Tuesday, June 17, 2008

ERP Feedback From Emre


- BS: Metallurgical & Materials Eng., Middle East Technical University (92-96)
- MSc: Materials Science & Engineering, Middle East Technical University (96-99)
- MBA: Bilkent University (05-present)

- Project Manager @ Roketsan (99-05)
- Business Development Manager @ AYESAS (05-present)

- Working in a company having global operations in aerospace & defense or energy industries in business development or marketing positions

- ERP systems are used almost all companies that I intend to work. Understanding the IT infrastructure of organizations (my own organization, customers and suppliers) will enhance my business skills.

- Improving my managerial perspective on ERP systems, what to expect from ERP systems, how to execute ERP implementation programs.


One of the most critical thing that I have learnt in the course in day-1 was that the systems uses a single database. Sharing of the same database by all departments and functions eliminates the risk of various entries for the same transaction and minimizes labor requirement for labor entries.

I was familiar with MRP systems from my previous job as a project manager. It was not surprising to find out that ERP systems was developed from MRP systems. It was basically integration of other functions like HR, Finance to MRP system.

In my previous employment I observed the implementation of an ERP system by Oracle and in my current employment I observed the implementation of an ERP system by SAP. In both cases my position had no modules in ERP system, thus I was not directly involved in ERP implementation programs. However I was fortunate to observe the pain created in organizations during the implementation. Thus it was no new information for me to have strong top management support for the ERP implementations to overcome internal strains.

So far I have heard only SAP and Oracle companies as ERP solution providers, however I have found out several other ERP solution providers like SSa Global, Compiere, OFBiz.

Another important thing for me was the open source companies for ERP systems. From the discussions held in the class, it seems that open source companies are more effective and beneficial for companies than other usual ERP systems. However I did not understand why open source solutions are used so rarely. Could the insufficient amount of customer support only reason for this?


1) ERP Software
-ERP systems may require organziations to change the way they work, as in the case of staff vacation time which was a double entry before the implementation.
-Customization of software packages of the ERP system is costly not only at the beginning but in the coming years as well. The reason is that every time a new version of the software package is received, the implications of modifications should be reviewed again.
-ERP may provide organizations valuable information that they did not even anticipate to get.

2) ERP Purchase Decision
-SAP has the largest market share in ERP systems
-In the first half of 1990s, ERP system implementations, depending on the companies requirements, were classified as either Support ERP Purchases, which involves HR and finance modules or Value Chain ERP Purchaes, which involves materials management, production and operations as well as support functions.
-In the second half of 1990s, ERP system implementations was mainly ralized in order to meet various competitive goals better, to reengineer business processes, and to access to the integrated data. Furthermore IT capabilities of the companies significantly influenced their ERP purchases, such that existing insufficient in-house systems should be replaced with the most appropriate ERP solutions.

3) Decision Making in the Evaluation, Selection and Implementation of ERP Systems
-ERP projects are expensive and time consuming
-ERP market was growing at a significant rate of 23% in early 2000s.
-ERP selection decision is not only based on financial parameters but also business strategy, business processes and expectations of different stakeholders.
-ERP projects consist of different phases namely; initiation, requirement analysis, inviting vendors to bid, vendor short listing, design and implementation and post implementation.
-Different models could be generated for ERP decision makings. The paper states six different models; classical, administrative, incremental, adaptive, irrational and political models.
-At different stages of ERP projects different models shall be dominant in the same organization, depending on the dynamics of the business and organization structure.

4) Assesing ERP Software
-SAP has the largest market share in the ERP marlet and is unique in integrating both SAP and non-SAP applications.
-ERP solution providers develop solutions on vertical industry business units, to be able to serve all supply chain.
-ERP systems are not very effective in returns or reverse logistics.
-Even though ERP solution providers offer wide variety of modules for various functions, there may be still need for 3rd party solutions.

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