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ch06 - Chapter 6 Enterprise Resource Planning Systems...

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Chapter 6: Enterprise Resource Planning Systems
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OBJECTIVES FOR CHAPTER 11 Functionality and key elements of ERP systems ERP configurations--servers, databases, and bolt-on software Data warehousing as a strategic tool and issues related to the design, maintenance, and operation of a data warehouse Risks associated with ERP implementation Key considerations related to ERP implementation Internal control and auditing implications associated with ERPs The leading ERP products and their distinguishing features
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PROBLEMS WITH NON-ERP SYSTEMS In-house design limits connectivity outside the company Tendency toward separate IS’s within firm Lack of integration limits communication within the company Strategic decision-making not supported Long-term maintenance costs high Limits ability to engage in process reengineering
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TRADITIONAL IS MODEL: CLOSED DATABASE ARCHITECTURE Similar in concept to flat-file approach Data remains the property of the application Fragmentation limits communications Existence of numerous distinct and independent databases Redundancy and anomaly problems Paper-based Requires multiple entry of data Status of information unknown at key points
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TRADITIONAL IS MODEL: CLOSED DATABASE ARCHITECTURE
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Order Entry System Manufacturing and Distribution System Procurement System Customer Sales Account Rec Production Scheduling Shipping Vendor Accts Pay Inventory Customer Database Manufacturing Database Procurement Database BUSINESS ENTERPRISE Customer Supplier Products Orders Purchases Materials Traditional Information System with Closed Database Architecture
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WHAT IS ERP? Those activities supported by multi-module application software that help a company manage the important parts of its business in an integrated fashion Key features include: Smooth and seamless flow of information across organizational boundaries Standardized environment with shared database independent of applications and integrated applications
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Data Warehouse On-Line Analytical Processing (OLAP) Bolt-On Applications (Industry Specific Functions) Sales & Distribution Business Planning Shop Floor Control Logistics Customers Suppliers Operational Database Customers, Production, Vendor, Inventory, etc. Legacy Systems Core Functions [On-Line Transaction Processing (OLTP)] ERP System BUSINESS ENTERPRISE ERP System
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TWO MAIN ERP APPLICATIONS Core applications: A.K.A. On-line Transaction Processing (OLTP) Transaction processing systems Support the day-to-day operational activities of the business Support mission-critical tasks through simple queries of operational databases Include sales and distribution, business planning, production planning, shop floor control, and logistics modules
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