Why Enterprises Resource Planning Software

[Chandak Badri]

 
Enterprises Resource Planning Software

 

Do we need it?

 

Currently the ABC Company does not have the integrated data source which provides the base for timely development of meaningful reports. This is also causing lot of duplication entries in various manual and computerized systems.

 

Thus it is essential that we must go for ERP Software. The implementation of ERP solutions in ABC will seek to streamline and integrate operation processes and information flows in the company to synergise the resources of an organization namely men, material, money and machine through information.

 

No Magic in ERP Software

 

At this stage both Top Management and Middle Management feel that we have to change our old systems and these systems are required to be inline with the modern practices. However some of us believe that an EPR Solution can improve the system in the organization. Yes an ERP Solution offers the best generic practices but it all depends upon that how we implement that and how we configure the Software.

 

There is no Magic in ERP Software, it cannot tackle the problems of flawed business strategies and poor performing business processes. We have to identify those weaknesses before going for ERP.

 

Success of an ERP Solution depends upon Preparation of Process and Peoples. Its benefits are a direct result of effective preparation, implementation and appropriate and optimum use.

 

Business Process Re-engineering

 

Business Process Reengineering (BPR) and Implementation of ERP Solution are two different things. BRP is a pre-requisite for going ahead with ERP. An in depth BPR study has to be done before taking up ERP. Business Process Reengineering brings out deficiencies of the existing system and attempts to maximize productivity through restructuring and re-organizing the human resources as well as divisions and departments in the organization.

 

Recommendations for Implementation of ERP Software
 

The ABC ERP Solution Implementation methodology should be as follows:-

 

Which ERP software?:-

We are going for Oracle ERP Business Solution as Karachi Office has already evaluated it and decided in favor of it.

 

Project Ownership:-

 

It is very important that at least one of the director shall take the ownership of the project and take it as a business decision.

 

Owner of the project who is responsible for success of that project should be fully aware of the fact that he may be required to make not-so-easy decisions, particularly relating to human resources. He should have the intent and authority to swiftly decide and implement those decisions.

 

Formation of Steering Committee:-

 

A common Steering Committee should be formed of senior executives with full authority to make changes happen and happen quickly. The Steering Committee will be responsible for the success of the ERP Implementation Project.

 

 

Selection of Project Managers:-

 

Separate full time Project Managers should be selected for Karachi and Lahore Office. Their responsibilities will include management of project team and interaction with departments.

 

 

Line of action

 

Business Objectives

 

Standing Committee should identify the areas need to be address and require system improvements/development.

 

Objectives:

1. Improvements required in existing area
   
2. Weaknesses to be addressed in current system
   
3. Future needs
   
4. MIS report requirements.
   

 

Means

 

Standing Committee should have meetings and decide on above matters as soon as possible after obtaining recommendations from department heads to devise future strategic action plan.

 

Meanwhile we should commence work on prototype phase

 

GAP ANALYSIS

 

Objectives:

1.                  Evaluation of type of data required to be fed into Oracle software.

2.                  Recognition of stages at which this data should be fed.

3.                  Identification of persons who will feed this data.

4.                  Evaluation of capabilities of our existing human resources for feeding that information and training needs.

5.                  Assessment of logical order of feeding data and our support by our current system for that logical order.

6.                  Initial Appraisal of effects on our existing business practices and sustainability of alternate practices.

7.                  Review of additional reports we will get from the system and their benefits.

8.                  Identification of time at which these reports will be available to management and their efficacy at that stage.

9.                  Ascertainment of requirements for customization.

10.              Ascertainment of requirements for additional human resources at head office and site.

 

 

How we do it!

1.                  Formation of prototype project team which includes key user of all departments.

2.                  Establishment of prototype configuration room at Head Office.

3.                  Procurement/Allocation of required hardware in consultation with Jaffer Business Systems (JBS).

4.                  Request to JBS to install ERP business solution for evaluation purpose.

5.                  Request to Jaffer systems to delegate persons to help in evaluation.

6.                  Arranging sample data from site alongwith relevant persons

7.                  Data feeding to evaluate modules related to general ledger, payables, receivables, assets and cash management, order management, purchasing, inventory, bill of materials, work in process, master production scheduling, quality and cost management

8.                  Integrating all modules and evaluating results.

 

Deliverables:

1.                  Detailed gap analysis mentioning customization and business processes change requirements.

2.                  Report on whether this task can be done by internal project team or should we go for functional consultants like Ferguson?

3.                  If we are not going for Oracle than what should we do? Do we need customized software or another ERP solution?

4.                  Implementation plan: Recommendation whether we should implement Oracle ERP Business Solution, requirements for customization and business process reengineering

 

11.              Evaluation of an online connection between head office and site and its alternatives.

12.              Identification of strength and level of I.T. support staff and other human resources that will be required to maintain that system at head office and at site.

13.              Evaluation of integrated system and benefit of integration.