CH 1 A Foundation for Understanding ERP System

CH 1 A Foundation for Understanding ERP System -...

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Foundation For Understanding ERP
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A Foundation for Understanding ERP System What Is ERP According to Delloitte consultant, An ERP system is a packaged business software system that allows a company to “automate and integrate the majority of its business process, share common data and practices across the enterprise and produce and access information in real time environment”. ERP system are different from legacy systems as the organizations use ERP to integrate enterprise wide information supporting financial, human resources, manufacturing, logistics, sales and marketing functions.
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A Foundation for Understanding ERP System What Is ERP An ERP system introduces “best practices” which are defined as “simply the best way to perform a process”. In order to be competitive, organizations must improve their business practices and share information with their suppliers, distributors and customers.
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A Foundation for Understanding ERP System The Evolution of ERP In 1960s Reorder Point Systems were introduced that uses historic data to forecast the future inventory demand as well as makes new order when quantity of an item falls below certain level. Its major concern was to manage large volume production of products and their cost. In 1970s Material Requirement Planning (MRP) systems came which helped in planning the manufacture of products and ordering inventory on demand-based approach.
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A Foundation for Understanding ERP System The Evolution of ERP In 1980s Manufacturing Resource Planning (MRP-II) systems were made to aid capacity planning; it could schedule and monitor the execution of production plans. Monitoring process control and quality, reduced overhead costs, and detailed cost reporting were the major aspects of this system. In 1990s the additional functionality, Manufacturing Execution Systems (MES), of MRP-II systems was introduced. Its major ability was to create and easily align with new products and services time to time as per customers’ specific needs.
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A Foundation for Understanding ERP System The Evolution of ERP In late 1990s and till now Enterprise Resource Planning (ERP ) systems are ruling with lots of features such as integrating supplier, manufacturing, and customer data throughout the supply chain.
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A Foundation for Understanding ERP System The Integrated Systems approach ERP systems impose an “integrated systems” approach by establishing a common set of application supporting business operations and administers them to work together in a single direction. Successful implementation of ERP system requires:
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CH 1 A Foundation for Understanding ERP System -...

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