Day 2 Articles

ERP Software:

Enterprise resource planning allows the collection and consolidation of information across the enterprise. This application allows for tracking and basic reporting
All input from different departments, collected at a central location.
By installing ERP to their companies, companies can compare the financial data and track the purchases under way.
In the case it can be seen that by installing ERP software, they added a kind of advantage which they can consistently buy things.
There are some drawbacks of ERP such as it takes long time to convert the data used before ERP into single enterprise-level program.
Duplication of data is another problem.

The ERP Purchase Decision: Influential Business and IT Factors

In that paper the main goal is to identify set of businesses and IT factors that are associated with the purchase of ERP systems.
While taking ERP Purchase decision there are four business factors, data integration, new ways of doing business, global capabilities, flexibility/agility and there are four IT factors such as IT purchasing, IT cost reduction, IT expertise and IT architecture is identified.
IS professionals are frequently involved in the implementation of large scale integrated, cross functional systems which is named ERP. 13% of mid-sized European companies buy ERP for one specific area, 70% of companies buy ERP for more than three functional areas.
Operational changes with third-party consulting costs ranges from 2 times to 10 times the purchase price of the ERP software.
There are three business capabilities that influence the ERP purchases: The ability to better meet various competitive goals, the desire to reengineer business purchases, and access to integrated data.
Before 1990s another benefit of the ERP systems was avoiding year 2000 problems.

Assessing the ERP Software

Most companies have an idea of implementing their preferences before the selection process begins.
While the supply chain management market has shrunk with the economic downturn, ERP vendors’ share of the market increases.
ERP vendors give importance on developing their modules.
Execution side of supply chain management grew 4% while planning segment decreased by 10%.
Third party software vendors would specialize in vertical industries, targeting mid-market customers.
There are some weak points of ERP softwares such as they can not handle returns or reverse logistics very well.

Decision Making in the Evaluation, Selection and Implementation of ERP Systems

Decision making selection and implementation of ERP systems involve making multiple decisions during the ERP project lifecycle.
ERP projects are strategic projects for the whole benefit of the organization.
ERP systems are expensive projects that exceed $100,000 and takes time to implement 6 months to 2 years.
ERPs are implemented in order to support supply chain management, customer relationship management, professional service automation and other areas.

There are 6 decision making models for implementation of ERP projects,

The Classical Model: Based on econ theory
The Administrative Model: Looks at alternatives that meet min. standards
The Incremental Model: Decision makers make small changes by making successive limited comparisons.
The Adaptive Model: Mix of administrative and incremental models
The Irrational Model: Decisions are a product of organizational events
The Political Model: The model is one in which politics replace organizational goals