Can ERP Becomes An Alternative To MIS ?
Submitted by: Swatisudha Samantaray Roll. No. R060106013 UPES
What Makes The Business To Think:
The Challenges Of Globalization Unprecedented Levels Of Competition. Shifting Of Mass Production System To Mass Customization System Deals With Multiple Countries, Multiple Currencies Trade Barriers Are Falling Consumers Are In Demand Change Becomes Constant
Attention Goes To:
What Is Information System:
An Information System Is An Open, Purposive System That Produces Information By Using “Input-process-output” Cycle From The Available Data.
Manpower
Money
Machines
Technology
Customer
DATA Input
Processing
Feedback Control
Output I n f o r m a t i o n
Why Information System:
•
To Remain Competitive, Desired Information Is Required To The Right People At The Right Time.
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Information Systems Used To Enable Information Flow Within And Between Processes Efficiently And Effectively.
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Through Information System Competitive Advantage Can Be Gained Via Cost Reduction, Product Enhancement, And Customer Service Improvements.
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Information Systems Are Useful Tools To Enable And Manage Business Transformation Or Change.
Management Information System # 1: •
According To Schwartz, MIS Is A System Of People, Equipment, Procedures, Documents And Communicatio Communication n That Collects, Validates, And Operates On Transformers, Stores, Retrieves And Present Data For Use In Planning, Budgeting, Accounting, Controlling, And Other Management Process.
•
The MIS Emphasizes: » » » »
Organization-wide Information Decision Support Managerial Emphasis Computer Based Systems
Management Information System # 2:
•
Provide A System For Collecting, Processing, Storing, Retrieving, And Transmitting Information To The Users. User
Source Source
Data Capturing
Processing
User
Dissemination
User
Source
Retrieval Source Storages
User
Management Information System # 3:
Facilitates The Decision Making Processes By Furnishing Information
This Helps Decision-maker To Select The Best Course Of Action.
Characteristics Of MIS:
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Management Oriented:
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Management Directed:
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Integrated:
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Common Data Flow:
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Heavy Planning Element/ Long Term Planning:
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Sub-system Concept:
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Flexibility And Ease Of Use:
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Need Based:
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Exception Based:
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Future Oriented:
Limitations Of MIS: •
MIS Cannot Replace Managerial Judgments In Decision-making.
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The Quality Of Output Of An MIS Is Directly Proportional To The Quality Of Input And Processes.
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In A Fast Changing And Complex Environment, MIS May Not Have Enough Flexibility To Update Itself Quickly.
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MIS Takes Only Quantitative Factors Into Account. A ccount.
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MIS Is Less Useful In Making Non-programmed Decisions.
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MIS Is Less Effective In Organizations Where Information Is Not Being Shared With Others.
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MIS Is Less Effective Due To Frequent Changes In Top Management, Organizational Structure And Operational Management.
Why Enterprise Resource Planning:
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Information Systems Are Becoming More And More Complex
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Due To The Stumbling Blocks: Time, Cost, Objective Data, Unstructured Process
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Development Of A Vision Of Integrated Information System
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Dissimilar Systems
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Business Becomes Global
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Incoherent Business Process
Current Business Scenario: Customer (Europe)
Suppliers (China)
Planning Headquarter (Japan)
Planning at Manufacturing Plants (China & Indonesia)
Suppliers (India)
Manufacturing Product A (China)
Manufacturing Product B (Indonesia)
Finance at Headquarters (Japan)
Human Resources / Payroll at Headquarters (Japan)
Sales (North America ) Distribution (Logistics) Shipping and Transportation Foreign Trade
Finance at Manufacturing Plants (China and Indonesia)
Human Resources / Payroll at Manufacturing Plants (China and Indonesia)
Customer (Australia)
Sales (China) Customer (Korea)
What Is ERP: Serves As A Cross-functional Enterprise Backbone That Integrates & Automates Many Internal Business Processes And Information Systems Covering All Functional Areas.
Characteristics Of ERP:
Many Distinct Business Modules Such As Financial, Manufacturing, Accounting, Distribution, Etc.
Use Centralized Common Database Management System (DBMS)
The Modules Are Integrated And Provide Seamless Data Flow Among The Modules
They Are Flexible And Offer O ffer Best Business Practices
They Require Time-consuming Tailoring And Configuration Setups For Integrating With The Company’s Business Functions
The Modules Work In Real Time With Online And Batch Processing Capabilities
They Are Internet-enabled
Evolution Of ERP:
2000s
Web Extended ERP
1990s
Enhanced ERP
1980s
Enterprise Resource Planning
1970s
Manufacturing Resources Planning ( MRP II )
1960s
Manufacturing Requirements Planning ( MRP )
Shifting Trends Of ERP:
ERP Modules:
The Number And Features Of The Modules Vary With The Package. Some Of The Most Common Modules Available In Almost All Packages Are: Finance/Accounting Mfg. Planning/Scheduling Plant Maintenance, Quality Management, Material Management Human Resources Distribution Management Customer Order Management Cost Management
Shop-floor Management Inventory Management Procurement Management Production Control Transportation Management Supply Chain Management Customer Relationship Management E-business
Benefits Of ERP:
Gives A Company An Integrated Real-time View Of Its Core Business Processes
Helps Improve The Quality And Efficiency Of Customer Service
Reductions In Transaction Processing Costs And Hardware, Software, And It Staffs
Leads To Improved Performance, Better Decision Making, Competitive Advantage
Replaces A Multiplicity Of Different Systems And Databases D atabases
Allows Replacement Of Disparate Systems E.G. Exxon Mobile Used ERP To Replace 300 Different Systems
Increases Organizational Real Time Information Flow
Process Reengineering -- Update Old Processes
Foundation For New Processes, Such As E-procurement
Lays Foundation For Electronic Commerce
MIS Vs. ERP:
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Both MIS And ERP Systems Focus On The Automation Of Business Processes, Data Transfer, And Information Sharing Across The Organization.
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MIS Is An Information System Designed For Providing Information To Support Operational Control, Management Control, And Decisionmaking Functions In An Organization Org anization
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ERP Systems Are Some Of The Most Advanced, State-of-the-art Management Information Systems In Today’s Business World. W orld.
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An ERP System Integrates Information Systems And Business Processes To Enable Information Entered Once To Be Shared Throughout The Organization.
MIS Vs. ERP: MIS’s Role:
1. 2. 3.
To Ge Generate Re Report orts-for -for Example To Answ Answer er WhatWhat-if if Ques Questi tion onss Ask Asked ed By Mana Manage gem ment ent To Support Decision Making
ERP’s Role:
1. 2. 3. 4. 5. 6. 7. 8. 9.
Staff Reduction Better Invento ntory Mana Manag gement Impr Impro ove Cust Custom omer er Res Respo pons nsiv iveeness ness Efficient Pr Procurement Enha En hanc nced ed Fina Financ ncia iall Man Manag agem emen entt And And Corpo Corpora rate te Gover Governa nanc nce: e: Soft Softwa ware re Secu Securi rity ty:: E.G. .G. Sera Serade dex x ERP Encouraging Un Uniqueness Changing The Wor Working Pattern Web-enable ERP
Why ERP Is The Best ? # 1
Why ERP Is The Best ? # 3 In What ?
How ?
Reliable information access
Common database, consistent and accurate data, improved reports
Avoid data and operation redundancy
Avoids multiple data input to the central database
Delivery and cycle time reduction
Minimizing retrieving and reporting delays
Cost reduction
Time saving in decision making
Easy adaptation
Changes in business processes easy to adapt and restructure
Improve scalability
Structured and modular design
Improve maintenance
Vendor supported long term contracts as a part of procurement
Global outreach
Extended modules like CRM and SCM
E-commerce, E-commerce, e-business
Collaborative culture
Why ERP Is The Best ? # 4 BEFORE ERP
WITH ERP
Business Processes
Proliferation of fragmented processes with duplication of effort
Re-engineering around a business models that conforms with “ best practices”
Productivity
Lack of openness to customers and suppliers
Direct interactions with customer and suppliers by enhanced ERP modules like SCM and ERP
Supply chain management management
Lack of integration
Linkages with suppliers and customers
eBusiness
Web based interfaces support isolated systems and their components
Web based interfaces are front end to integrated system
Information
Lack of tactical information for effective monitoring and control of organizational resources
Allows cross functional access to the same data for planning and control.
Communication
Lack of effective communications with customers and suppliers
Facilitate organizational communications with customers and suppliers
ERP :Integration With E-Procurement and E-Commerce:
Many companies with ERP use e-commerce
E-commerce needs to interface with ERP
ERP : Integration With CRM and SCM:
Supplier Collaboration
SCM Key Process Integration via ERP
Design Partners
Product Lifecycle Management
CRM Consumers and Channels
ERP : Integration With SCM:
0 6 9 1 0 7 9 1
Inventory Purchasing MRP
0 8 9 1
MRP II
0 9 9 1
ERP
0 0 0 2
Internal ERP/SCM
+
Production scheduling
+
Finance, labor
+
All internal resources
Internal customers + and suppliers
+
External suppliers and customers
MRP
Production Management
MRP II
Major Manufacturing Resources
ERP
Coordinated Manufacturing and Service Transactions
Internal Enhanced ERP/SCM SCM Extended Web Extended ERP SCM
ERP : Integration With CRM: Back Office ERP
Front Office (CRM)
Front-end Function Like Managing, Acquiring And Retaining Customers Are Effectively Managed By CRM. They Effectively Capture The Customer Requirements At The Front End
ERP, Integrated With All Functional Areas, Converts This Customer Requirement Into Feasible Finished Products In Time.
ERP And BPR: •
Shift From Efficient To Effective, Passive To Active, Tactical To Strategic And Automation To Optimization, Is The Motto Of O f ERP.
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Business Process Re-engineering [BPR] Brings Out The Deficiencies Of The Existing Setup, Solves Old Problems, Redesigns Selected Processes, etc
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BPR And ERP Will Give Way To Implement New Systems And The Long Pending Improvements In The Existing Systems
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Implementing An ERP System Usually Requires A Company To Perform Business Process Reengineering (BPR) Or Business Process Re-design (BPRD).
Before Conclusion:
The ERP market is expected to grow 8 percent until 2008
The leading ERP system providers are SAP and Oracle/PeopleSoft.
SAP holds 40 percent of the $24 billion ERP market
Oracle and PeopleSoft systems hold 10 percent and 12 percent respectively
One Study Indicates that 33 % of companies said their ERP system significantly reduces personal requirement.
A study of ERP impleme implementations ntations reports that benefits typically start 8 months after implementation with median annual savings of o f $1.6 million
Conclusion:
Management Information System
Resource
Enterprise Resource Planning …Leads To Focusing On Creating Value And Improving Business Processes And Better Customer Satisfaction.
Questions? Discussion?
