimate business solution package that is predominantly concerned with making sure that the available resources of the organization are utilized in the best possible manner and coordinated with the business objectives of the organization. It is crucial that modern day business organizations have a single unified system, which aims at harmonizing its business efforts. This can prove to be a crucial determinant in deciding the scope, area and net results of the organization as a whole, rather than running many different systems that don't work well together. What makes ERP different from any other business solution package is the presence of a single and unified database system. ERP software is as essential to the needs of a business today as food is for living. Businesses cannot run competitively in the absence of properly drafted and formulated ERP software. The more effective implementation and follow-up, the better are the results. ERP software is needed by all modern-day organizations, irrespective of the size, area of operations and business objectives. Nowadays there are many ERP packages available in the global market, including SAP, PeopleSoft, Oracle, J D Edwards, and BAAN. The selection of an ERP software package is dependent on many factors: previous software implementation, nature and size of operations, recommendations of consultants, and management decisions. Before installing specialized software, a detailed study must be made and reviewed to match the business requirements with the available packages. This must be taken as a serious study as any

mistake in selection or its effective implementation can prove disastrous to the organizational objectives and prospects. The ERP software must be installed by an ERP vendor or third-party consulting organizations, which are expert service providers when it comes to providing Consulting, customization and support. Some of the benefits of ERP Software: * All processes and sub-processes are linked and unified into a single system. * There are enhancements in the field of productivity, efficiency and achievement of business objectives. * ERP tends to considerably reduce the response time by effectively transferring crucial information. * ERP helps in streamlining the numerous functions performed by the organization as a whole. * It helps the management to make vital decisions with unparalleled accuracy and in-depth study. Thus, ERP software can effectively change the outlook of any business organization that exists in today's cutthroat business world. Proper implementation of the ERP software is the key factor, which can benefit the growth prospects of any organization.
2. How would you define ERP in one sentence?

ERP is a strategic tool which helps companies gain a competitive edge. Enterprise Resource Planning (ERP) is an integrated computer-based system used to manage internal and external resources, including tangible assets, financial resources, materials, and human resources ERP (enterprise resource planning) is an industry term for the broad set of activities that helps a business manage the important parts of its business. ERP is a suite of applications including financials, manufacturing, human resources and other modules, that together automate the back-office business administration functions of an enterprise. ERP is the concept of taking many departments and combining their unique systems and utilising the methods used to streamline the business administration ERP programs are core software used by companies to coordinate information in every area of the business. 3. ERP Vendors list:

ABAS Software Agresso CDC Software Cincom Systems COA Solutions Comarch Dolibarr

Epicor GBP Global Shop Solutions Lawson Software Microsoft Dynamics NetSuite Openbravo

OpenERP Oracle Applications Plex Systems Pronto Software QAD Ramco Systems SAP

SIV.AG SSA Global Technologies Syspro Technology One The Sage Group Visma WorkBook Software

4. What are the major ERP modules? SAP modules: Sales & Distribution Materials Management Production planning (with others) Quality Management Plant Maintenance Human Resources Financial Accounting Controlling Asset Management Project System Oracle modules: Marketing, Sales Procurement Manufacturing Service Human Resources Financials Asset Management Projects 5. What major problems/issues does Enterprise Resource Planning address? Eliminates the problem of synchronizing changes between multiple systems - consolidation of finance, marketing and sales, human resource, and manufacturing applications. It permits the control of business processes that cross functional boundaries. Provides top-down view of the enterprise. Real time information is available to management anywhere, anytime to make proper decisions. Shorten production lead time and delivery time Reduces the risk of loss of sensitive data by consolidating multiple permissions and security models into a single structure. Integration among different functional areas to ensure proper communication, productivity and efficiency. Managing inter-dependencies of complex processes bill of materials

6. What is a business blueprint? (Just Rahul) SAP provides Solution Manager(SM), a tool that helps companies manage the implementation of SAP ERP. In SM, the ERP implementation project is presented in a 5 phase implementation Roadmap. Business Blueprint is the 2nd phase and takes about 25 to 40 days to be implemented.

The Business Blueprint (BB), produces detailed documentation of the business process requirements of the company, The BB provides a detailed description of the how the company intends to run its business with the SAP ERP system. Process mapping is critical in the BB phase. The BB guides consultants and project team members in configuring the SAP ERP system. During the BB phase, technical team members determine the method of data transfer from the existing computer systems (called legacy system) which will either be replaced by the ERP system or will continue to function with the ERP system through with an interface. What is a business blueprint? (Prateek Swarup)
Source: http://www.erp.com/component/content/article/3-general/4070-the-erp-systems-blueprint-where-itall-begins.html

The "Blueprint" refers to all the activities, which are necessary for the reproduction and description of the customer's business operations in an ERP System. These activities commence before the ERP project itself. This activity is to complete the Blueprint, which is one of the main deliverable. The Blueprint serves as your master plan, and becomes a detailed written document. This document shows you the business requirements in detail, and serves as the basis for organization, configuration and, if necessary, development activities. Before any transactions can be reproduced in the system, the total business extent involved must first be defined. This is done by writing down the essential business processes that are to be supported by the ERP System. Some systems may have a built in analyzer tool to support this activity. Once the framework has been defined (overall implementation plan), the individual business operations can be systematically analyzed in greater detail, documented ("scripted") and reproduced ("prototyped"). The activities stretching from the conceptual design to the documented prototype thus lead to the detailed solution. This article outlines the overall context in and a modular manner of building and working with an ERP Business Blueprint. The Blueprinting phase is made up of seven major sections. 1. Project Management: The purpose of this section is to establish a proper cycle of project management activities to ensure that the implementation project is on target. It determines all project planning, controlling and updating activities. It also identifies where changes in the relationship between business processes and the organizational structure need to be managed, in consultation with departmental management. Activities will include:

Conduct project team status meetings, conduct steering committee meetings and general project management.

2. Change Management: The change management section addresses the organizational and human resource factors that impact the ERP implementation, ensuring the timely success of the implementation. This includes a series of change processes that allow the change team to manage organizational risk, accelerate the implementation, and optimize organizational processes. These change management processes ensure that the change team understands and manages the organizations perceptions of and responses to the changes that will occur as a result of implementing the ERP system. Activities: Create a Business Impact Map Complete the leadership risk assessment Develop sponsorship strategy Complete the baseline project team risk assessment Complete the baseline organizational risk assessment Establish the change communications framework Establish management structure for skills development process Establish management structure for knowledge transfer process 3. Project Team Training: The purpose of this section is to train the project team to implement the system efficiently. Training should reflect the scope of the implementation, and the needs of the individual team members. 4. Develop System Environment: The purpose of this section is to install and technically configure the technical sandbox client and development systems. You must define and check quality assurance system administration procedures for the development system. Activities: Create technical design Set up development environment Install setup of system landscape Systems administration Initialize implementation table settings 5. Business Organization Structure: This section is to define the enterprise organizational structure using organizational units, such as company codes and sales organizations. In conducting the organization structure workshop,

several topics are discussed, including: what enterprise process areas and business processes will be used in the ERP system setup or configuration? What organizational units within the company will be affected by the implementation? This will be the creation and definition of the organizational structure.

6. Business Process Definition: The purpose of this section is to define the company requirements based on ERP business processes, to provide the required functions. You must first define your organizational structure. The business process definitions create your Business Blueprint. Activities will include: Prepare for business process workshops Conduct global requirements workshop Conduct business process workshops Conduct detailed requirements workshops Prepare end user training plan Complete Business Blueprint Business Blueprint review and sign off Business Blueprint Quality Check? The purpose of this section is final verification of all deliverables from this phase. It is critical that quality checks be performed throughout the phase, as tasks are completed. The Business Blueprint ensures that everybody has an accurate understanding of the final scope of the project regarding business processes, organizational structure, and system environment. In addition, this includes project team member training, project standards, and strategies in the technical area. You must address issues regarding changes in scope, impact on budget, and resource planning. Perform quality check and obtain a signed approval. Summary The Business Blueprint is one of the main deliverables. It serves as your conceptual master plan, and becomes a detailed written document. This document shows you the business requirements in detail, and serves as the basis for organization, configuration and, if necessary, development activities. Results: Documented and approved project goals and objectives. A well-grounded and detail implementation plan. Overall project schedule and implementation sequence. Business process definition and organization structure. A coordinated, cost-effective, and organizationally effective roll out plan. A successful ERP implementation.

Q7. What is a Process? A process in a business context is a collection of activities that takes one or more kinds of input and creates an output that is of value to the customer. The customer for a business process can be tput the traditional external customer (the person who buys the finished product), or it may be the internal customer (such as a colleague in another department). Examples of some common processes in the ERP context are e Process: Sales Order Input: Request to purchase computer Functional area responsible for input: Marketing and Sales Output: Order is generated Process: Arranging financing in-house house Input: Financial help to purchase hase Functional area responsible for input: Accounting and Finance Output: Customer finances through the computer company Thinking in terms of processes helps managers to look at their organizations from the customer's perspective.

8. What is a transaction? Transaction Analysis provides complete support for unlimited optional fields throughout the application. You can manage information more effectively and easily obtain necessary data for analyzing business operations and practices. Transaction Analysis allows you to define all the information you require for each General Ledger account, customer, vendor, item, transaction, and transaction detail, making it easy to record and track data from the originating transaction through to your General Led Ledger. Imagine being able to trace the optional field information you define for customers and items to your Order Entry orders, Order Entry shipments, Order Entry invoices, Accounts Receivable invoices through to your General Ledger journal entries and accounts! You can define unlimited text, accounts!

amount, date, time, integer, number, and yes / no optional fields for use throughout the applications. 9. What types of companies haveto undertake re-engineering? MICHAEL HAMMER (author of landmark book, Reengineering the Corporation: A Manifesto for Business Revolution) says, Three kinds of companies undergo re-engineering. The first is companies that are in big trouble, that are being beaten by competitors, that are losing money, that are just in terrible shape. These companies turn to re-engineering as a last resort. The second group is composed of companies facing major change. Everything is pretty good now, but they see on the horizon a very different set of circumstances. These might be telecommunications companies such as GTE, electric power companies, companies in an industry now going global, businesses that are being deregulated. This is the largest group of companies that are re-engineering because almost every industry is in the throes of unbelievable change. And the third group is filled with companies that are doing just fine, that don't see major change on the horizon, but they re-engineer in order to get so much better than the competition that nobody will ever catch them. Moreover, the companies that have unintegrated information systems that support only the individual functional areas are likely to face many process inefficiencies,as information cannot be shared efficiently between various functional areas, which in turn increases the cost. Such companies that are based on functional model of business organization are stuck with silos of information, which limit the exchange of information between the lower operating levels and instead the exchange of information between operating groups are handled by top management, which might not be knowledgeable about the functional area. But, in todays, quickly changing markets and stiff competition, this functional model more often leads to a top heavy and overstaffed organization. Hence for such companies, reengineering becomes necessary, which enables them to view their business as a set of cross functional process, i.e., the functional business model with its separate silos of information is replaced with a process oriented business model. 10. What is the typical architecture for an ERP (basic configuration)?
ERP applications are most commonly deployed in a distributed and often widely dispersed manner. While the servers may be centralized, the clients are usually spread to multiple locations throughout the enterprise. Generally there are three functional areas of responsibility that is distributed among the servers and the clients. First, there is the database component - the central repository for all of the data that is transferred to and from the clients. Then, of course, the clients - here raw data gets inputted, requests for information are submitted, and the data satisfying

these requests is presented. Lastly, we have the application component that acts as the intermediary between the client and the database. Where these components physically reside and how the processes get distributed will vary somewhat from one implementation to the next. The two most commonly implemented architectures are outlined below.

Two-tier Implementations In typical two-tier architecture, the server handles both application and database duties. The clients are responsible for presenting the data and passing user input back to the server. While there may be multiple servers and the clients may be distributed across several types of local and wide area links, this distribution of processing responsibilities remains the same. Three-tier Client/Server Implementations In three-tier architectures, the database and application functions are separated. This is very typical of large production ERP deployments. In this scenario, satisfying client requests requires two or more network connections. Initially, the client establishes communications with the application server. The application server then creates a second connection to the database server.

Server Farm for Business Applications PC Client for Front end access Typical network protocol is TCP/IP

12. How are companies organized after implementing an Enterprise Resource Planning product? ERP programs are core softwares used by companies to co-ordinate information in every area of business. Companies would be much better organized after implementing an ERP product.

Integrated information systems can lead to more efficient business processes that cost less than those in unintegrated systems. After an ERP implementation a company is much better placed to integrate globally and barriers of currency and exchange rates, language and culture can be bridged automatically so that data can be integrated across international borders. ERP implementation can bring about integration of people and data while eliminating the need to update and repair many separate computer systems. After and ERP implementation management would be more organized to manage the operations and not just monitor them. Instead of obtaining data from each business unit and analyzing them, ERP system has all the data in one place, thus making it significantly easier for managers to focus on improving processes. Most organizations after successfully implementing ERP process can dramatically reduce costs and improve operational efficiency. After implementing ERP companies mostly benefit in the following areas: Integrate financial information As the CEO tries to understand the company's overall performance, he may find different versions of the truth. Finance has its own set of revenue numbers, sales have another version, and the different business units may each have their own version of how much they contributed to revenues. ERP creates a single version of the true that cannot be questioned because everyone is using the same system.

Integrate customer order information- ERP system can become the place where the customer order lives from the time a customer service representative receives it until the loading dock ships the merchandise and finance service an invoice. By having this information in one software system, rather than scattered among many different system that can't communicates with one another, companies can keep track of orders more easily and coordinate manufacturing, inventory and shipping among many different location at the same time.

Standardize and speed up manufacturing processes- Manufacturing companies-especially those with an appetite for mergers and acquisitions-often find that multiple business units across the company make the widget using different methods and computer systems. ERP systems come with standard methods for automation some of the steps of a manufacturing process. Standardizing those processes and using a single, integrated computer system can save time, increase productivity and reduce head count.

Reduce inventory- ERP helps the manufacturing process flow more smoothly, and it improves visibility of the order fulfillment process inside the company. That can lead to

reduced inventories of the stuff used to make products (work-in-progress inventory), and it can help users better plan deliveries to customers, reducing the finished good inventory at the warehouse and shipping docks. To really improve the flow of your supply chain, you need supply chain, you need supply chain software, but ERP help too.

Standardize HR information- Especially in companies with multiply business units, HR may not have a unified, simple method for tracking employees' time and communicating with them about benefits and services. ERP effectively fixes that.

13. What is a best practice? Best Practices in ERP include various aspects which help the implementation and use become successful, some of these practices involve: Executive management should endorse the ERP project ERP software implementation responsibilities should be shared between the IT department and the functional areas where the software is being implemented Executive management should be cognizant about institutions ability to adapt to adopt the organizational changes that occur when ERP is implemented A project team or manager should be assigned full time to the implementation the War room The project team composition should represent all functional areas where the ERP is going to be implemented All employees who will use the ERP should go through intensive training to make best use of it

14. How are best practices used? Best practices are used in technology development, such as new software, but also in construction, transportation, business management, sustainable development, and various aspects of project management. Best practices are also used in healthcare to deliver high quality care that promotes best outcomes. Best practices are used within any business type including, but not limited to: sales, manufacturing, teaching, programming software, road construction, health care, insurance, and accounting. Also i have included best practices of ERP implementation (For ref.) The first best practices of ERP implementation is to involve all users in the Planning stages of the process. Another is to plan a budget, and stick with that budget.

The best practices of ERP implementation also involve finding a consultant and installation firm. The best practices of ERP implementation are dependent upon the needs of the company, and the size of the company..Larger companies will have different needs, and a different budget than a smaller company. 16. What are the basic four functional areas of ERP systems? Marketing & Sales Supply Chain Management Accounting and Finance Human Resources *******Read Page 20 to 27 from Textbook to gas around! 17: What is MRP II? MRP II stands for Manufacturing Resources Planning, a computer modeling technique for analyzing and controlling complicated Manufacturing operations. When the manufacturing data has been collected (parts, assemblies, resources) the lead time and cost of every component can be predicted under any manufacturing conditions. As soon as an order is received the workload on the manufacturing organisation and the delivery time can be calculated. MRP II systems also keep track of customers, suppliers and accounting functions. Inventory can be purchased and assemblies made "Just in Time". The records kept by an MRP system highlight inadequacies such as overloaded production centers and delays by suppliers.The effect of new orders, changes in capacity, shortages, delays and a myriad of other disturbances are calculated and tracked with confidence. The major effects that an MRP II system will have on a manufacturing operation will be: Reduced inventory. Accurately predicted delivery times. Accurate costing at every stage of the manufacturing process Improved use of manufacturing facilities Faster response to changing conditions Control of every stage of production How MRP II works:

Diagram demonstrating how Manufacturing Resources Planning works

18. Best of Breed Solution The best product of its type. Organizations often purchase software from different vendors in order to obtain the best-of-breed for each application area; for example, a human resources package from one vendor and an accounting package from another. While ERP vendors provide a wealth of applications for the enterprise and tout their integrated system as the superior solution, every module may not be best-of-breed. The contrasting commercial security product argument is that a "best of breed" approach provides more effective protection. While a single vendor's vertically integrated product stack may be the offering of choice for vendors who want to monopolize a client's or customer's business, it could be also be argued that each component of a comprehensive security strategy should be evaluated both for its performance within its niche and its open compatibility with other, non-integrated components of the whole. ERP in the traditional sense means implementing a single system to handle all critical business functions. But some companies instead find that implementing and integrating niche packages that handle specific functions extremely well are more suited for their organizations. The late '80s and early '90s saw a shift in vendor capabilities, which translated to a change in buying habits. As technologies progressed and platform offerings broadened, many applications vendors appeared in the Financials Applications market. The majority entered with specific niche offerings and ushered in the option and reality of Bestof-Breed. Over the last three to five years, there's been another shift. With even more

advanced technologies emerging, buyers can use products from a variety of vendors fairly easily. When evaluating ERP vs. Best-of-Breed, analyze the pricing options carefully, and consider all anticipated costs. The costs of the applications themselves, aka license fees, are very comparable from one option to the next. Also, implementation costs may be exaggerated with an integrated ERP approach. On the other hand, integration and interfacing efforts for Best-of-Breed may add up, depending on the scope of customization and programming efforts. As a basic rule, Best-of-Breed vendors have selected a product offering that complements their core competencies. They have taken the path of doing one thing and doing it well." As a result, they have amassed experience relevant to that one thing.

19. What should you consider when choosing ERP modules for your company? The following factors need to be considered while choosing ERP modules for your company: Buyer: What type of Buyer are you and what are your particular needs. Product: What product features and functionality you should focus on Cost: What expectation you have for price and indirect cost Vendor: what you need from vendor during sale, installation and support ERP Selection Methods ERP systems can be costly to implement. As such, when choosing an ERP system, it is important that you take time to select the right ERP system or set of modules for your business. Determining whether or not to undertake a project, such as an enterprise resource planning (ERP) system, can consume valuable resources and time. In order to do this in the most efficient manner, it is important to have a plan of action, and this is particularly important when you are selecting an ERP solution. When an ERP system is being considered, it is extremely important to weigh all of the options carefully. This is because of the time, money and training that will be consumed by implementing such a system. There are three criteria that are generally used when evaluating whether to approve a project such as an ERP solution. Financial Considerations When Choosing an ERP Solution Financially speaking, projects must make money to be acceptable. As such, there are several measurements that the finance department may make in order to determine whether or not a project is feasible. If the project doesn't make money, after all, there seems little incentive to undertake it. Net present value (NPV) is generally the most accepted method of valuing a project. It takes into account the time value of money and cash flows generated. The cash flow and discount rate selection process is the most important part of an NPV calculation. Determining an average cost

of capital for your firm and the predicted cash flows will help you get an accurate result from the NPV calculation. Budgetary constraint is the most used method when considering IT projects. This is because if the company cannot afford it, then it isn't even worth the effort of the selection process. The IRR and payback methods were also very popular for many firms dealing with IT implementations. Management Considerations When Choosing an ERP Solution On the management side, there are more variables to consider than simply dollars and cents. For example, managers may differentiate between implicit and explicit business needs, legal needs, environmental concerns and competitive pressures. This can make the management side of valuation very difficult to quantify. Generally, companies take a few factors and try to create a scoring system that can be objectively applied across the options. Sometimes probability of achieving the intended benefits is included in this part of the calculations, and other times it is included in the financial part of the process. Probability seems to be more directly tied to things like expected return, so it would make sense to assess a probability variable to your financial calculations. However, the probability of achieving the benefits instead of simply succeeding in implementation takes on a different look. This sort of probability may be more directly tied with a softer science such as management. Development Considerations When Choosing an ERP Solution Development is usually the least important decision factor in these processes. One of the most important factors is the probability that a project will finish on time. This simply doesn't happen very often, so it is important to determine what sort of adverse effects this could have on business operations.
20. What areas does cost cover for installing ERP?

The cost breakdown structure of an ERP system shows the following components: Hardware cost If the ERP system needs an upgrade of the existing IT systems of the company. License cost This is dependent on the number of licenses procured and the number of modules installed. Professional services cost Includes the implementation, testing and maintenance costs. Can be as high as half the cost of the project. The cost of implementing an ERP system with 5 10 licenses can cost around $20000. For a large company having more than 500 employees it is around $2 million. The costs of installation,

implementation, and data migration generally run about three to four times the original cost of the packaged ERP software. For example, if your software costs $2 million, you can expect to pay an additional $6 million to $8 million for consulting services to get the system into production. The average time taken could run upto a maximum of 4 years. However costs can vary from business to business based on the complexity of the project.

23. What is managements role regarding ERP systems? Top management support has been consistently identified as the most important and crucial success factor in ERP system implementation projects. Top management must provide the necessary resources and authority or power for project success. Top management support in ERP implementation has two main facets: (1) providing leadership; and (2) providing the necessary resources. To implement ERP system successfully, management should monitor the implementation progress and provide clear direction of the project. They must be willing to allow for a mindset change by accepting that a lot of learning has to be done at all levels, including themselves. Source: CRITICAL SUCCESS FACTORS FOR THE IMPLEMENTATION OF ENTERPRISE RESOURCE PLANNING (ERP): EMPIRICAL VALIDATION, by T R Bhatti Among the most important factors for the success of ERP project is the top management commitment and support. The role of top management includes, developing an understanding of the capabilities and limitation of the proposed system, setting goals, and communicating the corporate IT Strategy to all employees. Source: http://software.ivertech.com/_ivertechArticle9034_ERPEnterpriseResourcePlanning.htm The commitment of top management to the diffusion of innovations throughout an organization has been well documented. In particular, early in a projects life, no single factor is as predictive of its success as the support of top management. The roles of top management in IT implementations include developing an understanding of the capabilities and limitations of IT, establishing reasonable goals for IT systems, exhibiting strong commitment to the successful introduction of IT, and communicating the corporate IT strategy to all employees. Research on project failures shows that project cancellations occur when senior management delegates progress monitoring and decisions at critical junctures of the project to technical experts. The importance of top management support was instrumental in the successful implementation of a large customized system [26], was the second most important CSF in a study of MRP implementations in Sinagapore, and appeared to be the driving force behind a successful ERP implementation at a manufacturing firm in the southern Midwest.

Source: The Impact of Critical Success Factors across the Stages of Enterprise Resource Planning Implementations, by Somers T M and Nelson K 24. What makes the ROI on ERP systems difficult to determine?

An ROI is an assessment of an investment project's value, calculated by dividing the value of the project's benefits by the project's cost. An ERP system's ROI can be difficult to calculate because of the many intangible cost and benefits that are achieved. An ERP eliminates redundant effort and duplicated data, it saves 'frustration' for the different departments and most importantly provides seamless information flow and better communication which can help improve customer relationships (due to availability of real time data) - all of these factors are very difficult to quantify. Many companies have likened ERP system to be similar to electricity which is a necessity (and something people don't calculate an ROI on). And because both cost savings and increased revenues occur over many years, it is difficult to put an exact dollar figure to the amount accrued from the original ERP investment. 26. Is ERP software inflexible?? <Read This Start> This question doesnt have any fixed answer. Flexibility is different for each ERP software present in the market. Some are flexible and some are very rigid. The answer below is the best I could give without talking about any one software in particular. Most of it is from a paper abstract by Casey Lawrence(first one in the references) Also please read the detailed explanation is given in Page 46 of our textbook. <Read This End> Once an ERP system is in place, trying to reconfigure a system while retaining data is expensive and time consuming. Pre-implementation planning is very important. Its much easier to customize an ERP program when the system is being configured and no data has been stored. Though SAP contains ABAP to customize their ERP solution, most other ERP softwares are still rigid and difficult to customize.

Figure 1 illustrates how difficult it is to make a balanced decision regarding customizations. The illustration shows a marble on a stick. If you hold each end with both of your hands and try to keep the marble in the middle, you will understand how difficult it is to find a balanced approach to customizations. It is easy to let the marble roll to the left and go the direction of generic enterprise software implementation, which has the illusion of simplicity. Or, roll to the right and fall into the unlimited customization trap. Because it is so difficult to limit customizations, once you start its hard to stop. Both sides are easy to slide into. But keeping the marble in the middle is nearly impossible and requires a lot of skill in holding your ground with users and management. This is what happens to nearly all implementations. You start off either trying to perform a generic implementation or a strategy to minimize customizations and you end up heading towards unlimited customizations, and the hidden costs go through the roof. Implementation management must hold their ground, but often the pressure becomes overwhelming, especially when critical missing functionality is uncovered during the implementation. To reduce the risk of stepping in over your head when wading into the swamp, you must minimize your risk through a customization strategy using flexible enterprise software functionality. That is, the ability to customize the software without heavy programming. What I mean by heavy programming is when you must bring in a developer with years of experience to make changes and additions. Minimizing the cost and effort behind customizations is very difficult without some software flexibility. Software flexibility will provide a means to minimize customizations and provide a balanced strategy towards customizations. The hidden cost behind customizations is the cost of programming. If you find a way to simplify or eliminate programming, you will significantly reduce the hidden costs. This is what true flexibility deliversthe means to get a handle on outrageously expensive customizations. Flexibilitycombined with a good strategy to identify as many customizations as possible early in the gameshould give a company the necessary tools to keep the marble in the middle. However, before you get too excited, you should know that flexibility is a missing or elusive feature in most enterprise software. As a matter of fact, true flexibility within enterprise software doesnt really exist today. Yes, I know, this is discouraging. But, there is hope. The good news is that some enterprise software products have elements of flexibility, which I recommend looking for when selecting a product. 27. What type of database does ERP support? Answer: Almost all the popular databases are supported by the ERP. ERP is a very broad term, because it includes different ERP solutions provided by different companies. The particular ERP solution may support only select few database. But most ERP vendors support multiple RDBMS products. If we take example of SAP, then SAP supports the following databases:

Oracle MS SQL Server IBM DB2 for Linux, UNIX, and Windows SAP liveCache Technology MaxDB IBM DB2 Universal Database for z/OS IBM DB2 Universal Database for iSeries IBM Informix

And every major ERP application is built on top of relational database technology. Most ERP vendors support multiple RDBMS products. Factors influencing the choice of DBMS include whether it is supported by the package vendor, whether the DBMS is already used in-house, the level of staff experience with the DBMS, how the DBMS impacts performance, and the relationship between the DBMS vendor and the package vendor. When choosing a DBMS, it is important to consider how rapidly new versions are supported and certified by the application vendor. 28. What are the phases that a company goes through when planning and implementing ERP systems. Who are the team players and what are the objectives for each phase? The phases through which a company goes through while planning and implementation of ERP are given as follows: 1. Strategic Planning: The objectives of the phase are: a. Assignment of a project team b. Examining current business processes and information flow c. Setting objectives d. Developing a project plan This phase basically talks about the initial assignment of the project team who will overlook the process of implementation of the ERP for the organization. The team players in the phase consist of the top management, chiefly consisting of CEO and CIO. 2. Procedure Review: The objectives of the phase are: a. Reviewing software capabilities b. Identifying manual processes c. Developing standard operating procedures This phase basically talks about the gap analysis done by the project leads of the project team. The team players in this phase consist of members of the project team which was formed in the first phase. 3. Data Collecting and Clean-Up:

The objectives of this phase are: a. Convert data b. Collect new data c. Review all data input d. Clean-up data This phase basically talks about customizing the ERP software according to the organization. The team players in this phase are again the members of the project team. However, in this phase the major role is of the domain experts where they keys in the data related to their respective domain. 4. Training and Testing: The objectives of this phase are: a. Pre-test the database b. Verify testing c. Train the trainer d. Final testing This phase basically talks about training and testing of the final customized ERP package before the ERP package is implemented in live. The team players in this phase are the members of the project team who play the role of the end-users. They work in tandem with domain experts to resolve any bug found out during the testing of the package. 5. Go Live and Evaluation The objectives of this phase are: a. Develop a final Go-Live checklist b. Evaluate the solution This phase basically talks about measuring the performance of the system incorporated. The team players in this phase are the members of the project team for development of the checklist and evaluation of the performance. However, the data for the evaluation is given by the actual end-users who run the package once the system has been made live. 29. Why do some companies have more success with ERP than others? IT Toolbox conducted a survey to identify the most important factors for successful ERP projects. And the results were Strong Program Management [6%] Executive Support and Buy-in [ 19%] Organizational change management and training [ 13%] Realistic expectations [ 8%] Focus on business processes [ 5%] All of the above [48%] These are some of the factors which make ERP projects for some of the companies 1. Please understand and be convinced about why you need ERP, sometime organizations dont need ERP at all!!!. Dont rush to ERP consultants and ask for solution of all your

business problems which cant be solved by ERP but rather can be solved with tweaking your business processes! 2. Focus on your business processes, compile requirements and then choose right ERP package for that. Unless company is clear about how they want their business operations to run and what their key business requirements are, no ERP package can guarantee success. 3. To achieve healthy ROI from investment, establish key performance measures, set baselines and targets for those measures, and track performance after go-live. This is the only way to realize the business benefits of ERP. 4. Any project without support from it's top-management will fail but this is not only requirement, keep all the stakeholders in loop and get their buy-ins also. As we know topmanagement can only get data out of system when someone is putting data into the system!!! 5. ERP systems involve big change for people, and the system will not do you any good if people do not understand how to use it effectively. Therefore, spending time on money on training, change management, job design, etc. is crucial to any ERP project. This should all be included in your ERP organizational change management plan. 6. As any other project, meticulous planning and impeccable project management are must for ERP projects too. Finally according to me, involve people from all fronts (depts./ranks) without them success will be farfetched dream. 30. What are some of the Hardware and Software advances that lead to the development of ERP? Following three things were responsible for the development of current ERP systems: 1) Computer Hardware and software development: Computer s/w and h/w developed rapidly in 1960s n 1970s. Mainframe computers of 1960s were not powerful enough to provide integrated, real time data for business decision making. In accordance with Moores Law, soon the computers evolved very fast with capabilities of hardware almost doubling every 18 months. In 1970, relational database software was developed utilizing these advancements of the hardware. In 1980s spreadsheet software became popular. 2) Early attempts to share resources: PC gained popularity in business in 1980s By mid 1980s, telecommunication developments allowed users to share data and peripherals on local networks. This client-server architecture allowed scalability by upgrading the server only. Hence extending the life of hardware investment. By mid 1980s, DBMS technology was available. 3) The manufacturing roots of ERP: Concept of integrated information system took shape on the factory floor.

Manufacturing s/w developed during the 1960/70s, evolving from simple inventory tracking system to Material Requirement Planning (MRP) Electronic Data Interchange (EDI), the direct computer-to-computer exchange of standard business documents, allowed companies to handle purchasing process electronically, avoiding delays. This led to the foundation of SCM. What is a best practice? A best practice is what results when qualitative comparisons are made between similar organizations business practices. OR A best practice is any activity that an organization finds successful in accomplishing a task.

Who would you assign to an Enterprise Resource Planning implementation team? An ideal ERP implementation team should have 1. Backing from the higher management i.e. CIO or CFO should be heading the team 2. Project should be sponsored by VPs of different functional heads which would be affected by the implementation of ERP. 3. The executive management should remain actively involved throughout the implementation 4. A project manager should whose core competency is ERP should be assigned full time for the implementation 5. The project team composition should represent all functional areas where the software will be implemented. 6. The team should consist of functional and IT people. 7. After the implementation the same team should be provide training for all the business users, then the team should be dissolved. Is ERP software inflexible No. The reasons are as follows: ERP offers numerous configuration option that help businesses to customize the software to fit to their unique needs Programmers can write specific routines for special applications in SAPs internal programming language called ABAP(Advanced business application programming) The integration platform, Netweaver offers further flexibility in adding SAP and non-SAP components to the companys IT infrastructure.