Essential Steps for Selecting the Right ERP Vendor

School

Anna University, Chennai**We aren't endorsed by this school

Course

MBA BUSINESCON

Subject

Information Systems

Date

Dec 12, 2024

Pages

Uploaded by CommodoreMask11755

Question 1: Discuss why it is important to conduct a prerequisite study before selecting the vendor and type of ERP for the organization. Also, explain why SCEE was especially concerned about selecting an ERP vendor? Answer: - Introduction: Importance of conducting a prerequisite study before selecting the vendor and type of ERP for the organization. SCEE (State Corporation of Education and Employment) is a company under the state government which has been assigned with the responsibility of promoting education and job. Since it is recently established company, the major objective of SCEE is to take initiatives in promoting education and enhancing employability for the youngsters of rural areas. SCEE has also decided to restructure itself by implementing Enterprise Resource Planning (ERP) software’s in the work processes. By having a long- term business visions in mind, the organization realized the need to streamline and automate its internal as well as external operations and took this decision. The main issue faced by SCEE was selecting a suitable ERP vendor for implementation. They conducted a prerequisite study before selecting the vendor and type of ERP for the corporation. In this chapter let’s discuss more about importance of conducting a prerequisite study before selecting the vendor and type of ERP for the organization. Concept & Application:- Choosing an (ERP) system is one of the vital decision that a business can make. To be sure, there are a plenty to factors to be considered not only the ERP systems’ features, budget and model, but also the vendors who is going to implement the ERP for the company. A thorough assessment consumes a lot of time but it will prove well worth the investment in terms of operational and cost benefits, analysis and data integration that helps real-time decision-making and support for future growth. Enterprise resource planning (ERP) systems play a major role in streamlining processes, resource optimization and enhancing efficiency. But, implementing ERP successfully requires very careful planning, strategic alignment and execution. Following are 10 key prerequisites essential for implementing a successful ERP. 1. Clear Business Objectives Before implementing an ERP, it’s crucial to define a clear business objective. Identify the specific problems that is being aimed to solve with ERP. It can be improving supply

chain visibility, enhancing customer relationships, or optimizing financial reporting, we need to align ERP goals with organizational strategies. 2. Executive Sponsorship and Leadership ERP proposals need a strong executive sponsorship and leadership. The support from top-level is crucial to secure resources, managing the changes effectively and driving the adoption across various departments. 3. Cross-functional Team Collaboration It is important to form a cross-functional implementation team involving representatives from key departments such as finance, IT, operations and human resources. This cross functional team should closely collaborate throughout the ERP project lifecycle to ensure diverse perspectives. 4. Comprehensive Business Process Review A thorough review to be conducted on existing business processes before ERP implementation. Identify the inefficiencies, dismissals and areas for improvement. Streamline and optimize processes effectively to align with ERP functions with best practices. 5. Data Quality and Integrity Ensuring data quality and integrity are most important. Cleansing, validating and migrating data precisely into the ERP system. Establish data governance policies to maintain accuracy and security post-implementation. 6. Scalable Infrastructure and IT Readiness Assess the organization’s IT infrastructure and readiness for ERP deployment. Evaluate network capabilities, hardware requirements and other capabilities with existing systems. Invest in necessary enhancements that supports ERP functionalities. 7. Change Management Strategy Develop a strong change management strategy to prepare employees for ERP adoption. Ensuring sufficient training by conducting workshops and resources to facilitate smooth transitions. 8. Vendor Selection and Collaboration Choosing an ERP vendor aligns with your organization’s industry, scale and specific requirements. Close collaboration with the vendor during implementation is much important to ensure clear communication, achievable timelines and milestones. 9. Customization vs. Standardization

Try for a balance between customization and regulation. While customizations may tackle unique business needs, excessive revisions can complicate upgrades and maintenance. Influence ERP best practices and industry standards where feasible. 10. Continuous Improvement and Evaluation ERP implementation results the beginning of a continuous improvement journey. Establishing a proper metrics and KPIs to monitor ERP performances post-implementation is most important. Ask feedback from users and stakeholders regularly to identify areas for enhancement and optimization. Conclusion:- Before choosing the vendor for ERP implementation, assess the experience and capability of each and every shortlisted ERP vendor. Go through the track record of successful implementations of the vendor within your industry and the ability to understand your business needs specifically. Case studies and customer reviews can also provide valuable insights of the vendor’s capabilities. A well experienced vendor brings good industry knowledge and best practices ensuring a smooth implementation and maximizing the ERP system's benefits for the organization.

Question 2: Xrbia Telecom came across a lot of challenges while working with its legacy billing and finance system as it only catered to a particular requirement with limited integration of functionalities. Most of the processes were complex and time consuming. They decided to reorganize its system and processes to improve its efficiency by replacing it with ERP system which is automated system and is also integrated, flexible and scalable. Discuss what are the benefits of ERP implementation and also discuss the challenges in its implementation. Answer:- Introduction: Xrbia Telecom have realized that the existing billing and finance system is outdated and it is not supporting to meet the current business requirements as processes were complex and time consuming. Hence they have decided to reorganize its system and processes to improve its efficiency by replacing it with ERP system which is automated system and is also integrated, flexible and scalable. In this chapter let’s discuss about the benefits of ERP implementation and also discuss the challenges in its implementation. Concept & Application:- ERP has gained importance in the market for its never-ending benefits to organisations. Today many organisations are changing their key business systems and adopting new ERP packages. The main reasons for implementing ERP systems are given as follows: ● Increases performance of the business:ERP helps to decrease manufacturing cycle time, reduce inventory storage issues and boost up order deliveries. ● Increases revenue:ERP allows to increase an organisation’s sales through sales force automation processes. ● Increases productivity:ERP allows an organization to obtain more work done with limited people, thus increases productivity. ● Improves the efficiency of business processes:An ERP system automates business processes and reduces non-value added activities. In addition, an ERP

system follows an organization to match customer demands which helps to reduce inventory carrying costs. ● Leverages the available resources:ERP leads to proper utilization of organizational resources such as capital and human resource. An ERP system helps an organization to benefit a clear insight of all resources that they can be utilized more effectively to improve business efficiency. ● Provides high security:An ERP system, keeps security to the critical information of an organization such as financial and customer’s details. An ERP system does not allow unauthorized users to access any critical information that can damage the organization. ● Standardizes business practices: An ERP streamlines business practices of an organization thus preventing inaccuracies, in-consistencies and delays in work processes. ● Combines operational, financial and strategic insights: An ERP system combines and analyses the data of all the departments of an organization and delivers crucial operational, financial and strategic insight, which ultimately lead to effective decision making. ERP implementation challenges:Every organization faces challenges during adapting to a new system. The implementation of a new ERP system is not a technical job but it requires a lot of planning and proper communication. The common challenges that are faced during the implementation process are given as follows: •Stages to be followed:The ERP implementation process should follow all the implementation phases. It leads to a chaotic situation if the sequence of phases is not followed by an organization, it further leads to confusion in the organization. ● Training:It is important to impart training to employees during and after the implementation stage. It is because training helps to enhance cooperation and build trust among employees and prevent situations such as job insecurity or functional inefficiencies. ● Lack of proper analysis:For a successful ERP implementation, an organization must analyze its requirements. If the organization does not analyse its requirements, it may not be able to choose the right ERP system. ● Lack of support from the top management:Support of top management is vital for the implementation of an ERP system. Lack of support from top management may lead to ineffectual decision making.

● Compatibility issues with ERP modules:Any incompatibility issues in ERP processes with respect to existing systems pose a major problem for organizations. Different companies come in partnership with different vendors of ERP this it is their responsibility to solve any compatibility issues. ● Infrastructure investment:It is important for an organizations to make investments in infrastructure development for ERP implementation. Lack of proper infrastructure slows down the progress of application development. This further leads to the wastage of resources. Conclusion:- Thus, we have seen the benefits of implementing ERP and challenges in implementation in the above concept and application. Every organization irrespective of industry would have come across these challenges in the implementation and also attained the benefits of ERP as well. This ERP implementation will help Xrbia Telecom to overcome the existing billing and finance system issues which is complex and time consuming.

Question 3 (a): BridgeSoft Technology is an IT Company with the motive of providing solutions to different Organisations by catering to their specific product related requirements. They have decided to implement SAP software in their organization to integrate the various business processes and to enhance the efficiency of the organization. Considering the above scenario, discuss the following: a) Discuss the SAP architecture which BridgeSoft Technology has used for implementation. Answer 3(a):- Introduction: SAP architecture which BridgeSoft Technology has used for implementation. SAP (Systems, Applications and Products) is a Data Processing software company known for a leader in Enterprise Resource Planning (ERP) software. SAP is a well-structured software package which provides business solutions to its client/server. It has managed to acquire a large stake in the market despite strong competitors in the market. This is because SAP is the most popular vendor for ERP solutions. SAP has various software modules for processing different business functions. These include the following 1. Finance 2. Sales, Marketing and Distribution 3. Materials Management 4. Production Planning 5. Supply chain management 6. Human resource management 7. Quality management Let us discuss the architectures of SAP in the concept and application.

Concept & Application:- The SAP architecture has three main layers: ● Presentation layer:This layer networks with the database layer through the application layer. This layer also contains the SAP Graphical User Interface (GUI). The user provides inputs to the GUI by using keystrokes, mouse-clicks and function keys, which are passed on to the application server for processing. Likewise, the results sent by the application server are formatted by the GUI so that the users can understand them. ● Application layer:This layer intermingles with the presentation and database layers. The application contains an application server that decodes the ABAP/4 language and programs. The application server includes a set of executable functions which control the input and output from the application layer. ● Database layer: This layer permits the data or information received to the application layer. It saves all data of the ERP SAP systems. The layer contains a set of executables which process the database requests that are received from the application server. It moves these requests to the Relation Database Management System (RDBMS) which provides the requested data to the database server.

Conclusion:- From the above concept and application, we understand the architecture types which a organization like BridgeSoft Technology can choose on its own based upon the requirements on functionality and user interface as well. It will help an IT Company by providing solutions by catering to their specific product related requirements. They can also decide to implement SAP software in their organization to incorporate the various business processes and to enhance the productivity of the organization.

Question 3 (b): Discuss the benefits of SAP implementation by BridgeSoft Technology Answer 3(b):- Introduction: Benefits of SAP implementation by BridgeSoft Technology By implementing SAP ERP software package Bridgesoft technology can obtain vast benefits by improving the efficiency in the productivity by eliminating non value added activities and by utilizing the manpower in a better way by making the tasks simple and effective. Concept & Application:- The following are the key advantages of implementing SAP in Bridgesoft Technologies: 1.Data centralisation SAP sets the data from multiple processes and business functions at a single consolidated location. This makes data sharing and information across business units easier. Departments such as sales, inventory, finance, production and human resources can access the informations from different departments and efficiently communicate the needs of their department. 2.Automation SAP permits the automation of workflows and builds processes streamlined. Data from routes like accounts, order management and vendor management flows automatically as per the approval and rejection guidelines are defined in the system. This helps organizations to become more capable as the employees can focus on more productive tasks. 3.Accessibility In SAP there is a possibility to arrange SAP through cloud platform. This makes SAP ERP highly handy and accessible. SAP also deals mobile-based applications for many of its features and applications. SAP supports all the major operating systems and devices like Windows, Linux, Android, iPhones and Mac. 4.Globalisation SAP offers support for a variety of geographical locations. As an enterprise tool, SAP supports all the global major currencies, making it useful for companies with international operations. 5. Visualisation

SAP reports and dashboards functionality lets us to view all the important data pointers in an easy-to-understand format. Graphs and charts are easier to understand and go through comparing to large data files. This facility lets us to decide on the next course of action swiftly and makes understanding the processes and related issues that much easier. Conclusion:- Thus, we have seen the benefits of SAP implementation from the above concept and application which is evident that the organisations of various industries can go ahead with SAP implementation for the betterment of the organization as well as for enabling an easy and smooth going process in the workplace for the employees.