IDSC topic 4

lecture notes and articles

enterprise resource planning (ERP)

tightly integrated software used to automate back-office functions in a single management information system

• “one source of truth"

• stores data so that all departments of a business can share information

• All financial transactions flow to the general ledger (if we change something in the business, we need to change it in the system as well!)

ERP basic processes

• Procure to pay

• Order to cash

• Plan to produce

• Field to fork

• Hire to retire

challenges with ERP

• software may not support all business functions

• Risks in vendor lock-in, switching cost

• Vendors continually updating software, companies need to stay current for support

estern digital (example with ERP)

• A merger of Western Digital, SanDisk, and HGST was a big challenge for the company.

• After the merger, Western Digital wanted to centralize ERP so that all three companies could work together.

clour based (example with ERP)

• TTI Inc., a specialty distributor of electronic components based, needed to go beyond replacing its legacy system.

• “This technology gives us the guardrails to do things in a standardized, simplified way around the world. “

• That foundational process, with the help of technology, allows us to look globally, act locally.

supply chain management (SCM)

• management of the flow of goods and services

• Includes the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.

5 processes of SCM

• plan

• source, make, deliver

• return

WHAT IS ERP ARTICLE:

what is ERP?

ERP systems collect and organize key business information and help organizations run lean, efficient operations, even as they expand.

• Each module pulls information from and pushes information into the central database that is a key component of an ERP system.

two main approaches:

1. to purchase software that can handle each of these core business functions like accounting, sales, inventory and manufacturing from different vendors. -> then integrate with a central database (ERP)

2. to buy all the modules you need from the ERP vendor and avoid integrations since the applications are already designed to work together. (best option for the large majority of businesses thanks to its simplicity)

the 13 ERP modules:

1. finance

2. procurement (manages purchasing raw or made materials)

3. manufacturing

4. inventory mgmt

5. order mgmt

6. warehouse mgmt

7. supply chain mgmt

8. CRM

9. project service resource mgmt

10. workforce mgmt (keeps track of attendance and payroll)

11. HRM (keeps track of  PTO and performance reviews)

12. ecommerce (websites)

13. marketing automation

how does ERP help businesses

• access data from everywhere

• Information is always up-to-date

• Business decisions based on the same data

benefits of ERP

1. Cost savings

2. Workflow visibility

3. Reporting/analytics

4. Business insights/intelligence

5. Regulatory compliance & data security

6. risk mgmt

7. data security

8. collaboration

9. Scalability

10. flexibility

11. customization

12. Customer & partner management

dissadvantages of ERP

1. system cost

2. need for training

3. data conversion cost

4. complexity

5. maintenance

6. doesn’t solve process and policy issues

What Is Supply Chain Management ARTICLE:

what is the main goal of SCM?

make the most of the resources involved in a supply chain and be as productive as possible

what is the SCM process?

1. planning

2. sourcing

3. making

4. delivering

5. returning

benefits of SCM

• Keeps Businesses Competitive & Paces with Technology

• Creates Productive Environments

• Proactive Strategy (leads to creative thinking)

• Satisfies Customers While Reducing Operating Costs