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ERP PERSPECTIVES

ERP PERSPECTIVES. GMP FOR PGCIL 18/Aug/2001. Presented By NIRMALA APSINGIKAR I.T. AREA ASCI. ENTERPRISE-WIDE RESOURCE PLANNING - AGENDA. THE CASE FOR ERP : BUSINESS CASE THE I.T. ANGLE ERP DEFINITIONS, EVOLUTION ERP COMPONENTS INVESTING IN ERP IMPLEMENTATION ISSUES.

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ERP PERSPECTIVES

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  1. ERP PERSPECTIVES GMP FOR PGCIL 18/Aug/2001 Presented By NIRMALA APSINGIKAR I.T. AREA ASCI erp

  2. ENTERPRISE-WIDE RESOURCE PLANNING- AGENDA • THE CASE FOR ERP : • BUSINESS CASE • THE I.T. ANGLE • ERP DEFINITIONS, EVOLUTION • ERP COMPONENTS • INVESTING IN ERP • IMPLEMENTATION ISSUES erp

  3. The Business Case for ERP-POWER SECTOR THE BUSINESS ENVIRONMENT • Demand-Supply Gap growing • Unbundling of SEBs; Corporatization • Privatization • Increasing Competition (IPPs) • CERC & SERCs; Tariff Reform • Changing Customer Expectations • THE CHALLENGE: TO ACHIEVE AND MAINTAIN SUSTAINABLE BUSINESS ADVANTAGE erp

  4. SUSTAINABLE COMPETITIVE ADVANTAGE • Agility (Quick Response) • Continuous Innovation • Focus On Efficiencies erp

  5. Power Generation Business - Major Operational Concerns • Cost Effectiveness • Project Management • Supply-Chain Performance • Receivables Management • Assets /Plant Maintenance • Environmental Compliance • Safety • Quality erp

  6. SUSTAINABLE COMPETITIVE ADVANTAGE CORPORATE INITIATIVES • Optimizing, improving, and Automating Business Processes • Project Management • Contracts; • Procurement / Materials Management • Spares Inventory Optimization • Receivables Management • BPR / Process Thinking /cross-functionality • Leveraging Information Technology erp

  7. BUY- FROM SOLD- TO SUPPLIER CUSTOMER SHIP- TO SHIP- FROM INVOIC- TO INVOIC- FROM BUSINESS- PARTNER PAY- TO PAY- BY ....... ...... ....... INTERNAL Business Partners - multiple roles erp

  8. COMPLEX ORGANIZATION STRUCTURES • Enterprise has evolved as a networked structure , • consisting of many small/ medium-sized organisations , • having their own specializations • , Working in tandem • To create value for their customers erp

  9. RESPONSES TO BUSINESS PULL:MAJOR IMPLICATIONS • NEED TO MANAGE HIGHER ORGANIZATIONAL COMPLEXITY • CHANGE IN STRUCTURES, ROLES, PROCESSES • MANAGING INTERDEPENDENCE • Need for information infrastructure to support changing business requirements erp

  10. TRENDS IN I.S. APPLICATIONS OPTIMIZING AND AUTOMATING BUSINESS PROCESSES • On-line Transaction Processing (OLTP) • Integration Of Information Across Functions • Automation Of Work Flows;/ Groupware • Inter-organisational Systems • Electronic Data Interchange (EDI)/ E-commerce ERP / SUPPLYCHAIN/E-BUSINESS mispersp

  11. ENTERPRISE-WIDE APPLICATIONS ENTERPRISE RESOURCE PLANNING : ENABLING THE AGILE ORGANIZATION erp

  12. ERP DEFINITION(S) APICS • AN ACCOUNTING ORIENTED INFORMATION SYSTEM • FOR IDENTIFYING AND PLANNING THE ENTERPRISE-WIDE RESOURCES • NEEDED TO TAKE MAKE,SHIP & ACCOUNT FOR CUSTOMER ORDERS ERP DIFFERS FROM MRP -II SYSTEM IN TECHNICAL REQUIREMENTS LIKE, GUI, RDBMS,4 GL, CLIENT/SERVER ARCHITECHTURE, OPEN-SYSTEM PORTABILITY. erp

  13. ERP DEFINITION(S) GARTNER GRP. • ERP IS AN INTEGRATED APPLICATION SOFTWARE SUITE • THAT BALANCES MANUFACTURING, DISTRIBUTION AND FINANCIAL BUSINESS FUNCTIONS. • WHEN FULLY IMPLEMENTED , ERP CAN ENABLE ENTERPRISES • TO OPTIMISE THEIR BUSINESS PROCESSES AND ALLOW S FOR NECESSARY MANAGEMENT ERP IS THE TECHNICAL EVOLUTION OF MRP-II THROUGH THE INTRODUCTION OF RDBMS, CASE, GUI, 4GL DEVELOPMENT TOOLS, AND C/S ARCHITECTURE. erp

  14. ERP DEFINITION(S)….2000 • ERP is a structured approach to optimizing a company’s internal value chain. • The software, if fully installed across the enterprise connects the various parts through logical transmission and sharing of common data • In an ERP implementation data and processes are organized, codified, and standardized contd. erp

  15. ERP DEFINITION(S)….2000 • When data becomes available at one point in the business, it generates and processes related data in other areas • Transaction data are converted into useful information and analyses erp

  16. Enterprise planning : core process : Where does it fit? inventory information demand forecast Inventory Plan (safety stock) Demand Plan Enterprise planning engine Item master plan Resource master plan Planned Orders Distribution Purchase Orders Production Orders Orders erp

  17. ERP Integrated Enterprise The 1990’s Enterprise MFG Distribution Finance Projects Purchasing Sales erp

  18. ERP SOFTWARE • BASED ON AN ENTERPRISE BUSINESS MODEL • APPLICATION SOFTWARE MODULES FOR FUNCTIONS SUCH AS : • MANUFACTURING • TRANSPORTATION, SALES AND DISTRIBUTION • MAINTENANCE MANAGEMENT • FINANCE • HUMAN RESOURCES • PROJECT MANAGEMENT

  19. ERP SOFTWARE • INTEGRATION AMONG FUNCTIONAL MODULES • WORKFLOW ENABLED • INTERNET/EDI , INTRANET ENABLED • CUSTOMIZABLE THROUGH IMPLEMENTATION TOOLS (SOFTWARE) • PRESENT SOLUTIONS INTEGRATE SUPPLYCHAIN MANAGEMENT AND CUSTOMER RELATIONSHIP MANAGEMENT

  20. ERP MODULES • FINANCIAL • Accounts Receivable and Payable • General Ledger • Asset Accounting • Financial Consolidation • Cash Management and Forecasting • Budgeting • Product Cost Accounting • Profitability Analysis • Activity Based Costing • EIS erp

  21. ERP MODULES LOGISTICS / OPERATIONS • Enterprise Planning : (Demand forecast to Prodn. Planning) • Bill of Materials; Routing Management • MPS, MRP, CRP • Purchasing • Shop Floor Control • Quality Management • Warehousing • Transportation • Plant Maintenance • Field Service erp

  22. ERP MODULES • SALES AND MARKETING • Order Management • Pricing • Sales Planning • Sales Management • Customer Relationship Management • HUMAN RESOURCES • Human Resources : Time Accounting • Payroll • Personnel Management erp

  23. Project Solution Master Data Definition Budget Planning Monitoring Invoicing Progress Requirements Central Invoicing Order Management Warehousing Manufacturing Configurator Finance Service erp

  24. Project Monitoring Project Control Project Setup Project Execution Project Close Out Project Administration Project Invoicing Project Management Solution Business Control Diagram erp

  25. Project Definition Project Budget Project Planning Project Requirements Hours Accounting Project Progress Project Monitoring Project Invoicing Master Data Management Project Modules erp

  26. Project Data : Project-Specific Resources Project-Specific Cost Breakdown Structures Copying project data from Templates/ existing project Project Definition erp

  27. Project Requirements Planning • Manages the generation of: • Material (Purchased, manufactured; or from inventory) • Equipment • Subcontracting • Generates planned orders for Project Supply Chain (Warehouses, Suppliers, Production sites) • Confirmation->Release->transfer • Direct Delivery of Matl. To site, or to a Project Warehouse erp

  28. Manual Orders Manual Orders Project Requirements Planning Project Budget & Control Data PRP Purchase Orders Warehouse Orders Confirm & Transfer to Purchasing Confirm & Transfer to Warehousing erp

  29. Project Progress • Information on actual execution • Milestone Completion; • Manufacturing operations progress • Actual Material Costs and Commitments updated thro’ integration with Order Management and Warehousing modules • Actual labour hours and costs are updated through integration with Hours Accounting Module • Project Revenues posted erp

  30. Project Monitoring Performance Measurement • Scheduled Work = BCWS • Performed = BCWP • Actuals = ACWP • BAC = Budget at Completion • EAC = Estimate at Completion • Variances: • Schedule variances • Cost variances erp

  31. Project Invoicing • Upon selection of invoicing method, the invoicing amounts are calculated and generated through integration with Central Invoicing module (Multi-currency is supported) • Invoicing methods supported include: • Fixed Price (Installments on basis of progress/milestones/predefined schedule • Cost-plus (Reimbursement, etc) • Accounting support for Customer advance payments, retention transactions erp

  32. ENTERPRISE RESOURCE PLANNING (ERP) • Deployment of IT mechanisms for the best • use of Enterprise-wide resources and implementation of best business practices: • Evolved as a natural sequel to MRP (I & II) • Current solutions largely available to mfg. organisations • Manufacturing central to the solutions, HOWEVER, • solutions are being extended to cover services such as retailing, trading, healthcare, etc

  33. TRENDS IN I.S. APPLICATIONS Expected Benefits SUPPORTING STREAMLINED BUSINESS PROCESSES THROUGH : • Upto-the minute information for improved • operating decisions and services • Intuitive, iterative use of information • by executives • Improved collaboration & coordination • Improved internal administration • Direct links to client/partners mispersp

  34. ENTERPRISE SYSTEMSWHY ARE THEY IMPORTANT? • Provide Process and Information Integration • Support Industry “Best Practice” (Enable Business Process Re-Engineering/Improvement) • Globalization : Support MNC Reporting; Control Requirements • Foundation for e-Business (e-Commerce, SCM,CRM) • Enable Managing Business Change Consistently erp

  35. THE CASE FOR ERP PRODUCTS:THE I.S /I.T ANGLE erp

  36. THE CASE FOR ERP PRODUCTS:THE I.T. ANGLE • Rapid advances in I.T. (Computing : Hardware, software; and Connectivity) • Challenges in absorbing and effectively exploiting new information technologies • I.T. is not the Core Competence • Need for specialist companies who can assimilate new technologies and deploy them in products. erp

  37. MAKING THE CASE FOR ENTERPRISE SYSTEMS - COMPAQ COMPUTERS • Support the move to a Lean Production Strategy • Move from “Make to Stock” to “Build to Order” • Needed to tie together processes for Ordering, configuration, Manufacturing, inventory, and distribution • Post-ERP, can order materials from Suppliers on a daily basis; • Can plan Production on basis of week’s sales erp

  38. MAKING THE CASE FOR ENTERPRISE SYSTEMS - COMPAQ COMPUTERS…2 Initiatives Beyond ES • Outsourcing of Production • Resellers to customize the product to customer Specs • Exchanging data with Suppliers and Customers in Real time (using ERP with Internet) • Developed their own applications for production forecasting and order scheduling erp

  39. MAKING THE CASE FOR ENTERPRISE SYSTEMS - Reebok Managing global integration • growth through acquisitions. • Acquired several disparate systems along with acquired companies. • Own in-house systems were too inflexible • Outsourcing of Production • Industry best practices in manufacturing and distribution • Consortium with VF and SAP to develop industry vertical solution for Apparel footwear industry • Product creation processes not in ES. erp

  40. PUTTING THE PIECES TOGETHER ENTERPRISE SYSTEMS WTH BOLT-ONs VF Corporation • Was a member of the SAP Consortium to develop the Industry solution for the Apparel Industry • SAP R/3 Backbone • Product Development Processes supported by another S/w package WebPDM • Warehouse Control and Manufacturing control : Custom applications developed in-house • Capacity and Raw matls plg. Using i2’s Rhythm package • Forecasting using Logility s/w • Micromarketing using other 3rd party products such as JDA software, Marketmax, etc. • All these were hooked on to SAP R/3 using Application Program Interfaces (APIs) erp

  41. MAKING THE CASE FOR ENTERPRISE SYSTEMS - Others Intel : • ES was a way to standardize and integrate by getting rid of most legacy applications • Did not include manufacturing systems in the ES application. Microsoft • Better Financial and Procurement Systems worldwide • Better management Control and reporting erp

  42. Dovetailing ERP with Integrated Resource Management Systems in the Mining value chain Planning Geology Resource Modelling Mine Design Mine Plg. & Budgeting Process Control Environment Mgt. ERP Product Shipping Milling Beneficiation O P N S Reconcil. Bus. Intelligence Prodn. Mgt. Eqpt. Fleet Mgt. Matl. Movement Mgt. Supply Chain Mgt. Accounts Receivable Budget Accounts Payable Human Resource General Ledger Mtce. Mgt. Sales erp

  43. Specialized Applications for the Power Generation/Wholesale supply Industry • Load Profiling and forecasting • Power System Planning • Generation Planning; Load Despatch • Plant Optimization • Pollution Control; Environment Mgt. • Engineering Data / Workflow Management mispersp

  44. UTILITIESTypical ERP SOLUTION MODULES • Enterprise Management • Customer Relationship Management • Generation • Transmission & Distribution • Installation Services • Energy Service • Energy Trading erp

  45. UTILITIESTypical ERP SOLUTION MODULES • Enterprise Management • Strategic Planning Support • Business Intelligence and Data Warehousing • Managerial Accounting • Financial Accounting • Regulatory Reporting erp

  46. UTILITIESTypical ERP SOLUTION MODULES • Generation • Support for various generation facilities • Engineering and Construction • MRO Procurement • Plant Maintenance • Work Management Systems • Safety Protocols : Work Clearance Management erp

  47. UTILITIESTypical ERP SOLUTION MODULES • Transmission & Distribution • Engineering and Construction • Operations Management • Maintenance & Work Management • Outage Management Systems • Safety Protocols : Work Clearance Management erp

  48. UTILITIESTypical ERP SOLUTION MODULES • Transmission & Distribution • Distribution Management Systems • Automated Meter Reading • Field Crew Management • Spatial Information System Planning erp

  49. UTILITIESTypical ERP SOLUTION MODULES:- Extend to Trading Systems Trading Systems • Internet-Based Trading Systems • Settlement Systems Customer Relationship Management • Call Centres • Customer Information Systems • Billing erp

  50. Integrated Solutions for the Utilities Industry • Mincom Ellipse • SAP R/3 Utilities solution • Ramco Marshal mispersp

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