erp presentation
                     Enterprise Resource 
Planning 
(ERP)
SOSE! SITE Open Source ERP
http://www.open-source-erp-site.com
http://www.open-source-erp-site.com
Presentation - Flow
ERP – General Concepts
  
ERP based applications - Options
  
Building ERP solutions using Internal Sources
  
Adapting Tailor-made ERP Solutions 
  
Developing ERP applications using External Sources
  
Brainstorming on the Options
http://www.open-source-erp-site.com
ERP
General Concepts
http://www.open-source-erp-site.com
ERP – General Concepts
  What is ERP?
  The Current Scenario
  Why ERP?
  Definition
  Evolution
  Expectations
  BPR & ERP
  BPR – The Steps
http://www.open-source-erp-site.com
Enterprise Resource Planning
What is ERP?
ERP is a solution, which
  facilitates company-wide integrated 
    information systems, covering all 
    functional areas
  performs core Corporate activities and 
    increases customer service augmenting 
    Corporate Image
http://www.open-source-erp-site.com
Enterprise Resource Planning
The Current Scenario
  Islands of Information
  Difficult to get timely & accurate information
  Heterogeneous Hardware & Software
    platforms & practices
  Poor connectivity between different
    organizational locations
  Sticking with obsolete technology
  Resist to change
  Lack of proven man-power to develop
    integrated software
http://www.open-source-erp-site.com
Enterprise Resource Planning
Information Islands
B
http://www.open-source-erp-site.com
Why ERP?
  For Management – to know what is happening
    in the company
  One solution for better Management
  For cycle time reduction
  To achieve cost control & low working capital
  To marry latest technologies
  To shun the geographical gaps
  To satisfy the customers with high expectations
  To be Competitive & for survival
http://www.open-source-erp-site.com
Enterprise Resource Planning
ERP  - Definition
“Software solution that addresses the
Enterprise needs, taking a process view of
the overall organization to meet the goals,
by tightly integrating all functions and
under a common software platform”
http://www.open-source-erp-site.com
Enterprise Resource Planning
Evolution of ERP
  1960’s - Systems Just for Inventory Control
  1970’s  - MRP – Material Requirement Planning
    (Inventory with material planning & procurement)
  1980’s - MRP II – Manufacturing Resources Planning
    (Extended MRP to shop floor & distribution Mgnt.)
  Mid 1990’s - ERP – Enterprise Resource Planning
    (Covering all the activities of an Enterprise)
  2000 onwards – ERP II – Collaborative Commerce
    (Extending ERP to external business entities)
http://www.open-source-erp-site.com
Enterprise Resource Planning
ERP – Expectations
  Integrating all the functions
  Integrating the systems running in all the locations
  Transparency of information using a single
    data source across the organization
  Software must be responsive
  Modular
  Flexible
  Easy to add functionalities
  Provide growth path
http://www.open-source-erp-site.com
Enterprise Resource Planning
BPR & ERP
Just automating the existing business practices
will not help ERP to achieve the anticipated results
because, OO + NT = EOO
Business Process Re-engineering [BPR] brings out the
deficiencies of the existing setup
BPR and ERP will give way to implement new
systems and the long pending improvements in the
existing systems
BPR may be time consuming but the scope can be
restricted & controlled by the Management
http://www.open-source-erp-site.com
Business Process Re-engineering
BPR - Steps
Step 1 Step 2 Step 3
Understand Simplify/Impro Automate
ve
Understand Draft & frame the Implement 
the existing possibilities & with the help 
systems ways to simplify of ERP
associated or Improve or 
with all the eliminate the 
functionalitie processes
s
http://www.open-source-erp-site.com
Business Process Re-engineering
ERP – Options 
OPTION 1 – MAKE [Using Internal resources]
Developing a custom-built ERP package, specific to the
requirements of the organization, with the help of the
in-house IT department
OPTION 2 - BUY
Going for Tailor-made ERP packages available in the market like
SAP, Oracle applications, Baan, PeopleSoft etc.
OPTION 3 – MAKE [using External resources]
Developing a custom-built ERP package, specific to the
requirements of the organization, with the help of a 
software solution provider
http://www.open-source-erp-site.com
Enterprise Resource Planning
Building ERP solutions 
using 
Internal Sources
http://www.open-source-erp-site.com
ERP – Building using Internal 
          resources – The Facts
  Lack of adequate & qualified manpower
  Not driven with clear focus on expectations, 
     time & cost
  Poor software project management 
  Lack of seriousness with the Management & the
     IT Team
  High employee turnover
  Lot of schedule gaps during Project execution
  Normally project life is more
  Frequent change in the scope with the approval
     of the Management
http://www.open-source-erp-site.com
Tailor-made
ERP
Solutions
http://www.open-source-erp-site.com
Tailor-made ERP solutions
  About this option
  Execution Phases
  ERP product selection phase
  Product selection - Parameters
  Preparation Phase
  ERP product acceptance - Options
  Gap Analysis
  Production Phase
  Implementation Phase
  Post-Implementation Phase
  Pitfalls & Points of Concern
  Critical Success factors
http://www.open-source-erp-site.com
Tailor-made ERP solutions
About
  Generalized off the shelf application s/w 
packages
  Modules based on rich functionalities for all 
business   
    functions
  User tested with lot of installations
  No lead time requirement for software 
development
  Tuned for more users/networks with adequate 
& in-
    built security
  Parameterized for flexibility
  Can sit on latest hardware & software platforms
  Upgradation hottpf: //fwuwwn.ocpetni-osonurcae-leirtp-iseites.c owm ith version 
control
Tailor-made ERP solutions
Execution phases
  ERP product selection
  Preparations
  Production
  Implementation
  Post-Implementation
http://www.open-source-erp-site.com
Tailor-made ERP solutions
ERP Product selection 
Phase
  ERP Team formation for selection
  Appointment of Consultants [if needed]
  Scoping study
  Product selection
  Implementation partners selection
  Hardware/Communication cost estimation
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Product Selection - 
Parameters
  Reputation of the ERP product
  No.of installations in the geographical vicinity
  % of the overall functional availability
  Customization possibilities
  After sales support
  Your investment plan & budget
  Implementation partner’s track record
http://www.open-source-erp-site.com
Tailor-made ERP solutions
ERP Product selection Criteria
Goal: Functionality
To select the
Most Suitable  Software 5 Strategic
Package Solution Requirement
Levels Technology
Vendor
Support
Costs
http://www.open-source-erp-site.com
Preparation Phase
  Framing ERP Implementation Strategies
  Formation of Apex & Steering committees
  Functional & IT team formation
  Training on ERP functions & features
  Scope finalization
  GAP analysis
  Action plan to resolve the gaps
http://www.open-source-erp-site.com
Tailor-made ERP solutions
ERP product acceptance - 
options
1. Adapting directly, all the functions available in 
     the ERP Product [Applicable for startup companies]
2.  Change the way the firm does the business to fit
     the product [Compromising]
3.  Customize the ERP product to suit the business
     Processes. [Customization]
http://www.open-source-erp-site.com
Tailor-made ERP solutions
GAP Analysis
This is the process to identity the gaps by mapping 
the expectations of the company with the 
capabilities of the ERP product
Results of Gap Analysis
  Directly Supported
  Workaround suggested
  Extension required
  Change in business process – suggested
  Not full supported
  Manual – not under the scope of ERP
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Production Phase
  Installing the software & hardware
  Tuning the software to meet the 
     customization needs
  Master & Control data arrival as per 
     the Product data structures
  Location & people specific roles & rights
     allocation for module access & security
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Implementation Phase
  Conference Room Pilot [Parallel run]
  Resolving the Parallel run issues
  Training the end users
  Live run
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Post-Implementation Phase
  Regular monitoring
  Tuning [hardware/software] for patching
     the performance issues
  Maintenance
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Pitfalls & Points of concern
  Costly comparing to custom-built options
  Lot of hidden costs
  Chances of cost & time overrun are high
  The Level of customization/Indianization
  Compulsion to pay for redundant modules/features
  Vigorous involvement of all during implementation
  Non-availability of special practices like Customer
     Complaint, Logistics
  Linking historical data – offline & painful
  The requirement of Change Management is a must
  Dependency on outsiders is high  
  IT department – Poor grip on the Implemented systems
  
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Critical Success Factors
  The firm & optimistic approach of the Management
- on adapting the ERP product driven methodologies
- on customization
- on monetary commitments
  The dedicated Team
  Good Training
  Strict adherence to the Project schedules
  Right technical infra-structure
  Change Management
http://www.open-source-erp-site.com
Tailor-made ERP solutions
Custom-built
ERP
Solutions
using external resources
http://www.open-source-erp-site.com
Building ERP using 
Ext.sources
  About this option
  The Principle!
  The Steps
  Why?
  Points of Concern
  Software Vendor selection
  Critical Success factors
http://www.open-source-erp-site.com
About
Here the whole package is designed & built 
  by keeping a specific enterprise & its business
     Practices in mind
  by incorporating the improvements/additions
  with due integration 
  without compromising or changing the current way
     of doing the business    and
  providing flexibility to accommodate your business
     fluctuations
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Custom-Built ERP solutions
The Principle!
   The best as seen elsewhere, need not be the
   the best for you.  
   What is your best is what
   can be successfully implemented 
http://www.open-source-erp-site.com
Custom-Built ERP solutions
The Steps
1. Software vendor selection
2. Detailed study by the vendor
3. Scope & platform finalization
4. Freezing the commercials
5. Development
6. Hardware addition/upgradation
7. Old master/transaction data migration
8. Parallel run with Integration & connectivity 
check
9. Implementation
10.Maintenance
http://www.open-source-erp-site.com
Custom-Built ERP solutions
Why?
  Very economical while comparing the cost of  implementing 
     tailor-made ERP solutions
  Less prone for hidden-cost hits
  The company can opt for its choice of Hardware, Software & 
     communication platforms based on the skill availability
  The company and the software vendor have the direct
     relationship during the project execution.  The proximity
     would be high & convenient. 
  IT department has good control over the Project
  What is required only would be considered under the scope – 
     No redundancy
http://www.open-source-erp-site.com
Custom-Built ERP solutions
Why?  - Cont.
  The requisite flavor of E-Biz & work-flow components
     can be embraced towards value edition
  The existing practices & applications can be tuned and
     linked with the proposed package 
  Maintenance & improvements are easy & less costlier.   
     Even IT team can maintain the setup after getting the 
     source code
http://www.open-source-erp-site.com
Points of Concern
  Software development vendor selection
  Requirement/scope finalization [high chances of 
   retaining the islands as it is]
  Less chances of Value addition
  Not time tested
  Chances of Prolonged project duration
http://www.open-source-erp-site.com
Software Vendor Selection
The following traits should be considered while 
selecting the software vendor for building the 
ERP application
  Technical expertise
  Domain knowledge
  Adequate manpower
  Project management skills
  Long existence in the field
  Extra skills [e-biz & workflow]
http://www.open-source-erp-site.com
The Critical Success Factors
•  Clear Vision & support of the Management
•  Capabilities of the software development vendor
•  Scope & Expectations finalization towards
    meeting the ERP concepts
•  Strict implementation schedules & periodical
    monitoring
•  The involvement of the IT & functional teams
http://www.open-source-erp-site.com
Custom-Built ERP solutions
Beyond ERP
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Thank You
SOSE! SITE Open Source ERP
http://www.open-source-erp-site.com
http://www.open-source-erp-site.com