CHAPTER 12: Integrating the Organization from End to End – Enterprise Resource Planning

•          At the heart of all ERP systems is a database, when a user enters or updates information in one module, it is immediately and automatically updated throughout the entire system

•          ERP systems automate business processes

·         ERP – The organization before ERP

•          ERP – bringing the organization together

·         EVOLUTION OF ERP

INTEGRATING SCM, CRM, AND ERP

•          SCM, CRM, and ERP are the backbone of e-business

•          Integration of these applications is the key to success for many companies

•          Integration allows the unlocking of information to make it available to any user, anywhere, anytime

INTEGRATION TOOLS

•          Many companies purchase modules from an ERP vendor, an SCM vendor, and a CRM vendor and must integrate the different modules together

–      Middleware – several different types of software which sit in the middle of and provide connectivity between two or more software applications

–      Enterprise application integration (EAI) middleware – packages together commonly used functionality which reduced the time necessary to develop solutions that integrate applications from multiple vendors

•          ERP systems must integrate various organization processes and be:

–      Flexible

–      Modular and open

–      Comprehensive

–      Beyond the company

•          Flexible – must be able to quickly respond to the changing needs of the organization

•          Modular and open – must have an open system architecture, meaning that any module can be interface, with or detached whenever required without affecting the other modules.  Some organizations will begin with buying two modules, such as accounting and sales, and then will add modules, such as CRM and SCM, as they gain confidence in their current modules.  (Implementing in small pieces or phases – companies do not want to buy the entire ERP and spend years implementing twenty different modules to find that it doesn’t meet their need)

•          Comprehensive – must be able to support a variety of organizational functions for a wide range of businesses

•          Beyond the company – must support external partnerships and collaboration efforts

Enterprise Resource Planning’s Explosive Growth

•          ERP solutions are growing because:

–      ERP is a logical solution to the mess of incompatible applications that had sprung  up in most businesses

–      ERP addresses the need for global information sharing and reporting

–      ERP is used to avoid the pain and expense of fixing legacy systems