Q1. Differentiate between Commercial and Open Source ERPs software packages.

Differences between Source ERPs Commercial ERP

Open Source ERP

brands support corporations

known brands is not guaranteed and bigger corporations

available along with the source liberal and cause troubles when code they are modified necessary modifications in code inconvenient rather than changing their business policies change their business process to adapt to this ERP regular schedule of the company during implementation intimated to its customers not known implementation less the employees. It calls for lots of ning investments in terms of time and employees are very easy does not money require much training as source code is more than a training manual whenever something goes wrong ERP software has been traditionally used by large corporations to integrate and automate diverse departments across the enterprise. For a long time, smaller companies purchased individual accounting and payroll packages and then migrated to expensive ERP solutions as they grew. They did not have many options as ERP solutions were costlier and required business magnitude and use by many employees to justify the investment. But now with many open source ERP software available, it is now possible for small companies to go in for ERPs at an earlier stage. There are several open source software in the market including Compiere, ERP5, and Fisterra. . Microsoft Dynamics AX from Microsoft Business Division is one of Microsofts flagship ERP systems. It is commercial business solutions software. Its primary strengths are ease of use, customisation, internationalisation, and cutting edge technology. Microsoft Dynamics NAV is an ERP computer program from Microsoft Corporation. It is intended to assist with Finance, Manufacturing, Customer Relationship Management (CRM), Supply Chains, Analytics, and Electronic Commerce in Small and Medium-sized Enterprises. My SAP ERP is yet commercial ERP software. It is produced by SAP AG and was formerly known as SAP R/3. This is a client/server-based application that uses a 3-tier model. The first
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layer is the presentation or client layer, which interfaces with the user. The second layer is the application layer which houses all the business-specific logic. The third layer is the database layer which records and stores all the information about the system, including transactional and configuration data. The success of any ERP package depends on its ease of customisation and implementation process. Q2. For a successful MRP system three types of information are very essential. Describe the types of information.(Master Production Schedule 3 marks ;Bill of Material 4 marks; Inventory Records 3 marks) Master Production Schedule (MPS) The MPS is a detailed production schedule for end items or finished goods that provides the major input to the materials requirement planning process. Associated with each finished product is a BOM It describes the dependent demand relationships that exist among the various components, raw materials, parts, subassemblies, and so on. The entire set of BOMs for the company's finished products is called the BOM file. Inventory records provide inventory status data for each product or component such as stock-on-hand, stock-on-order, and so on. It also contains planning factors like lead-time, safety stock, re-order level, and so on. MRP logic uses the MPS, the BOM file and the inventory records to determine the following for all components:

The MRP system calculates the due dates and release dates taking into consideration the leadtimes required to produce or procure the components. It also recognises the order in which they are assembled into the finished product. If the MRP process is carried out in conjunction with capacity planning, the production facility must have the capacity to complete the orders on time. Bill of Material (BOM) A BOM defines the relationship of components to end items. The BOM identifies all components used in the production of an end item, the quantity required, and the order in which the components are assembled. For example, consider an office chair. The chair is composed of a seat cushion, back cushion, adjuster mechanism, base unit, wheels, and fasteners. To manufacture the chair the wheels, base unit, and adjuster mechanism are assembled into a chair frame, to which the base cushion and back cushion are attached. All the fasteners are identical and there are 11 of them for this chair. Figure1 shows a BOM for an office chair. To simplify the discussion, this BOM does not show all purchased raw materials (paint, steel tubing and so on). This form of the BOM is frequently called a product structure diagram. All items appearing below the final product in a BOM are referred to as components, whether they are raw materials or component parts or subassemblies. In the above figure, all items with the exception of the 'Office chair are components. The term- parent component describes a component at one level in the BOM that is composed of components from the next lower level in the BOM. The lower level

componentsarecalledchildcomponents.

Figure1: Bill of material for the office chair The key to MRP is time-phasing of requirements for components are based upon the structure of the BOM. If the time required either manufacturing or purchasing components (lead-time) is known, we can determine when orders must be released to the shop floor or outside suppliers. This is to ensure that the required components will be available when needed. Inventory Records It is a process for keeping track of objects or materials. In general, the term may also refer to just the software components. Modern Inventory Control (IC) systems depend upon barcodes, and potentially Radio Frequency Identification (RFID) tags. These systems provide automatic identification of inventory objects. For example, in an academic study performed at Wal-Mart, RFID reduced Out of Stocks by 30 percent for products selling between 0.1 and 15 units a day. Inventory objects could include any kind of physical asset: fixed assets, circulating tools, library books, merchandise, consumables, or capital equipment. The system uses a RFID or barcode scanner reader to automatically identify the inventory object. Then it collects additional information from the operators via fixed terminals (workstations), or mobile computers to record an inventory transaction. An IC system may be used to automate a sales order fulfilment process. Such a system contains a list of order to be filled, and then prompts workers to pick the necessary items. Also it provides them with packaging and shipping information. Q3. Explain the features, benefits and Limitations of ERP Inventory Management. ERP Inventory Management ERP is a computer system that maintains information database which can be accessed through out the organisation. i.e. the system is centralised. Systems that deploy ERP inventory management allows information sharing across various departments of the organisation and also across geographical locations. It allows employees
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to view information in reliable and consistent fashion. The systems that deploy ERP procedures maintain only one software system and are dependent on networks. Features of ERP Inventory Management ERP inventory management has many features .Some of them include: maintaining best possible stock level

Online status of item quantity in terms of on-hand, on hand available, reserved, ordered, to order, rejected, defective and rework-able quantities managing complex storage needs and automatic update of warehouse ERP management uses bar codes to maintain inventory items. A bar code is a small image that has bars (lines) and spaces fixed on the store items and used as an identification mark of a particular product. This makes tracking stock much easier. Once the items are bar-coded, they get scanned and their product information is entered into the ERP inventory management system. Introducing bar code labels on stock helps companies save money as it keeps the list of stock updated. Employees can easily see when certain quantities are low and need to re-stock. Customers also benefits from this as customers can see what products are currently in stock. The main purpose and benefit that the organisation can derive from ERP management system is that the ERP system is company-wide and has a single software system, where as organisations that do not employ ERP management will have dissimilar and diverse software applications that may not be compatible with one another. Benefits and Limitations of ERP Inventory Management ERP inventory management system has many benefits. Some of them include: facilitating appropriate communication between different areas. providing a top down summary of the mechanism of a company. d primitive paper based systems that improves efficiency. Limitations of ERP Inventory Management ERP inventory management helps an organisation in many ways. However, it also has some limitations. They are: Limited customisation Expensive Not friendly with every type of business like small organisations. Harder to fix responsibility as it is a company-wide system that connects all areas When all departments in a company are not willing to share information, maintenance of sensitive data can disturb the work flow

Q4. What are the activities of Human Resources management systems? Activities of HRM System The various activities that HRM systems encompass are: Payroll: This system provides automatic and instant updates of employee information such as employee attendance, and employee arrival and departure time. It also triggers activities of various deductions and tax to be paid by the employee. It bridges the gap between employee related activities and the organisations financial management system. Work time: This system performs cost analysis and maintains an efficiency metrics up to date. Administration: Every organisation provides certain schemes and policies for the benefits of the employees. The HRM system keeps track of the employees usage of the benefit programs such as insurance plans, compensation benefits, and retirement policies. HR management information system: This system maintains records such as address data, training and development and other correlated activities such as recruitment, placement and maintains employees personnel records. Recruitment: Recruiting employees that best suits an organisations criteria is very necessary. Online recruiting has become one of the major ways to employ the right and potential candidates for the positions listed in an organisation. This can be achieved by online job portals, consultancies or recruiting sites. Training: This system is also called as learning management systems. This system keeps track of employee skills and training to be provided. It also decides the type of training course required, and other learning materials such books and CDs required for the training. The HRM system also keeps track of calendar of training classes, performance and appraisal metric of employees. Performance Record: This system maintains performance updates of employees Employee self service: This system helps employees to interact with the HR regarding any queries and wants in an organisation related to benefits, policies and concerns. Organisational development: This system helps in analysing various modules of an organisation which helps in retaining the deserving candidates. Shared talent: This system ensures that every employee in the organisation has access to necessary information and ensures cooperation to make shared decisions regarding an aspect. This creates a positive work environment. Q5. Explain any two benefits of an ERP implementation? Some of the benefits that you can find in an organisation with ERP implementation are: -time -time shipment

Improved supplier performance

-making capability
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Reduction in Cycle Time The time between receiving of the order and delivery of the product is known as Cycle time. At one end of the manufacturing spectrum is the make-to-order operation, where the cycle time and cost of production are high. This is because in a make-to-order situation the manufacturer starts making the product or designing the product only after receiving the order. He will procure the materials and components required for production only after getting the order. On the other end of the manufacturing operations is the make-to-stock approach. Here the products are manufactured and kept in the finished goods inventory before the order is placed. In both cases the cycle time can be reduced by the ERP systems, but the reduction will be more in the case of make-to-order systems. In the case of make-to-stock, the items are already manufactured and kept in warehouses or with distributors for the sales. Here, the cycle time is reduced not in the shop floor, but during the order fulfilment. In the earlier days, even for the made-to-stock items, the cycle time used to be high. This was because the process was manual and if computerised, not integrated. Suppose a customer places an order. The order entry clerk has to check whether the order is available in the warehouse nearest to the customer. If it is not available there, he will check whether it is available in any other warehouse or with any of the distributors. Then he will have to process the order, inform the concerned warehouse or distributor to ship the item. Simultaneously he informs the finance department to raise the invoice, and so on. All this used to take a lot of time few days or sometimes even weeks. But with an ERP system, as soon as the order is entered into the system, the system checks the availability of the items. If it is not available with the nearest manufacturer, then the warehouse that is closest to the customer and which has the item in stock is identified. The warehouse is informed about the order, and the shipment details are sent to the distribution module. Here it will perform the necessary tasks like packaging and picking so that the delivery is not affected. The finance module is also alerted about the order so that they can raise the invoice. All these actions are triggered by the click of a button by the order entry clerk. Since all the data, updated to the minute, is available in the centralised database and since all the procedures are automated. We have to keep in mind that almost all of these activities are done without human intervention. This efficiency of the ERP systems helps in reducing the cycle time. In the case of make-to-order items, the ERP systems save time by integrating with Computer Aided Design/ Computer Aided Manufacturing (CAD/CAM) systems. Time and cost reductions are possible when CAD-engineered designs are converted automatically into software programs for computerised production machines using CAD/CAM systems. The computerised conversion eliminates the costly and time consuming steps. This avoids a person convert design drawings into a computer program for computer-controlled production equipment, such as robots or machine tool. These systems reduce cycle times by 30-50%. Combined with this it helps in achieving automation in material procurement, and production planning. Efficiency achieved through the plant maintenance and production systems the ERP packages helps in reducing the cycle times. Better Customer Satisfaction Customer satisfaction means meeting or exceeding customers' requirements for a product or service. Evaluation of the degree of satisfaction is usually made on at least three measures: the company respond to the customers' demands in a timely manner, a criterion that is especially important for custom products and services.

ERP systems have proved that they can produce goods at the flexibility of make-to-order approach without loosing the cost and time benefits of made-to-order operations. This means that the customer will get individual attention and the features that he/she wants. There is no need for the customer to spend more money and wait for long periods. With the introduction of the web-enabled ERP systems, the customers can place the order, track the status of the order and make the payment sitting from home. The customer could get technical support by either accessing the company's technical support knowledge base (help desk) or by calling the technical support. All the details of the production and the customer are available to the person at the technical support department. With this data the company will be able to support the customers even better. All this is possible because of the use of the latest developments in information technology by the ERP systems. However, this will go a long way in improving the customer satisfaction.

Q6. Who is an ERP vendor and what are his roles? Vendors Vendors are the people who invest huge amounts of time and effort in research and development of the ERP package. They come up with innovations that make the packages more efficient and flexible to implement and use. If one studies the history of the ERP packages and finds out how each package evolved, it soon becomes evident that every ERP package grew out of the experience or opportunity of a group of people, working in a specific business, who created systems that could deal with certain business segments. ERP market place is crowded with more and more players and competitor entering the market to provide ERP packages that have features and functionality to cater to the needs of businesses in almost all sectors. The ERP vendors spent billions of rupees in research to come up with new ideas that make the packages more efficient and flexible. With the evolution of new technologies, the vendors constantly upgrade their product to make the best and latest advancements in technology available in the market. For example, SAP is the global market leader in ERPs with approximately 30 to 60 percent of the world market; The company spends a large percentage of its revenue in research and development of new technologies. Role of the Vendor As soon as the company signs the contract, the vendors should supply the product and its documentation. Once the software is delivered, the company can develop the training and testing environment for the implementation team. The roles of the vendors during and after implementation of ERP are: The vendor is responsible for fixing any problems in the software that the implementation team encounters. The vendor should have a liaison officer to constantly interact with the implementation team. The vendors provide initial training for the company's key users. These key users are the ones who will define, together with the consultants, how the software is to serve the company. They are also called as in-house functional experts who decide how the functionalities are implemented to adapt the product to suit the company's unique requirements. It is very important to provide these in-house experts a through training on the features of the package. Vendor's training should include showing the key users how the package works, what are the major components, how the data and information flows across the system, what is flexible and what is not, what can be configured and what cannot, what can be customised and what should not, what are the limitations, what are the strengths and weaknesses and so on.
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The objective of the vendor training is to show how the system works, not to show how it should be implemented. This means that the vendor demonstrates the product as it exists and highlights what are the possible options available. The company's employees who are participating in the vendor training should try to understand the characteristics of the package and the impact of the system on their business processes. The trainees should use these training sessions to question the vendor on all aspects of the system. Now some of you might ask, we are hiring consultants who are experts in the package so why can't we get training from the consultants? This is true. Most of the consultants are capable of providing sound training for the packages. But we are hiring the consultants for implementing the system. However, the consultants also have a role to play during this vendor training. They should participate in the training sessions to evaluate how the users react to the reality that is starting to take shape from the detailed presentations and demos. Consultants should also ask questions that the vendors are trying to avoid and the users are unaware of. This is the best way to present the real picture to the users and it will also prevent the vendors from making false claims. Vendors play an important role in project support function and exercise the quality control with respect to how the product is implemented. It is the vendor who understands the finer details and subtleties of the product and can make valuable suggestions and improvements that could improve the performance of the system. It is also in the best interests of the vendor that this participation continues, because if the implementation fails, most of the blame will fall on the vendor. Also a successful implementation means another satisfied client, improved goodwill and good referrals and so on. So the vendor will continue to participate in all the phases of the implementation, mostly in an advisory capacity, addressing specific technical questions about the product and technology. Vendors help to fill gaps between the package and the actual business processes. The software might have to be customised to suit the company's needs. Here, customising means altering the product so that it is suited for the company's purposes. The choice of whether to customise or not is the one that can have enormous impact on the project and it often constitutes a point of conflict between the consultants and users. But if the decision to customise has been taken, it is the vendor's duty to carry out the necessary modifications. This is because only the vendor knows the product well enough to make the necessary changes without affecting the other parts. Moreover, the company should get a guarantee (in writing) from the vendor that despite the customisation, it will be able to benefit from the future software improvements introduced by the vendor. ERP integrates business process reporting for the different business divisions. It creates transparent data exchange and facilitates timely and informed decision making for senior managers. The successful implementation of the enterprise resource planning software improves the management and planning of a business corporation. It increases the performance of the organisation. This increasing trend has enhanced the value of ERP vendors in the market. ERP vendors are continuing to expand market presence by offering new applications. The top three players namely SAP AG, Oracle, Baan PeopleSoft account for 64 per cent of the ERP market revenue.