Enterprise Resource Planning System - Research Paper Example

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This paper “Enterprise Resource Planning System” aims to explore the issues that companies face when purchasing an Enterprise Resource Planning system (ERP system). It also provides brief information on the things to consider when purchasing an ERP system…
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Enterprise Resource Planning System
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Download file to see previous pages One must consider the scale the drive “Enterprise Resource Planning” (ERP) vendors in order to understand these vendors’ sales tactics. Millions of dollars are invested by big players such as Oracle/PeopleSoft, SAP, Microsoft, and SYSPRO --- to name some --- to develop ERP systems (Dowlatshahi, 2005, p.3745). For these vendors, CD copy of the system is just minimal capital; therefore closed deals for implementations of these systems gain them absolute profit. It should be of no surprise to see these vendors exhaust all means to close deals with potential clients, since there is a lot of profit at stake (Fulla, 2007, p.35). Some companies report being given trips to the vendor’s headquarters, luxurious meals and accommodations, and transport by stretch limos (Dowlatshahi, 2005, p.3747). These are all part of a vendor’s strategy in wooing clients to buy their ERP system.
Basically, these ERP systems are similar in their fundamental functionalities in business processes management. Therefore, to sell a product, vendors must establish their product’s superiority over other ERP systems available in the market. The danger here is the vendor’s inclination to make outrageous claims regarding their ERP system. Some vendors publicize the advanced functionality of their system, some vouch for the ease of use, while others offer money-back guarantees of up to millions of dollars if their system fails to double other company’s ERP system performance (Fulla, 2007, p.36). ERP vendors even try to sell extra technical and consultation support aside from their software licenses. Final quotes may include consulting and programming assistance of up to thousands of hours. However, companies should be aware that there are usually fees for this consulting assistance, and it may be easier to find cheaper open market services (Fulla, 2007, p.38).
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