ERP On Supply Management Maturity Model

ERP enabling technology and characteristics

Discuss about the ERP on Supply Management Maturity Model.

Each operations in modern business realizes heavily in accurate and timely information to service in technology’s competitive market. In fact, information system plays the vital role to the organization and no decision can be made without information and data; therefore the organizations are implementing ERP (Enterprise resource planning software) for accomplishing completive market over their competitors. Therefore the present report is mainly emphasized on the enterprise resource planning system, and ERP enabling technology and characteristics. Moreover the present report also discussed about the main features of ERP system and why the organization undertake ERP system. At last the report emphasized on the implementation of the ERP system and its architecture that helps to understand who ERP system performed its functions.

As said by the Karathanasis, (2017), An Enterprise resource planning system is completely integrated business management system covering all the functional and operational areas of the organization such as finance, production, Accounting, marketing and human resource departments. It integrates and organizes the information flow and operational processes to make optimization utilization of the resources including material, money, machine and men. ERP system is multifaceted as well as international tightly integrated close loop business that assists the organization to ensure effective functions and better financial management.

In a simple manner Enterprise resource planning promise one application, one database and one user interface for complete entire organization, where one centralize system ruled distribution, sales, manufacturing and finance (Mahapatra, & Krishnan, 2017). Taking data from the several departments it is the tool that helps the workers and manager plan, control and monitor the entire organization functions. A modern Enterprise resource planning system improves an organization performance and manufacturing capabilities to accurately schedule production, reduce inventory, utilizes the available resources and manage process more explicitly.

As study conducted by the Kumawat, & Kumawat, (2017), without sophisticated information technology infrastrure, ERP system implementation is not possible. Before the advancement of the information technology development ERP system were built only to work with the mainframe computer system that has an ability to enabling the ERP system functionality in better manner. But in this ear, advance development of the server architecture as well as scalable relational database management system, all have effectively contributes for the ease of the enhancement of the development of the Enterprise resource planning system. Most of the ERP system implements the three layer architecture that would helps them to secure data and information in most effective manner (Fok et al., 2017). In the arcituercture of three tires, it is seen that at the server end information is stored. Maintenance of data consistency and integrity and process requires done at the end to client end. Three tire architecture mainly embodying all the applications logic as well as business rules and regulations that are not a part of application software enforcing an effective validation check.

Why organization undertake ERP system

It can be considered that organizations incorporating ERP solutions have multiple of control as well as function. Therefore, the online information transfer has to be done through the several locations. Thus to facilities these transaction in most effectiecve and easy manner, the effective enabling technologies of the ERP systems are work group, workflow, internet, intranet, electoral data interchange as well as data ware house.

Flexible: – Almajali,  Masa’deh & Tarhini, (2016)  said that Enterprise resource planning system should be flexible in order to respond the changing requires of an organization. The three tire architectures or cline server architectures technology mainly enable enterprise resource planning to execute across several database backend through ODBD (open database connectivity).

Open and modular: – Enterprise resource planning system is open system architecture that means any module of the ERP system detached and interfaced whenever needed with not impacting the other modules (Hsu, Yen & Chung, . 2015). Moreover ERP system should support multiple hardware platforms for the organizations having heterogeneous collection of the systems. The system has an also ability to support third party add-ons.

Comprehensive: – The main characteristics of the enterprise resource planning system are that it support server organization operations and must be effectible for several range of organization functions.

Best business practices: – ERP i.e. enterprise resource planning system package imposes its own logic on the organization’s culture, strategies as well as function. The system must be the collection of the effective process applicable in nationwide.

• Enterprise resource planning system provide multi-mode, multi-platform, multi-currency, multi-manufacture and multilingual facilities
• ERP system effectively supports business planning activities, strategic planning activities, execution activities, operational planning, creation of resources and materials.
• Enterprise resource planning facilities organization wide integrated information system that includes the all operational areas such as selling and distribution, manufacturing, receivables, inventory, human resources etc (Almajali, Masadeh, & Tarhini, 2016).
• Enterprise resource planning system bridge the gap across organizations
• Enterprise eliminates several organizations issues such as productivity enhancement, quality problems, customers services, inventory problems and cash management etc (Nwankpa, 2015).
• Enterprise resource planning is the solution for an effective project management system

Implementation of the ERP system helps the organization to integrate its financial information in better and effective system that would helps to improve the performance in successful manner (Nwankpa, (2015); Huang, & Handfield, (2015); Nwankpa, & Roumani, (2014)). Finance has its own set of profit and loss accounts, sales information and other organization units that helps to improve organization’s profits. Therefore incorporation of the ERP system within the organization helps them to create the single version that provides better and accurate information of the resource utilization and company’s revenues. Moreover, implementation of the ERP system also helps the organization to integrate customer’s information in successful manner. Enterprise resource planning system helps the organization to standardize and speed up the functionality process, because it communicates with each department in fast manner. Moreover multiple organization units across the organization make the same recoding/transaction/ reporting system that can not only save the time of the company but also helps the increase the performance and productivity of the company.

According to the Teittinen, Pellinen, & Jarvenpaa, (2013), ERP system effectively aids the organization to increase the manufacturing procedures more smoothly and this would help the visibility of the order fulfillment procedures within the organization. Implementation of the ERP system also helps the organization to lead to decrease inventories of the material that is used to build the products and it would aids users better plan deliveries to consumers (Nwankpa, & Roumani, 2014). Apart from that use of the ERP system also helps the organization to improve supply chain process. Therefore from the observation and findings it is concluded that incorporation of the enterprise resource planning system helps the business in effective and successful manner. From the observation it is concluded that implementation of the ERP system helps the organization to sustain in market especially in technology advancement market for long time.

In order to gain and understand the implementation of the enterprise resource planning system, a several numbers of the researchers have developed a conceptual framework also known as the process models system. Ehie, & Madsen, (2005), suggested that a five stage of the enterprise resource planning implementation procedures are used by the organization in implementation process these are project preparation, business blueprint, realization and evaluation, final preparation and finally live and support. The first stage of the ERP implementation process includes the project preparation which is mainly defined as the comprehensive planning phase in which project team with management set the budget, understand the importance of the ERP implementation within the organization and define plan and objective as shown in below figure. The second phase of the implementation includes the business blue print phase, in which the oratgnizaiton present business process is analyzed in detail manner that would helps them to select an appropriate enterprise resource planning system. After that the project team is trained of the configuration and the functionality of the chosen enterprise resource planning system. A gain and understanding the functionality of the organization helps the team members to allow insight to reengineering its business operations (Chou, & Chang, 2008). At the end of the realization phase, project team concentrates on adopting an enterprise resource planning system such as development, modification of the interfaces as well as data conversion. At the same manner, each procedure of the design is tested on a conference room.  In the final stage, the whole procedures is fully tested and integrated through the company with several scenario and full data. At this phase of the users are effectively trained by the trainer regarding how to use system. Finally the system is go live and supported.

As said by the Nwankpa, (2015), Enterprise system architecture is mainly organized in the tiers or layers in order to manage the system functionality as well as complexity in order to offers flexibility and scalability. Most of the organization mainly implements three tiers architectures because this architecture is most scalable, flexible and reliable. The three tires architecture mainly consists of the application tire, web tier and data tier. Web tier offers the users to access the data and information from the data tire, whereas application tire offers the users to hide the complexity of the system and data tier is used to store the data and information. The main benefits of the implementation of this architecture are that it offers the organization to effective scalability, flexibility, reliability, maintainability, reusability and security (Hsu et al., 2015). The main limitation of this architecture is that it is complex and expensive. Moreover web tier allow users the capability to analyze and access information with the help of web browsers. Whereas application tier of ERP system consist of the reporting tools and web browsers whereas organization process and end client interact with the system. Data tier in ERP system mainly focused on the organization overall data structure and its relationship with the eternal and internal system.

Conclusion

As per the above findings and conclusion it is said that ERP system helps the organization to increase its performance. The findings also shows that ERP system helps the TOP level of the management in decision making procedures and the organization achieved their expected return with help of use of ERP system in successfully manner. ERP system not only includes the benfitisal but also includes the some challenges in implementation procedures such as resreocues, cost and time. Overall the observation shows that ERP system is best suited for the organization in present era.

References

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Ehie, I. C., & Madsen, M. (2005). Identifying critical issues in enterprise resource planning (ERP) implementation. Computers in Industry, 56(6), 545-557

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Fok, L., Kwong, K. K., Fok, W. M., & Zhang, Y. (2017). A STRUCTURAL EQUATION MODELLING OF ERP IMPLEMENTATION IN JAMAICA AND USA. GLOBAL JOURNAL OF MANAGEMENT AND MARKETING, 1(1), 30.

Hsu, P. F., Yen, H. R., & Chung, J. C. (2015). Assessing ERP post-implementation success at the individual level: Revisiting the role of service quality. Information & Management, 52(8), 925-942.

Huang, Y. Y., & Handfield, R. B. (2015). Measuring the benefits of ERP on supply management maturity model: a “big data” method.International Journal of Operations & Production Management,35(1), 2-25.

Karathanasis, S. (2017). The role of change management in ERP and other information systems implementation.

Kumawat, P., & Kumawat, N. K. (2017). Investigating End User Satisfaction in ERP Systems: An Analytical Approach. IJETT,4(1).

Mahapatra, M., & Krishnan, S. (2017). Adoption of Open Source ERP in Small and Medium-sized Enterprises.

Nwankpa, J. K. (2015). ERP system usage and benefit: A model of antecedents and outcomes. Computers in Human Behavior, 45, 335-344.

Nwankpa, J., & Roumani, Y. (2014). Understanding the link between organizational learning capability and ERP system usage: An empirical examination. Computers in Human Behavior,33, 224-234.

Teittinen, H., Pellinen, J., & Järvenpää, M. (2013). ERP in action—Challenges and benefits for management control in SME context.International Journal of Accounting Information Systems, 14(4), 278-296.