Role of ERP in Business Functions and Processes

Business Process

A collection of activities that take some input and creates an output that adds value for the customer

Functional Silos

An organisation that is divided into separate departments that work independently and focus mainly on their own goals rather than the organisation as a whole

Functional Silos Issue

Leads to short-sighted improvements focusing on individual divisions rather than the entire organisation

Advantage of Business Process Perspective

Enables managers to view operations from the customer’s viewpoint

Inputs in Business Processes

Materials, people, equipment

Marketing and Sales

Handles product development, pricing, promotion, order processing, and sales forecast

Marketing and Sales needs

They require customer data, order data, sales trends, and production costs from Accounting & Finance and supply chain management for pricing

Supply Chain Management

They manage manufacturing and raw material purchasing

SCM needs

Require sales forecasts by M/S to plan production and control inventory costs

Accounting and Finance

They document transactions, handles raw material purchasing, payroll, and customer receipts

Why is A/F crucial for M/S and SCM?

Because they provide forecasting and staffing decisions for M/S and SCM

HR

manages recruitment, training, evaluation, and compensation

Benefit of system integration

It allows faster responses to market changes, improving flexibility and efficiency