BY GAURAV MEHTA & MEHUL RAVAL

What is ERP?
Why ERP?
How it works?
How to implement it?
Benefits of ERP.
Other issues, concerns.
 Enterprise Resource Planning (ERP), is a
concept that addresses the enterprise
needs taking the process view of an
organization to meet the organizational
goals, tightly integrating all
functions(marketing, sales, finance,
production and HR).
 Enterprise-wide system which integrates the business
functions and processes of an organization
 Integration of business functions into one seamless
application Links business processes
 Utilizes a common information system
 It helps in effective forecasting, planning, and
scheduling
 Properly implementing ERP will give you a competitive
advantage and help you run your business more
effectively, efficiently, and responsively.
 1960’s: Inventory Control Systems
 1970’s: MRP: Material Requirement Planning
 1980’s: MRPII: MRP & Distribution
 1990’s: MRPII  ERP with introduction
of other business functions

 Today: Web Enabled ERP – Connecting

ERP Externally

Obtain the right mix of people, processes and
technology!!
 On time deliveries
 Reduced cycle time
 Better Customer Satisfaction
 Reduced overheads and inventory
 Timely responsiveness ,customers and
suppliers can be in online
communication
 Market share and image enhancement
 Reduced quality costs
 Direct Costs
◦ Represent a portion of total cost
◦ Hardware, Software and People on project
◦ Largest is personnel
 
 Indirect Costs
◦ Back-filling positions
◦ Increasing salaries
◦ Total life cycle costs of ERP
◦ Maintenance and Upgrades
 Training
 Integration and Testing
 Customization
 Data Conversion
 Consultants
 Post ERP depression
 Waiting for ROI
•Requirement Study

•ERP Selection (Which module?)

•Selection Of Implementation Partner

•Project Sponsor

•Project Leader / Project Team

•ERP Awareness Program

 Failures more due to human factors than the
system itself
 Inadequate user training (Ex EXCEL CROP CARE)
 Resistance to change and fear of unemployment
 Lack of discipline in feeding information to the
system at transaction level(salesperson should
enter his name, time and order no. date etc)
 Inexperienced consultants (configuration
incomplete)
 Wrong package selection for the industry and the
 SAP
Oracle Applications
BAAN
SSA
Ramco Marshal
IBM
PeopleSoft
JDE
D&B
 The Promise of Integration - SAP R/3 View of Manufacturing

Sales and Distribution Production Planning Materials Management

Demand management Direct requisition
Sales planning
Profit planning Master planning Purchasing
SOP Inventory management
Rough-cut capacity Goods receipt
Planned requirements planning
Forecasts Material valuation
MRP/Planned orders Invoice verification
Customer order Order Warehouse management
processing - Creation
- Release
Shipping, - Confirmation Quality Management
billing, transport Shop floor control Lot inspection
Capacity leveling Process charting
Process planning
Preventive Maintenance
Planned repair
Project system Emergency
Cost
Complexity
Inflexibility

Dependence
Integration
Upgrades
 Biggest ERP supplier
 55% global share, and rising fast
 One of world’s most successful software firms
 Huge web of connections
 More than 1,000 “partners”
 Consulting firms
 Makers of add-on software, etc,
 More than 12,000 customers
 More than 10 million licensed users
 22 versions tailored to specific industries
 World-wide usage
 Designed to satisfy the information needs for
business sizes (small local to large all
international)
◦ Multi-lingual
◦ Multi-currency
 Designed to satisfy the information needs for all
industries (industry solutions)
 Enables a company to link it’s business
processes
 Ties together disparate business functions
(integrated business solution)
 Helps the organization run smoothly
 Real-time environment
 Scalable and flexible
Excel Crop Care Limited
(ECCL) operates
numerous offices,
manufacturing plants
and warehouses but was
unable to automatically
share key business
information across the
sites.
BUSINESS NEED: With continued growth planned, the company
wanted to make enterprise-wide data sharing easier. Rather than
upgrade its already complex custom applications, the company
needed help migrating all its operations to a single centralized
SAP solution.

SOLUTION: IBM Global Business Services helped ECCL design and

implement an enterprise-wide my SAP solution to manage the
company's supply chain operations. This enabled ECCL staff at any
company location to obtain the real-time information they need to
do their jobs.

BENEFITS: The company has realized cost savings up to 60,66,000

Rs annually. Process improvements and faster data sharing
increase overall company efficiency and productivity, and a
standardized platform will scale to match company growth.
 SAP Enterprise System
PCs, Laptops, etc.
Browser Client

Network

Web
Internet Server
Transaction
Presentation Server

Application Application
Servers

Database

Database
 SAP Enterprise System

Pre-Sales Sales Order Accounts

Delivery Billing
Activity Receivable

Availability Goods Issued to

Check Delivery

In Inventory General Ledger

Plant or Warehouse Inventory Accounts
YES Postings

NO Goods from Production

Order

Planned Order Production Completion Confirmation Accounts

Order Payable
 SAP Enterprise System

Logistics
• Materials Management (MM)
• Sales and Distribution (SD)
• Production Planning (PP)
• Quality Management (QM)
• Plant Maintenance (PM)
• Service Management (SM)
 Materials Management (MM) Integration
Procurement Process
(Procure-to-Pay)
Purchase
Purchase
Requisition
Order

Notify
Vendor

Payment
to Vendor
Vendor
Shipment
Invoice
Receipt
Goods
Receipt
 Sales and Distribution (SD)

Shipping
Transport
Sales
Sales
Information
Support
Sales and System
Master
Distribution Data
Billing
(SD) Foreign
Sales
Trade
Credit
Mgmt.
 Financial Accounting (FI)

Accounts
Receivable

Financial General Fixed

Accounting Ledger Assets

(FI) Accounts
Banks
Payable
Special
Purpose
Ledger
- An Introduction to Accessing
and Navigating the SAP R/3
System -
SAP Enterprise System
 SAP Enterprise System

Table
Valid Valid
Client User Password From To
400 STEVE ******** 1/1/2000 12/21/2000
400 BOB ******** 1/1/2000 12/21/2000
400 JERRY ******** 1/1/2000 12/21/2000
410 STEVE ******** 1/1/2005 12/31/2008
410 BOB ******** 1/1/2005 12/31/2008
410 JERRY ******** 1/1/2005 12/31/2008
 SAP Enterprise System

System Menus

System Transaction
Navigation Name

Transaction
Icons

Transaction
Work Area

Status Messages
 Enter

Comm
and
Field

Save
Back
E
Cancxeit
l
Find/E Print
xpand
icons
SAP Enterprise System

Scroll
icons
Create
a
Create new s
a desk ession
top sh
ortcut
Help i
con
Optio
ns
 SAP Enterprise System

 An SAP session is
a window in
which the user
may perform a
particular task
 Users may have

up to nine
sessions open at
one time
 SAP Enterprise System

System Messages

• E = Error
– An invalid entry has been made
– The cursor moves to the field where the error
has occurred
• W = Warning
– A possible error has been made
– The user can continue without changing
• I = Information
– Feedback from the system
Q&A