WHY ERP?
ERP systems are large computer systems that tie separate application programs of different business functions. ERP systems work in real-time so exact status of everything is always available. Moreover, ERP systems are generally global so they enable working in different languages and in different currencies.
Billy is currently working as manufacturing manager in McDougle Furniture Company in North Carolina. The owner of the Company, Mr. McDougle, was considering acquiring the furniture company of his brother in Ohio. Company in Ohio has implemented a new ERP system – SAP R/3. Therefore, Mr. McDougle wanted to analyze the pros and cons of implementing an ERP system in North Carolina in order to integrate two companies each other and he appointed Billy for this mission.
The reason behind ERP implementation is important so as to analyze the costs and benefits of it. Some companies implements to solve the Year2000 problem which is non-sense. Some other firms will implement ERP to integrate the various functions of the business or to force a badly needed organizational change. McDougle wanted to implement ERP in order to get common information, common management systems, common data and common reports from the system in order to use the same kind of management in both places.
Billy had participated to an SAP seminar and he gained a general knowledge of SAP R/3. R/3 is an SAP product which ties the information throughout an organization and therefore it provides benefits of single data entry, immediate access and common data. In this system, all processes are integrated with the same data.
With the help of ERP systems, duplication of information is eliminated therefore efficiency of operations can be improved with time savings. Moreover, the quality of the data could be increased due to decrease in errors in data entries. Another benefit of ERP is that it assures that all divisions of the company are dealing with current and identical data.
The main issue in using R/3 is configuration which is the process of matching the system to the organization. This system also enables to creating your own menus and sub-menus that are in line with the organization.
R/3 system works in line with the contemporary business practices which are referred as best practices.
In SAP seminar, instructor mentioned to ASAP – Accelerated SAP, which can be used as a guide before the implementation especially for the smaller firms that do not want to re-engineer their processes. ASAP is formed from 5 major steps which are Project Preparation, Business Blueprint, Realization, Final Preparation and Go Live stages. One of the most important features of ASAP is that it can be used for solving the open issues related to the implementation since the data related to the issue, parties involved are all documented.
SAP also gave high importance to organizing the computers to run R/3 applications. Database computer is placed at the heart of the system since all of the data are stored in that database. Therefore, the reliability of the database is very important for the health of the system. There are also 2 other layers which are called application and presentation layer. Application layer is formed from computers which run the software. Presentation layer consists of end-user computers. This system is called “three-tier client-server system”.
System configuration is one of the most important parts of the system because system administrator has to authorize users for the usage of the system.
After the SAP seminar, the owner of the company also sent Billy to the factory in Ohio to understand the processes there and the benefits of SAP. When Billy went there, he realized that the two factories are very different from each other and the same system with the same configuration is very hard to implement in North Carolina.
Conclusion
ERP systems could be very beneficial for some firms but in others it cannot be as beneficial as others. In the case of this book the main reason behind this is the need for flexibility in the production process. ERP will certainly change the business processes and this will lead to negative results in this firm since they generally produced tailor made products in line with the consumer needs.
In general, companies within the same sector have similar workflows but in this case factories did not have similar workflows. They were totally different therefore using the same configuration without having consultancy from experts will lead to negative results.
Moreover, top management should also consider the psychological effects of this kind of a big change. They have to be transparent to their employees in order to prevent bad rumors within and outside the company. Rumors will decrease the motivation of workers. People will certainly resist to big changes so implementation team and top management are responsible for explaining the main aim and the results of this project in order to decrease the retention from workers.
Tuesday, June 17, 2008
June 16, 2008 - Lecture Notes
ERP means Enterprise Resource Planning and in practice it is a kind of software that links all business units and processes. It has a modular structure; therefore it enables companies to implement just a single module. ERP allow real time updates so it does not require nightly updates.
When we look to the historical development of ERP, it is the extension of MRP and MRP-II. MRP is Materials Requirement Planning and it is helpful in deciding when to buy what based on the manufacturing activity of the Company. MRP-II is Manufacturing Resource Planning and it is an extended version of MRP since it also brought Human Resources and Financial aspects. ERP is the broadest one and it includes all of the functions of the Company.
The most important feature of ERP systems is the database since all of the data are stored in a database. All ERP systems come with some best practice business processes in mind but in general they enable customization in line with the needs of the related Company.
We can classify ERP providers into 3 groups which are major players such as Oracle, SAP, SSA Global; small ones and finally the open source communities and firms such as Compiere, OFBiz, WebERP.
There is also one more type of ERP provider which is called On Demand ERP (SAAS) which provides this service over internet. On Demand ERP has lower initial costs but on the other hand it has some security issues since companies should share all of the private information with an outside company. Moreover, it might slow down the transaction due to internet and network problems.
Advantages and Disadvantages of Each Type of ERP Providers
Advantages of Major Players:
-Strong support
-High availability of consultants
-International know-how
-High variety of applications
-Better products due to the increased competition in the sector
Disadvantages of Major Players:
-High cost
-More functions than needed
-Less flexibility
Advantages of Small Ones
-Lower cost
-More flexible
Disadvantages of Small Ones
-Lower quality
-Less availability of consultants
-Going concern of existing firms for future updates, maintenance and consultancy
Advantages of Open Source
-It is free
-Support is cheaper when it is available
-Easy to customize
Disadvantages of Open Source
-Weak documentation
-Less availability of consultants
ERP Implementation
ERP implementation is an important strategic decision for a company so for the implementation companies should form a core team which will analyze the main business processes of company in order to identify the suitable modules. The most important issue is the determination of the team since companies should not treat ERP implementation projects as simple IT projects.
Core team should involve people from strategic departments who know the whole process, top management, consultants, IT manager and a Champion. Support of the top management is very important in order to reflect the importance of the project to all layers of the Company. Champion is like a project leader who has the authority to affect both the staff and the top management of the Company by forming a bridge between them.
In general, each manager within the company would be paired with a consultant in order to increase the effectiveness of the project since insiders know the business processes and the company in detail whereas consultants know the capabilities of software in detail. Moreover, after the implementations managers become new inside consultants since they have the chance to learn the software more than the others. Matching IT managers with consultants would also increase the involvement of the IT department which in turn increase the benefits of ERP system usage.
IT Implementation
Approximately 70% of all IT implementation projects are failed. We can define failure in 4 bullets which are as follows:
· It might not work in terms of meeting the requirements
· It might not meet budget requirements
· It might not meet time requirements-deadlines
· It might not be used – there can be failure to use
When we look to the historical development of ERP, it is the extension of MRP and MRP-II. MRP is Materials Requirement Planning and it is helpful in deciding when to buy what based on the manufacturing activity of the Company. MRP-II is Manufacturing Resource Planning and it is an extended version of MRP since it also brought Human Resources and Financial aspects. ERP is the broadest one and it includes all of the functions of the Company.
The most important feature of ERP systems is the database since all of the data are stored in a database. All ERP systems come with some best practice business processes in mind but in general they enable customization in line with the needs of the related Company.
We can classify ERP providers into 3 groups which are major players such as Oracle, SAP, SSA Global; small ones and finally the open source communities and firms such as Compiere, OFBiz, WebERP.
There is also one more type of ERP provider which is called On Demand ERP (SAAS) which provides this service over internet. On Demand ERP has lower initial costs but on the other hand it has some security issues since companies should share all of the private information with an outside company. Moreover, it might slow down the transaction due to internet and network problems.
Advantages and Disadvantages of Each Type of ERP Providers
Advantages of Major Players:
-Strong support
-High availability of consultants
-International know-how
-High variety of applications
-Better products due to the increased competition in the sector
Disadvantages of Major Players:
-High cost
-More functions than needed
-Less flexibility
Advantages of Small Ones
-Lower cost
-More flexible
Disadvantages of Small Ones
-Lower quality
-Less availability of consultants
-Going concern of existing firms for future updates, maintenance and consultancy
Advantages of Open Source
-It is free
-Support is cheaper when it is available
-Easy to customize
Disadvantages of Open Source
-Weak documentation
-Less availability of consultants
ERP Implementation
ERP implementation is an important strategic decision for a company so for the implementation companies should form a core team which will analyze the main business processes of company in order to identify the suitable modules. The most important issue is the determination of the team since companies should not treat ERP implementation projects as simple IT projects.
Core team should involve people from strategic departments who know the whole process, top management, consultants, IT manager and a Champion. Support of the top management is very important in order to reflect the importance of the project to all layers of the Company. Champion is like a project leader who has the authority to affect both the staff and the top management of the Company by forming a bridge between them.
In general, each manager within the company would be paired with a consultant in order to increase the effectiveness of the project since insiders know the business processes and the company in detail whereas consultants know the capabilities of software in detail. Moreover, after the implementations managers become new inside consultants since they have the chance to learn the software more than the others. Matching IT managers with consultants would also increase the involvement of the IT department which in turn increase the benefits of ERP system usage.
IT Implementation
Approximately 70% of all IT implementation projects are failed. We can define failure in 4 bullets which are as follows:
· It might not work in terms of meeting the requirements
· It might not meet budget requirements
· It might not meet time requirements-deadlines
· It might not be used – there can be failure to use
bio of Seçil Akdemir
Hi,
My name is Seçil. I am graduated from Middle East Technical University Department of Economics in 2004. After graduation, I worked at Audit Department of Ernst&Young İstanbul Office for 2.5 years and I generally participated to audit works of firms from financial services. Later, I worked at Investor Relations Department of Yapı Kredi Bank for 3 months. And now, starting from last September I am doing my MBA degree at Bilkent University. Next semester, I will study at Bocconi University in Italy as an Erasmus student. After my graduation, I am again planning to turn back to business consultancy sector since I realized that it is more suitable for me.
During my audit experience, we were analyzing the workflows so I know the importance of ERP systems and applications for all kind of firms. Having lectures from an instructor with professional real experience will certainly beneficial in such a course.
I have 2 sisters - one is younger and one is elder. Growing in such a big family is a great thing.
My name is Seçil. I am graduated from Middle East Technical University Department of Economics in 2004. After graduation, I worked at Audit Department of Ernst&Young İstanbul Office for 2.5 years and I generally participated to audit works of firms from financial services. Later, I worked at Investor Relations Department of Yapı Kredi Bank for 3 months. And now, starting from last September I am doing my MBA degree at Bilkent University. Next semester, I will study at Bocconi University in Italy as an Erasmus student. After my graduation, I am again planning to turn back to business consultancy sector since I realized that it is more suitable for me.
During my audit experience, we were analyzing the workflows so I know the importance of ERP systems and applications for all kind of firms. Having lectures from an instructor with professional real experience will certainly beneficial in such a course.
I have 2 sisters - one is younger and one is elder. Growing in such a big family is a great thing.
Kerem's Bio & Lessons Learned for 16th June
Kerem Ziraman is a second year MBA student in Bilkent University. His MBA education is mostly concentrated on marketing. He completed his BS in Bilkent University's Industrial Engineering Department. As a senior, he participated in a project for Coca Cola Turkey which automated the order generation process between warehouse and distributors. The project was a stand alone program, which was not integrated to the ERP software of the company. He also witnessed the use of old MAN-MAN, and (partially) implementation process of a small company ERP during his internships in ASELSAN (2003) and ORS Bearings (2005) respectively.
Outcome of 16.06.2008
ERP links software, operations and business units. An ERP is modular sturucture, these share same database.
As a quick history, ERP's origins descends from BOMs, at least in manufacturing terms.
One of the major discussions on 16th was on open source ERP. This discussion can be summarized as, open source has a good code, since many eyes checked the integrity of code, but there is lack of support and security with respect to not open source programns.
Another discussion was focused on the providers of ERP software, major players, smaller ones & open source communities. A fourth type On-Demand ERP also exists. It depends on the size of the company, the degree of internationalization, the budget of the company, country conditions... etc to pick from the list above.
On demand ERP is a structurally different from the other ERP programs. The provider of the S/W is also provider of the ERP service, where the server and applications are all kept in a distant place. Company sends all the vital information to outside server, however it critically decreases the infrastructure costs.
Some ERP related technical words were also mentioned. Transactions as in terms of creating, changing and displaying data. Transaction code, 4 Digit Transaction Codes, and Modules.
"When ERP was seen as an IT implementation it tends to fail."
Many companies applied the ERP implemantions because of the Y2K Problem.
There were 4 reasons some projects failed. Project didnt meet requirements, budget, time and misuse.
Implementation Team: Champion*, people who know workflow, top management, IT manager, consultants. * is important to keep the ERP project alive, s/he is the person on the hook.
Data warehousing and data mining was also mentioned. WArehousing was used to reveal the trends when you know what you are looking for. Mining on the other hands tries to explain relation ships between variables with models.
Outcome of 16.06.2008
ERP links software, operations and business units. An ERP is modular sturucture, these share same database.
As a quick history, ERP's origins descends from BOMs, at least in manufacturing terms.
One of the major discussions on 16th was on open source ERP. This discussion can be summarized as, open source has a good code, since many eyes checked the integrity of code, but there is lack of support and security with respect to not open source programns.
Another discussion was focused on the providers of ERP software, major players, smaller ones & open source communities. A fourth type On-Demand ERP also exists. It depends on the size of the company, the degree of internationalization, the budget of the company, country conditions... etc to pick from the list above.
On demand ERP is a structurally different from the other ERP programs. The provider of the S/W is also provider of the ERP service, where the server and applications are all kept in a distant place. Company sends all the vital information to outside server, however it critically decreases the infrastructure costs.
Some ERP related technical words were also mentioned. Transactions as in terms of creating, changing and displaying data. Transaction code, 4 Digit Transaction Codes, and Modules.
"When ERP was seen as an IT implementation it tends to fail."
Many companies applied the ERP implemantions because of the Y2K Problem.
There were 4 reasons some projects failed. Project didnt meet requirements, budget, time and misuse.
Implementation Team: Champion*, people who know workflow, top management, IT manager, consultants. * is important to keep the ERP project alive, s/he is the person on the hook.
Data warehousing and data mining was also mentioned. WArehousing was used to reveal the trends when you know what you are looking for. Mining on the other hands tries to explain relation ships between variables with models.
Book key notes
The book is about a company who plans to implement SAP system at their base, and one of the manager Billy wants to prevent company to do this, as he believes it is not appropriate for them.
--Any software can not manage a company, they are only tools, managers manage companies.
--Current software was generally is usefull and with the adaptations made to it, it pretty well usefull.
--SAP system is not a big revolution for any company, but, they projected significant benefits, including better efficiency, some reductions in overhead costs, and much better information for running the business.
--SAP system brings integrated software that means all the systems talk directly to eachother. Some firms even integrated with their customers and suppliers. That means there is one number for inventory, only one for accounting, one for scheduling ...
--The information is real time , when updated, the new status is available for everyone.
--Deciding to integrate systems , to find out which numver will be used for sub systems (accounting..) will be a difficult process, and a lot of knowledgeable people needed. These problems can not be solved by SAP system.
-- In any software processes is run by people, if a job is not entered in MRP it is not there, that is same with SAP systems.
--Implementing an ERP for silly IT problems is useless.
--Integrating the organization, educating and involving people to use them is a managerial problem and can not be solved by software.
--There are a huge set of customization in SAP systems. and to configure it will need a huge work effort. That can not be copied from any other firm, as the processe will be different for all the companies.
--SAP has integrated data with similar interfaces for all of the modules it involves.
--SAP has a lot of processes and these processes are usually not how people are organized and they cut across functional areas.
--The SAP implementation can change the way people do things.
--One of the big jobs in using SAP then is to match the system to the organizationç That efford is called configuration.
--SAP has some simple process configurations which are called best practices.
--Entering the same data only once helps to improve quality and efficiency and reliability of the system.
--There are five major steps to implement SAP system, which are Project preparation, Business BluePrint, Realization, and GO live and Support.
--There is a client code at the system which can identify subsystems.
--There is an audit trail and this can be viewed only by authorized people.
--There is a three tiered client server architecture. There are server processes a dispatcher process which enable priority queue implementation for available jobs. All of the system must be configured by a knowledgeable team. These can lead to new computer hardware buy decisions.
--There is a ABAP/4 programming language in which anyone can implement new features. But this kills backward compatibility option of SAP system.
--Flexibility of the software is ended after configurated. As there is no updates for the configuration.
These are all known from the book, after this knowledge in hand Bill decided to integrate their own solution with SAP involving a team effort with education efforts involved. But company owner did not want to wait and Bill lost his job and company ended with a big chaos, they lost a lot of valuable perdonel and cıstomers.
--Any software can not manage a company, they are only tools, managers manage companies.
--Current software was generally is usefull and with the adaptations made to it, it pretty well usefull.
--SAP system is not a big revolution for any company, but, they projected significant benefits, including better efficiency, some reductions in overhead costs, and much better information for running the business.
--SAP system brings integrated software that means all the systems talk directly to eachother. Some firms even integrated with their customers and suppliers. That means there is one number for inventory, only one for accounting, one for scheduling ...
--The information is real time , when updated, the new status is available for everyone.
--Deciding to integrate systems , to find out which numver will be used for sub systems (accounting..) will be a difficult process, and a lot of knowledgeable people needed. These problems can not be solved by SAP system.
-- In any software processes is run by people, if a job is not entered in MRP it is not there, that is same with SAP systems.
--Implementing an ERP for silly IT problems is useless.
--Integrating the organization, educating and involving people to use them is a managerial problem and can not be solved by software.
--There are a huge set of customization in SAP systems. and to configure it will need a huge work effort. That can not be copied from any other firm, as the processe will be different for all the companies.
--SAP has integrated data with similar interfaces for all of the modules it involves.
--SAP has a lot of processes and these processes are usually not how people are organized and they cut across functional areas.
--The SAP implementation can change the way people do things.
--One of the big jobs in using SAP then is to match the system to the organizationç That efford is called configuration.
--SAP has some simple process configurations which are called best practices.
--Entering the same data only once helps to improve quality and efficiency and reliability of the system.
--There are five major steps to implement SAP system, which are Project preparation, Business BluePrint, Realization, and GO live and Support.
--There is a client code at the system which can identify subsystems.
--There is an audit trail and this can be viewed only by authorized people.
--There is a three tiered client server architecture. There are server processes a dispatcher process which enable priority queue implementation for available jobs. All of the system must be configured by a knowledgeable team. These can lead to new computer hardware buy decisions.
--There is a ABAP/4 programming language in which anyone can implement new features. But this kills backward compatibility option of SAP system.
--Flexibility of the software is ended after configurated. As there is no updates for the configuration.
These are all known from the book, after this knowledge in hand Bill decided to integrate their own solution with SAP involving a team effort with education efforts involved. But company owner did not want to wait and Bill lost his job and company ended with a big chaos, they lost a lot of valuable perdonel and cıstomers.
bio of ahmet
Hi,
My name is Ahmet. I'm from Istanbul. I am an MBA student in Bilkent University and taking this nice class.
I graduated from Bogazici University in 2004.
I did 1 year of HR Colsulting in a head hunter and later joined a small global company to establish its business in Turkey.
My Ankara days started with my military service I did as an Engineering Officer in Turkish AirForce Headquarters. In 2006, I established a company on HVAC and started this MBA.
Apart from that I am a DJ, playing for 14 years now.
My aim with the academic-work aspects of life is to do a PhD on neuroeconomics and run a couple of small companies.
My name is Ahmet. I'm from Istanbul. I am an MBA student in Bilkent University and taking this nice class.
I graduated from Bogazici University in 2004.
I did 1 year of HR Colsulting in a head hunter and later joined a small global company to establish its business in Turkey.
My Ankara days started with my military service I did as an Engineering Officer in Turkish AirForce Headquarters. In 2006, I established a company on HVAC and started this MBA.
Apart from that I am a DJ, playing for 14 years now.
My aim with the academic-work aspects of life is to do a PhD on neuroeconomics and run a couple of small companies.
What I have learned (16.06.2008)
ERP is generally a software which combines each business unit in a company. That is it helps to serve right info to right people for the right time. It is a complete suite of integrated Applications which can be generally named as finance, accounting, selling, human resources... This software has some unique identifying attributes, which are It has a single integrated Database. That database serves to help entering an information only once, and view it at any time it is needed. The entered informations can be reached in a real time fasion. That means there is no batch processing, or nightly updates for the data to make it available. The main functionality of the software has a modular structure. That is we can add or remove some modules to the main application. And all of the developed or new modules has similar user interface, which gives a greate familarity to the users.
We learned about some previous systems called MRP, MRP2, and ERP, one of our friends mentioned something like ERP2, and our instructor will search for it.
Another interesting discussion was about Why a firm need to implement an ERP system, here the main point is to evaluate bottlenecks first, and give enough education for the users and then adapt ERP system for the company. The chaos when implementing the ERP is enough so, reengineering the business processes at the same time implementing an ERP will not be a good practice. ERP systems has some best practices, but they will not fit to any living company. There must be some huge amount of configuration and customization and this will take a lot of time. Generally , some who will decide to implement an ERP system must have resonable causes. Copying another companies behavior , or implementing an ERP because of a problem like 2000 problem is not feasible.
There are major players at ERP system vendors which are Oracle and SAP generally. There are some small ERP companies, and there are Open Source ERP systems. Compiere, OFBiz, WebERP can be listed for open source vendors.
We have discussed cons and pros for these Open source ,major and small players.
Generally to say , if someone wants strong support and do not want to have a software development team major or small vendors can be a choice. If some can solve the problems by his/her team ,they can buy open source software. Open source software can be more configurable, can deliver fast support and can have small managable code size.
SAP system is a transactional system and all of the transactions has 4 character transaction codes. These transactions can be from any module. and a list of transaction makes a business process.
When implementing a new SAP system, first a war team must be formed. This team can be involved from Department managers who know business processes, consultants from SAP implementor firm, IT managers and a Champion who will be responsible for all of the project.
We learned that SAP has an open system architecture. That is it can work at many hardwares on very operating systems and with many different Relational Database vendors. SAP system van be internationalized, that is we can use screens in our language, with our currencies and tax rates. There is an audit trail system which can help us to resolve which transaction is made by which user.
There is also data mining solitions for SAP systems.
At last we see an example of business process which involves different modules and different transactions.
ERP is generally a software which combines each business unit in a company. That is it helps to serve right info to right people for the right time. It is a complete suite of integrated Applications which can be generally named as finance, accounting, selling, human resources... This software has some unique identifying attributes, which are It has a single integrated Database. That database serves to help entering an information only once, and view it at any time it is needed. The entered informations can be reached in a real time fasion. That means there is no batch processing, or nightly updates for the data to make it available. The main functionality of the software has a modular structure. That is we can add or remove some modules to the main application. And all of the developed or new modules has similar user interface, which gives a greate familarity to the users.
We learned about some previous systems called MRP, MRP2, and ERP, one of our friends mentioned something like ERP2, and our instructor will search for it.
Another interesting discussion was about Why a firm need to implement an ERP system, here the main point is to evaluate bottlenecks first, and give enough education for the users and then adapt ERP system for the company. The chaos when implementing the ERP is enough so, reengineering the business processes at the same time implementing an ERP will not be a good practice. ERP systems has some best practices, but they will not fit to any living company. There must be some huge amount of configuration and customization and this will take a lot of time. Generally , some who will decide to implement an ERP system must have resonable causes. Copying another companies behavior , or implementing an ERP because of a problem like 2000 problem is not feasible.
There are major players at ERP system vendors which are Oracle and SAP generally. There are some small ERP companies, and there are Open Source ERP systems. Compiere, OFBiz, WebERP can be listed for open source vendors.
We have discussed cons and pros for these Open source ,major and small players.
Generally to say , if someone wants strong support and do not want to have a software development team major or small vendors can be a choice. If some can solve the problems by his/her team ,they can buy open source software. Open source software can be more configurable, can deliver fast support and can have small managable code size.
SAP system is a transactional system and all of the transactions has 4 character transaction codes. These transactions can be from any module. and a list of transaction makes a business process.
When implementing a new SAP system, first a war team must be formed. This team can be involved from Department managers who know business processes, consultants from SAP implementor firm, IT managers and a Champion who will be responsible for all of the project.
We learned that SAP has an open system architecture. That is it can work at many hardwares on very operating systems and with many different Relational Database vendors. SAP system van be internationalized, that is we can use screens in our language, with our currencies and tax rates. There is an audit trail system which can help us to resolve which transaction is made by which user.
There is also data mining solitions for SAP systems.
At last we see an example of business process which involves different modules and different transactions.
Background info
I am graduated from Bilkent University Computer Engineering faculty at 1999. I have 9 years engineering experience. I worked for Isbank, Cybersoft and Havelsan now. I am Achitectural Team leader of Turkish Air Force Information System. There are three sub systems in this project, and in one of them we are using SAP. I worked to develop some ERP systems for differnt firms. Generally, I know what an ERP system is.
In this course I believe, I will learn to evaluate ERP systems from a managerial perspective.
For today the most interesting thing for me is my little 5 year old son Emre, as he is now with his grand father and grand mother at Samsun. I missed him alot.
In this course I believe, I will learn to evaluate ERP systems from a managerial perspective.
For today the most interesting thing for me is my little 5 year old son Emre, as he is now with his grand father and grand mother at Samsun. I missed him alot.
MBA 675 at Bilkent University
I am teaching an MBA course at Bilkent University on ERP systems.
I have 17 students with varying backgrounds. A number of them are engineers.
It's very interesting and exciting to finally teach in my own country and at a top university too :)
Next, you should see the bio postings by my students. (I am surprised that nobody did that yet, but maybe they are night owls :)
Ladies and gentlemen, please use the labels when you're posting.
I have 17 students with varying backgrounds. A number of them are engineers.
It's very interesting and exciting to finally teach in my own country and at a top university too :)
Next, you should see the bio postings by my students. (I am surprised that nobody did that yet, but maybe they are night owls :)
Ladies and gentlemen, please use the labels when you're posting.
Bio of goker
I am Göker CANITEZER.
I graduated from Bilkent University, Computer Science and Information Eng. dep in 1999. I got Msc. in Computer Science from Bilkent in 2002.
I worked from 1999 to 2003 as a software developer in C++ and Java. From 2003 to 2007, I was senior architect and software framework team leader. Since 2007, I am in the SAP world as a functional consultant about international railway ticketing.
I am trying to improve the software development processes/workflows in where I work. By the help of this course I will try to understand that how an ERP system can be used in a big software house and in order to be succesful what kind of analysis should be done and which aspects should be considered? If I can prepare a good report with a proper roadmap, I think that it will increase my popularity in the company.
At the end of this course I hope that I will gain a managerial point of view about implementing an ERP system. I mean all the aspects that I should consider, from cost to usage, from data providing to education of the users.
One interesting thing about me: While I was a child, I was saying that I would be driver of the garbage collection truck. When I learned java I realized that gc means garbage collector.
I graduated from Bilkent University, Computer Science and Information Eng. dep in 1999. I got Msc. in Computer Science from Bilkent in 2002.
I worked from 1999 to 2003 as a software developer in C++ and Java. From 2003 to 2007, I was senior architect and software framework team leader. Since 2007, I am in the SAP world as a functional consultant about international railway ticketing.
I am trying to improve the software development processes/workflows in where I work. By the help of this course I will try to understand that how an ERP system can be used in a big software house and in order to be succesful what kind of analysis should be done and which aspects should be considered? If I can prepare a good report with a proper roadmap, I think that it will increase my popularity in the company.
At the end of this course I hope that I will gain a managerial point of view about implementing an ERP system. I mean all the aspects that I should consider, from cost to usage, from data providing to education of the users.
One interesting thing about me: While I was a child, I was saying that I would be driver of the garbage collection truck. When I learned java I realized that gc means garbage collector.
Day 1 WWH ERP
What is ERP? Why do we need ERP? How can we implement ERP?
First day of this course was interesting. Although I have one year experience on SAP development, topics we talked was interesting. We talked about what is MRP, MRP-II and ERP. their differences and What is the main killing point of ERP systems? Such as single db, modular structure, similar interfaces, etc.
"Why do companies try to fit their business processes to to the ERP software?" was very interesting and may be the most important topic/question. After reading the book Why ERP? Some picture of the problem can be realized and also paper called "Decision Making in the Evaluation, Selection and Implementation of ERP Systems" puts 6 decision making models and their natural conclusion is "selection of a product that was about 95 percent off-the-shelf with very little customization" which said by Marlene Orton in Summit magazine.
In addition to this, comparison of open source ERP softwares with Big Players is another point that draws the cost and need side of the big picture. As I understood from the talks, SMEs especially small ones can choose the open source or application service provider approach until they earn more money to be able to pay licence and support costs of the big ERP solutions. In fact, the main point is does the ERP investment makes a fast return in the business? Companies should consider this point while evaluating the solutions.
Moreover, implementing the solution is another problem and we talked about the core implementation team. After the full support of the top management, we need a champion, very knowledgeable technical people from different departments, functional consultants and a project manager from IT department. In the following phases different end users can be used in the group for detailed analysis.
And the conclusion with failure causes. Another most important point in day one. Is it works? Is it on time and on budget and may be the tricky one, is it used (properly or resistance to use). Why ERP book a little bit touches this usage side and the papers do not talk on this since may be this is the last point if everything goes OK:) In fact, the last point says that without considering the end user in the beginning the a big mistake was made by the top management/core team. Especially it can be lived in situations that top management wants the ERP system to monitor every people and to minimize the labour cost by firing redundant people. Although top management does not think firing, it should be stated clearly at the beginning of the project by showing how people will be effected in the end.
Summaries of papers:
ERP Software: It talks about what is ERP and its benefits. It says three drawbacks, first one is entering legacy paperwork data to the system, second one is while entering data there might be some typos (misaligned data?), third one is ERP does not say what to do with a lot of data. According to me, these are not drawbacks of the ERP system. These problems are already there. ERP is not a solution, it is a tool to solve the problems, like screwdriver. And his advice is to find an ERP system that fits 95% to the current business with minimal customization in order to be successful especially for easy upgrade. Business Intelligence is the next step of the ERP solutions is the concluding thought.
Decision making in the ESI of ERP Systems: It gives six models of decision making. It says ERP projects are great projects that effects the strategic positions of the firm. It gives information about some cost numbers and the numbers about the ERP sector. After giving six decision making model (Adaptive model seems better because of rationality and flexibility), it talks about the ESI process of an Health Service Provider. It compares the project phases of six models. It concludes with adequate resource assignment is important, getting insights from academics, can be helpful.
Assessing ERP Software: It is generally about the players in the market, their products and approach to the sector. Vertical solutions of some suppliers. In the end it talks about the weaknesses of ERP systems, such as reverse logistics scenario. As in the ERP Software article it says that functional assessment is the key decision point .
ERP Purchase Decision: It talks about why firms choose an ERP solution. As we talked in day one it says because of 2K, some of them use only specific modules such as accounting, some of them choose for integrated solution. It tries to find an anwser for "What ERP package capabilities are associated with the purchase of an ERP?" There are three business capabilities that effects the decisions: ability to better meet various competitive goals, the desire to reengineer business processes, and access to integrated data. And also it says "Current wisdom suggest that companies should design their "to be" processes with the target package in mind" as we talked in the class. Another interesting decision is buy vs build. Companies think that buy is cheaper because of maintenance and upgrade cost of buid.
First day of this course was interesting. Although I have one year experience on SAP development, topics we talked was interesting. We talked about what is MRP, MRP-II and ERP. their differences and What is the main killing point of ERP systems? Such as single db, modular structure, similar interfaces, etc.
"Why do companies try to fit their business processes to to the ERP software?" was very interesting and may be the most important topic/question. After reading the book Why ERP? Some picture of the problem can be realized and also paper called "Decision Making in the Evaluation, Selection and Implementation of ERP Systems" puts 6 decision making models and their natural conclusion is "selection of a product that was about 95 percent off-the-shelf with very little customization" which said by Marlene Orton in Summit magazine.
In addition to this, comparison of open source ERP softwares with Big Players is another point that draws the cost and need side of the big picture. As I understood from the talks, SMEs especially small ones can choose the open source or application service provider approach until they earn more money to be able to pay licence and support costs of the big ERP solutions. In fact, the main point is does the ERP investment makes a fast return in the business? Companies should consider this point while evaluating the solutions.
Moreover, implementing the solution is another problem and we talked about the core implementation team. After the full support of the top management, we need a champion, very knowledgeable technical people from different departments, functional consultants and a project manager from IT department. In the following phases different end users can be used in the group for detailed analysis.
And the conclusion with failure causes. Another most important point in day one. Is it works? Is it on time and on budget and may be the tricky one, is it used (properly or resistance to use). Why ERP book a little bit touches this usage side and the papers do not talk on this since may be this is the last point if everything goes OK:) In fact, the last point says that without considering the end user in the beginning the a big mistake was made by the top management/core team. Especially it can be lived in situations that top management wants the ERP system to monitor every people and to minimize the labour cost by firing redundant people. Although top management does not think firing, it should be stated clearly at the beginning of the project by showing how people will be effected in the end.
Summaries of papers:
ERP Software: It talks about what is ERP and its benefits. It says three drawbacks, first one is entering legacy paperwork data to the system, second one is while entering data there might be some typos (misaligned data?), third one is ERP does not say what to do with a lot of data. According to me, these are not drawbacks of the ERP system. These problems are already there. ERP is not a solution, it is a tool to solve the problems, like screwdriver. And his advice is to find an ERP system that fits 95% to the current business with minimal customization in order to be successful especially for easy upgrade. Business Intelligence is the next step of the ERP solutions is the concluding thought.
Decision making in the ESI of ERP Systems: It gives six models of decision making. It says ERP projects are great projects that effects the strategic positions of the firm. It gives information about some cost numbers and the numbers about the ERP sector. After giving six decision making model (Adaptive model seems better because of rationality and flexibility), it talks about the ESI process of an Health Service Provider. It compares the project phases of six models. It concludes with adequate resource assignment is important, getting insights from academics, can be helpful.
Assessing ERP Software: It is generally about the players in the market, their products and approach to the sector. Vertical solutions of some suppliers. In the end it talks about the weaknesses of ERP systems, such as reverse logistics scenario. As in the ERP Software article it says that functional assessment is the key decision point .
ERP Purchase Decision: It talks about why firms choose an ERP solution. As we talked in day one it says because of 2K, some of them use only specific modules such as accounting, some of them choose for integrated solution. It tries to find an anwser for "What ERP package capabilities are associated with the purchase of an ERP?" There are three business capabilities that effects the decisions: ability to better meet various competitive goals, the desire to reengineer business processes, and access to integrated data. And also it says "Current wisdom suggest that companies should design their "to be" processes with the target package in mind" as we talked in the class. Another interesting decision is buy vs build. Companies think that buy is cheaper because of maintenance and upgrade cost of buid.
Thursday, May 01, 2008
Thursday, April 10, 2008
day 4 (the end..)
what did i learn today?
There one thing that i will keep in mind: the elevator speech. i know there is almost no link with the class but i think that this technique is very useful and i will use it in mi future life!! thank you !
during the cession we learned about the phase to implement an ERP system.
There are 5 phases to make it right.
The sucess of the implementation can be resume by 4 points:
it has to meet the original objective
to be on time
to cost what was expected
to use the ressources we have.
70% of the failure is because one of those criteria is not done.
When you implement an ERP you have to keep in mind : the bussiness objectives, the critical sucess factors, the key performance indicators and the benefits for each of the area.
I liked when you ask us to contest our own questions of the first scession. It was good to realize that we actually learn many staffs.
Thank you
There one thing that i will keep in mind: the elevator speech. i know there is almost no link with the class but i think that this technique is very useful and i will use it in mi future life!! thank you !
during the cession we learned about the phase to implement an ERP system.
There are 5 phases to make it right.
The sucess of the implementation can be resume by 4 points:
it has to meet the original objective
to be on time
to cost what was expected
to use the ressources we have.
70% of the failure is because one of those criteria is not done.
When you implement an ERP you have to keep in mind : the bussiness objectives, the critical sucess factors, the key performance indicators and the benefits for each of the area.
I liked when you ask us to contest our own questions of the first scession. It was good to realize that we actually learn many staffs.
Thank you
At last but not least!
Today was the last intensive session, it was a sum up of everything we have seen during the week but I still learnt something!
We started by focusing on the different step of the implementation on an ERP like SAP. I retained five major steps. Those steps have not the obligation to be finished to start another one.
So, the first step consists of the Project Preparation: teams are created to implement together SAP, before they will be trained. In this step, you decide which system you'll implement, what are the key objectives? What are your resources?
The second step is the Business Blueprint: you work on matching SAP with processes. Teams have to know exactly how the system works. In this step, you try to map processes.
The third step is the Realization of the implementation: you make it real! This is a huge part in the implementation. You need to test transactions, to correct possible errors (doubles), to clean the old database, and ti train the trainer (who are actually employees using SAP).
The fourth step is the Final Preparation: just before the Go Live, you do the last tests and last changes.
Last, the Go Live & Support, you can use SAP, it might fit exactly your organisation and its needs. But you should check every month if the software is working well or not (avoid errors).
This week I discover Information System which I knew very few....I said the first day that I wasn't an expert in IT, I still mean it! However, I learnt a lot on ERP. This system can't work without the help of "human". It has the advantage of improving the efficiency of the company when it is implemented correctly but I was astonished on the 70% of failure due to reluctance to change, to high cost or to a problem of resources. You never implement an ERP system to save money! It has to be implemented for strategic reasons (goal of growth, possible return on investment). The project will be a success if needs are turned to met objectives, if time is respected, if cost and resources are not overspent.
As a student in master degree, I'll be able to analyse the business of an organisation, its strategy and the situation. In a company, I'll have to ask questions, to understand key needs. I shouldn't be reluctant to being involved in implementation of an ERP because I know that I could bring my skills and knowledge to the organisation. As future manager, we have to step up and be volunteer to take tasks, to help. Now, I have basic ideas about the modules, I'll be able to give my opinion but I should be open to training.....we always have to learn! This would be my conclusion.
I really enjoy this dynamic class, made by great exchange moments! THANKS
We started by focusing on the different step of the implementation on an ERP like SAP. I retained five major steps. Those steps have not the obligation to be finished to start another one.
So, the first step consists of the Project Preparation: teams are created to implement together SAP, before they will be trained. In this step, you decide which system you'll implement, what are the key objectives? What are your resources?
The second step is the Business Blueprint: you work on matching SAP with processes. Teams have to know exactly how the system works. In this step, you try to map processes.
The third step is the Realization of the implementation: you make it real! This is a huge part in the implementation. You need to test transactions, to correct possible errors (doubles), to clean the old database, and ti train the trainer (who are actually employees using SAP).
The fourth step is the Final Preparation: just before the Go Live, you do the last tests and last changes.
Last, the Go Live & Support, you can use SAP, it might fit exactly your organisation and its needs. But you should check every month if the software is working well or not (avoid errors).
This week I discover Information System which I knew very few....I said the first day that I wasn't an expert in IT, I still mean it! However, I learnt a lot on ERP. This system can't work without the help of "human". It has the advantage of improving the efficiency of the company when it is implemented correctly but I was astonished on the 70% of failure due to reluctance to change, to high cost or to a problem of resources. You never implement an ERP system to save money! It has to be implemented for strategic reasons (goal of growth, possible return on investment). The project will be a success if needs are turned to met objectives, if time is respected, if cost and resources are not overspent.
As a student in master degree, I'll be able to analyse the business of an organisation, its strategy and the situation. In a company, I'll have to ask questions, to understand key needs. I shouldn't be reluctant to being involved in implementation of an ERP because I know that I could bring my skills and knowledge to the organisation. As future manager, we have to step up and be volunteer to take tasks, to help. Now, I have basic ideas about the modules, I'll be able to give my opinion but I should be open to training.....we always have to learn! This would be my conclusion.
I really enjoy this dynamic class, made by great exchange moments! THANKS
Be involved!
Last day!
This morning we had a closer look to the implementation phase. What have I learnt?
First the basic implementation is composed of five phases: first the project initiation (to decide which systems to implement, to define a team, the goal), the planning step (how to plan the project and to know the aim of each step), the controlling phase, the execution one (to reach milestones and test takes part of this step) and then the closeout. These phases can be used for any kind of project; not only an IT project and you don’t need to finish a step in order to start a new one. The lifecycle of an ERP system has been studied by some researchers and according to them there are different phases to consider. But never forget that the project phase composed of the planning, control and execution is not enough to be successful. You have to take into account phases after the project one: this step is to check what is wrong in the system because there are still bugs and to fix it. The last step is to let the system living and to try to improve it (onward and upward phases). The graph was very useful to understand the different phases!
Concerning the SAP implementation timeline, this is closely the same but we had much more details. By the way, the idea when meeting consultants is to always be objective of what they will show: some graphs concerning their job can seem very persuasive but you have to wonder what the reason of these conclusions is. Thus the good news they will show are not complete and sometimes their graph tell you nothing about the success or the failure of their implementation. And I was very surprised about the percentage of failure implementations! What are the different parts of the SAP implementation?
· First the project preparation in which the team is formed and trained and in which the team plan the implementation. The milestones are to organize the work and to make sure that the budget is well running
· The business blueprint is to make sure that your process is matching with SAP. You need to start the mapping of your process and understand how SAP works.
· The realization is the huge part of the implementation since it takes the most effort. The key activities are unit test, integration test, data cleaning, preparation, collection validation and testing and the training of the trainer (the key managers will train the employees but they are to be trained first to understand what they are talking about, this will improve relationships and they will learn more by themselves)
· The final preparation is to resolve and complete all opened issues
· Finally Go Live & support phase.
But I learnt that if I am a good business analyst, if I have the competencies to analyse and make decisions thanks to my analysis, I would be involved in an implementation project. And I think this is exciting if I don’t like my future auditor internship! Every business analyst can be involved in an implementation even if you are not an IT expert, that’s good! Why? Because you have the competencies to understand the needs of the company (that is the basic thing to do), you can go to ask questions to key functional persons and translate it to technical people. You need to be volunteer to work, to participate, to open your mind and so on, that’s the basic ideas when being in enterprise: be open to learn more! (In US you have to step up! New words!!). This is a challenge. As an intern people, you can participate a lot in this implementation: test transaction by transaction, write the test script, be involved in the train the trainer, and schedule the rules and the material for instance.
But never forget that you never implement an ERP system to save money, you execute it for a strategic reason.
Finally, I would say that the overview of the questions we had the first day was a very good recap and I enjoy it! I also take pleasure in reading some articles that you provide to us. I realize that the culture is a considerable issue to have in mind thanks to the article on ERP in China and once again I become aware of one of the ERP difficulty: this is not only an IT issue! Thank you for your happiness and your willing to teach your professional and life experience!
This morning we had a closer look to the implementation phase. What have I learnt?
First the basic implementation is composed of five phases: first the project initiation (to decide which systems to implement, to define a team, the goal), the planning step (how to plan the project and to know the aim of each step), the controlling phase, the execution one (to reach milestones and test takes part of this step) and then the closeout. These phases can be used for any kind of project; not only an IT project and you don’t need to finish a step in order to start a new one. The lifecycle of an ERP system has been studied by some researchers and according to them there are different phases to consider. But never forget that the project phase composed of the planning, control and execution is not enough to be successful. You have to take into account phases after the project one: this step is to check what is wrong in the system because there are still bugs and to fix it. The last step is to let the system living and to try to improve it (onward and upward phases). The graph was very useful to understand the different phases!
Concerning the SAP implementation timeline, this is closely the same but we had much more details. By the way, the idea when meeting consultants is to always be objective of what they will show: some graphs concerning their job can seem very persuasive but you have to wonder what the reason of these conclusions is. Thus the good news they will show are not complete and sometimes their graph tell you nothing about the success or the failure of their implementation. And I was very surprised about the percentage of failure implementations! What are the different parts of the SAP implementation?
· First the project preparation in which the team is formed and trained and in which the team plan the implementation. The milestones are to organize the work and to make sure that the budget is well running
· The business blueprint is to make sure that your process is matching with SAP. You need to start the mapping of your process and understand how SAP works.
· The realization is the huge part of the implementation since it takes the most effort. The key activities are unit test, integration test, data cleaning, preparation, collection validation and testing and the training of the trainer (the key managers will train the employees but they are to be trained first to understand what they are talking about, this will improve relationships and they will learn more by themselves)
· The final preparation is to resolve and complete all opened issues
· Finally Go Live & support phase.
But I learnt that if I am a good business analyst, if I have the competencies to analyse and make decisions thanks to my analysis, I would be involved in an implementation project. And I think this is exciting if I don’t like my future auditor internship! Every business analyst can be involved in an implementation even if you are not an IT expert, that’s good! Why? Because you have the competencies to understand the needs of the company (that is the basic thing to do), you can go to ask questions to key functional persons and translate it to technical people. You need to be volunteer to work, to participate, to open your mind and so on, that’s the basic ideas when being in enterprise: be open to learn more! (In US you have to step up! New words!!). This is a challenge. As an intern people, you can participate a lot in this implementation: test transaction by transaction, write the test script, be involved in the train the trainer, and schedule the rules and the material for instance.
But never forget that you never implement an ERP system to save money, you execute it for a strategic reason.
Finally, I would say that the overview of the questions we had the first day was a very good recap and I enjoy it! I also take pleasure in reading some articles that you provide to us. I realize that the culture is a considerable issue to have in mind thanks to the article on ERP in China and once again I become aware of one of the ERP difficulty: this is not only an IT issue! Thank you for your happiness and your willing to teach your professional and life experience!
Last day
Today we saw various things:
First, the ASAP method to implement an ERP project:
This is an ERP implementation method developed by SAP. It is based on 5 different steps. The first one is the project preparation. As the name indicates, all the actions needed to prepare the future implementation must be taken like training of the team, getting the hardware, making the final budget... Then, the second stage is called business blueprint. During this phase, the managers and the consultants must figure out which modules will be necessary and how the current processes of the company will fit into the software. To achieve that, all the different end-to-end processes inside the company must be written down. The third step is the realization in itself. It is the biggest part because it is made of the testing of all the different transactions possible, the cleaning of the old database but also the training of managers who will be in charge of training the employees. Then, during the final preparation, the ultimate tests must be performed as well as the training of the employees. After that level, the ERP must be operational to perform all the different tasks inside the company. At last, the last part is going live, which actually corresponds to the daily using of the ERP environment and support, which must be provided by the consultants in case of problems.
Criteria for success:
After going live, the impact of the ERP is to be assessed. There are 4 major criteria for success. Obviously, we must identify whether we met our objectives or not. But it is also important to check if the duration, the money spent and the resources (human & materials) are coherent with what have been planned. If not, depending on the gap between the required and current situation, we can decide whether the project is a success or not.
Reasons to implement an ERP:
A company might want to use an ERP for several reasons. It could be to better manage the information and increase their data integrity thanks to the unique database, or to improve their processes through the “best practices” provided by the ERP, or to gain time using only one system… But implanting an ERP because one’s major competitor did is not a purpose and can be a reason for failure!
Reasons not to implement an ERP:
A firm may be reluctant to implement an ERP because the cost may not worth it. If the processes are actually competitive, there is no need to change them just for the good of changing. But the company may also not have enough resources (time, money, people…)
What I have retained from the 10th of April
This day was for me a good overview of the main points of the ERP system that we saw this week.
-ERP is not a competitive advantage:
It is not a good system for all the firms because it is a question of needing a particular organization in the transaction of the data. It is just a tool that will improve the firm efficiency if the firm needs it really, and finally the return on investment will be visible on the very long term. The issues of the implementation and the difficult phase of transition can impede the profit of the firm during few weeks so comparing with the competition is not a good option.
But because it exists 5 major softwares, the firms can find the best solution for its own organisation. The firms can work with PeopleSoft, Oracle, SAP... with all the modules or only the one that are useful for them, can choose their own way of implementing or for example its own timeline (Big bang or phased or both)
I think that the results provide facilities for the employees when they have integrated the method of using the ERP but the transition and the adaptation will be very hard. People will feel very confuse and discomforted with a system that is changing their ways and habits of working. They will need trainee and open-mindedness to go up the human natural protection: the “resistance to change”.
Implementing an ERP system is a big and wearying decision that have to be taken in order to met precise objectives with a strategic goal and mission. The board of directors have to take in consideration that this implementation will involve and should imply all the staff, a number of external consultants, time, money, etc : all the resources of the firm at the external and internal level.
-Do we will become good business analysts?
Since of our school and professional formations, we have the capacity of adaptation. We can understand and explain a problem more than other actors of a company because we have now a global overview of the main basic sectors of a firm. From this idea, we can learn quickly because we know how and where to search information. We can improve our knowledge to understand a problem and after share it with the others by asking questions or communicate on the subject.
We should have a strength will power to document and be very deeply informed on the subject. We can make the difference by being a step ahead, by stepping up, by put in action our desire of being better every time and outperform what we did just good. To give the good message to the staff we have to be more than comfortable with the subject, we have to pass the motivation and the feeling that we are the specialists to ensure them of the rightness of the board of directors decision. We may be the precious link between them and the employees.
-ERP is not a competitive advantage:
It is not a good system for all the firms because it is a question of needing a particular organization in the transaction of the data. It is just a tool that will improve the firm efficiency if the firm needs it really, and finally the return on investment will be visible on the very long term. The issues of the implementation and the difficult phase of transition can impede the profit of the firm during few weeks so comparing with the competition is not a good option.
But because it exists 5 major softwares, the firms can find the best solution for its own organisation. The firms can work with PeopleSoft, Oracle, SAP... with all the modules or only the one that are useful for them, can choose their own way of implementing or for example its own timeline (Big bang or phased or both)
I think that the results provide facilities for the employees when they have integrated the method of using the ERP but the transition and the adaptation will be very hard. People will feel very confuse and discomforted with a system that is changing their ways and habits of working. They will need trainee and open-mindedness to go up the human natural protection: the “resistance to change”.
Implementing an ERP system is a big and wearying decision that have to be taken in order to met precise objectives with a strategic goal and mission. The board of directors have to take in consideration that this implementation will involve and should imply all the staff, a number of external consultants, time, money, etc : all the resources of the firm at the external and internal level.
-Do we will become good business analysts?
Since of our school and professional formations, we have the capacity of adaptation. We can understand and explain a problem more than other actors of a company because we have now a global overview of the main basic sectors of a firm. From this idea, we can learn quickly because we know how and where to search information. We can improve our knowledge to understand a problem and after share it with the others by asking questions or communicate on the subject.
We should have a strength will power to document and be very deeply informed on the subject. We can make the difference by being a step ahead, by stepping up, by put in action our desire of being better every time and outperform what we did just good. To give the good message to the staff we have to be more than comfortable with the subject, we have to pass the motivation and the feeling that we are the specialists to ensure them of the rightness of the board of directors decision. We may be the precious link between them and the employees.
Wednesday, April 09, 2008
SAP session
I hope, that I was the last student to write on the wall...
I was there physically, but not enough with my brain!
But I keep in mind some notions.
It was interested to think together about the different akternatives to implement an ERP in a big company such as Decathlon. We find more than 6 different options and there are maybe more. To find the good solution it depends (!!!) :
-if the internal organisation is centralized or not
-of the existing systems into the company
The we talked about resources involved in ERP (internal or external) and finally the level of costumisation of ERP (code, table or module).
I was excited to use SAP, we tolk a lot about it and Iwas very curious! But, because the lack of time and many little problems, I feel a little bite frustrated. I am happy because, we saw the software, but I did not have the time to use it and to be used of it. I think that, for next year, it would be good to past much more time on it and do individually a little case after an overall presentation of SAP.
Thank you very much for your patience, motivation and smile!
I feel tied, go sleep!
See you tomorrow!
I was there physically, but not enough with my brain!
But I keep in mind some notions.
It was interested to think together about the different akternatives to implement an ERP in a big company such as Decathlon. We find more than 6 different options and there are maybe more. To find the good solution it depends (!!!) :
-if the internal organisation is centralized or not
-of the existing systems into the company
The we talked about resources involved in ERP (internal or external) and finally the level of costumisation of ERP (code, table or module).
I was excited to use SAP, we tolk a lot about it and Iwas very curious! But, because the lack of time and many little problems, I feel a little bite frustrated. I am happy because, we saw the software, but I did not have the time to use it and to be used of it. I think that, for next year, it would be good to past much more time on it and do individually a little case after an overall presentation of SAP.
Thank you very much for your patience, motivation and smile!
I feel tied, go sleep!
See you tomorrow!
Chosing your team & customizing your software
First, the implementation team is to be chosen. It must be a mix between in-house and outside staff. The team is made of functional technical experts, a project manager, the key managers from each departments, some trusted employees and a champion. The four last categories are made by internal staff. They are principally the future users of the ERP, the people in charge of the implementation, but also some facilitators who will help the project to be correctly accepted by the employees.
Then, we must choose the level of customization we want. Two types of configurations are possible: technical & processes. The first one consists of adapting the software to your processes and consequently, makes some changes inside the table or the codes of the modules. The second one consists of making your processes fit with the features of the ERP, so the way the employees are doing business will deeply change. Obviously, the prior step of every configuration is the selection of the appropriate modules you want to include in your ERP.
As we are talking of implementing an ERP, here is the point of view of Derek Slater (who apparently is a US teacher) on ERP projects. Maybe David Newlands has read it before giving its courses ;-)
"ERP Implementation in 10 Easy Steps
Ask the board of directors for an arbitrary but large sum of money. (Suggestion: $300 million.)
Give half the money to consultants. Ask them to select an appropriate ERP package for your company. Consultants will audit your business processes for six months and then select SAP, which they happen to resell.
Form cross-functional implementation teams. Hold meetings.
Reengineer all your business processes to match the software's model.
Give the other half of the money to consultants.
Install the software.
Train end users repeatedly.
Cross your fingers.
Turn on the software.
If you're still in business, immediately return to Step 1 because it's time for an upgrade."
Derek Slater
Today we really analyse the issues of the implementation of an ERP in an organisation.
We used the example of Decathlon.
We analyse issues such as the implementation team. Who should it be composed of?
- a functional technical expert
o in house: you need someone very skilled. you set up a new role in the organisation. The person will know the needs of the organisation and will have the control o the implementation.
o Outsourced: the person will have the technical competence to do the job. It will use the resources of the ERP company.
- Key developer from each department: a person in house who will be in charge to adapt the software to the specific needs of the operational level of each department. He will make the decision. You will need to train him to make him able to handle the project.
- A trusted employee at all the hierarchical level of the organisation. He will assume the role of leader in the implementation. It has to be a person able to motivate its pair to accept the changes.
- Super user (or power user). These persons will be employees with the will to understand how it works and they will be the reference in the ERP for all the other users. This ability to know the system will give them a real power in the company as they will know techniques and the solutions to the basic issues the company will face: they will become specialists . They will be the contact point , closer to the direct users of the ERP than the IT manager.
- A person from the top management to support the project. It will make you sure that the direction of the company is with you, even if you face issues. He can use his influence to convince the employees or managers who are resistant to the change.
Outsource a part of the team will allows a better efficiency even though it can frustrate some IT managers.
You will have to train all the users: you will use outsourced specialists.
An ERP software need most of the time a customisation to be adapted to your needs.
It can be a process customisation or a technical customisation or both or none( when you didn’t have any system).
The process customisation consist in modifying the way you are doing things to adapt to the ERP.
Sometimes, the ERP needs to make a process more complex but the global benefits of the ERP worth it. It is then the role of the IT department to find solutions to readapt the process.
The software customisation consist in modifying functions of the software to adapt it with your way of doing things. The software customisation is needed in almost all the cases.
You can do 3 types of customisation:
The module selection (no customisation at all, you just load the program and use it as it is)
The table configuration: you change options on the program, add some of your old ones, delete some that was existed and are useless for you. ( eg: had or delete some bolt-on’s which are additional software for your ERP).
The code modification: is creating new thing on the program and changing it in a huge way to make it fit to your needs.
Customizing is useful but there are some con’t the code modification:
- it is costly as you need skilled people to do it and you need to buy other software to fit with so it will be efficient for you. Moreover, as you change things , you will have to maintenance it for a long time to check if it really works.
- If your technicians change everything and make errors, you won’t be able to come back to the old version and all the system can be destroy.
- As you make changes, the company of the ERP is no more responsible for the errors and won’t support you technically in case of mistakes or wrong utilisation.
You have to keep in mind that when you implement your ERP, to prevent from errors, your old system will be still in place. So all your employees will have to double enter the data (which is a loss of time). Your implementation has to be very fast, very organised and tested.
You can test the ERP as a mini big bang on a small part of your organisation to see what will happen, the mistake to avoid, the solution found to the possible issues and keep in mind all this analysis before implemented it on the whole organisation.
The decision of the area test depend of the way the organisation is formed. If it is centralised or decentralized.
In the computer room, we used the SAP software. This system is complex to get used to but is very efficient when it is well used. The training lessons are compulsory and stressful for the employees because they know that if they don’t understand how to use it, they will not be able to do their work.
We manage to enter a data in the software.
We try to fill and order and to search for a client and quantities he asks.
Employees use specific codes to each transaction they want to do (create an order, search a client...)
We saw that the program is totally integrated in the sense that anybody (if it is unlocked) can have access to any part of the software. It improve the communication within the company and avoid phone call between the different areas.
We used the example of Decathlon.
We analyse issues such as the implementation team. Who should it be composed of?
- a functional technical expert
o in house: you need someone very skilled. you set up a new role in the organisation. The person will know the needs of the organisation and will have the control o the implementation.
o Outsourced: the person will have the technical competence to do the job. It will use the resources of the ERP company.
- Key developer from each department: a person in house who will be in charge to adapt the software to the specific needs of the operational level of each department. He will make the decision. You will need to train him to make him able to handle the project.
- A trusted employee at all the hierarchical level of the organisation. He will assume the role of leader in the implementation. It has to be a person able to motivate its pair to accept the changes.
- Super user (or power user). These persons will be employees with the will to understand how it works and they will be the reference in the ERP for all the other users. This ability to know the system will give them a real power in the company as they will know techniques and the solutions to the basic issues the company will face: they will become specialists . They will be the contact point , closer to the direct users of the ERP than the IT manager.
- A person from the top management to support the project. It will make you sure that the direction of the company is with you, even if you face issues. He can use his influence to convince the employees or managers who are resistant to the change.
Outsource a part of the team will allows a better efficiency even though it can frustrate some IT managers.
You will have to train all the users: you will use outsourced specialists.
An ERP software need most of the time a customisation to be adapted to your needs.
It can be a process customisation or a technical customisation or both or none( when you didn’t have any system).
The process customisation consist in modifying the way you are doing things to adapt to the ERP.
Sometimes, the ERP needs to make a process more complex but the global benefits of the ERP worth it. It is then the role of the IT department to find solutions to readapt the process.
The software customisation consist in modifying functions of the software to adapt it with your way of doing things. The software customisation is needed in almost all the cases.
You can do 3 types of customisation:
The module selection (no customisation at all, you just load the program and use it as it is)
The table configuration: you change options on the program, add some of your old ones, delete some that was existed and are useless for you. ( eg: had or delete some bolt-on’s which are additional software for your ERP).
The code modification: is creating new thing on the program and changing it in a huge way to make it fit to your needs.
Customizing is useful but there are some con’t the code modification:
- it is costly as you need skilled people to do it and you need to buy other software to fit with so it will be efficient for you. Moreover, as you change things , you will have to maintenance it for a long time to check if it really works.
- If your technicians change everything and make errors, you won’t be able to come back to the old version and all the system can be destroy.
- As you make changes, the company of the ERP is no more responsible for the errors and won’t support you technically in case of mistakes or wrong utilisation.
You have to keep in mind that when you implement your ERP, to prevent from errors, your old system will be still in place. So all your employees will have to double enter the data (which is a loss of time). Your implementation has to be very fast, very organised and tested.
You can test the ERP as a mini big bang on a small part of your organisation to see what will happen, the mistake to avoid, the solution found to the possible issues and keep in mind all this analysis before implemented it on the whole organisation.
The decision of the area test depend of the way the organisation is formed. If it is centralised or decentralized.
In the computer room, we used the SAP software. This system is complex to get used to but is very efficient when it is well used. The training lessons are compulsory and stressful for the employees because they know that if they don’t understand how to use it, they will not be able to do their work.
We manage to enter a data in the software.
We try to fill and order and to search for a client and quantities he asks.
Employees use specific codes to each transaction they want to do (create an order, search a client...)
We saw that the program is totally integrated in the sense that anybody (if it is unlocked) can have access to any part of the software. It improve the communication within the company and avoid phone call between the different areas.
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