MI0038 - Students SMU Assignments & Projects

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DRIVE-SPRING 2014
PROGRAMMBADS (SEM 4/SEM 6) MBAFLEX/ MBAN2 (SEM 4) PGDISMN (SEM 2)
SUBJECT CODE & NAME-MI0038/OM0011 ENTERPRISE RESOURCE PLANNING
BK ID-B1964 CREDITS AND MARKS-4 CREDITS AND 60 MARKS
Q1. Write short notes on:

Integrated data model

Latest trends in ERP

Order management sub module of sales and distribution module of ERP system

Organisational management sub module of Human resource module of ERP system
(Integrated data model, Latest trends in ERP, Order management sub module of sales and distribution
module of ERP system, Organisational management sub module of Human resource module of ERP
system )10 (2.5 marks each)
Answer.
Integrated data model
In the context of ERP implementation, the creation of an integrated data model is one of the most critical
steps. An ERP system aims at providing access to integrated data to all the employees of an enterprise.
This integrated data is used for business decision making. Once an ERP system is implemented in an
enterprise, the data pertaining to a single department is no longer required. This is because an ERP
system provides information related to all the departments of an enterprise, which helps employees to
get updated about the activities of different departments. Therefore, while designing an ERP system, an
enterprise should develop an integrated model that clearly specifies how the activities of different
departments are related to each other.
Latest trends in ERP
The following are the latest trends in ERP:
Open Source ERP: Refers to an ERP system whose access code is available publicly. It allows
organisations to access the code of an ERP system and customise it according to their requirements
without paying extra charges for customisation and licensing to vendors.
Web-enabled ERP: Allows organisations and its various stakeholders (customers, employees,
suppliers, distributors, and other parties) to access business information as and when required from
anywhere in the world.
Wireless ERP: Facilitates information sharing with the help of the Internet and various other devices.
It allows outsiders (customers, suppliers, and shareholders) to access business information anytime. It
allows access to ERP via mobile devices.
SaaS ERP: Enables organisations to get a ERP software package on rent or on license for a defined
period of time instead of purchasing it. This helps organisations to reduce the costs of purchasing and
implementing ERP software.
Order management sub module of sales and distribution module of ERP system
The sales and distribution module enables an organisation to perform these activities with the help of its
different sub-modules. Figure shows the different sub-modules of the sales and distribution module:
Figure: Different Sub-Modules of the Sales and Distribution Module
An organisation places or receives different types of orders, such as purchase order and sales order. For
example, as a customer, you place an order for products that you need. Such type of order is received by
an organisation and is known as sales order. An organisation receives or places orders in bulk. Therefore,
it is necessary for an organisation to manage its orders effectively in order to carry out its operations
smoothly. To do so, most organisations use the order management module.
The order management module enables an organisation to manage its order placement function
effectively. Broadly, there are two types of order management modules, which are:
Sales Order Management: This module helps an organisation to perform its sales activities
effectively. In addition, it allows an organisation to manage its sales orders, contracts, and customer
discounts. The module also ensures the on-time delivery of products to customers.
Purchase Order Management: This module helps an organisation in performing activities, such as
on-time purchase requisition, contract management, vendor selection and management, and rate
negotiation.
Moreover, the module allows an organisation to keep track on the activities of vendors and manage
purchase orders.
Organisational management sub module of Human resource module of ERP system
The human resource management module of an ERP system works in association with various submodules. These sub-modules are shown in Figure:
Figure: Sub-Modules of the Human Resource Module
Organisational management can be defined as a process that includes planning, organising, leading, and
controlling the efforts of human resource in order to achieve organisational goals. In other words, you
can define organisational management as a method in which the operations of an organisation are
broken down into several phases. This helps managers in having a clear picture of the organisation at any
point of time.
The organisational management sub-module enables an organisation to:

Establish an effective organisational and reporting hierarchy, thereby maintaining a favourable
work environment for employees.

Divide employees into different teams or groups based on their functions, business areas, and
geographical locations.

Define the roles and responsibilities of employees in an organisation.

Define salary for each job position.
Q2. Write short notes on :

Kanban ERP vendors

Data Mining

Collaborative CRM
(Kanban, ERP vendors, Data Mining, Collaborative CRM, Kanban ERP vendors, Data
Mining Collaborative CRM) 10 (2.5 marks each)
Answer.
Kanban
Kanban is a Japanese term used for ‘visual record'. It is an inventory control system that was developed
at Toyota in the 1950s by Taiichi Ohno. According to him, Kanban is a means through which JIT is
achieved. In Toyota, it was used as a technique for managing the flow of materials on the assembly line.
Over the passage of time, Kanban has become a highly effective method of production used by
organisations to achieve a competitive edge in the market.
Kanban is a simple and easy to understand approach that coordinates the production plan of an
organisation with that of its suppliers. Some of the main advantages of Kanban are:

Involves low cost for transferring information from one source to another

Helps in responding quickly to changes

Avoids over-capacity and over-production

Eliminates wastes
ERP vendors
ERP vendors play a significant role in ERP implementation. These ERP vendors are responsible for
administering the entire ERP implementation process, providing training to end users, and resolving
issues that may take place during implementation. Nowadays, the ERP market is facing stiff competition
due to increasing number of vendors. These vendors strive hard to fulfil the needs of customers by
providing unique and innovative ERP packages.
Some of the renowned ERP vendors are:

SAP-AG

BAAN Company

Oracle Corporation

People Soft

JD Edwards World Solutions Company

Systems Software Associates Inc. (SSA)

QAD
Data Mining
The term ‘mining’—an act of extracting hidden valuables from the earth. Similarly, data mining is an act
of extracting valuable information from a database. The ERP system of an organisation stores all its data
in a database. With the help of data mining, this data is analysed to produce meaningful information for
business decision making. More specifically, data mining is a process of finding out important elements
from a database, establishing relationship among them, and generating knowledge.
Collaborative CRM
Collaborative CRM facilitates the free flow of customer information among the different departments of
an organisation. This helps the organisation to understand and fulfil the requirements of customers,
thereby, maintaining cordial relationships with them. For instance, you are the marketing manager in an
organisation. Collaborative CRM can help you to share information related to the demand for products
and services with the production department. Apart from this, collaborative CRM integrates various
channels used for customer interaction. These channels include telephone, e-mail, voice chat, application
sharing, desktop sharing, file transfer, and collaborative browsing. Generally, collaborative CRM is
customised according to the requirements of customers.
Following are the main objectives of collaborative CRM:

Reducing customer service costs

Facilitating customer interaction

Gathering information related to customers
Q3. What are the benefits and features of ERP purchase module.
(Listing of benefits of purchase module)(Any 6 benefits), Description of features of purchase module)6,4
Answer.
Benefits of purchase module
The purchase module of an ERP system supports the overall purchasing function of an organisation
starting from purchase requisition to the final payment of raw materials. The module also helps an
organisation in searching prospective suppliers, negotiating prices, placing and tracking orders, and
preparing invoices. In this way, the purchase module streamlines the overall procurement process of an
organisation. To do so, the module maintains data related to the purchase of raw materials.
The purchase module is closely integrated with production planning and inventory control modules. It
also works in integration with the finance module while performing activities, such as order verification,
and payment settlement. In addition, the module can work with traditional and automated procurement
processes and a comprehensive information pool.
The following are the benefits of the purchase module of an ERP system:

Minimises manual operations and paperwork.

Helps in reducing inventory levels through efficient inventory management, thereby reducing
overall inventory cost.

Helps in preventing unnecessary delays in production by keeping track on the available inventory.

Evaluates the performance of the existing vendors and identifies potential vendors.

Maintains data related to purchasing activities and updates it from time to time.

Maintains effective coordination among the members of a supply chain.

Generates receipt notes and invoices.
Features of purchase module
The purchase module enhances the overall purchase function of an organisation. This module is capable
of performing activities, such as vendor evaluation, order placement, order tracking, and invoicing. The
following are the major features of this module:
Database Management System: The purchase module maintains all data related to the purchasing
of materials. The module also allows an organisation to modify the data and retrieve it as and when
required.
Flexibility: The purchase module of an ERP system is quite flexible as it readily adapts to changes that
take place in the business environment.
Integrated Approach: The purchase module works with other modules, such as production planning,
inventory control, and finance modules.
Automation: The purchase module automates the generation, modification, and cancellation of
purchase orders based on the production plan and schedule.
Q4.What are the benefits and features of ERP financial module?
(Listing of benefits of financial module, Description of features of financial module)5,5
Answer.
Benefits of financial module
Some of the main benefits of the financial module of an ERP system are:

Provides authorised access to financial data to multiple users at the same time.

Converts financial values in multiple currencies.

Generates accurate financial statements.

Connects different databases through a single source.

Maintains information related to previous years’ accounts.

Updates changes in different databases automatically.
Features of financial module
The financial module is one of the most crucial modules of an ERP system. It collects financial data and
generates reports, such as ledgers, trail balance, and balance sheets. In addition, the financial module
monitors the flow of cash within and outside an organisation. The following are some of the important
features of the financial module:
Integration of Financial System: The financial module provides integrated, up-to-date financial
information to all the departments of an organisation, thereby enabling them to make sound business
decisions.
General Ledger Module: The financial module includes a sub-module called general ledger. This submodule provides information related to the current and the future financial needs of an organisation.
Effective Security Features: The ERP financial module includes security features that help an
organisation to protect its financial data from misuse.
Multi-Currency System: The financial module consists of a multi-currency system that can convert a
particular amount in one currency to another easily. This helps in avoiding delays in business
transactions.
Multiple Payment Options: The financial module enables customers to make payments through
different modes, such as online, mobile, credit card, and debit card, etc.
Q5. What are the important functions of the ERP inventory management module? List any
FIVE main reasons for the failure of ERP implementation.
(Description of the functions of the ERP inventory management module, Listing of five main reasons for
the failure of ERP implementation) 7.5(1.5 marks for each function), 2.5 (0.5 marks for each reason)
Answer.
Functions of the ERP inventory management module
The major functions of the ERP inventory management module are material requisition management,
inventory release details, particulars of stock, receipt record of internal material transfers, and inspection
of inventoried stock of material. The sub-modules of the ERP inventory management module include
inventory requisition, inventory order assessment, inventory order placement, supplier performa, order
receipt and inspection, and invoicing.
The inventory management module of an ERP system enables an organisation to efficiently maintain the
optimum level of inventory available in its warehouse. The following are some of the major functions of
this module:
Material Requisition Management: The inventory management module maintains the information
related to the inventory requirements, identified by the different departments of an organisation.
Inventory Release Details: The inventory management module maintains a record of the type of
materials issued, in what quantity, at what time, and to which department.
Particulars of Stock Receipt: The inventory management module keeps a record of when a
particular material was received to be inventoried. It also records the qualitative and quantitative
specifications of materials at the time of their receipt.
Record of Internal Material Transfers: Sometimes organisations transfer materials to their other
units due to a number of reasons like cost saving, prevention of wastage, etc. Such types of transfers are
called internal material transfers. When internal material transfers take place, an organisation does not
purchase materials. However, it receives and releases such materials. The inventory management
module maintains the records of all internal material transfers in terms of the quantity of materials
transferred, name of the unit to whom the materials have been transferred, etc.
Inspection of Inventoried Stock of Material: The inventory management module performs
automated inspection of inventoried materials, and provides information about the same. The inventory
module of an ERP system works in close integration with its sub-modules. Let us discuss the functions of
different sub-modules of the ERP inventory module.
Five main reasons for the failure of ERP implementation
Following are some of the reasons for the failure of ERP implementation:
Lack of Top Management Support: Refers to one of the main reasons for the failure of ERP
implementation. The top management of an organisation plays a vital role in the implementation of an
ERP system by providing the required resources, reassigning jobs to employees and changing work
processes. In addition, if the top management supports ERP implementation, the employees also need to
support it. Therefore, it is important that the top management of an organisation should be aware of the
significance of implementing an ERP system.
Improper Planning and Budgeting: The ERP implementation project requires detailed planning,
which involves deciding the total budget, determining the resources required, assigning jobs and
responsibilities and estimating the time required for the implementation. Effective planning is crucial for
the successful implementation of an ERP system. Any inaccuracy at the planning stage may lead to
adverse situations, such as insufficient funds, ineffective procedures and lack of support of team
members.
Selection of an Inappropriate ERP System: Different organisations have different environment,
work culture and procedures. In addition, the objective of implementing an ERP system varies across
different organisations. Therefore, while selecting an ERP system, an organisation should determine
whether the system is able to fulfil its objectives. In addition, an organisation should determine whether
the ERP system can be implemented under the existing technology and working environment. If all these
aspects are not considered by an organisation while purchasing an ERP system, it may lead to the failure
of the system.
Lack of Training: Employees may resist ERP implementation in case proper training is not provided
to them. This is because they may have fear that their workload would increase with this implementation.
Ineffective Work Culture of an Organisation: Affects the implementation of an ERP system to a
large extent. ERP implementation is more successful in an organisation where employees are willing to
learn new things and are flexible to changes. On the contrary, the implementation of an ERP system fails
in an organisation where employees resist any type of change in the working environment.
Ineffective
Communication:
The implementation of
an ERP system requires effective
communication among different departments. Lack of communication may lead to inaccurate
information, which would ultimately result in the failure of ERP. If there is smooth communication
among employees, it would be easier to carry out activities involved in ERP implementation. Thus, the
entire plan of ERP implementation needs to be communicated to all the employees to get their support
for the implementation.
Q6. What are the different phases of ERP implementation life cycle?
(Explanation of the different phases of ERP implementation life cycle)10
Answer.
Different phases of ERP implementation life cycle
The process of implementing an ERP system in an organisation is called ERP implementation lifecycle or
ERP lifecycle, which comprises a number of phases. Figure below shows the different phases of ERP
implementation cycle:
Figure: ERP Implementation Lifecycle
Figure shows a chronological sequence of phases involved in the implementation of an ERP system.
Let us discuss the different phases of the ERP implementation lifecycle in detail.
1. Pre-evaluation screening
Pre-evaluation screening is the first phase of the ERP implementation lifecycle. It includes examining all
the available ERP systems. Among these systems, those that are able to meet the organisation’s
requirements are selected.
2. Package evaluation
The package evaluation phase involves a deep analysis of all the shortlisted ERP systems in order to
select the final system. It is the most important phase as the success of ERP implementation highly
depends on the selection of the right system.
3. Project planning
The project planning phase involves formulating a detailed plan for implementing an ERP system.
4. Gap analysis
Gap analysis is considered to be the most crucial phase of the ERP implementation lifecycle. In this
phase, an organisation develops a model that states its current status and future targets.
5. Re-engineering
You have already studied in the previous unit that re-engineering is all about a complete restructuring of
business processes, technology, and functions.
6. Configuration
Configuration is the functional phase of the ERP implementation lifecycle. In this phase, an ERP system
is synchronised with the existing system of an organisation.
7. Implementation team training
In this phase, the implementation team is trained for implementing the ERP system successfully in the
organisation. The training is given on the working of the ERP system and its implementation system.
8. Testing
In the testing phase, the ERP system is verified by creating real situations. These real situations can be
related to system overloads, invalid data entry, and hacking attacks.
9. Going live
In this phase, the old system is replaced by the new ERP system in order to perform various business
functions.
10. End-user training
In this phase, the employees who need to work on the ERP system are identified and segregated into
groups so that they can be trained to work on the new system.
11. Post-implementation
The post implementation phase involves continuous evaluation of the ERP system implemented in the
organisation.
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