Research on Operation Mode of Green ERP Based on Multilife Cycle
Yong Ren1, Min Zhou1, Yan-xia Chen1, Hua Zhang2
1
College of Machinery and Automation, Wuhan University of Science and Technology, Wuhan, China
Green Manufacturing and Energy Conservation & Emission Reduction Technology Research Center
Wuhan University of Science and Technology, Wuhan, China
(michelle_zhoum@163.com)
2
Abstract - By analyzing the background and research
fields of green manufacturing, the authors propose the
concept of green ERP (enterprise resource planning) based
on multilife cycle, elaborates its essence and characteristics.
On the basis of that, an operation mode of green ERP is built
and each operation stage of it is expatiated in detail. During
multilife cycle of green ERP, the factors of cost and resource
efficiency are focused on. The proposed operation mode is a
comprehensive qualitative answer to the question of what is
green ERP as well as a roadmap for future quantitative
research to better understanding.
development of ERP system based on virtual team.
Generally speaking, green ERP is in a fuzzy concept and
growth period. Based on the analysis above, the authors
propose a concept of green ERP based on multilife cycle
and analyze its essence and characteristics by referencing
philosophy of green manufacturing.
Keywords - Green, multilife cycle, operation mode, ERP
system
A. Concept and essence of green ERP based on multilife
cycle
I. INTRODUCTION
The way of society development is challenged by
environment, resource and population problems, and the
mode of sustainable development is expected to be a
selection for human being. Achieving green sustainable
development mode of high efficiency, low cost & energy
consumption and less environment pollution becomes
goal of human society development. The "Twelfth Five
Year Special Program" led alone by Minister of Science
& Technology, presents two special programs: great task
of manufacturing informationization and green
manufacturing. The Ministry of Industry & Information
also argues that green growth in industrial development
and information is a new growing point [1].
At present, green subject is widely researched, such
as green manufacturing [2-3], green design [4], green supply
management [5], green project management and so on.
Green IT/IS[6-11] subject is also involved, but it mainly
focuses on energy consumption and enterprise
implementation strategy from perspective of enterprise.
Among them, green ERP is rarely involved. In process of
informationization, ERP system is also required to be
more and more scientific with the development of
industry management .It is required to be innovation and
green feature etc. Indeed, virtualization of hardware and
embedding accounting of environment cost [12] into ERP
system to save electric energy and reduce environmental
impact are concerned by some scholars, but greening ERP
system itself is ignored, such as adopting green design of
ERP system based on multilife cycle and green
____________________
This paper is supported by the project Green Optimization
Method & Support Technology of Steel Manufacturing System,
Innovation Team of Hubei Province (T201102)
II. CONCEPT AND CHARACTERISTICS OF GREEN
ERP BASED ON MULTILIFE CYCLE
According to value theory, green technology is a
combination of multivalue. It takes green ecotype society
and environment value as its core beyond traditional
enterprise boundary. Green technology integrates the
benefits of customers, society and environment with
process of company value’s increment. From perspective
of cost (including primary development cost and
secondary upgrade cost) of ERP development taken by
customers (enterprises that implement ERP system), an
efficient and low cost green ERP based on multilife cycle
aims to achieve unification of economic, environmental
and social benefits. In this paper, green ERP is defined as
following: green ERP based on multilife cycle is a green
philosophy of management, method and tool which
integrates with traditional ERP system such as purchasing
management, design and production management, sales
and distribution management, and embeds environment
cost management module into financial management
subsystem and so on, is oriented for customers demand
and market, associates with advanced technology
superiority and supports rapid reconfiguration technology,
emphasizes on high efficiency, low cost during multilife
cycle stage to optimize resource allocation of inter and
extern of enterprises for unification of economic,
environmental and social benefits.
Green ERP based on multilife cycle extends
traditional space & time boundary of ERP system, its
essence integrates with system theory during multilife
cycle to achieve green goal of high efficiency and low
cost. Its essence can be understood from the following
aspects:
1) From perspective of ERP system itself, green ERP
system requires a green design in system architecture and
a guarantee of perfect performance quality such as a good
system expansibility ,reconfiguration and portability and
other advanced technology merits to own the ability of
upgrading or "remanufacturing" that oriented for multilife
cycle. This perspective presents the green merit of reuse,
remanufacturing and other green requirements.
2) From perspective of development process of ERP
system, green ERP requires a green operation model of
development team to reduce cost, especially the human
resource cost, to promote resource efficiency of
development process. So a collaborative method &
platform, such as virtual team, information network
technology and so on, should be taken to guarantee a
green ERP development process.
3) From perspective of customers, green ERP is
required to own the ability of promoting enterprises’
green management level based on GSCM(green supply
chain management) and cultivating green culture for
enterprises.
B. Characteristics of green ERP based on multilife cycle
On the basis of a thorough understanding of essence
about green ERP based on multilife cycle, a three
dimensional characteristics model is built by referring to
philosophy of green manufacturing. In this three
dimensions model, green evaluation on ERP will be made
in different project stages according to resource consumed
by each stage. The green degree is evaluated by time,
quality, cost, resource, environment five dimensions.
Then an accumulated green degree curve will be made
after evaluations. In fact, the accumulated green degree
curve oriented for multilife cycle varies from different
ERP projects and different stages. It is shown as figure 1.
Evaluation
Indexes
time
accumulated
green degree of ERP
quality
cost
resource
environmrnt
hum
te c
h n c a p i ta
in
equ forma ology l lysis ysis sign ent ing ing vice rade ation
n r
g
l
ti o n
r
i pm
ana ana m de elopmebug run se upg ene
m
an
ent
res ateri
a n d e m s te e v d te m te m te m x t g
al
our
em syst sy tem dystem sys sys sys ne
d
ce
sys s
Process
Resource
Fig.1 Characteristics of green ERP based on multilife cycle
1) Process dimension
Process dimension extends life cycle of green ERP
system. It includes demand analysis, system analysis,
system design, system development, system debugging,
system running, system service, system upgrade, and
developing next generation system and so on. For
example, in process of design & plan for green ERP
system, not only a thorough consideration on factors those
affect this generation ERP system should be predicted, but
also a further research on next generation ERP system
such as upgrading cost, technology feasibility and other
factors, should be considered.
So that an overall consideration on cost (consists of
development cost, running and maintenance cost, upgrade
cost), technology portability and reconfiguration,
effectiveness and implementation achievement and so on,
is required to be scheduled systematically oriented for
multilife cycle.
2) Resource dimension
Under green background, resource includes capital,
technology, information, equipment ， material, energy,
human resources etc. During multilife cycle of green ERP,
how to make use of resource more efficiently, especially
human resource, is a core factor for green ERP.
Integrating different types of resources effectively and
optimizing resources allocation in every key process node
group are very important reflections of green ERP.
In fact, different types of resources consumed by
different processes will affect the evaluation indexes in
certain degree and these green indexes of ERP will totally
produce effect in green degree of ERP.
3) Evaluation indexes dimension
Green ERP is a kind of product and service in deed.
According to green manufacturing theory, green product
can be evaluated by TQCRE(time, quality, cost, resource,
environment).As to green ERP, it involves a series of
green manufacturing processes and activities during
multilife cycle with information exchange, resource
consumption, and environmental impact etc.
In evaluation indexes dimension, time refers
development period, service respond time. Quality
represents system functional quality, technical
performance quality, service quality etc. Cost consists of
primary development cost, maintenance & service cost
and upgrade cost etc. Resource refers the efficiency of
different kinds of resources consumed by each operation
stage. Environment reflects the environment impact
during multilife cycle of green ERP. Generally speaking,
evaluation indexes dimension should be extended to cover
a more wide green conceptual scope and activities with a
broad understanding about green ERP.
Ⅲ. OPERATION MODE OF GREEN ERP BASED ON
MULTILIFE CYCLE
Operation mode of green ERP based on multilife
cycle consists of four stages: green philosophy and design
process, green development process of ERP R&D team,
green
implementation
&
running
process,
Plan
"remanufacturing" process. Its operation mode is shown
as figure 2.
Do
Check
Project planning
Green
philosophy &
design process
Time
Green
development
process of R&D
team
Quality
Action
P D
A C
System analysis
Market/
Customers
R&D team deveopment
Demand
Analysis
Green ERP
Design/
Management
ERP system
debug/implementation
Green
implementation &
running process
Green running in enterprises
Cost
Platform of
Performance
/Control/
Feedback
ERP
Suppliers/
Servicers
Resource
Next
generation
Maintenance service
System
upgrading/remanufacturing
Remanufacturing
process
Environm
-ent
Fig.2 Operation mode of green ERP based on multilife cycle
A. Green philosophy and design process
Green philosophy and design are the basis of
obtaining green product. Green philosophy does not
simply refer to ecological economy，it makes more sense
to save energy and resource consumption, to promote
operation efficiency, to realize benign circulation and
great vitality. Green design[13](also called ecological
design or design for environment)means to make use of
related product data during multilife cycle of product,
including
technology
information,
environment
information, economy information, resource information
etc, to take advanced design theory & method such as
CE(current engineering) for product design process which
does not only meet the common requirement of function,
quality, cost and so on, but also meets requirement of
good coordination with environmental characteristic. So
the whole goal of green design is to optimize design
factors that consist of static design data and dynamic
design data for minimizing negative environmental effect,
and promoting resource efficiency.
As to green ERP, designers should consider
technology factors, economy factors and environment
factors etc. in each stage and process of ERP during
multilife cycle. In process of design, technology
information includes technology feasibility, technology
reconfigurability
and
flexibility,
technology
maintainability, technology advancement. For example,
technology of supporting virtualized hardware and
software should be taken to reduce energy consumption
and promote operation efficiency of ERP system. For
economy factors, economic feasibility, primary
development cost, maintenance cost, secondary
development & upgrade cost should be paid more
attention to systemically. For environment factors, design
of green ERP requires an accounting module of
environment cost embedded into financial management in
ERP’s running process and an effective development
process design. In fact, a conceptual model and whole
project plan oriented for ERP multilife cycle that meet
green requirement of function, quality, cost and other
factors should be built to make reasonable decision during
green philosophy and design process.
B. Green development process of ERP R&D team
In this stage, the concept of green ERP refers to high
efficiency and low cost. In the traditional development
team, the team members complete their task personally
according to their own experience or knowledge. But in
the era of knowledge economy and information, product
development method of traditional team is confined to
low efficiency and high cost. So collaborative work mode
under network platform, effective virtual team[14] should
be applied to green ERP development process associated
with KM (knowledge management), CE and significant
incentive & coordination mechanism and so on. The
development mode of ERP R&D team is shown as figure
3.
The cultural platform of trust
and cooperation
1th stage plan of
milestone plan
Overall
plan of
ERP R&D
2th stage plan of
milestone plan
M th stage plan of
milestone plan
The platform of information &
knowledge & skills

Deviation
analysis
The platform of incentive
contract and performance
evaluation
The platform of task allocating
& coordinating
The platform of task
monitoring
Fig.3 Team operation mode of green ERP
Team
members
Member 1
Member 2
Member N
As figure 3 shows, in order to have a significant
efficiency and controlled cost of ERP R&D project, it is
necessary to make overall schedule and milestone plan for
each stage ahead. And quality, cost and time plans for
each task also should be scheduled. During
implementation of ERP project, the progress must be
tracked dynamically. When the deviation rate exceeds the
allowable range, remedy measures should be taken timely.
ERP R&D team will locate every role of team member
taken in ERP development project according to their
individual skills & expertise and adhere to principle of
ability priority. Each member’s task taken in ERP R&D
team will be controlled in a certain scope and equipment
and fund and so other resource also do not exceed a set
limit. As shown in equation (1).
N
Sj   Snmxt | x  j , t  t1  t2  S '
(1)
n 1
Where Sj is the total amount of resource j in a certain
period of time t1 to t2, Snmxt is the consumption of
resource j by member n and stage m in a certain period of
time t1 to t2, S ' is the limit consumption of resource j in a
certain period of time t1 to t2.Suppose that
C  C (m, n, s j , t )
(2)
Where C is the cost of ERP project, m is project
stage, t is the time of cost occur, Sj is resource j.
J
N
C P m   C P (m, n, s j , t )
(3)
Similarly, other green indexes of ERP such as time,
quality, resource and environment can also be controlled
or evaluated by experts marking or other methods. By this
operation mode of ERP R&D team, high efficiency and
low cost of ERP development process can be realized in a
more green method to prompt green degree of green ERP.
C. ERP implementation & green running process
Green running process of ERP means that ERP
system helps to promote green operation ability and
cultivate green management philosophy for enterprises. It
bases on standard management and efficient operation
mode of enterprise by controlling every "business node"
of management mechanism to realize green philosophy
that rapid response to market, efficient and agile operation,
lean management and low cost running process, friendly
environmental production. Based on environment cost
management module of enterprise ERP system, and
associated with financial management, production
management, material management, sales and distribution
management and other modules, green ERP makes use of
ERP system’s powerful prediction, planning, accounting,
control, analysis, and other functions during production
activities to improve economy benefit of enterprise. For
example, controlling the environment cost of enterprise is
an effective approach of implementing green management
philosophy.
D. "Remanufacturing" process
j 1 n 1
Cm  C d m  C P m   C d (m, n, s j , t )   C P (m, n, s j , t )
For green ERP based on multilife cycle, upgrade of
technology and "remanufacturing" merits are very
important reflections of green ERP system. It means
"reuse", "recycle", "reconfiguration" and low cost. Green
ERP requires advanced, reliable, reconfigurable system
technique architecture to manifest its green philosophy
such as taking agent technology with rational, aptitude,
autonomy, ego drive merits ,adopting object oriented for
design based on components development ,dispensing
exorbitant dependence on hardware or database,
supporting virtualized hardware to save energy
consumption and modularized function design
programming and so on. Indeed, next generation and
"remanufacturing" of ERP system make a multilife cycle,
green, efficient and low cost ERP system.
(5)
E. Platform of performance evaluation & control
p
Where C m is the plan cost of ERP project in stage m
of the total consumption resource J by all members N.
J
N
C d m   C d (m, n, s j , t )
(4)
j 1 n 1
d
Where C m is the actual cost of ERP project in stage
m of the total consumption resource J by all members N.
Because of a lot outside factors, there is always
much difference existed between actual and planed cost.
The cost discrepancy of ERP project is to subtract the
actual cost from the planed cost. As shown in equation (5):
J
N
j 1 n 1
Where
J
N
j 1 n 1
Cm is the cost discrepancy between actual
cost and plan cost of ERP project.
When Cm exceeds a set limit or allowable range,
remedy measures should be taken timely and then
improve.
As the same, Cn that in a certain period time t by
all members N, Cmnj that total project cost of in all
stage M by all member N can also be controlled and
evaluated.
In order to guarantee the total green degree of green
ERP based on multilife cycle, a platform of performance
evaluation & control should be built. The platform of
performance evaluation & control consists of process
layer, indexes layer, control & feedback layer. In process
layer, process is oriented for multilife cycle and it consists
of four operation stages during each life cycle. In indexes
layer, green indexes include TQCRE five dimensional
indexes from perspectives of ERP supplier and customers.
And each 1th level index can be divided into more 2th
level indexes and even 3th level indexes. In control &
feedback layer, planned indexes and actual indexes will
be evaluated according to experts, ERP project plan,
knowledge database etc. Then deviation analysis and
Process
Layer
Indexes
layer
solution will be feedback to control and improve process
layer continuously in real time. The whole control
platform mechanism is shown as the figure 4.
next generation
green philosophy
and design process
green development
process of R&D team
Quality
Time
Control/
Feedback
Layer
Planned
inedxes
green implementation
& running process
Cost
"remanufacturing" process
Resource
 
Environment
Actual
inedxes
Deviation Analysis/Solution/Control/Improvement
Fig.4 Performance evaluation & control mode
Ⅳ. SUMMARY AND FUTURE WORK
With
the
development
of
informatization
construction, energy, resource, cost, effectiveness become
key influencing factors for enterprise’s initiatives to
informatization implementation, especially the cost factor.
From the two perspectives of life cycle and green concept,
the paper has put forward the concept of green ERP based
on
multilife
cycle,
analyzed
its
operation
processes ,especially ERP R&D team green development
process. Greening ERP design and adopting highly
efficiency development process such as virtual
development team are effective approaches to reduce cost
of ERP system. On the other hand, research on green ERP
stays preliminary stage. How to achieve green operation
goal and reach enterprises’ green philosophy for
enterprises with the help of green ERP system ,how to
build a standard criterion for green ERP ,are all needed to
be further research.
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