ENTERPRICE RESOURCE PLANNING - Research Paper Example

? ENTERPRICE RESOURCE PLANNING By: Business application is a software system used by an organization in achieving their goals, one of which is increasing customer satisfaction. Organizations now compete in the global marketplace with the use of technology and communications (Bradley, Hausman & Nolan, 1993). Integration of technology and solutions is a significant factor in responsiveness and agility of the company. No matter what industry type or what the size of the company is, the right choice of tools will help the company in organizing expenses, analyzing sales, responding to customers, manufacturers, suppliers and partners. Buck & Meyers observes that, In the past, large mainframe computers handled the most tedious jobs like accounting and bank check clearing. But today, acquisition of such hardware is unnecessary and business applications can now take care of tasks easily without much acquisition costs for the company. (Buck & Meyers, 2009). This paper will discuss one specific business application which is the Enterprise Resource Planning (ERP) System, and identify what the system can offer to an organization. An analysis of the system will be provided together with the software and hardware specifications. The plan on how to maintain the system and how the manpower should be structured is also part of this paper. A recommendation on the ERP system package is provided together with the assumptions on changes that need to be made within the organization. It does not only speed up the productive cycle, but it also cuts costs considerably and this will be proven as the functions of an ERP system will be discussed in this paper. Introduction Information requirements determination is core and very major as one of the major interactive activities in system development. Organizations now compete in the global marketplace with the use of technology and communications Appan & Browne (2010). No matter what industry type or what the size of the company is, the right choice of tools will help the company in organizing expenses, analyzing sales, responding to customers, manufacturers, suppliers and partners. The risk of a schedule flaw in system management is of great importance. Scheduling is the process of arranging the events of the project in given time ranges. Risk of this occurring can be high only when the developer concentrates on a particular process more than the others. This could result to non-completion, poor product due to hurried process, and ignoring of some crucial procedures in the product’s scope. The probability of this happening is a 2, kind of a low rating, given the involvement of a supervisor that will help the developer keep up to the schedule. Resource allocation is one of the trickiest ventures in any given project. The major resources that could be required in the student projects is travelling to and fro the respectable institutions, and maybe paying up for some services such as SMS servers and hosting services. The risk for this is 4, quite a high probability given the financial situation that students stand. The developer might later realize that the specifications given or found are not exactly comprehensive. Refiguring or restructuring the design to match new specifications is quite tricky. The probability for this happening is 5, given the probability of requirement inflation, usually another risk. This is the worst risk that could be expected in any project, as it would combine each of the other risks as aforementioned. This could only thus be possible if the other risks have a high probability of happening. The probability could thus be the average of each of the other risks. This would result with the inadequacy of the Software Requirement Specifications document, usually done after the requirements of a given system have been analyzed. The developer might later realize that the design or rather system requires additional requirements for better functionality. This automatically alters the design and thus schedule. The probability for this is 5 given the hurried proposal and SRS development at the initial stages of the software development. Some scholars have come forth and shown that users do not recall all the relevant information they have about the requirements for systems, and they propose that this problem is exacerbated by current systems development practice, in which the same users are often interviewed multiple times by analysts. Enterprise Resource Planning (ERP) Most organizations are now IT-enabled and automation of their processes is one way of achieving optimal performance. Enterprise resource planning (ERP) systems was defined in Wikipedia as a system that integrates both internal and external management information across an organization. It encompasses accounting, manufacturing, sales and service, and even customer relationship management (CRM) by automating the activities involved in the said areas. An ERP system helps companies in maximizing their resources; this includes both human and financial resources. This is achieved by selecting the ERP package which best fits the organization. It should provide a solid foundation, and be able to incorporate all the fundamental aspects and processes of running the business. It has been noted that, the results should be easier tasks for the users due to reduction in cycle time, increased response time, and improved productivity since processes are already automated and not manually entered or computed, and cost savings in the long run. Baskerville & Pries-Heje, (2004). The organization should select the ERP vendor that will be able to provide the system that can handle their requirements. Research has shown that most organizations seek third party vendors who will be able to customize the system according to their unique needs but in-house consultants and developers may also do this as they work together with the organization’s contact person per department who know their key processes very well. (Raffa & Capaldo 2007) Training costs are incurred continuously as the users are trained every time there are changes with the software (i.e. software upgrades). Trainings involve time of the users and costs on hiring trainers and so it should be detrimental on deciding what system to acquire. For the benefits and features of the ERP system, it was also mentioned by Dempsey & Griffin (2007) that “ERPs were seen as a revolutionary solution to a lot of problems in the 20th century. They integrated disparate information of the organization and provided innovative report-writing tools” (p. 64-66). ERP systems are also customizable nowadays, with the wide variety of selection; the organization may decide which specific ERP product vendor they will acquire and which one best fit their business workflow. The system, as mentioned in the review above, is customizable for the organization’s unique business workflow. If the company would soon offer online shopping for customers, Netsuite also has the webstore feature. Support is also flexible because the customer (organization) may opt to avail platinum support which responds on a timely manner. ERP system functionality Carlsson & El Sawy, Has observed that Organizations in turbulent and high-velocity business environments are facing rapid and discontinuous change in demand, competitions, technology, and/or regulations. Growth in technology has prompted the easier usage and production through integration of centralized database system on both production and non production data. Carlsson & El Sawy, (2008). There has been a good relationship between customers and management enhanced by ERP. ERP system process Following proper process in ERP is of great significance given that the expected system is likely to be obtains assuming the rest of the factors are constant. Making a choice and more specifically the right choice in picking out the best available to deal with entails use of algorithms. Normally ERP appears to be the most complex task but this is not the case. “ERP implementations are more likely to fail, be delayed, cost more than forecast, or fail to deliver functionality than they are to succeed.” Software and Hardware Monitoring The journal written by Gorla, Chinta, & Chu (2007) stressed that IT plays a very important role in business reengineering. The following steps were also provided as a guideline for the implementation of the system within an organization: 1. Development of business vision and process objectives; 2. Identification of process to be redesigned; 3. Analysis of existing processes; 4. Identification of IT levers; 5. Pilot test of new processes; 6. Development of support solutions; 7. Make those new processes operational; and lastly 8. Draft plan for continuous improvement. Both software and hardware compatibilities of the ERP system will be provided by the vendor as before implementation. Documentation should be available for future reference so that the organization will be able to refer to it for any software and hardware changes in the future. ERP systems such as NetSuite have help guides and resource center available for the users which would list down hardware specifications and software compatibilities (“NetSuite Resource Center,” n.d.). As discussed in ERP Software 360.com (n.d.), the hosted ERP market is already emerging. It also mentioned that vendors of ERP system provide the application through thin-client system which operated through a web browser. Burstein [et al]. (2008). The system is accessed by users remotely from the vendor’s data center over the Internet therefore, minimizing the costs of hardware acquisition and maintenance. As noted by O’leary (2008): Much supply chain data is ultimately captured using ERP system. The data is updated real time, and is the basis of planning in both enterprise and the supply chain. Often there is sharing of ERP data to facilitate data exchange and this occurs by making the data available to others through data warehouse, accessible from the internet. As the world changes due to improved technology, there is also great need that the existing systems be upgraded to meet the client demands. Systems upgrades are therefore very significant to aid in performing of the desired tasks. Project objectives Project objectives determine what is to be done and how it is to be done, in order to meet the overall aims of a project. They can affect the quality of a project. If objectives are accurate and explicitly defined, they facilitate in proper execution of all the activities necessary for the production of a quality project product or service. Ambiguous objectives bring about ambiguity and inaccuracy that may bring about a poorly done project. They also provide for strong management of projects. Clearly defined objectives enable clear and easy management of projects. This maximizes the productivity of the project personnel. Cost refers to the budget and financial resources availed for the execution of the project. It determines the support hardware and software that can be purchased by the organization owning the project. Technologically sound hardware and good support software are expensive but if bought, will facilitate the implementation of a sound project Cost also affects the number of personnel that can be involved in a project. A bigger budget means that more personnel can be involved in the project. This in turn means faster execution of the project. If the budget is limited, this will mean working with a smaller number of personnel. This results in slow execution of the project. Cost also affects the expertise that can be hired and used. Experts are expensive to hire. If the project budget is sufficient, experts can be hired. This will ensure that the project execution is under good expertise. Good quality project products can thus be produced. Projects have start dates, schedules and end dates. Time is determined by: start date, task durations, task dependencies, task deadlines, task schedules and end date. Projects must be accorded adequate time if they are to be up to standard. If there is enough time allocated to a project, all the details are executed accordingly. This will ensure that the project products are of the required standard. On the other hand, accelerated projects are difficult to implement. They sometimes have unrealistic deadlines and schedules. This causes hurried decision making, which in turn causes unexpected problems in the project implementation. Project scope states the objectives, goals and what must be met so as to achieve the successful implementation of a project. The scope details the range of the project. This includes: parameters of the project, its limitations, what is to be included and what is to be excluded. A project scope must be explicitly defines as it must make clear to all the personnel involved what product or service is to be delivered by the project. If it is not explicitly defined, it may bring about scope creep. Scope creep is the incremental expansion of the scope of a project that may include the addition of project requirements that were not there initially, without adjusting the budget and schedule of the project accordingly. A properly described project scope helps in scope creep management in case of scope creep occurrence. Proper project scope also helps in planning for the change management strategies that will be needed when change management will be carried out. It also facilitates the identification of potential risks that may affect the project. In this way it also facilitates ERD system management. A project product is termed to be of good quality if it meets all the pre-set requirements and brings about sufficient customer satisfaction. Quality affects a project. For a project to yield a product of good quality, the following have to be input: a good time schedule, enough cost/budget, enough man-hours, proper expert input, explicitly defined objectives and a properly defined project scope. A good quality project product must have adequate time for implementation, proper expertise input, adequate financial resources, well defined objectives and scope. Conclusion From the paper, it is evident that the RIF is of great importance and can be used to come out with the basic system requirements as like we have see above. Understanding the methodology lays the primary ground under which we are able to design an ERP. Policies for enterprise resource planning improve customer and the orientation of the customer. References Alvarez, R. and Urla, J. (2002). “Tell Me a Good Story: Using Narrative Analysis to Examine Information Requirements Interviews During and ERP Implementation.” The DATA BASE for Advances in Information Systems, 33(1), 38-52. Appan, R., Browne, G. J. (2010). Investigating retrieval-induced forgetting during information requirements determination. Journal of the Association for Information Systems, 11 (5), 250-275. http://proxy1.ncu.edu/login?url=http://search.ebscohost.com/login.aspx?direct=true&db= buh&AN=51974640&site=ehost-live Buck, L.D., & Meyers, C. (2009). The mainframe revisited: More proof that the big box is suitable for BI and analytics. Information Management, 19 (1), 34. http://search.proquest.com.proxy1.ncu.edu/docview/214668678?accountid=28180 Burstein, F., Cowie, J., Zaslavsky, A., & Pedro, J. (2008). Support for real-time decision making in mobile financial applications. Information Systems and eBusiness Management, 6 (3), 257-278. http://search.proquest.com.proxy1.ncu.edu/docview/232430850?accountid=28180 Carlsson, S., & El Sawy, O. (2008). Managing the five tensions of IT-enabled decision support in turbulent and high-velocity environments. Information Systems and eBusiness Management, 6 (3), 225-237. http://search.proquest.com.proxy1.ncu.edu/docview/232440105?accountid=28180 Chang, S. E., & Jang, Y. (2009). Assessing customer satisfaction in a v-commerce environment. Journal of Organizational Computing and Electronic Commerce, 19 (1), 30-49. http://proxy1.ncu.edu/login?url=http://search.ebscohost.com/login.aspx?direct=true&db= buh&AN=36076020&site=ehost-live Connolly, R. (2007). E-commerce trust beliefs: The influence of national culture. http://www.iseing.org/emcis/EMCIS2007/emcis07cd/EMCIS07-PDFs/623.pdf Dempsey, S., & Griffin, J. (2007, December). Integrated information systems: Choosing the best system for your organisation. Accountancy Ireland, 39 (6), 64-66. http://search.proquest.com.proxy1.ncu.edu/docview/223178393?accountid=28180 Downing, L. (2006). Implementing EDMS: Putting people first. Information Management Journal, 40 (4), 44-46, 48, 50. http://search.proquest.com.proxy1.ncu.edu/docview/227717853?accountid=28180 Raffa, L., & Capaldo, G. (2007, October). Understanding alignment during implementation of an IS: Two case studies in Italian IT development firms. Journal of Information Technology Case & Application Research, 9 (4), 11-28. http://search.proquest.com.proxy1.ncu.edu/docview/214895608?accountid=28180 Read More