Enterprise resource planning (ERP) is a company-wide computer software system used to manage and coordinate all the resources, information, and functions of a business from shared data stores.
An ERP system has a service-oriented architecture with modular hardware and software units or “services” that communicate on a local area network. The modular design allows a business to add or reconfigure modules (perhaps from different vendors) while preserving data integrity in one shared database that may be centralized or distributed.
First generation ERP systems now run the complete back office functions of the world’s largest corporations. The ERP market rose at 50% per year to $8.6 billion in 1998 with 22,000 installations of the market leader, SAP R/3. The benefits of a properly implemented ERP system can be significant.
Typically, ERP systems run in three-tier client/server architecture. They provide multi-instance database management as well as configuration and version (or ‘customization’) management for the underlying database schema, the user interface, and the numerous application programs associated with them. Since ERP systems are designed for multinational companies, they have to support multiple languages and currencies as well as country specific business practices. The sheer size and the tremendous complexity of these systems make them difficult to deploy and maintain. Despite the worldwide success of systems like SAP R/3 and BaanERP, the underlying architectures, data models, transaction mechanisms and programming techniques are to a large degree unknown to computer scientists.
The goal of this tutorial is to present the information technology of BaanERP, as a representative of the ERP system paradigm, from a computer science (rather than from a business management) perspective, relating it to established database and distributed systems concepts and techniques. A critical assessment of BaanERP will point out some of its merits and weaknesses. The tutorial will help attendees to understand the potential of ERP system technology in general, and of Baan ERP system technology in particular, and how it relates to their own research and development work.
In this ERP I have worked in BaanERP, so considering and detailing BaanERP, We see overview of BaanERP.
Baan-The Company
Founded: 1978
Head quarter: Barneveld (The Netherlands) and Herndon
(Virginia, USA)
Customers: 13,000 customer sites worldwide (biggest customer:
Boing)
Employees: approx. 4,700
Revenues 1998: 736 Mio USD
EVOLUTION OF ERP
| 1950s – Inventory control module———- (ICM)
| 1960s – Material requirement planning—- (MRP1)
| 1970s – Manufacturing resource planning-(MRP2)
| 1990s – Enterprise Resource Planning-(ERP)
| 1994 – Supply Chain Management——— (SCM)
| Later – Customer Relation Management— (CRM)
| E- Commerce
| E- Governance
| Business to Customer————————- (B2C)
| Business to Business————————– (B2B)
Customization/Programming with BaanERP Tools
BaanERP Tools consist of three parts:
1. Application Administration: users, clients, database management, SQL queries, etc.
2. User interface customization: version management, menus, forms, reports, sessions, etc.
3. Programming
Some application administration functions, such as Software Installation, Device Management or Audit Management, are only of interest to Baan system administrators.
Components of ERP
To enable the easy handling of the system the ERP has been divided into the following Core subsystems:
Ò Sales and Marketing
Ò Master Scheduling
Ò Material Requirement Planning
Ò Capacity Requirement Planning
Ò Bill of Materials
Ò Purchasing
Ò Shop floor control
Ò Accounts Payable/Receivable
Ò Logistics
Ò Asset Management
Ò Financial Accounting
Selection of ERP
Once the BPR is completed the next task is to evaluate and select a suitable package for implementation. Evaluation of the right ERP package is considered as more crucial step. Evaluation and selection involves:
- Checking whether all functional aspects of the Business are duly covered.
- Checking whether all the business functions and processes are fully integrated.
- Checking whether all the latest IT trends are covered.
- Checking whether the vendor has customizing and implementing capabilities.
- Checking whether the business can absorb the cost.
Product version
| Triton 1.0 to 2.2d, 3.0 to last version of Triton is 3.1bx, then the product is renamed to Baan
| Baan 4.0 (last version of BaanIV is BaanIVc4 SPxx) & Industry extensions (A&D…)
| Baan 5.0 (last version of BaanV is Baan5.0 c SPxx)
| Baan 5.1, 5.2 (for specific customers only)
| SSA ERP 6.1 /Infor ERP LN 6.1 FP5
Suppliers of ERP
There are many numbers of ERP suppliers who are very active in the market. Some of the companies offering renowned international ERP products include:
Baan
CODA
D&B
IBM
JD Edwards
Marcarn
Oracle
Peoplesoft
Platinum
Ramco
SAP
SMI
Software 2000
Implementation of ERP
Implementing an ERP package has to be done on a phased manner. Step by step method of implementing will yield a better result than big-bang introduction. The total time required for successfully implementing an ERP package will be anything between 18 and 24 months. The normal steps involved in implementation of an ERP are as below:
Ë Project Planning
Ë Business & Operational analysis including Gap analysis
Ë Business Process Reengineering
Ë Installation and configuration
Ë Project team training
Ë Business Requirement mapping
Ë Module configuration
Ë System interfaces
Ë Data conversion
Ë Custom Documentation
Ë End user training
Ë Acceptance testing
Ë Post implementation/Audit support
The above steps are grouped and sub-divided into four major phases namely:
- I. Detailed discussions
- II. Design & Customization
- III. Implementation
- IV. Production
The phases of implementation via their tasks and respective deliverables are as below:
Detailed Discussion Phase:
Task: – Project initialization, Evaluation of current processes, business practices, Set-up project organization.
Deliverables: – Accepted norms and Conditions, Project Organisation chart, Identity work teams.
Design and customisation Phase:
Task: – Map organisation, Map business process, Define functions and processes, ERP software configuration and Build ERP system modifications.
Deliverables: – Organisation structure, Design specification, Process Flow Diagrams, Function Model, Configuration recording and system modification.
Implementation Phase:
Task: – Create go-live plan and documentation, Integrate applications, Test the ERP customisation, Train users
Deliverables: – Testing environment report, Customisation Test Report and Implementation report.
Production Phase:
Task: – Run Trial Production, Maintain Systems
Deliverables: – Reconciliation reports, Conversion Plan Execution
DIFFERENCE
Features of ERP
Some of the major features of ERP and what ERP can do for the business system are as below:
] ERP facilitates company-wide Integrated Information System covering all functional areas like Manufacturing, Selling and distribution, Payables, Receivables, Inventory, Accounts, Human resources, Purchases etc.,
] ERP performs core corporate activities and increases customer service and thereby augmenting the Corporate Image.
] ERP bridges the information gap across the organization.
] ERP provides for complete integration of Systems not only across the departments in a company but also across the companies under the same management.
] ERP is the only solution for better Project Management.
] ERP allows automatic introduction of latest technologies like Electronic Fund Transfer (EFT), Electronic Data Interchange (EDI), Internet, Intranet, Video conferencing, E-Commerce etc.
] ERP eliminates the most of the business problems like Material shortages, Productivity enhancements, Customer service, Cash Management, Inventory problems, Quality problems, Prompt delivery etc.,
] ERP not only addresses the current requirements of the company but also provides the opportunity of continually improving and refining business processes.
] ERP provides business intelligence tools like Decision Support Systems (DSS), Executive Information System (EIS), Reporting, Data Mining and Early Warning Systems (Robots) for enabling people to make better decisions and thus improve their business processes
Benefits of ERP
The benefits accruing to any business enterprise on account of implementing are unlimited. According to the companies like NIKE, DHL, Tektronix, Fujitsu, Millipore, Sun Microsystems, following are some of the benefits they achieved by implementing ERP packages:
Gives Accounts Payable personnel increased control of invoicing and payment processing and thereby boosting their productivity and eliminating their reliance on computer personnel for these operations.
Reduce paper documents by providing on-line formats for quickly entering and retrieving information.
Improves timeliness of information by permitting, posting daily instead of monthly.
Greater accuracy of information with detailed content, better presentation, fully satisfactory for the Auditors.
Improved Cost Control
Faster response and follow up on customers
More efficient cash collection, say, material reduction in delay in payments by customers.
Better monitoring and quicker resolution of queries.
Enables quick response to change in business operations and market conditions.
Helps to achieve competitive advantage by improving its business process.
Improves supply-demand linkage with remote locations and branches in different countries.
Provides a unified customer database usable by all applications.
Improves International operations by supporting a variety of tax structures, invoicing schemes, multiple currencies, multiple period accounting and languages.
Improves information access and management throughout the enterprise.
Provides solution for problems like Y2K and Single Monitory Unit (SMU) or Euro Currency.
Application Administration
The following application administration functions are of general interest:
Maintain Companies `Companies’ (clients) are defined by company number, name, currency, and a package combination that associates the corresponding database schema with the company.
User Management The name of a Baan user is normally the same as the system login name. To each user, a start menu, a program package configuration (`package combination’), and a client is assigned. The client determines the data set on which the user will work.
Text Management Internal texts that have to be edited with the built-in (rather old fashioned) text editor, and that are being stored line by line (and optionally by language), are used for delivery conditions, item descriptions, invoice footers, and the like.
Job Management A job consists of a configurable sequence of print and processing programs which are being executed periodically (for instance, every two hours).
Database Management comprises the following functions:
Separating the data into (normally) two databases: one for the `critical’ tables (such as operating parameters and authorizations) for which all user accesses are written in a security log, and one for the remaining tables;
Exporting, importing, deleting, checking and reorganizing tables (under miscellaneous);
Inspecting and possibly modifying the data of certain tables (under General Table Maintenance).
Customizing the User Interface
Various components of the user interface can be created and modified interactively without programming. This includes:
Menus consist of a list of choice options leading to application programs or to submenus.
Labels are named short texts used to label form fields and report columns.
Reports are defined by a number of layout elements and their data fields and labels.
They are used to create complex documents like bills of lading or invoices, and also for displaying or printing the results of SQL queries.
Forms consist of form fields for displaying and allowing to modify data, and of pull-down menus and push buttons to execute actions and call application programs.
Messages and Questions are named short texts used to display messages or ask questions during the execution of an application program.
Programming
BaanERP programming consists of version management and of the creation and maintenance of program scripts. Version management includes:
1. The creation and maintenance of package versions (PVRCs) and
2. The configuration of a set of package versions in a package combination.
The real programming refers to Program Scripts; include modules (called `Functions’) and DLL modules (Libraries):
Program Scripts are being written in a Pascal-like procedural programming language, called `Baan 3GL’. For event-based programming in connection with forms, there is a `4GL’ extension by the addition of special key words in order to refer to form and database events.
`Functions’ are in fact include modules allowing to reuse variable declarations, functions and procedures.
Libraries allow to maintain re-usable function and procedure code. As opposed to include modules (`Functions’), DLL library functions do not blow up the source code generated before compilation and the resulting object code.
HARDWARE REQUIREMENTS
3 Server of Compaq Proliant 7000 XEON, 400 MHz, 1GB RAM, with RAID feature.
- Ø Ap1, AP2 are two applications and DBS is the data base server.
- Ø One more ITI server of Compaq Proliant 5000 is for developmental, training and testing work.
400 clients Pentium PCs. Most of them are of HP or Compaq make.
1 Main switch and 9 Auxiliary switches of CICCO make and 35 HUBs of D-Link.
One Wave LAN, One Wave Point, 10 – Modems and 2 pair Ethernet Bridge (Slip stream device).
SOFTWARE REQUIREMENTS
On Server
- Ø Operating System- Window NT 4.
- Ø Data Base – Oracle 8.0.5.X
- Ø Application- BaaN IV C4
On Clients
- Ø Operating System is Dual boot to protect BaaN from Virus
- Ø BaaN on WIN NT side.
- Office, Internet and mails on WIN 98 side.
For Network
- Ø NMS (Network Management Software) of CISCO.
NETWORK
l We had gone for star topology.
l We have used optical fiber from main Switch to Auxiliary Switches.
l UTP (untwisted pair) cable from Aux. Switch to hub/client.
l Dialup for the distant and remote places.
l Ethernet Bridge (Slipstream device) for connecting one LAN to another LAN through a dead telephone copper wire.
l Wave LAN and Wave point working on radio wave for wireless data transformation.
Advantages
In the absence of an ERP system, a large manufacturer may find itself with many software applications that cannot communicate or interface effectively with one another. Tasks that need to interface with one another may involve:
Integration among different functional areas to ensure proper communication, productivity and efficiency.
Design engineering (how to best make the product).
Order tracking, from acceptance through fulfillment.
The revenue cycle, from invoice through cash receipt.
Managing inter-dependencies of complex processes bill of materials.
Tracking the three-way match between purchase orders (what was ordered), inventory receipts (what arrived), and costing (what the vendor invoiced).
The accounting for all of these tasks: tracking the revenue, cost and profit at a granular level.
ERP Systems centralize the data in one place. This eliminates the problem of synchronizing changes and can reduce the risk of loss of sensitive data by consolidating multiple permissions and security models into a single structure.
Some security features are included within an ERP system to protect against both outsider crime, such as industrial espionage, and insider crime, such as embezzlement. A data-tampering scenario, for example, might involve a disgruntled employee intentionally modifying prices to below-the-breakeven point in order to attempt to interfere with the company’s profit or other sabotage. ERP systems typically provide functionality for implementing internal controls to prevent actions of this kind. ERP vendors are also moving toward better integration with other kinds of information security tools.
Disadvantages
Problems with ERP systems are mainly due to inadequate investment in ongoing training for the involved IT personnel – including those implementing and testing changes – as well as a lack of corporate policy protecting the integrity of the data in the ERP systems and the ways in which it is used.
| Customization of the ERP software is limited.
| Re-engineering of business processes to fit the “industry standard” prescribed by the ERP system may lead to a loss of competitive advantage.
| ERP systems can be very expensive (This has led to a new category of “ERP light” solutions)
| ERPs are often seen as too rigid and too difficult to adapt to the specific workflow and business process of some companies—this is cited as one of the main causes of their failure.
| Many of the integrated links need high accuracy in other applications to work effectively. A company can achieve minimum standards, and then over time “dirty data” will reduce the reliability of some applications.
| Once a system is established, switching costs are very high for any one of the partners (reducing flexibility and strategic control at the corporate level).
| The blurring of company boundaries can cause problems in accountability, lines of responsibility, and employee morale.
| Resistance in sharing sensitive internal information between departments can reduce the effectiveness of the software.
| Some large organizations may have multiple departments with separate, independent resources, missions, chains-of-command, etc, and consolidation into a single enterprise may yield limited benefits.
| The system may be too complex measured against the actual needs of the customers.
| ERP Systems centralize the data in one place. This can increase the risk of loss of sensitive information in the event of a security breach.
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