Q2
Q2 Analyse the different ERP modules and their impact to the general industries.
When we look at Enterprise Resources Planning (ERP) software available in the market, we will find many different modules that serve different purposes in company areas of operations. ERP is actually processes and procedures to enable collaboration between the main areas of operations in a company: Marketing and Sales, Production and Materials Management, Accounting and Finance, and Human Resources. I will discuss each aspect, analyse the impact to the general industries and analyse the impact to the IT industries.
Marketing and Sales function is very broad and includes but not limited to marketing, sales order processing, customer relationship management, customer support, sales forecasting and advertising. (Brady, Monk, and Wagner, 2001) Each of these aspects is broad within themselves and very detailed, however I will only touch on the main facets of each below.
Marketing - A process involving exchange of goods between customers and sellers.
Sales Process - involves fulfillment of customers' requests of goods and services
Customer Relationship Management - maintaining relationships with customer before or after the sale
Customer Support - involves providing assistant to help customer to solve specific problems with goods and services before or after sales
Sales Forecasting and Advertising - involves planning or predict the future sales and decide the quantity and directions of advertising need to be done
Production and Materials Management would involve Supply Chain Management that is dealing with the relationships of the following factors from the source all the way to the retailer and ultimate end user.
Material Sourcing - Finding and acquiring the raw material of services required for further processing
Supply Control - Control the raw materials and ensure steady supply to manufacturing process
Product Manufacturing - Decision on what to produce and how to produce it
Logistic Planning - Decision or planning of what vehicle to use, which is the best route (operations research) to result in a timely delivery or reception of goods
Quality Control - Process or test that ensure the raw material or products meets certain standard
Plant Maintenance - Maintain the machinery for production process to ensure steady output of goods
Accounting and Finance functional area includes the business functions of financial accounting, cost allocation and control, planning and budgeting and cash flow management. (Brady, Monk and Wagner, 2001) As each of them is broad and detailed, I will discuss the processes that involve other area of operations.
Cost allocation and control - Process that controls the allocation of money and spending in a proper way
Planning and budgeting - Preparation or forecast the use of money in the future
Cast flow management - Ensure that the financial status is healthy by maintaining more inflow than outflow of money
Human Resources include the business functions of recruiting and hiring, training, payroll and benefits.
Recruiting and hiring - Process to enroll suitable people to work towards company goals
Training - Process to develop the skills of staffs to perform certain tasks
Payroll and benefits - Ensure that staffs are paid according to contract and benefits to keep them happy to stay with the company.
With ERP system, Human Resources can gather all personnel data into a common database and share within the department or managerial levels of the company. They can also input and maintain data for the working hours of the work force for reporting purpose. Employee can also access their own personal information and change their personal details online and it will be sent to Human Resources for verification and timely update. (Ashbaugh and Rowen, 2002)
Each one of these detailed aspects is critical for the entire business process to succeed. None seems more important and each in some aspect relies on the others. Each one of these aspects involve in cycles which one leads to another and the process repeats, for example, Human Resources hires people for all aspects of the business functions, production management develop goods to be sold for business to create a profit, materials management take care of the manufacturing process turning raw materials to final goods for customer. Marketing and Sales promotes the product and maintain good relationship to customers. Meanwhile the Accounting and Finance take cares of all the cost planning and budgeting and draw up the financial reports for them to decide their next moves.
The positive impacts of the ERP system to the general industry are the improvement in collaboration, process & procedure and development. The negative impacts of the ERP system is the cost and time to design, implement, training of staffs and also the management uptake & approval since the benefit of ERP system won't be visible in a later stages (Markus et al., 2000)
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