Enterprise Resource Planning - Example

Enterprise Resource Planning Name: University: Date: Enterprises Resource Planning (ERP) Introduction Introduction Enterprise resource planning (ERP) can be described as software for business process management that enables a company to make use of integrated applications system so as to computerize lots of back office functions associated with human resources and technology and also to manage the business (Dechow & Mouritsen, 2005). As mentioned by Dechow and Mouritsen (2005), ERP systems incorporate every feature of business operation, such as manufacturing, development, product planning, sales as well as marketing. In this case, the best suited type of ERP system for business enterprise relies on the business size as well as the functions supporting the requirements of the business. Basically, all types of ERP systems have a software component, a hardware component, as well as a component for process documentation. Normally, ERP systems cover a number of organizational aspects; for instance, ERP system can human resources, cover quality control, production, parts ordering, in addition to manufacturing engineering. The essay seeks to introduce SAP, a type of ERP system by providing a brief history, market effectiveness, and easiness of implementing it. Body SAP is ERP software created by SAP SE, a Germany-based company, and it integrates the crucial functions of the business within an organization. SAP ERP 6.0, the most recent version was introduced in the market in 2006. SAP provides two solutions; the first is R/3 suite and second is B1 suite. In this case, R/3 suite can be described as an integrated software system supporting the whole lot from very big companies to exceedingly small businesses. Importantly, R/3 suite can be customized so as to meet particular needs of the company, and it utilizes client-server network architecture, functional in a range of platforms, such as OS/400, Windows Server as well as, Unix. Furthermore, R/3 suite may be put into practice by means of numerous database packages, such as DB2, SQL Server, or Oracle (Jie, 2009). On the other hand, B1 suite is more targeted at SMEs businesses and it provides pre-built modules for reporting, Electronic commerce purchasing, warehousing, finance, and customer relationship management. Historically, SAP was instituted in 1972, by former staffs of IBM in Germany, and is currently amongst the top three independent software vendors in the world. SAP begun with a vision of developing application software that was standard for real-time business processing, and also desired to market as well as develop a typical enterprise software that could incorporate every process of the business. This was after noticing that most clients were developing the very similar or same business programs, but which were not integrated together (SAP, 2005). In Data Processing, SAP connotes Systems, Applications and Products; thus, pointing out that SAP focuses on creating a collective database that is centralized for every functioning application in the organization. Owing to changes in the software industry and marketing changes, numerous versions of SAP have been released so as to manage such changes. Undoubtedly, SAP is well-integrated and the most influential ERP software packages in the market these days. Even though it has scores of competitors, SAP has succeeded in remaining the most preferred and popular solutions and also has been able to get an enormous market share. The key reason behind the reputation of SAP is its capability to combine all crucial processes of business in all industries (Zelleke, 2014). When successfully installed, SAP is bale to integrate finance, customer relationship management, human capital management, business services and sales, production, materials procurement and management; thus, offering the business the capability to coordinate centrally every area of its business. Evidently, SAP has many decades of business experience and has continued to evolve so as to become accustomed to changes in the manner how business is conducted. As mentioned by Zelleke (2014), this has facilitated SAP to be effortlessly customizable as well as applied in all types of industries: banking, aviation, manufacturing, and even in organizations such as United Nations. It also has high adaptability feature which is attributed by its configuration easiness. Immediately after the customized framework has been implemented, shifting from legacy systems as well as ensuing continuity and maintenance of the SAP system may be carried out with a few, well-trained support personal. After its installation, SAP can preserve data integrity thanks to its robust data checks as well as balances (Zelleke, 2014). For instance, this reduces the likelihood of any person in HR department making a blunder which can be redirected in payroll (finance). SAP, as an ERP package is exceedingly beneficial for oil and gas industries, bearing in mind the fact that Oil and Gas companies, especially in UAE are experiencing financial, operational, as well as regulatory processes, which are extremely multifaceted in nature as compared to other industries. All Oil and Gas companies are facing lots of setbacks that need affordable and flexible real world solutions. For this reason, SAP Enterprise Resource Planning (ERP) provides these companies a means for saving money as well as time with a system that is easy to use, and that has the needed tools for managing and connecting assets, processes so as to make certain, compliance as well as profitability. Oil and Gas Companies are always searching for system adaptability, which is an important competitive differentiator can benefit from the Switch and Enhancement Framework provided by SAP ERP. This software can offer the OIL and Gas Companies the needed insights assist in reducing risk, operate efficient processes, maintain with changes in oil regulation, and improve profitability (Weiss, 2008). SAP is effective in market because it integrate processes from maintenance and engineering to production as well as financials. Additionally, SAP heightens suppleness and responds proactively to ever-changing conditions in the market, and also enhances use of assets, lengthen lifetimes, as well as lessen costs of maintenance. Its market effectiveness is also attributed by its ability to synchronize project management so as to steer maximum return on capital employed and create reliable safety, health, as well as compliance regulations and standards. Applications of SAP are built around its most recent R/3 system, which offers the ability to manage cost, assets, and financial accounting, manufacturing materials and operations, workers, as well as archived documents. Other applications include mySAP Business ByDesign, Business One, and R/2. SAP functional modules include a number of modules: Financial Modules includes controlling, treasury; financial accounting; investment management; and enterprise control (IANT, 2013). Another module is Logistics Modules, which involves management of material; production; sales, and distribution; planning as well as control; quality management; product data and service management; and plant maintenance. Another module is HRM Module which involves; organizational and personal management; payroll accounting; employees’ development; and event, training, and time management (IANT, 2013). The last SAP module is Cross Application Module concerned with SAP Office and workflow. In comparison to other ERP systems such as MAXIMO, the strategy of SAP on selling its applications to the small-medium enterprise market has recently been ambiguous and disordered. Whereas SAP B1 has experienced a number of modest successes with companies in mid-market, Preez (2014) posits that SAP has continued to experience an uphill struggle in markets its Business ByDesign. This attributed largely by the internal arguments at SAP concerning where precisely Business ByDesign must be positioned; thus, making the situation more confusing. Furthermore, even though SAP currently boasts that 80 per cent of its clients are SMEs, Preez (2014) posits that SAP is still a leader in selling heavy and big enterprise applications as compared to MAXIMO and other types of ERP systems. But, confusion arises on how SME strategy of SAP can overcome the NetSuite’s domination in the SME cloud market. Implementation of SAP ERP is evidently complex, challenging, and can drain the financial resources of a company (Preez, 2014). The broad scope, power, as well as flexibility of the functionality of SAP may generate unforeseen challenges the organisation that have to be cautiously handled during the implementation of the SAP software package. To successfully implement SAP, the user must have knowledge on what they expect from SAP, and develop a platform to allow it to take place. So as make sure SAP positively impact the business, organizations must have the appropriate resources and clear organizational goals. To begin with, the organization must convert its business goals into certain project deliverables. Devoid of flawless deliverables, the organization cannot perform its projects properly. Besides that, successful implementation of SAP can be achieved if the organization aligns its resources; that is worker abilities, technologies and methods so as to ensure that the project deliver the needed results. Conclusion In conclusion, it has been argued that SAP offers the client focused solutions, which can help the company get the needed results. What’s more, the ability to implement SAP ERP functions into scores of business process to meet the demands of the customers is imperative. So, implementation as well as planning is exceedingly crucial for all business processes. As argued in the essay, application of SAP ERP has turn out to be prevalent in most industries, thanks to its ability to effectively integrate business processes, which includes sales and marketing, planning, and development. In comparison to other ERP solution, SAP is without a doubt the most commonly utilised ERP solution in the market. References Dechow, N., & Mouritsen, J. (2005). Enterprise resource planning systems, management control and the quest for integration. Accounting, Organizations and Society, 30(7,8), 691–733. IANT. (2013). SAP Enterprise Solutions. Retrieved from Aurosys Solutions (IANT): http://www.aurosyssolutions.com/sap-enterprise-solutions/ Jie, M. W. (2009, September 5). Types of ERP Systems. Retrieved from EHOW: http://www.ehow.com/about_5366970_types-erp-systems.html Preez, D. d. (2014, Novemeber 20). Is SAP any clearer on its SME strategy? Retrieved from Diginomica: http://diginomica.com/2014/11/20/sap-clearer-sme-strategy/ SAP. (2005, April 9). SAP Overview. Retrieved from SAPs' WORD: http://www.sapsword.com/home/sap-overview Weiss, T. (2008, October 1). Industry Solutions Are Now Integrated into the SAP ERP Core: How the Switch and Enhancement Framework Makes It Possible. Retrieved from SAPinsider: http://sapinsider.wispubs.com/Assets/Articles/2008/October/Industry-Solutions-Are-Now-Integrated-Into-The-SAP-ERP-Core-How-The-Switch-And-Enhancement-Framework Zelleke, L. (2014, December 16). SAP ERP. Retrieved from Software Inside: http://erp.softwareinsider.com/l/218/SAP-ERP Read More