Find Book. More essential reading lists. See all features. These were some of the authors who wrote the words that filled our childhoods with adventure, wonder, laughter and more. Is reading ever again as full of wonder as it is during childhood? Back then, books seemed almost magic, opening doors to strange, wonderful and frightening realities.
Without ever leaving the safety of our bedrooms, we were able to explore all kinds of new terrain. Growing up in the s was idyllic in many ways. In childhood, the stories we explored seemed more full of adventure and wonder than could be possible. We would fight our drooping eyelids, reading late into the night by the light of a flashlight, to see what happened next.
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Locate your local office at: www. In memory of our colleague Majdi Najm. His support and friendship are sorely missed. More specifically, it is about looking at the processes that make up a business enterprise and seeing how ERP software can improve the performance of these business processes. ERP software is complicated and expensive.
Unless a company uses it to become more efficient and effective in delivering goods and services to its customers, an ERP system will only be a drain on company resources. Our experience in teaching about ERP systems has revealed that undergraduate business students do not always understand how businesses operate, and advanced un Purchase answer to see full attachment.
Wxraavfu Duke University. Completion Status:. Honor Code. I was struggling with this subject, and this helped me a ton! Can't find what you are looking for? Post your question on Studypool and get help from one of our expert tutors in topics ranging from mathematics to rocket science! Similar Questions. Need more information ragarding the onboarding process in companies.
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Not every business own Read the various perspectives on the death penalty on pages Evaluate each argument for validity and soundness. Process improvement case. If you don't work for an organization at the present time or the organization does not address process improvement, th Project Scenario. Executive Summary of overall project including scope, time and cos Human Resourse Management.
How would you apply the dynamic culture leadership model to a real or hypothesized health leadership situation or case? The Catcher in the Rye by J. Nervous Conditions by Tsitsi Dangarembga. The Odyssey by Homer. Gone with the Wind by Margaret Mitchell. Big Magic by Elizabeth Gilbert. Communist Manifesto by Karl Marx. Night by Elie Wiesel. Anthem by Ayn Rand. Most Popular Answers. Marketing Management Directions: Be sure to save an electronic copy of your answer before submitting it to Ashworth College for grading.
Unless otherwise stated, answer in complete sentences, and be sure to use correct English, spelling, and grammar. Sources must be cited in APA format. Your response should be four 4 double-spaced pages; refer to the "Assignment Format" page located on the Course Home page for specific format requirements. Respond to the items below. Some marketers believe that product performance is the end all and be all. Other marketers maintain that the looks, feel, and other design elements of products are what really make the difference.
Take a position: Product functionality is the key to brand success versus product design is the key to brand success. Prices are often set to satisfy demand or to reflect the premium that consumers are willing to pay for a product or service. Take a position: Prices should reflect the value that consumers are willing to pay versus prices should primarily just reflect the cost involved in making a product or service.
Contracting Officers. Although the Oracle project was canceled before a successful product was developed, the three founders of SDL saw the commercial potential of a relational database system. The company changed its name again, to Oracle, and in released the client-server Oracle relational database. The company continued to improve its database product, and in released Oracle Financials, a set of financial applications.
CRM is discussed in more detail in Chapter 3. In , Oracle completed its acquisition of Sun Microsystems, a major manufacturer of computer hardware and software that developed the Java software development platform. Our customers benefit as their systems integration costs go down while system performance, reliability, and security go up.
Keep in mind that most other ERP software vendors provide similar functionality, with some having strengths in certain areas. The latest versions of ERP systems by SAP and other companies allow all business areas to access the same database, as shown in Figure , eliminating redundant data and communications lags.
In information systems, errors most frequently occur where human beings interact with the system. ERP systems ensure that data are entered only once, where they are most likely to be accurate.
For example, with access to real-time stock data, a salesperson taking an order can confirm the availability of the desired material. When the salesperson enters the sales order into the system, the order data are immediately available to Supply Chain Management, so Manufacturing can update production plans, and Materials Management can plan the delivery of the order.
If the sales order data are entered correctly by the salesperson, then Supply Chain Management personnel are working with the same, correct data. The same sales data are also available to Accounting for invoice preparation. Earlier in this chapter, you learned how software modules work. Information about the customer pricing, address and shipping instructions, billing details, and so on is maintained and accessed from this module.
The Materials Management MM module manages the acquisition of raw materials from suppliers purchasing and the subsequent handling of raw materials inventory, from storage to work-in-progress goods to shipping of finished goods to the customer. The Production Planning PP module maintains production information. Here production is planned and scheduled, and actual production activities are recorded. The Plant Maintenance PM module manages maintenance resources and planning for preventive maintenance of plant machinery in order to minimize equipment breakdowns.
The Asset Management AM module helps the company manage fixed-asset purchases plant and machinery and related depreciation. The Human Resources HR module facilitates employee recruiting, hiring, and training. This module also includes payroll and benefits. This module allows for costs to be collected against a project, and it is frequently used to manage the implementation of the SAP ERP system.
PS manages buildto-order items, which are low-volume, highly complex products such as ships and aircrafts. That is because nearly every activity in the company has an impact on the financial position of the company: Copyright Cengage Learning.
This module generates financial statements for external reporting purposes. The CO module supports managerial decision making. It can perform task-flow analysis and prompt employees by email if they need to take action. The Workflow module works well for business processes that are not daily activities but that occur frequently enough to be worth the effort to implement the workflow module—such as preparing customer invoices.
In summary, ERP integrates business functional areas with one another. Before ERP, each functional area operated independently, using its own information systems and methods for recording transactions.
ERP software also makes management reporting and decision making faster and more uniform throughout an organization. In addition, ERP promotes thinking about corporate goals, as opposed to focusing only on the goals of a single department or functional area. When top management is queried on the reasons for implementing ERP systems, the overriding answer is control. And another company might believe that its internally developed production and logistics software gives it a competitive advantage.
When a company uses modules from different vendors, additional software must be created to get the modules to work together. Frequently, companies integrate different systems using batch data transfer processes that are performed periodically. In those cases, however, the company no longer has accurate data available in real time across the enterprise. Thus, a company must be sure the decision to use multiple vendors—or to maintain a legacy system—is based on sound business analysis, not on a resistance to change.
Software upgrades of nonintegrated systems are made more problematic because further work must be done to get software from different vendors to interact.
Chapter 2 32 Any large software implementation is challenging—and ERP systems are no exception. There are countless examples of large implementations failing, and it is easy to understand why. Many different departments are involved, as are the many users of the system, programmers, systems analysts, and other personnel.
Without top management commitment, large projects are doomed to fail. More implementation issues are discussed in Chapter 7. After a company chooses its major modules, it must make an incredible number of decisions on how to configure the system.
These configuration options allow the company to customize the modules it has chosen to fit its needs. For example, in the Financial Accounting FI module, a business might need to define limits on the dollar value of business transactions that certain employees can process. This is an important consideration in minimizing the risk of fraud and abuse, and is just one example of the many decisions facing a company at the start of a major ERP implementation.
An example of a tolerance group is shown in Figure As part of the configuration process, a company can define any number of tolerance groups with a range of limits, and can then assign employees to these tolerance groups.
The Development of Enterprise Resource Planning Systems While SAP has defined the tolerance group methodology as its method for placing limits on an employee, configuration allows a company the flexibility to further tailor this methodology for other uses. Assume a sporting goods company places an order in January for 1, life jackets. The company receives only in the shipment from the manufacturer, which arrives in March.
This delivery, although it is short five life jackets, is close enough to the original order that it is accepted as complete. The difference of the five life jackets represents the tolerance. By defining the tolerance group to accept a variance of a small percentage of the shipment, the company has determined that it is not worth pursuing the five extra life jackets. Tolerance could indicate a shortage, as in this example, or an overabundance in an order. Thus, an order of 1, life jackets would also be within the tolerance.
Tolerance groups should be defined and documented, in part to deal with fraud issues. The sporting goods company should know the reason for a short order: is it because the order is within the tolerance range, or is it because a worker on the loading dock stole five life jackets? Can you think of other areas within a company that would need to have some limits set on variances or payments? Why would it be beneficial to set those tolerance groups? Its most significant characteristics are its suitability for large companies, high cost, automation of data updates, and applicability of best practices—all of which are described below.
Prior to the development of ERP systems, it was assumed that these giants could never have integrated systems because of the sheer amount of computing power required to integrate them. Increased computing speeds, however, meant that large companies in a variety of industries, including manufacturing, gas and oil, airlines, and consulting, could have integrated information systems.
In addition to the cost of the software, many companies find they must buy new hardware to accommodate such powerful programs. Full implementation of all modules can take years. In fact, most companies view ERP implementations as an ongoing process, not a one-off project. As implementations are completed in one area of a company, other areas may begin an implementation or upgrade a previous implementation. The modular design of SAP ERP is based on business processes, such as sales order handling, materials requirement handling, and employee recruiting.
When data are entered into the system, data in all related files in the central database are automatically updated. No further human input is required to make the changes.
A best practice is the best, most efficient way of handling a certain business process. Although some customization is possible during implementation, many companies find they must still change some of the ways they work to fit the software. Small and midsized companies represented a ripe, profitable market. For example, in , small and midsized companies in the United States increased their IT expenditure by more than 4 percent over the previous year.
It is an example of the software-as-a-service SaaS approach that eliminates the need for a company to buy and maintain the software and hardware to run an ERP application. SaaS is discussed more fully in Chapter 8. SAP faced a canceled implementation by Dell Computers, a lengthy implementation at Owens Corning, and a lawsuit by the now-defunct FoxMeyer drug company. Cadbury experienced a well-publicized surplus of chocolate bars at the end of , due, in part, to a troubled SAP ERP implementation.
The Development of Enterprise Resource Planning Systems methodology, a framework for implementing systems, to ease the implementation process. SAP has continued developing implementation methodology; the latest version, Solution Manager, is designed to greatly speed the implementation process. The BW software runs on a separate server and lets the user define unique reporting and analysis methods and integrate information from other systems. The tools used to analyze data in the BW system are known as business intelligence BI.
SAP HANA will allow companies to analyze business operations and large volumes of transactional and analytical data in real time. SAP addressed the issue of Internet-based data exchange with its NetWeaver integration platform, which provides a unified means to connect SAP systems to other systems and to the Internet. Like all technology, ERP software and related products are constantly changing.
So, before choosing a software vendor, most companies study their needs and then hire an external team of software consultants to help choose the right software vendor s and the best approach to implementing ERP. Recall that integrated information systems can lead to more efficient business processes that cost less than those in unintegrated systems. Barriers of currency exchange rates, language, and culture can be bridged automatically, so data can be integrated across international borders.
ERP integrates people and data while eliminating the need to update and repair many separate computer systems. For example, at one point, Boeing had data systems that fed data into its production process; the company now has a single system for recording production data.
ERP allows management to actually manage operations, not just monitor them. The ERP system already has all the data, allowing the manager to focus on improving processes. This focus enhances management of the company as a whole, and makes the organization more adaptable when change is required.
An ERP system can dramatically reduce costs and improve operational efficiency. As a result of the integrated process capabilities, EZ-FLO has been able to greatly improve its inventory management processes and has eliminated its annual inventory count, which used to take employees two days to complete.
In addition, the company has reduced manufacturing lead times in its domestic plants by two weeks. These process improvements led to improved customer service, and a 20 percent increase in the number of new customers—with a 12 percent growth in sales per customer. Welch Foods, Inc. For these smaller companies, implementations usually take about 10 months. ERP packages imply, by their design, a certain way of doing business, and they require users to follow that way of doing business.
For a particular business, some of its operations—or certain segments of its operations—might not be a good match with the constraints inherent in ERP. Therefore, it is imperative for a business to analyze its own business strategy, organization, culture, and operation before choosing an ERP approach. Dow Chemical spent seven years and close to half a billion dollars implementing a mainframebased enterprise system; now it has decided to start over again on a client-server version.
At the time, Kmart was not happy with its existing supply chain software, and it attempted to implement another product too quickly. For years, the giant U. ERP systems are popping up in some unlikely industries. The government of Singapore is implementing an ERP project that will link 20 different healthcare providers together under one system, which is estimated to be 20 percent more efficient and will eliminate a tremendous amount of duplicate information.
Along with the normal modules that an ERP system contains, such as financials and human resource management, this enterprise healthcare system will include electronic medical records and clinical management modules. Sometimes, a company is not ready for ERP. In many cases, ERP implementation difficulties arise when management does not fully understand its current business processes and cannot make implementation decisions in a timely manner. An advantage of Copyright Cengage Learning.
Chapter 2 38 an ERP system is that it can reduce costs by streamlining business processes. If a company is not prepared to change its business processes to make them more efficient, then it will find itself with a large bill for software and consulting fees, with no improvement in organizational performance.
Many SAP customers have cut energy usage; for example, 7-Eleven reduced its cooling energy usage by 12 percent, Dannon cut its fuel costs by 22 percent with better management of its transportation system, and Kendall-Jackson wine makers cut their lighting bill by 40 percent—all through the use of enhanced information from their ERP system. Companies can use the software to track and report on their energy consumption; however, in order to make changes, a company must determine the baseline of its energy consumption.
SAP sustainability software application allows Walmart and its suppliers to track their energy usage, emissions, and consumption of other natural resources. How about it its image? Companies need to be careful about how much custom programming they include in their implementations, or they could find they have simply re-created their existing information systems in a new software package instead of gaining the benefits of improved, integrated business processes.
In its implementation of PeopleSoft, FedEx Corporation installed the systems for Financial and Human Resources functions with little or no modification. Once an ERP system is in place, trying to reconfigure it while retaining data integrity is expensive and time consuming. That is why thorough pre-implementation planning is so Copyright Cengage Learning. It is much easier to customize an ERP program during system configuration, before any data have been stored.
The financial benefits provided by an ERP system can be difficult to calculate because sometimes ERP increases revenue and decreases expenses in ways that are difficult to measure. In addition, some changes take place over such a long period of time that they are difficult to track.
Finally, the old information system may not be able to provide good data on the performance of the company before the ERP implementation, making comparison difficult. And because an ERP system can help a company produce goods and services more quickly, more sales can be generated every month. In some instances, a company that does not implement an ERP system might be forced out of business by competitors that have an ERP system—how do you calculate the monetary advantage of remaining in business?
Because both cost savings and increased revenue occur over many years, it is difficult to put an exact dollar figure to the amount accrued from the original ERP investment.
ERP systems provide real-time data, allowing companies to improve external customer communications, which can improve customer relationships and increase sales.
Some companies do not even try to make the calculation, on the grounds that the package is as necessary as having electricity which is not justified as an investment project. Companies that do make the ROI calculation have seen widely varying results. Manufacturing firms are more likely to see a positive ROI than government or educational organizations.
However, most companies reported that nonfinancial goals were the primary motivation for their ERP installations. Seventy-one percent of those companies surveyed said that the goal behind the ERP installation was improved management vision. At first, ROI was difficult for Toro to quantify.
Then, the emergence of an expanded customer base of national retailers, such as Sears and Home Depot, made it easier to quantify benefits.
A recent survey of small and midsized companies showed that only 48 percent always do an ROI evaluation, and only 25 percent always repeat the calculation after implementation. These small and midsized business owners feel they just need an ERP to support their business, even if the ROI calculation is not performed.
Early ERP implementation reports indicated that only a small percentage of companies experienced a smooth rollout of their new ERP systems and immediately began receiving the benefits they anticipated. However, it is important to put such reports into perspective.
All kinds of software implementations can suffer from delays, cost overruns, and performance problems—not just ERP projects. Such delays have been a major problem for the IS industry since the early days of business computing.
Nevertheless, it is worth thinking specifically about why ERP installation problems can occur. You can find numerous cases of implementation woes in the news. Gore, the maker of GoreTex fabric, had problems implementing its PeopleSoft system for personnel, payroll, and benefits.
Gore blamed the consultants for not understanding the system and leaving its Personnel department in a mess. PeopleSoft consultants were brought in to resolve the problems after implementation, but the fix cost W. Gore additional hundreds of thousands of dollars. Companies rarely use this approach because it is so risky.
Because of that, Hershey lost a large share of the Halloween candy market that year. The root of a problem may lie in flawed core business processes. Unless the company changes its business processes, it will just be computerizing an ineffective way of doing business.
Some executives and IT managers skimp on employee education and training. Some companies do not place the ownership or accountability for the implementation project on the personnel who will operate the system. This lack of ownership can lead to a situation in which the implementation becomes an IT project rather than a company-wide project. A recent academic study attempting to identify the critical success factors of ERP implementations showed that a good project manager was critical and central to success of a project.
In addition, training was crucial—along with a project champion, that is, someone who might not be in the CEO role but who brings enthusiasm and leadership to a project. ERP implementation brings a tremendous amount of change for users of the system. Managers need to effectively manage that change in order to ensure a smooth implementation.
Most people will naturally resist changing the way they do their jobs. Many analysts have noted that active top management support is crucial for successful acceptance and implementation of such company-wide changes.
Some companies willingly part with funds for software and new hardware, but they do not properly budget for employee training. ERP software is complex and can be intimidating at first. This fact alone supports the case for adequate training. Those companies spending less than 13 percent on training are three times more likely to have problems with their ERP implementations.
Employees left the company, morale was down, and help desk calls were up. After three years, the ERP implementation was temporarily stopped. For many companies, it takes years before they can take full advantage of the wide variety of capabilities of their ERP systems.
Most ERP installations do generate returns, and news coverage now focuses on how companies gain value from their existing systems or are upgrading and adding functionality to their existing ERP systems. Howard H. Aiken, the pioneering computer engineer behind the first large-scale digital Copyright Cengage Learning.
Chapter 2 42 computer, the Harvard Mark I, predicted in that only six electronic digital computers would be needed to satisfy the computing needs of the entire United States. Hewlett-Packard passed up the opportunity to market the computer created by Steve Wozniak that became the Apple I. And Microsoft founder Bill Gates did not appreciate the importance of the Internet until , by which time Netscape controlled the bulk of the Internet browser market.
Gates, however, did dramatically reshape Microsoft around an Internet strategy by the late s. Its Internet Explorer browser is now more commonly used than any other. Thus, even people who are most knowledgeable about a new technology do not always fully understand its capabilities or how it will change business and society. ERP systems have been in common use only since the mids. As this young technology continues to mature, ERP vendors are working to solve the adaptability problems that plague customers.
The growth in the computing power of mobile devices such as smartphones and tablets will create more opportunities for ERP companies to develop applications that provide customers with instantaneous data while improving their efficiency. The new ERP system replaced disparate systems, some of which were in paper format.
This integrated enterprise system brings the storefront to the back office through a number of different module implementations. In addition, the new system facilitates greater compliance with financial regulations and better sales management, along with the electronic purchasing of all raw materials.
One impetus for installing this ERP system was for management to be able to digest information on market conditions, and react quickly to open new stores or renovate existing stores. More cafes are planned to open soon. Assume you own and run a small local coffee shop. You do all your ordering of ingredients for your coffee shop by hand—using pencil, paper, mail, and telephone. All your sales are recorded by hand in a book, and transcribed for filing of small-business taxes.
How could a small ERP system help your business become more efficient? What would an ERP system allow you to do? One of the latest lawsuits is by Montclair State University in New Jersey, which is suing Oracle for a failed implementation. Montclair University refused the additional fee, and Oracle left the project. Experts agree that lawsuits such as these are not productive; no one really wins. It is essential that customers pay close inspection to the legal contract drawn up between themselves and the software vendor.
ERP software is extremely complex, and it is often difficult to ask the right questions when negotiating the contracts. Most importantly, the customer should understand its own business processes and be able to relay them to the software vendor.
The customer must also accept that their business processes will need to change to fit the software. To top it off, the pricing of many ERP packages is very complex, with a variety of different licensing models to choose from. The bottom line is: Understand the contract you are signing. Research the topic of ERP contracts on the Internet. How could ERP vendors make it easier for customers to understand their licensing models? What could customers do to ensure a contract contains all possible eventualities?
For some companies, however, the ROI may not be immediate or even calculable. If it is not exactly holding true, what does this mean for the future of the computing industry?
What are the main characteristics of an ERP system? What are some newly developed features of ERP systems? Imagine that your uncle owns and operates a construction company. The company owns a number of very expensive pieces of machinery, such as backhoes, for building houses and apartment buildings.
However, business is picking up, and she has gotten far behind in filing taxes, paying bills, and so on. Use the Internet for research. Much has been written in the news media about ERP systems, both in print and online. Consider some smaller ERP systems.
Compare two of the systems, and list the similarities between the module-type offerings. Are there any clear differences between them?
Based on the search results, choose an example of an ERP implementation, and write a memo to your instructor describing the implementation. Discuss ways in which you think the company adopting the ERP system could have improved its implementation. Write a three-page paper on the findings of this study concerning factors critical to the success of an ERP implementation. Choose five factors you think are most important, and focus your writing on those five. Au Bon Pain.
Barlas, Demir. Chapter 2 46 Blau, John. Blau, John. Bradley, Joseph. Burleson, Donald. Business Wire. Chemical Week. Davenport, Thomas H. Dignan, Larry. Few, Stephen. Foroohar, Rana. Greenbaum, Joshua. Hammer, Michael, and James Champy.
Reengineering the Corporation. New York: Harper Business, Hamerman, Paul, and R. Henschen, Doug. Ho, Victoria. Kanaracus, Chris. Kirkpatrick, David. Kumar, Kuldeep, and Jos van Hillegersberg. McCue, Andy. Meissner, Gerd. New York: McGraw-Hill, Montgomery, Nigel. Nadeau, Michael. Nelson, Emily, and Evan Ramstad. Nolan, Sean. Osterland, Andrew. Peerstone Research. Richard, Kenneth J. SAP AG. Schneider, Polly. Chapter 2 48 Slater, Derek. Sliwa, Carol. Stein, Tom.
Steinert-Threlkeld, Tom. Sullivan, Laurie. Wailgum, Thomas. Westervelt, Robert. Wheatley, Malcolm. White, Joseph B. Whiting, Rick. Worthen, Ben. Throughout the remainder of this book, we will use Fitter Snacker to illustrate information systems concepts in general and ERP concepts in particular. As you learned in previous chapters, the availability of a common database is one of the advantages of having an integrated information system, because the data in the system are consistent across the different modules.
Integration can lead to problems, however. If the data are not correct, the error will carry over into all modules. Because of this, company-wide use of transaction data is inefficient, as you will see later in this chapter. The Wholesale Division sells to intermediaries that distribute the bars to small shops, vending machine operators, and health food stores.
The Direct Sales Division sells directly to large grocery stores, sporting goods stores, and other large chain stores. The two divisions operate separately from one another, in effect breaking the Marketing and Sales functional area into two pieces. The two sales divisions differ primarily in terms of order volume and pricing terms.
The Direct Sales Division offers customers volume discounts to encourage larger sales orders, which are more efficient to process. The Wholesale Division charges customers a lower fixed price because the orders are usually large. Each order—regardless of size— generates costs related to the paperwork, shipping, and handling of the order. Thus, an order of cases of snack bars incurs the same handling costs as an order of 10 cases.
In addition to selling snack bars under the Fitter Snacker brand name, the company also packages the bars in store-brand wrappers for some chain stores. These problems occur because Fitter has three separate information systems: the sales order system, the warehouse system, and the accounting system. Information from each system is shared either electronically through periodic file transfers sales order system to accounting system or manually by paper printout credit status from the Accounting Department to sales clerks.
The high number of manual transactions creates many opportunities for data entry errors. Further, not all the information stored in the three systems is available in real time, resulting in incorrect prices and credit information.
In each sales division, Fitter has four salespeople who work on the road, plus two clerks who work in the sales office. The entire sales process involves a series of steps that require coordination between Sales, Warehouse, Accounting, and Receiving, as shown in Figure Notice that Production is not directly involved in the sales process because Fitter plans production using a make-to-stock strategy, with product shipped to customers from warehouse inventory rather than being manufactured for specific orders.
For a new customer, the sales process begins with a sales call, which might be over the telephone or in person. At the end of the sales call, the salesperson prepares a handwritten quotation on a form that generates two copies. The original quotation goes to the customer, and the middle copy is first faxed and then mailed to the sales office; the salesperson keeps the bottom copy for his or her records.
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