E-BUSINESS PRESENTATION
E-BUSINESS PRESENTATION
LEVEL 1.1
GROUP PRESENTATION
STRATEGIC INFORMATION MANAGEMENT AND E BUSINESS(MSM611)
LECTURER: DR ZIMUTO
ENTERPRISE RESOURSE PLANNING SYSTEMS
Definition
EVOLUTION OF ERP
ERP Systems evolved out of Material Resource Planning (MRP) and Manufacturing
Resource Planning 11(MRP11)
MRP systems addressed the single task of materials requirements planning and the
MRP11 extended the scope to the entire manufacturing function. The manufacturing
industry traditionally had a better climate to use computers.
ERP history started with material requirements planning (MRP) systems in the
1960s, when J.I. Case, a manufacturer of tractor and construction machinery,
worked with IBM to develop what is believed to be the first MRP system.
While they were expensive to create, required a team of experts to maintain and took
up a lot of space, early MRP systems enabled businesses to track inventory and
production. That helped manufacturers manage raw materials procurement and
delivery of product to the factory so they could better plan production runs.
By 1990, research firm Gartner coined the term “enterprise resource planning.”
The new name recognized that many businesses—not just manufacturing—were
now using this technology to increase the efficiency of their entire operations.
This is when ERP systems took on their current identity: a unified database for
information from across the company. ERP systems brought in other business
functions, like accounting, sales, engineering, and human resources (HR), to serve
as a single source of accurate data for all employees.
(Page 199)
COMPONENTS OF ENTERPRISE RESOURCE PLANNING
Financial Management - This component stores and analyses all your financial
data, including accounts payable, accounts receivable, costs, budgets, and
forecasts. It helps reveal insights into your spending, so you can discover profit
trends and times of unusually high spending. Then you can put that data to good use
by changing whatever processes are causing lower profits or high spend, so you can
maximize your profits while reducing costs.
The diagram below shows how different components of the ERMS connect within an
organisation through a web of functions. Mallach (2020) page 198
Delta Beverages and Afdis distilleries both have shifted to use the SAP for
automation of their functions. This has improved the efficiency of their functions in
areas like HR. Accounting, Inventory Management and Customer relations
Management.
BENEFITS OF ERP
From the presentation above we recommend organisations to embrace ERPS for the
enhancement of their business processes. This has proved effective as
organisations like Delta, Afdis have embraced the use of SAP system in their
business processes.
However, before implementing ERPS, an organisation should have a clear vision of
what it needs to achieve and establish precise requirements, which are aligned with
its business goals. It is crucial to assess what you want to accomplish and how each
business process can be improved.
Further considerations should be made such as the cost of the system, the risks,
backup services, size of the organization, functional fit for your organisation etc.
Looking for a partner that has deep industry expertise, understands your business
processes inside and out, and has a track record of process expertise would
enhance the chances of coming up with a system that is efficient.