VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

STUDY MATERIAL
ENTERPRICE RESOURCE PLANNING
DEPARTMENT OF

IT

R S

Vel Tech
Vel Tech Multi Tech Dr.Rangarajan Dr.Sakunthala Engineering
College
Vel Tech High Tech Dr. Rangarajan Dr.Sakunthala Engineering
College

SEM - VIII
VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

INDEX
UNITS

I.
II.

PAGE NO.

06

Introduction

25

ERP Implementation

III. The Business Modules

40

IV.

The ERP Market

64

V.

ERP Present and Future

89

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

# 42 & 60, Avadi Veltech Road, Avadi, Chennai 62.

Phone : 044 26840603
26841601
26840766

email : veltech@vsnl.com
website : www.vel-tech.org
www.veltechuniv.edu.in

R S

Student Strength of Vel Tech increased from 413 to 10579, between 1997 and 2010.
Our heartfelt gratitude to AICTE for sanctioning highest number of seats and highest number of courses for the
academic year 2009 2010 in Tamil Nadu, India.

Consistent success on academic performance by achieving 97% - 100% in University examination results during
the past 4 academic years.
Tie-up with Oracle Corporation for conducting training programmes & qualifying our students for International
Certifications.

Permission obtained to start Cisco Networking Academy Programmes in our College campus.
Satyam Ventures R&D Centre located in Vel Tech Engineering College premises.
Signed MOU with FL Smidth for placements, Project and Training.
Signed MOU with British Council for Promotion of High Proficiency in Business English, of the University of
Cambridge, UK (BEC).
Signed MOU with NASSCOM.
Signed MOU with INVICTUS TECHNOLOGY for projects & Placements.
Signed MOU with SUTHERLAND GLOBAL SERVICES for Training & Placements.
Signed MOU with Tmi First for Training & Placements.

VELTECH, VEL TECH MULTI TECH engineering colleges Accredited by TCS

VEL TECH, VEL TECH MULTI TECH, VEL TECH HIGH TECH, engineering colleges & VEL SRI RANGA SANKU
(ARTS & SCIENCE) Accredited by CTS.
Companies Such as TCS, INFOSYS TECHNOLOGIES, IBM, WIPRO TECHNOLOGIES, KEANE SOFTWARE & T
INFOTECH, ACCENTURE, HCL TECHNOLOGIES, TCE Consulting Engineers, SIEMENS, BIRLASOFT,
MPHASIS(EDS), APOLLO HOSPITALS, CLAYTON, ASHOK LEYLAND, IDEA AE & E, SATYAM VENTURES,
UNITED ENGINEERS, ETA-ASCON, CARBORANDUM UNIVERSAL, CIPLA, FUTURE GROUP, DELPHI-TVS
DIESEL SYSTEMS, ICICI PRULIFE, ICICI LOMBARD, HWASHIN, HYUNDAI, TATA CHEMICAL LTD, RECKITT
BENKIZER, MURUGAPPA GROUP, POLARIS, FOXCONN, LIONBRIDGE, USHA FIRE SAFETY, MALCO,
YOUTELECOM, HONEYWELL, MANDOBRAKES, DEXTERITY, HEXAWARE, TEMENOS, RBS, NAVIA MARKETS,
EUREKHA FORBES, RELIANCE INFOCOMM, NUMERIC POWER SYSTEMS, ORCHID CHEMICALS, JEEVAN
DIESEL, AMALGAMATION CLUTCH VALEO, SAINT GOBAIN, SONA GROUP, NOKIA, NICHOLAS PHARIMAL,
SKH METALS, ASIA MOTOR WORKS, PEROT, BRITANNIA, YOKAGAWA FED BY, JEEVAN DIESEL visit our
campus annually to recruit our final year Engineering, Diploma, Medical and Management Students.

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Preface to the First Edition

This edition is a sincere and co-ordinated effort which we hope has made a
great difference in the quality of the material. Giving the best to the students,
making optimum use of available technical facilities & intellectual strength has
always been the motto of our institutions. In this edition the best staff across the
group of colleges has been chosen to develop specific units. Hence the material, as a
whole is the merge of the intellectual capacities of our faculties across the group of
Institutions. 45 to 60, two mark questions and 15 to 20, sixteen mark questions for
each unit are available in this material.
Prepared By :

Mr. Einstein. J.
Asst. Professor.

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

IT1006
UNIT 1

VEL TECH MULTI TECH

VEL TECH HIGH TECH

ENTERPRISE RESOURCE PLANNING

INTRODUCTION

ERP: An Overview, Enterprise An Overview, Benefits of ERP, ERP and Related Technologies,
Business Process Reengineering (BPR), Data Warehousing, Data Mining, OLAP, SCM
UNIT II

ERP IMPLEMENTATION

ERP Implementation Lifecycle, Implementation Methodology, Hidden Costs, Organizing the

Implementation, Vendors, Consultants and Users, Contracts with Vendors, Consultants and
Employees, Project Management and Monitoring
UNIT III

THE BUSINESS MODULES

Business modules in an ERP Package, Finance, Manufacturing, Human Resources, Plant

Maintenance, Materials Management, Quality Management, Sales and Distribution
UNIT IV

THE ERP MARKET

ERP Market Place, SAP AG, Peoplesoft, Baan, JD Edwards, Oracle, QAD, SSA
UNIT V

ERP PRESENT AND FUTURE

Turbo Charge the ERP System, EIA, ERP and e-Commerce, ERP and Internet, Future Directions
TEXT BOOK
1. Alexis Leon, ERP Demystified, Tata McGraw Hill, New Delhi, 2000
REFERENCES
1. Joseph A Brady, Ellen F Monk, Bret Wagner, Concepts in Enterprise Resource Planning,
Thompson Course Technology, USA, 2001.
2. Vinod Kumar Garg and Venkitakrishnan N K, Enterprise Resource Planning Concepts and
Practice, PHI, New Delhi, 2003

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

UNIT I
PART A
1. What is ERP?
Enterprise Resource Planning (ERP) covers the techniques and concepts employed for the
integrated management of businesses as a whole, from the viewpoint of the effective use of
management resources, to improve the efficiency of an enterprise. Ideally the data for various
business functions are integrated.
2. Write the advantages of ERP.
Installing an ERP system has many advantages both direct and indirect. The direct
advantages include improved efficiency, information integration for better decision making, faster
response time to customer queries, etc. The indirect benefits include better corporate image,
improved customer goodwill, customer satisfaction, and so on.
3. Direct benefits of ERP.
The following are some of the direct benefits of an ERP system:
Business Integration
Flexibility
Better analysis and planning capabilities
Use of latest technology

4. Discuss evaluation of ERP.

As the department become large, they became closed & water tight. Each had their own set
of procedures & hierarchy, each & every department maintain information separately which
causes waste of resources.
Hence ERP is implemented to integrate all the department together and limit the waste of
resources.
5. How business integration achieved by ERP system?
ERP packages are considered to be integrated, is the automatic data updation (automatic
data exchange among applications) that is possible among the related business components.
VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

6. Why are ERP systems said to be flexible?

Different languages, currencies, accounting standards and so on can be covered in one
system, and functions that comprehensively manage multiple locations of a company can be
packaged and implemented automatically.
7. Why do many ERP Implementation fails?
Many a company fails in this because of a wrong product, incompetent and haphazard
implementation and inefficient or ineffective usage.
8. What are the reasons for the growth of the ERP market?

To enable, improved business performance

To support business growth requirements
To provide flexible, integrated, real-time decision support
To eliminate limitation in legacy systems
To take advantage of the untapped mid market (medium size organizations)

9. How do conventional application packages and ERP packages differ?

The first answer to this question is that ERP packages cannot only handle individual
business functions such as accounts and inventory, but also the entire range of business functions
necessary for the companys operations.
The second difference is that ERP packages are targeted at everything from small
businesses to the largest organizations, and that they can be composed of a highly flexible
decentralised database and an information system cluster linked by a network.
The third difference is global adaptation, represented by ERP packages multilingual and
multi-currency capacity. In the present day, when companies, irrespective of their size and market
share, are manufacturing and selling in various areas of the world, the globalization of
management platforms is being hastened, along with the global adaptation of enterprise
information systems.
10. What is an integrated information system?
An information system is an open, purposive system that produces information using the
VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

input process output cycle. The minimal information system consists of three elements
people, procedures and data. People follow procedures to manipulate data to produce
information. In todays computer world, the definition of information systems has undergone a
slight change. Today, an information system is an organized combination of people, hardware,
software, communication networks and data resources that collects, collates, transforms and
disseminates in an organization.
11. What is MIS?
MIS or Management Information System is a computer based system that optimises the
collection, collation, transfer and presentation of information throughout an organization through
an integrated structure of databases and information flow.
12. Why are the integrated information system important for the organizations success?
ERP system that treats the organization as a single entity and caters to the information
needs of the whole organization. If this is possible, and if the information that is generated is
accurate, timely and relevant, then these systems will go a long way in helping the organization in
realizing its goals.
13. What is business modeling?
In business modeling, we model the business as an integrated system, taking the processes
managing its facilities and materials as resources. Information is a very important resource and is
very critical in managing all the other resources.
Thus, the business model is a representation of the actual business what are the various
business functions of the organization, how are they related, what are their interdependencies,
and so on. The business model is usually represented in the graphical form using flow charts and
flow diagrams. From the business model, the data model of the system is created.
14. What is integrated data model?
It should clearly depict the organization; it should reflect the day-to-day transactions and it
should be updated continuously. At any given time, the database should give a snapshot of the
organization at that point in time. So if an order is entered, the sale is done and the goods are
dispatched, then the database should reflect those changes. The inventory should be reduced and
the account receivables should be increased. All these things have to happen instantaneously and
automatically. That is the challenge and that is the advantage of the integrated database and the
integrated data model.
VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

15. What are the limitations of ERP?

1. Managers cannot generate custom reports or queries without help from a programmer
and this inhibits them from obtaining information quickly, which is essential for
maintaining a competitive advantage.
2. ERP systems provide current status only, such as open orders. Managers often need to
look past the current status to find trends and patterns that aid better decision making.
3. The data in the ERP application is not integrated with other enterprise or division
systems and does not include external intelligence.
16. How to overcome the limitations of ERP?
Some of these technologies are:

Business Process Reengineering (BPR)

Management Information System (MIS)
Decision Support Systems (DSS)
Executive Information Systems (EIS)
Data Warehousing
Data Mining
On-line Analytical Processing (OLAP)
Supply Chain Management
Customer Relationship Management (CRM)

17. What is BPR?

The fundamental rethinking and radical redesign of business processes to achieve dramatic
improvements in critical, contemporary measures of performance such as cost, quality, service and
speed.
18. What is data warehousing?
The primary concept of data warehousing is that the data stored for business analysis can
be accessed most effectively by separating it from the data in operational systems. The most
important reason for separating data for business analysis, from the operational data, has always
been the potential performance degradation on the operational system that can result from the
analysis processes.
19. What is Data mining?
VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Data mining is the process of identifying valid, novel, potentially useful and ultimately
comprehensible information from databases that is used to make crucial business decisions.

20. What do you mean by OLAP?

OLAP can be defined in five words Fast Analysis of Shared Multidimensional
Information.
FAST means that the system is targeted to deliver most responses to users within about five
seconds, with the simplest analysis taking no more than one second and very few taking more
than 20 seconds. ANALYSIS means that the system can cope with any business logic and
statistical analysis that is relevant for the application and the user, and keep it easy enough for the
target user. SHARED means that the system implements all the security requirements for
confidentiality (possibly down to cell level) and, if multiple write access is needed, concurrent
update locking at an appropriate level. MULTIDIMENSIONAL means that the system must
provide a multidimensional conceptual view of the data, including full support for hierarchies and
multiple hierarchies. INFORMATION is refined data that is accurate, timely and relevant to the
user.
21. Explain the concept of supply chain management?
A supply chain is a network of facilities and distribution options that performs the function
of procurement of materials, transformation of these materials into intermediate and finished
products, and the distribution of these finished products to customers. Supply chains exist in both
service and manufacturing organizations, although the complexity of the chain may vary greatly
from industry to industry and firm to firm.
22. What is the use of common database?
The common database can allow every department of a business to store and retrieve
information real time. The information should be reliable, accessible and easily shared.
23. List the Reasons for the growth of the ERP Market
To improve business performance
To support business growth requirements
To eliminate limitations in legacy system
VEL TECH

VEL TECH MULTI TECH

10

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

PART B
1. Describe the overview of ERP.
Enterprise Resource Planning (ERP) covers the techniques and concepts employed for the
integrated management of business as a whole, from the viewpoint of the effective use of
management resources, to improve the efficiency of an enterprise. ERP packages are integrated
(covering all business functions) software packages that support the above ERP concepts.
Originally, ERP packages were targeted at the manufacturing industry, and consisted
mainly of functions for planning and managing core businesses such as sales management,
production management, accounting and financial affairs, etc. However, in recent years,
adaptation not only to the manufacturing industry, but also to diverse types of industry has
become possible and the expansion of implementation and use has been progressing on a global
level.
ERP software is designed to model and automate many of the basic processes of a company,
from finance to the shop floor, with the goal of integrating information across the compnayand
eliminating complex, expensive links between computer systems that were never meant to talk to
each other.
Figure shows how information is integrated within an organization using an ERP system.

Strategic & Operational

Planning

Finance

Human
Resource

Manufacturing
ERP
System

Logistics Management

Materials Management

Maintenance Management

VEL TECH

Quality Management

VEL TECH MULTI TECH

11
Sales &
Distribution

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Figure. Information integration through ERP systems.

ERP software is a mirror image of the major business processes of an organization, such as
customer order fulfillment and manufacturing. Its success depends upon reach-a circumscribed
ERP system isnt much better than the legacy system it replaces. In many cases, it is worse,
because the old code at least was written specifically for the company and the task. ERP systems
set of generic processes, produce the dramatic improvements that they are capable of only, when
used to connect parts of an organization and integrate its various processes seamlessly. When a
warehouse in Noida enters a customer order, for example, the data flows automatically to others in
the company who need to see it-to the finance department at the company headquarters in
Mumbai and to the manufacturing plant in Chennai. The lure of information integration struck a
chord with CEOs and CFOs and CFOs-ERP vendors primary targets-and sales of ERP took off in
the early 1990s.
REASON FOR THE GROWTH OF THE ERP MARKET
The is no doubt that the market for Enterprise Resource Planning (ERP) systems is in great
demand. Industry analysts are forecasting growth rates of more than 30% for at least the next five
years. Why are so many companies replacing their key business systems? The answer is:
To enable improved business performance
Cycle time reduction
Increased business agility
Inventory reduction
Order fulfillment improvement
To support business growth requirements
New products/product lines, new customers
Global requirements including multiple languages and currencies

VEL TECH

To eliminate limitation in legacy systems

Century dating issues
Fragmentation of data and processing
Inflexibility to change
VEL TECH MULTI TECH

12

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Insupportable technologies

To take advantage of the untapped mid-market (medium size organizations)

Increased functionally at a reasonable cost
Client server/open systems technology
Vertical market solutions

These are some of the reasons for the explosive growth rate of the ERP markets and the ERP
vendors. As more and more companies are joining the race, the ERP vendors are shifting their
focus from big-Fortune 1000-companies to different market segments (medium size companies,
small companies, etc). The future will see fierce battle for market share and mergers and
acquisitions for strategic and competitive advantage. The ultimate winner in this race will be the
customer, who will get better products and better service at affordable prices.
2. Benefits of ERP.
The Advantages of ERP
Installing an ERP system has many advantages-both direct and indirect. The direct
advantages include improved efficiency, information integration for better decision making, faster
response time to customer queries, etc. The indirect benefits include better corporate image,
improved customer goodwill, customer satisfaction, and so on. The following are some of the
direct benefits of an ERP system,

Business Integration
Flexibility
Better Analysis and Planning Capabilities
Use of Latest Technology

Business Integration
The first and most important advantage lies in the promotion of integration. The reason
why ERP packages are considered to be integrated, is the automatic data updation (automatic data
exchange among applications) that is possible among the related business components. Since
conventional company information systems were aimed at the optimization of independent
business functions in business units, almost all were weak in terms of the communication and
integration of information that transcended the different business functions. In the case of large
companies in particular, the timing of system construction and directives differs for each product
VEL TECH

VEL TECH MULTI TECH

13

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

and department/functions and sometimes, they are disconnected. For this reason, it has become
an obstacle in the shift to new product and business classification. In the case of ERP packages,
the data of related business functions is also automatically updated at the time a transaction
occurs. For this reason, one is able to grasp business details in real time, and carry out various
types of management decisions in a timely manner, based on that information.
Flexibility
The second advantage of ERP packages is their flexibility. Different languages, currencies,
accounting standards and so on can be covered in one system, and functions that comprehensively
manage multiple locations of a company can be packaged and implemented automatically. To
cope with company globalization and system unification, this flexibility is essential, and one can
say that it has major advantages, not simply for development and maintenance, but also in terms
of management.
Better Analysis and Planning Capabilities
Yet another advantage is the boost to the planning functions. But enabling the
comprehensive and unified management of related business and its data, it becomes possible to
fully utilize many types of decision support systems and simulation functions. Furthermore, since
it becomes possible to carry out, flexibly and in real time, the filling and analysis of data from a
variety of dimensions, one is able to give the decision-makers the information they want; thus
enabling them to make better and informed decisions.
Use of Latest Technology
The fourth advantage is the utilization of the latest development in Information Technology
(IT). The ERP vendors were very quick to realize that in order to grow and to sustain that growth,
they had to embrace the latest developments in the field of Information Technology. Therefore,
they quickly adapted their systems to take advantage of the latest technologies like open systems,
client/server technology, Internet/Intranet, CALS (Computer-Aided Acquisition and Logistics
Support), electronic-commerce, etc. It is this quick adaptation to the latest changes in Information
Technology that makes the flexible adaptation to changes in future business environments
possible. It is this flexibility that makes the incorporation of the latest technology possible during
systems customization; maintenance and expansion phases.
As has been stated above, ERP includes many of the functions that will be necessary for
future systems. However, undertaking reforms to company structures and business processes, so
as to enable the full use of these major features, is the greatest task for companies that will use
them. It is necessary to take note that casually proceeding with the implementation of ERP, merely
VEL TECH

VEL TECH MULTI TECH

14

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

for reasons of system reconstruction or preparation for the year 2000, is likely to result in turning
the above mentioned advantages into disadvantages.
3. Describe Integrated Management Information.
Integrated Management Information
An information system is an open, purposive system that produces information using the
input-process-output cycle. The minimal information system consists of three elements-people,
procedures and data. People follow procedures to manipulate data to produce information. In
todays computer world, the definition of information systems has undergone a slight change.
Today, an information system is an organized combination of people, hardware, software,
communication networks and data resources that collects, collates, transforms and disseminates in
an organization.
Management Information System(MIS) is a planned system of the collecting, processing,
storing and disseminating data in the form of information needed to carry out the functions of
management. Information system include systems that are not intended for decision making. But
MIS intended for decision making also.

VEL TECH

VEL TECH MULTI TECH

15

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Figure. An enterprise where all departments know what the others are doing
Management Information Systems, also called information-reporting systems, were the
original type of management support systems, and they still are a major category of information
systems. MIS produce information products that support many of the day-to-day decision making
needs of the management. Reports, charts, graphs, displays and responses produced by such
systems provide information that managers have specified in advance. Such predefined
information satisfies the needs of managers at the operational levels of the organization who are
faced with the structured type of decision-making.

But the problem with these information systems is that they only give information that has
been predefined. So each department will have its own database and information systems. These
systems will produce different reports of varying detail that were specified when the systems were
built.
This method of information gathering has two major disadvantages. One, people in one
department do not have any information about what is happening in the other departments. May
be at the top management level the summary reports are being circulated to other departments
also, but these summary reports often fail in capturing the real picture. The second drawback is
that these systems give only the information that they were designed to produce at the time they
were built. Suppose a manager wants some information which is not in the reports, then these
systems are of no help.
These systems lack the integrated approach. There will be an accounting system for the
finance department, a production planning system for the manufacturing department, an
inventory management system for the stores department, and so on. All these systems will
perform in isolation. So if a person wanted some information which has to be derived from any of
these two systems, he has to get the necessary reports from both systems and then correlate and
combine the data.
Because the systems work in isolation, collecting and analyzing the data needed for one
departments functioning, can be a difficult task, since, getting information about some aspect that
is dependent on more than one department can be tedious. No business executive or decisionmaker can take good decisions with the isolated data that he gets from the various reports
produced by each department. Even if he collates the data and produces the information that he
requires, he would have lost valuable time that could have been better spent in decision-making.
In reality, an organization cannot function as islands of different departments.
VEL TECH

VEL TECH MULTI TECH

16

The

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

production planning data is required for the purchasing department. The purchasing details are
required for the finance department and so on. So if all the information islands, which were
functioning in isolation, were integrated into a single system, then the impact of that would be
dramatic. For example, if the purchase department can see the production planning details, it can
make the purchasing schedule accordingly. If the finance department can see the purchase details
as soon as it is entered in the system, they can plan for the cash flow that will be necessary for the
purchases.
We have seen that in todays competitive business environment, the key resource of every
organization is information. If the organization does not have an efficient and effective mechanism
that enables it to give the decision makers the right information at the right time, then the chances
of that organization succeeding in the next millennium are very remote.
The three fundamental characteristics of information are accuracy,
relevancy and
timeliness. The information has to b e accurate, it must be relevant for the decision-maker and it
must be available to the decision-maker when he needs it. Any organization that has the
mechanism to collect, collate, analyze and present high quality information to its employees, thus
enabling them to make better decisions, will always be one step ahead of the competition. Today,
the time available for an organization to react to the changing market trends is very short. To
survive, the organization must always be on its toes, gathering and analyzing the data both
internal and external. Any mechanism that will automate this information gathering and analysis
process will enhance the chance of the organization to beat the competition.
So, what is needed is a system that treats the organization as a single entity and caters to
the information needs of the whole organization. If this is possible, and if the information that is
generated is accurate, timely and relevant, then these systems will go a long way in helping the
organization in realizing its goals.
4. Describe Business Modeling in ERP.
Business Modeling:
Business modeling or creating a business model is one of the first activities in any ERP
project. As said earlier, the ERP systems should mirror the business processes. A business model
is not mathematical model, but it is a representation of the business as one large system showing
the interconnections and interdependencies of the various subsystems and business processes as
shown in figure.
Based on the organizations goals, objectives and strategic plans, a business model
consisting of the business processes is developed. These business processes are controlled by
different individuals in the organization (the people) to achieve common goals. Based on the
VEL TECH

VEL TECH MULTI TECH

17

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

business model, the ERP system is developed with the aim of providing the required information
and necessary assistance to the various individuals, to help them perform their business processes
more effectively and efficiently.

Figure: Real world

Processe
s

Interrelationsh
ip &
Interdependen
cies
Plant
Material

Customer Order

Contract

Invoice

Figure: Business Model

In business modeling, we model the business as an integrated system, taking the processes
managing its facilities and materials as resources. Information is very important resources and is
very critical in managing all the other resources.
Thus, the business model is a representation of the actual business what are the various
business functions of the organization, how are they related, what are their interdependencies,
and so on. The business model is usually represented in the graphical form using flow charts and
flow diagrams. Form the business mode, the data model of the system is created.
5. Describe Integrated Data Model.

VEL TECH

VEL TECH MULTI TECH

18

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Integrated Data Model:

One of the most critical steps in the ERP implementation is the creation of an Integrated
Data Model. As we have seen earlier, one of the advantages of having an ERP system is that all
employees from the different departments get access to the data the integrated data. The
company uses this integrated data for its analysis and decision-making.
With the implementation of ERP systems, the departmental information systems and the
departmental databases will have to go. There can no longer be isolated databases, which cater to
the needs of a particular department. All the data has to be from the integrated database. This
approach will reduce data redundancy and provide updated information about the entire
organization to all employees.
For the integrated database to be effective it should clearly depict the organization; it should
reflect the day-to-day transactions and it should be updated continuously. At any given time, the
database should give a snapshot of the organization at the point in time. so if an order is entered,
the sale is done and the goods are dispatched, then the database should reflect those changes. The
inventory should be reduced and the account receivables should be increased. All these things
have to happen instantaneously and automatically. That is the challenge and that is the advantage
of the integrated database and the integrated data mode. The integrated data model is derived
from the business model as shown in figure.
So, when designing the data model for the ERP system, the most important thing that
should be kept in mind is the information integration and the process/procedure automation. The
data model should reflect the entire organization and it should successfully depict and integrate
the data structures of the entire organization.
6. Describe Business Process Reengineering.
Business Process Reengineering (BPR)
BPR has been around for quite some time and a lot has been written about it in both, the
practitioner trade press and the academic research journals. However, the controversy still
remains about whether there is any accurate description of BPR, or BPR is just a fad an appealing
label to tag on to whatever your company is doing, to suggest that your latest and greatest work is
in vogue. But if reengineering is to continue in the long run, then it must do more than advertise
its considerable successes to date. It must become more proactive and inclusive with regard to
human, organizational and motivational change issues.

VEL TECH

VEL TECH MULTI TECH

19

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Dr Michael Hammer defines BPR as the fundamental rethinking and radical redesign
of business processes to achieve dramatic improvements in critical, contemporary measures of
performance such as cost, quality, service and speed. One of the main tools for making this
change is the Information Technology (IT). Any BPR effort that fails to understand the importance
of IT, and goes through the pre-BPR analysis and planning phases without considering the various
IT options available, and the effect of the proposed IT solutions on the employees and the
organization, is bound to crash during takeoff.
We have seen that the ERP systems help in integrating the various business processes of the
organization with the help of modern developments in IT. With a good ERP package, the
organization will have the capability of achieving dramatic improvements in critical areas such as
cost, quality, speed and so on. So many BPR initiatives and up in the ERP implementation.

7. Describe Data Warehousing.

Data Warehousing:
If operational data is kept in the databases of the ERP system, it can create a lot of problems.
As time passes, the amount of data will increase and this will affect the performance of the ERP
system. So it is better to archive the operational data once its use is over. When I say the use is
over, it does not mean that the archived data is useless. On the contrary, it is one of the most
valuable resource of the organization. However once the operational use of the data is over, it
should be removed from the operational databases. For example, once the financial year is over,
the daily transactional data can be archived. Figure shows what happens if the data is not
archived.

VEL TECH

VEL TECH MULTI TECH

20

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Figure: Operational data vs. archive data

It is evident from the figure that even though the operational data volume is nearly the
same each year, since the data is not archived, the total amount of data that is stored in the
operational database will go on increasing. Figure shows the effect of keeping this huge amount
of data in the operational database.
It is clear from the above graph that as the volume of the data in the database increases, the
performance of the database and the related applications decreases.

Figure: Data volume vs. performance

From the above discussions, it is evident that we should separate the operational data from
the non-operational data. I am not using the term archive data, because if the non-operational
data is archived, there is little or no use for it. But this data is a very valuable resource and is too
precious to be kept in some archive. It is in this situation that a data ware house comes in handy.
The primary concept of data warehousing is that the data stored for business analysis can
be accessed most effectively by separating it from the data in operational systems. The most
important reason for separating data for business analysis, from the operational data, has always
been the potential performance degradation on the operational system that can result from the
analysis process. High performance and quick response time is almost universally critical for
operational systems. The reasons to separate the operational data from the analysis data have not
significantly changed with evolution of the data warehousing systems, except that now they are
considered more formally during the data warehouse building process. Advances in technology
VEL TECH

VEL TECH MULTI TECH

21

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

and changes in the nature of business have made many of the business analysis processes much
more complex and sophisticated. In addition to producing standard reports, todays data
warehousing systems sup port very sophisticated online analysis, including multi-dimensional
analysis.
8. Explain the concept of Data Mining.
Data Mining:
We are living in the information age. The importances of collecting data that reflects ones
business, or of activities that achieve competitive advantage, are widely recognised now. Powerful
systems for collecting data and managing it in large databases are available in most organizations.
However, the major bottleneck of converting this data into effective information is the difficulty
faced in extracting knowledge about the system from the collected data. Modeling the
investigated system discovering relations that connect variables in a database are the subjects of
data mining.
Data mining is the process of identifying valid, novel, potentially useful and ultimately
comprehensible information from databases that is used to make crucial business decisions.
Modern data mining systems self learn from the previous history of the investigated system,
formulating and testing hypotheses about the rules, which the system obeys. When concise and
valuable knowledge about the system of interest has been discovered, it can and should be
incorporated into some decision support system which helps the manager make wise and
informed business decisions.
The main reason for needing automated computer systems for intelligent data analysis is
the enormous volume of existing and newly appearing data that require processing. The amount
of data accumulated each day by various businesses, scientific and governmental organizations
around the world is daunting. Research organizations, academic institutions and commercial
organizations create and store huge amounts of data each day. It becomes impossible for human
analysts to cope with such overwhelming amounts of data.
The other problems that surface when human analysts process data are:
The inadequacy of the human brain when searching for complex multifactorial
dependencies in the data
The lack of objectiveness in analyzing the data

VEL TECH

VEL TECH MULTI TECH

22

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

A human expert is always a hostage of the previous experience of investigating other

systems. Sometimes this helps, sometimes this hurts, but it is almost impossible to get rid of this
fact.
One additional benefit of using automated data mining systems is that this process has a
much lower cost than hiring an army of highly trained (and paid) professional statisticians. While
data mining does not eliminate human participation in solving the task completely, it significantly,
it significantly simplifies the job and allows an analyst, who is not a professional in statistics and
programming, to manage the process of extracting knowledge from data.

9. Describe OLAP.
On-Line Analytical Processing (OLAP):
According to Business Intelligence Ltd (http://www.OLAPReport.com), OLAP can be
defined in five words Fast Analysis of Shared Multidimensional Information.
FAST means that the system is targeted to deliver most responses to users within about five
seconds, with the simplest analysis taking no more than one second and very few taking more
than one second and very few taking more than 20 seconds. ANALYSIS means that the system can
cope with any business logic and statistical analysis that is relevant for the application and the
user, and keep it easy enough for the target user. SHARED means that the system implements all
the security requirements for confidentiality (possibly down to cell level) and, if multiple write
access is needed, concurrent update locking at an appropriate level. MULTIDIMENSIONAL
means that the system must provide a multidimensional conceptual view of the data, including
full support for hierarchies and multiple hierarchies. INFORMATION is refined data that is
accurate, timely and relevant to the user.
Simply put, OLAP describes a class of technologies that are designed for live ad-hoc data
access and analysis. While transaction processing (OLTP) generally relies solely on relational
databases, OLAP has become synonymous with multidimensional views of business data. These
multidimensional views are supported by multidimensional database technology and provide the
technical basis for calculations and analysis required by Business Intelligence applications.
OLAP technology is being used in an increasingly wide range of applications. The most
common are sales and marketing analysis; financial reporting and consolidation; and budgeting
and planning. Increasingly however, OLAP is being used for applications such as product
VEL TECH

VEL TECH MULTI TECH

23

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

profitability and pricing analysis; activity based costing; manpower planning; and quality analysis,
or for that matter any management system that requires a flexible, top down view of an
organization.
10. Explain the concept of Supply Chain Management.
Supply Chain Management:
A supply chain is a network of facilities and distribution options that performs the function
of procurement of materials, transformation of these materials into intermediate and finished
products, and the distribution of these finished products to customers. Supply chains exist in both
service and manufacturing organizations, although the complexity of the chain may vary greatly
from industry to industry and firm to firm.
Traditionally, marketing, distribution, planning, manufacturing, and the purchasing
organizations along the supply chain operated independently. These organizations have their own
objectives which are often conflicting. Marketings objective of high customer services and
maximum sales revenue conflict with manufacturing and distribution goals. Many manufacturing
operations are designed to maximize throughput and lower costs with little consideration for the
impact on inventory levels and distribution capabilities. Purchasing contracts are often negotiated
with very little information beyond historical buying patterns. The result of these factors is that
there is not a single, integrated plan for the organization- there are as many plans as businesses.
Clearly, there is a need for a mechanism through which these different functions can be integrated
together. Supply chain management is a strategy through which such integration can be achieved.
Lambest and cooper identified that SCM having the following management components :

Planning and control

Work structure

Organization structure

Production flow facility structure

Information Flow facility structure

Management methods

Risk and reward structure

Culture and attitude

VEL TECH

VEL TECH MULTI TECH

24

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

UNIT II
PART A
1. Write different phases of the ERP implementation.
The different phases of the ERP implementation are given below:

Pre-evaluation Screening
Package Evaluation
Project Planning Phase
Gap Analysis
Reengineering
Configuration
Implementation Team Training
Testing
Going Live
End user Training
Post implementation

2. Define Pre evaluation Screen.

The Company should do a pre-evaluation screening to limit the number of packages that
are to be evaluated by the committee. Not all packages are equal each has its own strengths and
weakness. The pre-evaluation process should eliminate those packages that are not at all suitable
for the companys business processes.
VEL TECH

VEL TECH MULTI TECH

25

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

3. Describe package evaluation.

The evaluation / selection process is one of the most important phases of the ERP
implementation, because the package that you select will decide the success or failure of the
project. Since ERP systems involve huge investments, once a package is purchased, it is not an
easy task to switch to another one. So it is a do it right the first time proposition.
4. Write the important points for evaluating ERP software.

Fundamental fit with the companys business processes

Degree of integration between the various components of the ERP system
Flexibility and scalability
Complexity
User friendliness
Quick implementation
Ability to support multi site planning and control
Technology client / server capabilities, database independence, security
Availability of regular upgrades
Amount of customization required
Local support infrastructure
Availability of reference sites
Total costs, including cost of license, training, implementation, maintenance, customization
and hardware requirements.

5. Describe the project planning phase for ERP.

This is the phase that designs the implementation process. It is in this phase that the details
of how to go about the implementation are decided. Time schedules, deadlines, etc. for the project
are arrived at. The project plan is developed. Roles are identified and responsibilities are
assigned. The organizational resources that will be used for the implementation effort are decided
and the people who are supposed to head the implementation are identified. The implementation
team members are selected and task allocation is done. This phase will decide when to begin the
project, how to do it and when the project is supposed to be completed. This is the phase which
will plan the what to do in case of contingencies; how to monitor the progress of the
implementation; what control measures should be installed and what corrective actions should be
taken when things get out of control. The project planning is usually done by a committee
constituted by the team leaders of each implementation group. The committee will be headed by
the ERP incharge (usually the CIO or COO). The committee will meet periodically (during the
VEL TECH

VEL TECH MULTI TECH

26

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

entire implementation lifecycle) to review the progress and chart the future course of actions.
6. Why is the pre-evaluation screening required?
There are hundreds of ERP vendors of all sizes and shapes all claiming to have the
solution that is ideal for your company. Analyzing all the packages before reaching a decision is
not a viable solution. It is also a very time consuming process. So it is better to limit the number
of packages that are evaluated to less than 5. It is always better to do a through and detailed
evaluation of a small number of packages, rather than doing a superficial analysis of dozens of
packages. It is to identify these packages that we need the pre evaluation screening.
7. What are the factors to be considered when selecting an ERP package?

When selecting an ERP package, the following factors should be considered:

Functional fit with the companys business processes
Degree of integration between the various components of the ERP system
Flexibility and scalability
Complexity
User friendliness
Quick implementation
Ability to support multi site planning and control
Technology client / server capabilities, database independence, security
Availability of regular upgrades
Amount of customisation required
Local support infrastructure
Availability of reference sites
Total costs, including cost of license, training, implementation, maintenance, customisation
and hardware requirements.

8. What is Gap analysis?

Gap analysis is a phase in the ERP implementation, where the organization tries to find out
the gaps between the companys existing business practices and those supported by the ERP
package. Put very simply, this is the process through which companies create a complete mode of
where they are now and where they are heading. The trick is to design a model, which both
anticipates and covers any functional gaps. It has been estimated that even the best ERP package,
customer tailored to a companys needs, meets only 80% of the companys functional
requirements.

VEL TECH

VEL TECH MULTI TECH

27

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

9. How are the gaps, found out during the gap analysis phase filled?
This can be done in different ways. One of the most affordable, but most difficult, solutions
entails altering the business to fit the ERP package. Another solution is that the company can
simply agree to live without a particular function (the cheap but annoying solution). Other
solutions include:
Pinning your hopes on an upgrade (low cost but risky)
Identifying a third party product that might fill the gap (hopefully it also partners with
the ERP packages, keeping interfacing to a minimum)
Designing a custom program
Altering the ERP source code, (the most expensive alternative; usually reserved for mission
critical installations)
10. Define Reengineering.
Reengineering Business Process Reengineering. The radical transformation of a business
process to achieve orders of magnitude and improvement in one or more performance measures
relating to fitness for purpose, quality, cycle time and cost; usually requiring the application
of technology enablers. Reengineering projects typically take a minimum of two years to
complete.
11. Explain the main functional area of ERP implementation.
Rule of ERP implementation is, synchronising existing company practices with the ERP
package rather than changing the source code and customising it to suit the company. In order to
do so, business processes have to be understood and mapped in such a way that the arrived at
solutions match up with the overall goals of the company.
12. Define Testing.
This is the phase where you try to break the system. You have reached a point where you
are testing real case scenarios. The system is configured and now you must come up with
extreme-case scenarios-system overloads, multiple users logging on at the same time with the
same query, users entering invalid data, hackers trying to access restricted areas and so on. The
test cases must be designed specifically to find the weak links in the system and these bugs should
be fixed before going live.
13. Explain End User Training.
This phase starts much before the system goes live. The employees who are going to use
VEL TECH

VEL TECH MULTI TECH

28

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

the new system are identified. Their current skills are noted and based on the current skill levels,
they are divided into groups. Then each group is given training on the new system. This training
is very important as the success of the ERP system is in the hands of the end users. So these
training sessions should give the participants an overall view of the system and how individual
actions would affect the entire system.
14. Explain Maintenance mode.
The post ERP organization will need a different set of roles and skills than those with less
integrated kinds of systems. At a minimum, everyone who uses these systems needs to be trained
on how they work, how they relate to the business process and how a transaction ripples through
the entire company whenever they press a key. The training will never end; it is an ongoing
process; new people will always be coming in, and new functionality will always be entering the
organization.
15. Who are ERP vendors?
Vendors are the people who have developed the ERP packages. They are the people who
have invested a huge amount of time and effort in research and development, to create the
packaged solutions.
16. Write important skills that ERP should possess.
Knowledge of how to organize and run a project of this magnitude
Enough experience in handling problems and issues that arise during the
implementation
Good people skills
Good leadership skills
Excellent training skills
17. Describe Vendors.
Vendors are the people who have developed the ERP packages. They are the people who
have invested huge amounts of time and effort in research and development to create the
packaged solutions. 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.
18. Write the role of vendor.

VEL TECH

VEL TECH MULTI TECH

29

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

The vendor should supply the product and its documentation as soon as the contract is
signed. Only after the software is delivered, can the company develop the training and testing
environment for the implementation team. The vendor is responsible for fixing any problems in
the software that the implementation team encounters. So the vendor should have a liaison officer
who should constantly interact with the implementation team.
Another role the vendor has to play is that of the trainer to provide the initial training for
the companys key users, people who will play lead roles in the implementation of the system.
19. Write briefly about consultants.
Business consultants are professional who specialize in developing techniques and
methodologies for dealing with the implementation and with the various problems that will crop
up during the implementation. They are experts in the administration, management and control
of these types of projects. Each of them will have many man years of implementation experience
with various industries and would have time tested methodologies and business practices that
will ensure successful implementation. They will be good at all phases of the implementation
lifecycle, right from package evaluation to end user training.

20. Write the role of the consultant.

The consultants should guarantee the success of the project and should be able to show the
results (quantifiable results like reduction in cycle time, increased response time, improved
productivity and so on) to the satisfaction of the company management.
Consultants are responsible for administering each of the phases of the implementation, so
that the required activities occur at the scheduled time and at the desired level of quality and with
effective participation of all those who must participate.
21. Who is an end users and why are the so critical for the success of the ERP implementation?
End users are the people who will be using the ERP system once it is in place. These are the
people who were doing the functions that are being automated or computerised by the ERP
system. With the implementation of the ERP system, the old job descriptions will change, the
nature of the job will undergo drastic transformation. It is human nature to resist change. When
we are talking about implementing an ERP system we are talking about change in a very massive
scale. Employees will fear that system will feat that system will replace existing jobs, as many
functions will be automated. Also people will be afraid of the amount of training they have to
VEL TECH

VEL TECH MULTI TECH

30

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

undergo and learning they have to do to use the new system. Job profiles will change, job
responsibilities will undergo drastic alterations, and people will be forced to develop new skill
sets. If these fears are not addressed and alleviated well in advance, it will cause trouble for the
organization.
22. Explain the steps of data migration strategy.

Identifying the data to be migrated

Determining the timing of data migration
Generating data templates
Freezing the tools for data migration
Deciding on migration related steps
Deciding on data arching

PART B
1. Explain ERP implementation lifecycle.
The different phases of the ERP implementation are given below:

VEL TECH

Pre-evaluation Screening
Package Evaluation
Project Planning Phase
Gap Analysis
Reengineering
Configuration
Implementation Team Training
Testing
Going Live
End-user Training
Post-implementation

VEL TECH MULTI TECH

31

VEL TECH HIGH TECH

VEL TECH

Vendors

VEL TECH MULTI TECH

Pre-Selection
Pre-Selection
Screening
Screening

VEL TECH HIGH TECH

Company
Managemen
t

Package Evaluation
Package Evaluation

Project Planning
Project Planning

Gap Analysis
Gap Analysis

Testing
Testing

Configuration
Configuration

Re- engineering
Re- engineering

Implementation
Implementation
Tram training
Tram training

End-user Training
End-user Training

Going Live
Going Live
Post Implementation
Post Implementation
Phase
Phase

Fig. ERP implementation lifecycle different phases

PRE - EVALUATION SCREENING
Once the company has decided to go in for the ERP system, the search for the perfect
package starts. But there are hundreds of ERP vendors of all sizes and shapes all claiming to
have the solution that is ideal for you. Analyzing all the packages before reaching a decision is not
a viable solution. It is also a very time consuming process. So it is better to limit the number of
packages that are evaluated to less than five. It is always better to do a thorough and detailed
evaluation of a small number of packages, than doing a superficial analysis of dozens of packages.
Hence, the company should do a pre-evaluation screening to limit the number of packages that are
to be evaluated by the committee. Not all packages are equal each has its own strengths and
weakness. The pre-evaluation process should eliminate those packages that are not at all suitable
for the companys business processes. One can zero in on the few best packages by looking at the
product literature of the vendors, getting help from external consultants and most importantly, by
finding out what package is used by companies which are similar. It is always better to find out
how the different packages are performing in environments similar to yours.
PACKAGE EVALUATION
VEL TECH

VEL TECH MULTI TECH

32

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

The evaluation / section process is one of the most important phases of the ERP
implementation, because the package that you select will decide the success or failure of the
project. Since ERP systems involve huge investments, once a package is purchased, it is not an easy
task to switch to another one. So it is a do it right the first time proposition. There is little room
for error.
The most important factor that should be kept in mind when analyzing the different
packages is that none of them are perfect. The idea that there is no perfect package needs to be
understood by everyone in the decision-making team. The objective of the selection process is not
to identify a package that covers each and every requirement (a perfect fit). The objective is to find
a package that is flexible enough to meet the companys needs, or in other words, a software that
could be customized to obtain a good fit.
Once the packages to be evaluated are identified, the company needs to develop a selection
criteria that will permit the evaluation of all the available packages on the same scale. To choose
the best system, the company should identify the system that meets the business needs, that
matches the business profile and that which identifies with the business practices of the company.
It is impossible to get a system that will perform, exactly as the company does business, but the
aim should be to get the system that has the least number of differences.
According to S. Shankaranarayanan, Senior Consultant with Baan Infosystems India Pvt.
Ltd. (ERP Systems-Using IT to gain a competitive advantage), some important points to be kept in
mind while evaluating ERP software include:
Functional fit with the companys business processes.
Degree of integration between the various components of the ERP system.
Flexibility and scalability
Complexity
User friendliness
Quick implementation
Ability to support multi-site planning and control
Technology client/server capabilities, database independence, security
Availability of regular upgrades
Amount of customization required
Local support infrastructure
Availability of reference sites
Total costs, including cost of license, training, implementation, maintenance,
customization and hardware requirements.
2. Explain implementation Methodology.
VEL TECH

VEL TECH MULTI TECH

33

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

IMPLEMENTATION TEAM TRAINING

Around the same time that the configuration is taking place, the implementation team is
being trained, not so much how to use the system, but how to implement it. This is the phase
where the company trains its employees to implement and later, run the system. The ERP vendors
and the hired consultants will leave after the implementation is over. But for the company to be
self-sufficient in running the ERP system, it should have a good in-house team that can handle the
various situations. Thus, it is very vital that the company recognizes the importance of this phase
and selects those employees who have the right attitude people who are willing to change, learn
new things and are not afraid of technology and good functional knowledge.
TESTING
This is the phase where you try to break the system. You have reached a point where you
are testing real case scenarios. The system is configured and now you must come up with extremecase scenarios system overloads, multiple users logging on at the same time with the same query,
users entering invalid data, hackers trying to access restricted areas and so on. The test cases must
be designed specifically to find the weak links in the system and these bugs should be fixed before
going live.
GOING LIVE
This is it. Lights on, switches thrown, gloves off. On the technical side, the work is almost
complete data conversion is done, databases are up and running; and on the functional side, the
prototype is fully configured and tested and ready to go operational. The system is officially
proclaimed operational, even though the implementation team must have been testing it and
running it successfully for some time. But once the system is live the old system is removed, and
the new system is used for doing business.
END-USER TRAINING
This is the phase where the actual users of the system will be given training on how to use
the system. This phase starts much before the system goes live. The employees who are going to
use the new system are identified. Their current skills are noted and based on the current skill
levels, they are divided into groups. Then each group is given training on the new system. This
training is very important as the success of the ERP system is in the hands of the end-users. So
these training sessions should give the participants an overall view of the system and how
individual actions would affect the entire system. In addition to these general topics, each
employee is trained on the job or task that he/she is supposed to perform once the system goes
VEL TECH

VEL TECH MULTI TECH

34

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

live. It is human nature to resist change. Also many people are afraid of computers and other new
technologies. So there will be resistance to change. Another factor is that not all people will be
successful in making the changeover. The company management should address these concerns
and take necessary actions to avoid failure. The end-user training is much more important and
much more difficult (since most end-users are not thrilled at having to change) than the
implementation, team training. Companies are beginning to take this phase seriously, as there is
statistical evidence now, which shows that most implementations fail because of a lack of end-user
training.
POST- IMPLEMENTATION (MAINTENANCE MODE)
One important factor that should be kept in mind is that the post-implementation phase is
very critical. Once the implementation is over, the vendors and the hired consultants will go. To
reap the full benefits of the ERP system, it is very important that the system should get enterprisewide acceptance. There should be enough employees who are trained to handle the problems that
might crop-up. There should be people, within the company, who have the technical prowess to
make the necessary enhancements to the system as and when required. The system must be
upgraded as and when new versions or new technologies are introduced. Here the organization
should think in terms of the incremental benefits of the new enhancements. Because with any
upgradation or enhancements, there will be a lot of other aspects like user training that have to be
considered. So instead of going in for upgradation as and when a new version is announced by the
vendor, the organization should first analyse the costs and benefits.
The post-ERP organization will need a different set of roles and skills than those with less
integrated kinds of systems. At a minimum, everyone who uses these systems needs to be trained
on how they work, how they relate to the business process and how a transaction ripples through
the entire company whenever they press a key. The training will never end; it is an ongoing
process; new people will always be coming in, and new functionality will always be entering the
organization.
Just as courtships and honeymoons are different from marriages, living with ERP systems
will be different from installing them. Projects for implementing the ERP systems get a lot of
resources and attention. However, an organization can only get the maximum value of these
inputs if it successfully adopts and effectively uses the system.
3. Who is an ERP vendors and what are his roles?
VENDORS

VEL TECH

VEL TECH MULTI TECH

35

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Vendors are the people who have developed the ERP packages. They are the people who
have invested huge amounts of time and effort in research and development to create the
packaged solutions. 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. Now with the ERP market place becoming crowded with
more and more players entering the market and the competition becoming hot, todays ERP
packages 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 innovations that make the
packages more efficient, flexible, and easy to implement and use. Also with the evolution of new
technologies, the vendors have to constantly upgrade their product to be able to use the best and
latest advancements in technology.
Role of the Vendor
First and foremost, the vendor should supply the product and its documentation as soon as
the contract is signed. Only after the software is delivered, can the company develop the training
and testing environment for the implementation team. The vendor is responsible for fixing any
problems in the software that the implementation team encounters. So the vendor should have a
liaison officer who should constantly interact with the implementation team.
Another role the vendor has to play is that of the trainer-to provide the initial training for
the companys key users, people who will play lead roles in the implementation of the system.
These key users are the ones who will define, together with the consultants, how the software is to
serve the company. In other words, it is these in-house functional experts who will decide how the
functionalities are to be implemented, as well as how to use or adapt the product to suit the
companys unique requirements. So it is very critical that these key users are given a thorough
training on the features of the package. Vendors training should achieve the goal of 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 customized and what should not, what are the limitations, what are the strengths and
weaknesses and so on.
Now some of you might ask: we are hiring consultants who are experts in the package so
why cant 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. 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 companys employees who are
VEL TECH

VEL TECH MULTI TECH

36

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

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.
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.
The role of the package vendor does not end with the training. The vendor also plays an
important project support function and must 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 an- other 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.
The vendor has other responsibilities also. There will be gaps between the package and the
actual business processes. The software might have to be customized to suit the companys needs.
Customizing means altering the product so that it is suited for the companys purposes. The
choice of whether to customize 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
customize has been taken, it is the vendors 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 customization, it will be able to benefit from the future software
improvements introduced by the vendor.
4. Who are consultants and what are their roles?
CONSULTANTS
Business consultants are professional who specialize in developing techniques and
methodologies for dealing with the implementation and with the various problems that will crop
up during the implementation. They are experts in the administration, management and control of
VEL TECH

VEL TECH MULTI TECH

37

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

these types of projects. Each of them will have many man-ears of implementation experience with
various industries and would have time-tested methodologies and business practices that will
ensure successful implementation. They will be good at all phases of the implementation lifecycle,
right from package evaluation to end-user training. The only problem with them is that they are
expensive-very expensive. Many of the big consulting firms, having forecasted the ERP boom,
invested a great deal of money in developing a range of consulting services in this field and
assigned many of their professionals to become specialists in the various aspects of ERP-packages
and their implementation. These firms researched the various products, developed an in depth
understanding of each products strengths and weaknesses, worked by the side of the ERP
vendors, confirmed that the vendors package worked and learned the tricks and techniques of the
trade, found out the pitfalls and mistakes that should be avoided and thus created a pool of
experts who could handle the ERP implementation without failure.
Thus, consultants are people who have made the business of ERP implementation their
business and have invested huge amount, of money and manpower for that purpose. So when you
want to get the services of these consultants, the first question that will be asked is Are they
going to be expensive? The answer is a definite YES. The consultants will be expensive, so the
company will have to formulate a plan regarding best optimum utilization of the money spent on
consultants. If we study the statistics, we can see that a well-selected, integrated system that was
successfully implemented and which is successfully working usually pays for itself in a relatively
short period between 10 and 30 months. If you analyze the cost break-up, you will find that the
most expensive part of the implementation was the consultation charges. For a typical ERP
implementation, the cost of consultants is 1.5 to 3 times for every rupee invested in the software
product. Sounds amazing; but it is true and it is also true that the software will pay for itself-the
software cost, the consultants charges and other expenses incurred during implementation in
the above mentioned period (10-30 months). But the catch is that the product has to be the right
one and the implementation has to be successful. That is why the expertise of the consultants
becomes invaluable and the money spent on good consultation is never wasted. So finding the
right consultants people who have the necessary know-how, who will work well with the
company personnel, people who will transfer their knowledge to the companys employees and
people who are available in case their services are required again is very important.
Role of Consultants
The role of the consultants is very familiar to all of us because we have seen many of them
in action. The company places its trust in the consultants, that its business objectives will be
achieved. In fact, it is a better practice that the contract between the company and the consultants
should have all the performance clauses in place. The consultants should guarantee the success of
the project and should be able to show the results (quantifiable results like reduction in cycle time,
VEL TECH

VEL TECH MULTI TECH

38

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

increased response time, improved productivity and so on) to the satisfaction of the company
management.
Consultants are responsible for administering each of the phases of the implementation, so
that the required activities occur at the scheduled time and at the desired level of quality and with
effective participation of all those who must participate. For keeping the promises that the
consultants have made during the negotiations, they have to transform their approaches and
methodologies into detailed work plans. The methodology will have to be converted into tasks and
should be allocated to the right people. The time schedule for each phase and each task has to be
determined and the project plan has to be finalized.
Consultants should add value to the project. They bring the know-how about the package
and about the implementation-the know-how that is not included in the standard documentation.
This know-how (also know as practical knowledge) is derived from their expertise which stems
from practical experience. Because the consultants have seen many projects and have made or seen
many mistakes, they can avoid the phenomenon of reinventing the wheel. They will know what
will work and what will not. Thus by eliminating the trial-and-error method of implementation,
and by doing it right the first time, the consultants help in saving huge amounts of money, time
and effort .
Consultants should also know how to remain impartial while questioning current company
processes in an effort to promote better businesses practices and better implementation results.
They should strive to improve the companys business processes so that the software package can
be used as it was originally intended by its developers. Refining the companys processes can only
optimize the performance of the system and maximize future user satisfaction. The consultants are
also responsible for analyzing and clearly addressing the customization issues. They must be able
to distinguish between the must have and nice to have items and decide on the level of
customization. This is an area where the consultants have to use their diplomatic skills, as the
company people might want to customize all the aspects. It is the duty of the consultants to
present the advantages and drawbacks of each area and reach a consensus decision, which should
also be the right one. Consultants need to position themselves in such a way as to balance their
loyalty to the client and the project, with that of defending the package vendor, when such defense
is technically correct. This is indeed a very difficult job (like a tight-rope walk) and that is why
consultants are being paid such huge amounts for their services.
It is the duty of the consultant to understand the total context and scope of the envisioned
work and to know when to alert the company management about actions and decisions that must
be undertaken so that the job will not be compromised and the implementation will not be
jeopardized. Maintaining technical documentation on the project also falls within the duty of the
VEL TECH

VEL TECH MULTI TECH

39

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

consultant. The consultants will leave once the project is complete, but the knowledge of the
project must stay within the organization. So the consultants should create a knowledge base and
should train enough people so that the work they have started is continued.
5. Explain End users in detail.
End-Users:
End users are the people who will be using the ERP system once it is in place. These are the
people who were doing the functions that are being automated or computerized by the ERP
system. With the implementation of the ERP system, the old job descriptions will change, the
nature of the job will undergo drastic transformation. It is human nature to resist change. When
we are talking about implementing an ERP system we are talking about change in a very massive
scale. Employees, will fear that system will replace existing jobs, as many functions will be
automated. Also people will be afraid of the amount of training they have to undergo and learning
they have to do to use the new system. Job profiles will change, job responsibilities will undergo
drastic alterations, and people will be forced to develop new skill sets. If these fears are not
addressed and alleviated well in advance, it will cause trouble for the organization.
It should be worth noting the fact, that while the ERP systems eliminate many existing jobs,
it creates many new ones-ones with more responsibilities and value addition. It is easy to see that
the automation of the business processes, through technology, can eliminate the jobs of many
employees whose function it is to record, control, calculate, analyze, file or prepare reports. But it
must be pointed out to the employees that the same automation creates many more opportunities
for them, because they can get away from the monotonous clerical work and transform themselves
into highly valued individuals, in a new and challenging working environment using modern
technology. If the company can succeed in making its employees accept this fact and assist in
making the transformation (by giving them training), then the major (and most critical) obstacle in
the path of an ERP implementation is solved.

UNIT III
PART A
1. What are the modules available in ERP Package?

VEL TECH

Finance
Manufacturing and Production Planning
Sales and Distribution
Plant Maintenance,
VEL TECH MULTI TECH

40

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Quality Management
Materials Management, etc.
2. What is financial data?
The entire concept of information technology is based on the premise that providing the
right information, to the right people, at the right time can make a critical difference to the
organization. Much of this key information could be taken from the financial data. But merely
having the financial data is not enough. You need a set of processes and views of your data that
provides up-to-the-minute financial information in exactly the form you need it to make that
critical difference and help with that crucial decision. Accounting software needs access to
information in each area of your organization, from R & D and market research through
manufacturing, distribution and sales. Your financial solution must provide the management with
information that can be leveraged for strategic decisions, in order to achieve competitive
advantage.
3. Define financial module in ERP module.
The finance modules of most ERP systems provide financial functionality and analysis
support to thousands of businesses in many countries across the globe. These ERP systems
include not only financial application components, but also Human Resources, Logistics, Business
Workflow and links to the Internet. Hundreds of business processes are covered in these systems.
4. Write the types of subsystem in financial module.
Financial Accounting (General Ledger, Accounts Receivable / Payable, Special
Ledgers, Fixed Asset Accounting, Legal Consolidation)
Investment
Management
(Investment
Planning/Budgeting/
controlling,
Depreciation Forecast/ Simulation/ Calculation)
Controlling (Overhead Cost Controlling, Activity-Based Costing, product Cost
Accounting, Profitability Analysis)
Treasury (Cash Management, Treasury Management, Market Risk Management,
Funds Management).
Enterprise Controlling (Executive Information System, Business Planning and
Budgeting, Profit Centre Accounting).
5. Describe financial accounting.
The objective of a good financial accounting system is to provide company wide control and
VEL TECH

VEL TECH MULTI TECH

41

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

integration of financial Accounting Module of an ERP system, gives you the ability to centrally
track financial accounting data within an international framework of multiple companies,
languages, currencies, and charts of accounts. For example, when raw materials move from
inventory into manufacturing, the system reduces quantity values in inventory and
simultaneously, subtracts values for inventory accounts in the balance sheet. Most of the Financial
Accounting modules comply with international accounting standards, such as GAAP and IAS.
They also fulfill the local legal requirements of many countries.
6. Define Investment Management.
Investment Management provides extensive support for investment processes right from
planning through settlement. Investment management facilitates investment planning and
budgeting at a level higher than that needed for specific orders or projects.
7. Define Controlling.
The controlling system gathers the functions required for effective internal cost accounting.
It offers a versatile information system, with standard reports and analysis paths for the most
common questions. In addition, there are features for creating custom reports to supplement
standard reports.
8. Define Treasury.
You can gain a significant competitive advantage by efficiently managing the short,
medium, and long term payment flows and the resulting risk exposure. Tasks such as short
term monitoring and concentration of bank account balances, medium term planning, and
forecasting of incoming and outgoing resources in accounts receivable and payable, to a long
term view of areas such as materials management and sales, underline the importance of intergrating information from various company divisions. Linking these operating divisions to
realised and planned financial transactions and positions in treasury, has a significant impact on
the companys success. Such integration also facilities management and control of cash flows, and
risk positions through all the divisions in the company. The treasury component provides you
with a basis for effective liquidity, portfolio and risk management.
9. Define Enterprise Controlling.
Enterprise controlling comprises of those functions that will optimise share holder value,
while meeting internal objectives for growth and investment. This module usually include
executive information system, business planning and Budgeting, Consolidation, and Profit Centre
VEL TECH

VEL TECH MULTI TECH

42

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Accounting.
10. Define Manufacturing Module in ERP Package.
A good manufacturing system should provide for multi mode manufacturing
applications that encompass full integration of resource management. These manufacturing
applications should allow an easier exchange of information throughout the entire global
enterprise, or at a single site within a company.
11. How does manufacturing respond to the customer?
Manufacturers must respond quickly and effectively to customer demands. While agility is
desirable, agility without an effective enterprise manufacturing system results in speed without
purpose. The very heart of an enterprise manufacturing system centers on its integrated planning,
business process and execution capabilities.
12. What are the major subsystem of the manufacturing module?

Material and Capacity Planning

Shop floor control
Quality Management
JIT / Repetitive Manufacturing
Cost Management
Engineering Data Management
Engineering Change Control
Configuration Management
Serialization / Lot Control
Tooling

13. Define Material and capacity planning.

The planning systems of ERP packages are designed to provide the responsiveness your
company needs to meet those customer requirements. With these systems, planners can simulate
alternative plans; gaining the information they need to determine which parts and assemblies to
make, which to buy and when to manufacture or purchase. Most packages have features to
generate recommendations for purchases and production and, where necessary, recommend
changes to current plans to prevent under or over utilization of work centers.
14. Define quality management.
Elimination of defects in standard product designs and manufacturing methods, before
VEL TECH

VEL TECH MULTI TECH

43

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

production, is just as important as eliminating defects during production. In fact, to achieve

quality levels, manufacturers must focus on identifying and correcting defects in underlying
product designs and production methods and not simply inspect the incoming material and
finished goods.
15. Define Bench Marking.
A method of measuring processes against those of recognized leaders. It helps establish
priorities and targets, leading to process improvement. It is undertaken by identifying processes
to be benchmark and their key characteristics; determining who to benchmark; collecting and
analyzing data from direct contact, surveys, interviews, technical journals and advertisements;
determining the best of class from each benchmark item identified; and evaluating the process in
terms of the benchmarks set and the improvement goals.
16. Define JIT.
JIT Just in Time: A policy calling for the delivery of materials products or services at
the time they are needed in an activity or process. Used to reduce inventory, wait time and
spoilage.
17. What are the subsystems in Human resources module?
The various subsystems under the HR module are:
Personnel Management (HR master data, Personnel administration, information systems,
Recruitment, Travel management, Benefits administration, Salary administration)
Organizational Management (Organizational structure, Staffing schedules, Job descriptions,
Planning scenarios, Personnel cost planning)
Payroll Accounting (Gross/net accounting, History functions, Dialog capability, Multicurrency capability, International solutions).
Time Management (Shift Planning, Work schedules, Time recording Absence determination)
Personnel Development (Career and succession Planning, Profile Comparisons,
Qualifications assessments, Additional training determination, Training and event
management).
18. Define personal management.
Personal management includes numerous software components, which allow you to deal
with human resources tasks more quickly, accurately and efficiency. You can use these
VEL TECH

VEL TECH MULTI TECH

44

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

components not only as part of the company wide ERP solution, but also as stand alone systems.
19. Define organizational management.
This module will assist you in maintaining an accurate picture of your organizations
structure, no matter how fast it changes. In many cases, graphical environments make it easy to
review any moves, additions, or changes in employee positions.
20. What are the subsystems in plant maintenance module?
The major subsystems of a Plant Maintenance module are:
Preventive Maintenance Control
Equipment Tracking
Component Tracking
Plant Maintenance Calibration Tracking
Plant Maintenance Warranty Claims Tracking
21. Write the functions of quality management.

Quality planning
Quality Inspection
Quality Control

22. Define CIQ.

The integration of Quality Management in the ERP systems provides considerable
advantages because only an integrated system can support all the elements of a quality
management system, according to ISO 9000. The integration allows the quality management
functions to influence all processes within a company, thereby affecting all phases of a products
life cycle.

23. What are the main modules of the material management?

Pre-purchasing Actives
Purchasing
Vendor Evaluation
Inventory Management
Invoice Verification and Material Inspection

VEL TECH

VEL TECH MULTI TECH

45

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

24. Differentiate Capital Budget and Cash Budget.

Capital budget concerns fixed asset requirements for the next five years and how these will
be financed.
Cash budget is basically a detailed plan that shows all expected sources and uses of cash to
meet short term expenses.
25. What are the subsystems in sales and Distribution module?

Data Management
Order Management
Shipping
Billing
Pricing
Transportation

PART - B
1. Explain Finance module and its sub system.
The entire concept of information technology is based on the premise that providing the
right information, to the right people, at the right time can make a critical difference to the
VEL TECH

VEL TECH MULTI TECH

46

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

organization. Much of this key information could be taken from the financial data. But merely
having the financial data is not enough. You need a set of processes and views of your data that
provides up-to-the-minute financial information in exactly from you need it to make that critical
difference and help with that crucial decision. Accounting software needs access to information in
each area of your organization, from R&D and market research through manufacturing,
distribution and sales. Your financial solution must provide the management with information
that can be leveraged for strategic decisions, in order to achieve competitive advantage.
This section provides an overview of the financial solutions in most of the ERP packages, In
todays business enterprise, you need to know that your financial decisions are based on todays
data, not numbers from records closed a month ago, or even a week ago. And you need to know
that this same todays data represents every segment of your organizations activities, whether
your enterprise stretches across a room or around the globe. This is essential, because the most
efficient way to get your enterprise to where you want it tomorrow is to know exactly where it is
today.
What ever be the financial goals of your organization, the financial application components
of the ERP solutions work hand in hand to improve the bottom line. This is true because the
financial functionality is tightly integrated across all business areas and all geographic areas. This
tight integration includes all the other different modules, from materials management to human
resources to logistics. Because the ERP system automatically links related areas, it eliminates the
need to repeat procedures. You enter your data only once. Within the ERP system, all areas work
in concert, creating a new level of efficiency in handling your financial data.
The finance modules of most ERP systems provide financial functionality and analysis
support to thousands of business in many countries across the globe. These ERP systems include
not only financial application components, but also Human Resources, Logistics, Business Work
flow and links to the Internet. Hundreds of business processes are covered in these systems.
The finance modules of most ERP systems will have the following sub-systems:
Financial Accounting (General Ledger, Accounts Receivable / Payable, Special
Ledgers, Fixed Asset Accounting, Legal Consolidation)
Investment
Management
(Investment
Planning/Budgeting/
controlling,
Depreciation Forecast/ Simulation/ Calculation)
Controlling (Overhead Cost Controlling, Activity-Based Costing, product Cost
Accounting, Profitability Analysis)
Treasury (Cash Management, Treasury Management, Market Risk Management,
Funds Management)
VEL TECH

VEL TECH MULTI TECH

47

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Enterprise Controlling (Executive information System, Business Planning and

Budgeting, Profit Centre Associating).
2. Explain Financial Module Sub system in detail.
The objective of a good financial accounting system is to provide company wide control and
integration of financial Accounting Module of an ERP system, gives you the ability to centrally
track financial accounting data within an international framework of multiple companies,
languages, currencies, and charts of accounts. For example, when raw materials move from
inventory into manufacturing, the system reduces quantity values in inventory and
simultaneously, subtracts values for inventory accounts in the balance sheet. Most of the Financial
Accounting modules comply with international accounting standards, such as GAAP and IAS.
They also fulfill the local legal requirements of many countries.
General Ledger
The General Ledger (GL) is essential both to the financial accounting system and to strategic
decision making. Through active integration with business processes in logistics and in the
accounting sub ledgers, the GL serves as a central pool of financial data for financial reporting as
well as for other accounting areas. However, the origin of centrally stored data can still be traced at
any time by drilling down on data from a given transaction.
The general Ledger supports all the functions needed in a financial accounting system. This
includes flexible structuring of the chart of accounts at the group and company level, distributed
application scenarios, real-time simultaneous update of sub legers and the general ledger,
elimination of time consuming reconciliation, and parallel views of data, in both the general
ledger and the managerial accounting applications. The GL provides document parking, posting,
reporting, and an integrated financial calendar for automating periodic activities. A typical general
ledger is shown in Fig. The system also provides summary information from other components at
a user defined level of detail. By creating combinations of entered data, you generate data
summaries, that can be used in planning, allocation, distribution and reporting.

VEL TECH

VEL TECH MULTI TECH

48

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Fig. Typical general ledger

Usually, the GL has features that allow you to take advantages of more functions in General
Ledger and in Cost Centre Accounting. For example, you can create your own database tables and
define non standard fields, to suit specialized accounting or reporting requirements. Some ERP
systems support features, like the option of grouping data selectively and then, updating it in only
there ledgers which have been specified; provision for parallel charts of account and currencies;
planning and allocation tools; direct data entry in special purpose ledgers for adjustment postings;
user defined reporting; etc.
Account Receivable and Payable
ERP systems offer a financial overview of global business partner relationships, in the
VEL TECH

VEL TECH MULTI TECH

49

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Accounts Receivable and Payable functions. These sub-legers are integrated, both with the General
Ledger and with, areas in Sales and Distribution and Materials Management, where financial data
originates. Accounts Receivable and payable transactions are performed automatically, when
related processes take place in other modules. This module uses standard business rules for
procedures ranging from data entry and reporting, to processing payments and bank transactions.
Accounts Receivable and Payable functions include Internet integration, document management,
full support for EDI processing, including automatic integration with cash management and
flexible reporting using customer and vendor information systems. The module also provides,
enterprise-wide credit management with workflow integration, payment automation with EFT
and check processing, and document parking with various approval procedures.
Asset Accounting
Asset accounting, manages the companys fixed assets. With in the Financial Account
system, Asset Accounting serves as a sub-ledger to the General Ledger, providing detailed
information on asst related transactions. Significant features include country-specific charts of
depreciation complying with local legal requirements, full support throughout the asset life cycle
from acquisition to retirement, depreciation simulation and interest calculation, and integration
with project management and order accounting for management of capital assets. Asset
Accounting also provides integration with Plant Maintenance for management of machinery and
equipment, management of leased assets and assets under construction, mass processing with
workflow integration, and interactive reporting.
Legal Consolidation
Consolidated financial statements need to be integrated effectively with operational data at
the individual company level. By using different valuation methods, you can plan balance sheet
strategies to suit the companys requirements. The legal consolidation sub-system is closely linked
to the financial Accounting system, permitting direct data transfer, from individual statements into
the consolidated report. This cases the workload of the staff and reduces data entry errors. In
addition to the consolidated statements required by law, Legal Consolidation also allows you, to
create multiple views of you consolidation data. With these views you can generate reports about
legal entities or segments of your business.
3. Explain Controlling in financial module.
The controlling system gathers the functions required for effective internal cost accounting.
It offers a versatile information system, with standard reports and analysis paths for the most
common questions. In addition, there are features for creating custom reports to supplement
VEL TECH

VEL TECH MULTI TECH

50

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

standard reports.
Overhead Cost Controlling
Many organizations experience a significant increase in the percentage of indirect costs,
which cannot be directly assigned to either the products manufactured, or to the services
rendered. While cost monitoring and optimization may be quite advanced in production areas,
transparency is often lacking in over head cost areas. The overhead cost controlling sub system
focuses on the monitoring and allocation of over heads.
Cost Centre Accounting
Cost centre accounting analyses where overheads occur within the organization. Costs are
assigned to the sub areas of the organization where they originated. The system offers a wide
variety of methods for allocating posted amounts and quantities. In particular, activity accounting
permits, the allocation of great many costs to products, based on cost sources and enabling
assignments, which were not previously possible.
Overhead Orders
Overhead orders subsystem collects and analyses costs, based on individual internal
measures. This system can monitor and automatically check budgets assigned to each measure.
Activity Based Costing
The goals of the entire organization, should come before the goals of individual
departments, when it comes to business process reengineering. The Activity-Based Costing
module, is a response to the growing need for monitoring and controlling cross- departmental
business processes, in addition to functions and products. Seeing costs from a new perspective,
substantially enhances organization transparency in overhead areas. The system automatically
determines the utilization of business processes by products, customers, and other cost objects
based on the cost drivers taken from the integrated accounting environment. This, significantly
reduces the effort involved in maintaining a business processes by products, customers, and other
cost objects based on the cost drivers taken from the integrated accounting environment. This,
significantly reduces the effort involved in maintaining a business process model in a separate
system.
Product Cost Controlling
Product cost controlling module determines, the costs arising from manufacturing a
VEL TECH

VEL TECH MULTI TECH

51

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

product, or providing a service. Plan and standard values, serve in valuating war house stock and
for contrasting revenues received with costs. In addition, the values in Product Cost Controlling,
are crucial for determining the lowest price limit for which a product is profitable. Simulations
illustrate the effects of changes in production methods on the cost of goods manufactured.
Cost object controlling
Cost object controlling helps you monitor manufacturing orders. Integration with the
logistics components results in a logistical quantity flow, that provides instant information on
actual cost object costs, allowing ongoing costing calculations at any time. Follow-up calculations
determine and analyze the variances between actual manufacturing, costs, and the plan costs
resulting from Product Cost Planning.
Profitability Analysis
Profitability analysis subsystem examines the sources of returns. As part of sales
controlling, Profitability Analysis is the last step in cost based settlement, where revenues are
assigned to costs according to the market segment. You can defined any market segment- distinguishing, for example, between products, customers, orders, sales organizations, distribution
channels and business areas and evaluate it, according to contribution and revenue margins.
Information from Profitability Analysis, frames important decisions in areas such as determining
prices, selecting customers, developing conditions and choosing distribution channels.
4. Explain sales and distribution in ERP package.
In todays global business environment, the one thing companies can count on is rapid
change and the new opportunities and challenges that change is sure to bring. New competition
pushes businesses product life cycles and forces of service, while evolving technology compresses
product life cycles and forces companies to adopt new technologies or risk losing market share. In
this ever changing environment, keeping a competitive edge means being able to anticipate and
respond quickly to changing business conditions. To keep pace with these rapid changes,
companies need an integrated and flexible enterprise system that supports all aspects of their
business with state of- the art functionality. This innovative solution should upgrade
effortlessly and interface easily with third party applications, as well as have the ability to
incorporate existing systems while extending its reach to the internet and e- commerce.
With todays business environment characterized by growing competition, shrinking cycle
times and the accelerating pace of technological innovation, companies are increasingly being
forced to streamline business processes. In a world in which it is no longer enough to simply have
VEL TECH

VEL TECH MULTI TECH

52

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

the best product, these companies are focusing on core competencies and closer partnerships over
the whole supply chain. Here, increased efficiency in sales and distribution is a key factor to
ensure that companies retain a competitive edge and improve both profit margins and customer
service. In helping business to beat them on delivery, the sales and distribution modules of many
ERP vendors offer a comprehensive set of best of bread components for both order and logistics
management. Many of these systems are tightly integrated with the Distribution Requirements
Planning (DRP) engine of the for just in time deliveries. This integration enables the mapping
and supply of single site or multi site organizations and the definition of relationships in a
companys internal supply chains. Developing precise logistics management. Many of these
systems are tightly integrated with the Distribution Requirements Planning (DRP) engine of the
for just-in-time deliveries. This integration enables the mapping and supply of single site or
multi site organizations and the definition or relationships in a companys internal supply
chains. Developing precise logistics planning for just- in time deliveries, this system can also
generate replenishment orders by using defined warehouse requirements.
The following are the sales related business transactions:

Sales queries, such as inquires and quotations

Sales orders
Outline agreements, such as contracts and scheduling agreements.
Delivery/Shipment
Invoicing/Billing
After sales support

During sales order processing, the following basic functions are carried out:

Inquiry handling
Quotation preparation and processing
Contracts and contract management ( order management)
Monitoring the sales transactions
Checking for availability
Transferring requirements to materials planning (MRP)
Scheduling the delivery
Calculating pricing and taxes
Checking credit limits
Invoicing /Billing
Creating printed or electronically transmitted documents (confirmations, and so on).

Depending on how your particular system is configured, these functions may be completely
VEL TECH

VEL TECH MULTI TECH

53

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

automated or may also require some natural processing. The data that results from these basic
functions (for example: shipping dates, confirmed quantities, prices and discounts) is stored in the
system where it can be displayed and, in some cases, changed manually during subsequent
processing. The sales and distribution module very actively interacts with the Material
Management and Financial Accounting modules for delivery and billing.
Figure shows sales and distribution and its associated processes.
Typically, a Sales and Distribution module will contain the following sub-systems:
Master Data Management
Order Management
Warehouse Management
Shipping
Billing
Pricing
Sales Support
Transportation
Foreign Trade
5. Explain manufacturing in ERP Package.
Competition in the next millennium places and increased emphasis upon time, as expressed
by speed, quality, service and global focus. Agility is the watch word. Manufacturers are measured
by their ability to react quickly to sudden, often unpredictable change in customer demand for
their products and services. To compete successfully beyond the year 2000 requires manufacturing
applications that are time and activity based and above all else, focused on the customer,
increasingly, these manufacturing applications are a centre point within the spectrum of a supply
chain, running from the customer to a suppliers and encompassing the entire enterprise.
A good manufacturing system should provide for multi mode manufacturing
applications that encompass full integration of resource management. These manufacturing
applications should allow an easier exchange of information throughout the entire global
enterprise, or at a single site within a company. Regardless of how bit or small an enterprise is,
these applications should provide a wealth of feature / function, broad scope of coverage,
operational stability and a platform-independent architecture. These capabilities empower an
enterprise to achieve productivity gains, adopt forward thinking technologies and implement
process reengineering. As a companys internal processes become more sophisticated or as market
forces change, these solutions should be capable of meeting the challenge. The manufacturing
VEL TECH

VEL TECH MULTI TECH

54

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

system should be integrated with the other modules of the package.

A robust system of manufacturing planning business process, and execution must satisfy a
variety of business practices and production methods. These business practices and production
methods place stringent demands on the manufacturer. Regardless of how manufacturer view
their internal operations, to the customer, it boils down to quick response to customer demand in
two fundamental ways Manufacturers either make products to stock prior to receipt of a
customer order, or they make and ship the products upon receipt of a customer order.
Manufacturers must accomplish this task quickly efficiently and cost effectively to remain
profitable and competitive. These two fundamental ways of responding to customer demand are
as shown in fig.
To day, companies must be able to deliver customer specific products with the lead time
of standard, off the shelf products. To help manage product and market shifts, the
Manufacturing module provides the freedom to change manufacturing and planning methods, as
and when they need a change. The Manufacturing modules provides the freedom to change
manufacturing and planning methods can be combined within the same operations, with
unlimited flexibility to choose the best method or combination of methods for each product, at
each stage throughout its life cycle.

Fig. Manufacturing process from raw materials (supplier to finished goods (customer))
In addition, this control and visibility comes without having to sacrifice the functionality
needed to efficiently manage different types of production. These systems support the entire range
VEL TECH

VEL TECH MULTI TECH

55

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

of production strategies only one system is needed to manage all manufacturing activities.
Engineer to- order products can be planned using the system, while the systems forecasting and
distribution planning features handle make to stock items. Products that are assembled to
order can be planned using advanced features available in the Manufacturing module. All
demands can be aggregated into user definable plans at a detail or summary level.

Fig. Make to order and Make to - stock

Enterprise requirements then flow into consolidated production schedules and material
and capacity plans, and all production activity can be schedule and tracked through shop floor
control systems.
The manufacturing module should enable an enterprise to marry technology with business
processes to create an integrated solution. It must provide the information base upon which the
entire operation should be run. It should contain the necessary business rules to manage the entire
supply chain process, whether within a facility, between facilities, or across the entire supply
chain. Control and execution can be performed at strategic, tactical and operational levels with in
the business. These require effective planning to support contract commitments throughout the
supply chain, control over intermediate range planning horizons and time fences, and execution
over the short range of frozen scheduling required by the shop floor. Whether a single site
implementation, several sites with in one country, or hundreds covering the globe, the
manufacturing system should provide the foundation for creating concurrent business processes
VEL TECH

VEL TECH MULTI TECH

56

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

across the supply chain and achieving Return on Assets (ROA) improvement.
6. Explain human Resource module.
Human resources management is an essential factor of any successful business. The
competitive environment of the next millennium, with its economic and technological changes,
will affect the HR department in the same way it will all the other areas of your enterprise. In
short, HR managers must continually review and optimize their business processes. The HR
modules of most ERP systems have a set of rich features and will integrate seamlessly with the
other modules and are thus, invaluable aids in improving productivity. They offer company
wide solutions for HR departments and make it possible for other departments to access specific
employee data.
A human resource management system has to be adaptable to company specific
requirements, and should constantly grow with increasing HR requirements. It should cover all
the functions required in business practices, it should be flexible enough to allow you to optimize
your business processes by tailoring the ERP solution to suit your organizations needs. Today,
many businesses cross boundaries. The system should support the organizations international
needs with country specific versions of the HR components. A part from languages, currencies
and legal requirements, accounting systems often vary from country to country as well, making
this a vital features. A flexible structure enables quick and easy customization of the system to suit
your requirements. When you log on in a particular language, screens, messages and documents
appear in the language you specify. You then have access to the systems complete functionality.
The different ERP systems offer many different subsystems under the HR umbrella. Listed
below are some of the most common subsystems. Here again, the idea is not to be comprehensive
but to give you an idea about the options available. The various subsystems under the HR module
are:
Personnel Management (HR master data, Personnel administration, information systems,
Recruitment, Travel management, Benefits administration, Salary administration)
Organizational Management (Organizational structure, Staffing schedules, Job descriptions,
Planning scenarios, Personnel cost planning)
Payroll Accounting (Gross/net accounting, History functions, Dialog capability, Multicurrency capability, International solutions).
Time Management (Shift Planning, Work schedules, Time recording Absence
determination)
Personnel Development (Career and succession Planning, Profile Comparisons,
Qualifications assessments, Additional training determination, Training and event
management).
VEL TECH

VEL TECH MULTI TECH

57

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

7. Explain plant maintenance module.

Introduction
The achievement of world class performance demands delivery of quality products
expeditiously and economically. Organizations simply cannot achieve excellence with unreliable
equipment. The attitude towards maintenance management has changed as a result of quick
response manufacturing, Just-in-Time reduction of work in process inventory and the elimination
of wasteful manufacturing practices. Machine breakdown and idle time for repair was once an
accepted practice. Times have changed. Today when a machine breaks down, it can shunt down
the production line and the customers entire plant. The preventive Maintenance module provides
an integrated solution for supporting the operational needs of an enterprise-wide system. The
Plant Maintenance module includes an entire family of products covering all aspects of
plant/equipment maintenance and becomes integral to the achievement of process improvement.
The major subsystems of a Plant Maintenance module are:
Preventive Maintenance Control
Equipment Tracking
Component Tracking
Plant Maintenance Calibration Tracking
Plant Maintenance Warranty Claims Tracking
Preventive Maintenance Control
Preventive Maintenance Control provides planning, scheduling and control of facilities and
equipment. Equipment lubrication, component replacement and safety inspection can be planned
scheduled, and monitored. Maintenance tasks can be tracked for each machine, or piece of
equipment, by two user defined modes, as well as calendar day frequency. These modes could
include tracking by hours of operation, units of production produced, gallons of fuel consumed, or
the number of days in operation since the last service interval. Preventive Maintenance Control
enables organizations to lower repair costs by avoiding downtime, machine breakage and process
variability. Companies achieve higher machine utilization and improved machine reliability and
tolerance control, along with higher production yields.
Equipment Tracking
Equipment is an asset that needs to be monitored and protected. In many situations,
equipment maintenance costs constitute the single largest controllable expenditure of an
organization. All facets of plant location history and utilization history are described and tracked.
VEL TECH

VEL TECH MULTI TECH

58

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

This history includes acquisition and disposition information and associations between different
pieces of equipment to pinpoint operational dependencies. Running totals for operation units to
date (miles, hours, days, units of production, etc.) are also provided. Each piece of equipment is
defined by a model and serial number. User-defined data sheets can be developed which allow for
the grouping of user data into formats that can be linked to equipment records. All of this
detailed information for technical specialists working in equipment operations, maintenance and
transportation control.
Component Tracking
Components are, typically subsets of larger equipment and deserve the same amount of
cost controlling scrutiny.
Component tracking enables equipment managers to identify
components with chronic repair problems. They can determine whether a repair or replacement
should be covered by warranty. Planning component replacements, rather than waiting for
component failures to occur, reduces unscheduled equipment downtime. Component tracking
includes repair/exchange history and component service life.
Plant Maintenance Calibration Tracking
Plant Maintenance Calibration Tracking allows organizations to leverage their investment in
the Plant Maintenance module by providing for the tracking of equipment calibration in support
of ISO 9000 requirements.
Plant Maintenance Warranty Claims Tracking
Plant maintenance Warranty Claims Tracking is an administrative system designed to
provide control of all items covered by manufacturer and vendor warranties. It enables plant
management to recover all of the warranty; re-imbursements to which they are entitled but have
not been able to recover in the past. Features include the ability to establish the type and length of
warranty, for example, elapsed day, months, mileage stipulation, or operating units. A complete
history is performed for each item covered by the warranty, and complete information regarding
the warranty service provider is generated.
8. Explain quality Management in ERP Package.
The ISO 9000 series of standards defines the functions of quality management and the
elements of a quality management system. The functions in the Quality Management module
support the essential elements of such a system. The other integrated modules in the system
complement this functionality. The ISO standards require that quality management systems
penetrate all processes within an organization. The task priorities, according to the quality loop,
VEL TECH

VEL TECH MULTI TECH

59

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

shift from production (implementation phase) to production planning and product development
(planning phase), to procurement and sales and distribution, as well as into the entire usage phase.
In the area of production, quality assurance is no longer viewed in terms of inspection and the
elimination of defects alone. Instead, the production process itself becomes the focus of attention.

CAQ and CIQ

Just as the requirements for quality management systems have changed as a result of the
ISO 9000 standards, the term Computer-Aided Quality Management (CAQ) must also be
redefined. Computer-Integrated Quality Management (CIQ) is a more appropriate term because
an isolated CAQ system cannot carry out the comprehensive tasks of a quality management
system. The ERP system takes this into consideration by integrating the quality management
functions into the affected applications themselves (for example, procurement, warehouse
management, production and sales/distribution), instead of delegating them to isolated CAQ
systems. As a result of this approach, the processes described in the quality manual can be
implemented and automated in the electronic data processing (EDP) system.
The representation of the elements of a quality management system within the ERP system
is not only the responsibility of the Quality Management module. Instead, the ERP system must
be considered as a whole, in which all integrated modules contribute their part. Within the
framework of the system, for example, the Human Resources modules handles personnel-related
matters, the Controlling module handles the management of quality related costs and the Plant
Maintenance module handles the monitoring of test equipment. As a part of the Logistics
application, the Quality Management module handles the traditional tasks of quality planning,
quality in section and quality control. For example, it supports quality management in
procurement, product verification, quality documentation and in the processing of problems.
The quality Management modules internal functions do not directly interact with the data
or processes of other modules.
Quality Management Module-Functions
The Quality Management module fulfills the following functions:
Quality planning (Management of basic data for quality planning and inspection planning,
Material specifications, Inspection planning)

VEL TECH

VEL TECH MULTI TECH

60

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Quality Inspection (Trigger inspections, Inspection processing with inspection plan

selection and sample calculation, Print shop papers for sampling and inspection, Record results
and defects, Make the usage decision and trigger follow-up actions)
Quality Control (Dynamic sample determination on the basis of the quality level history,
Application of statistical process control techniques using quality control charts, Quality scores for
inspection lots, Quality notifications for processing internal or external problems and initiating
corrective action to correct the problems, Inspection lot processing and problem processing,
Quality Management Information System for inspections and inspection results and quality
notifications).
Computer Integrated Quality Management (CIQ)
The integration of Quality Management in the ERP systems provides considerable
advantages because only an integrated system can support all the elements of a quality
management system, according to ISO 9000. The integration allows the quality management
functions to influence all processes within a company, thereby affecting all phases of a products
life cycle.
The Quality Management module uses the systems integration to link the tasks of quality
management with those of the other applications, such as materials management, production,
sales/distribution and cost accounting. An inspection that is triggered automatically upon goods
receipt is an example of this. The Quality management module is integrated with the master data
and processes of the following applications:

Materials management (purchasing, inventory management,

warehouse management, material requirements planning)
Production (work scheduling, shop floor control)
Sales and distribution (delivery, creation of quality certificates)

The Quality Management module supports the exchange of data with other applications in
order to prevent related data from being recorded and stored redundantly. For example, the
information provided by a goods receipt posting relating to the material, vendor and lot size is
automatically transferred to the inspection lot data record when an inspection is triggered.
9. Explain material management module in ERP package.
The Materials Management module optimizes all purchasing process with workflow-driven
processing functions, enables automated supplier evaluation, lowers procurement and
VEL TECH

VEL TECH MULTI TECH

61

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

warehousing costs with accurate inventory and warehouse management and integrates invoice
verification. The main modules of the Materials Management module are:

Pre-purchasing Actives
Purchasing
Vendor Evaluation
Inventory Management
Invoice Verification and Material Inspection

Pre-purchasing Activities
This system supports the complete cycle of bid invitation, award of contract and acceptance
of service. The pre-purchasing activities include maintaining a service master database, in which
the descriptions of all services that are to be procured can be stored. The system also keeps a
separate set of service specifications that can be created for each concrete procurement project or
proposed procurement in the purchasing document. Sets of service specifications may include
both items with services and items with materials. When creating such specifications, the user
does not have to list individual services manually. Instead, the data is simply copied from the
master data. Use of this technique means that data only has to be entered once. The manual entry
effort is reduced to a minimum.
Requirements
Calculation

Requisition for
Quotations

Vendor Ratings

Quotation
Evaluation

Vendor Selection

Contracts

VEL TECH

VEL TECH MULTI TECH

62

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Figure: The pre-purchasing activities module

There are two ways of entering service specifications-planned and unplanned.
Purchasing
Purchasing is a very important component of the Materials Management module. The
Materials Management module is fully integrated with other modules in the system. It supports
all phases of materials management: materials planning and control, purchasing, goods receiving,
inventory management and invoice verification. Good communication between all participants in
the procurement process is necessary for purchasing to function smoothly. Purchasing
communications with other modules in the system to ensure a constant flow of information.
Vendor Evaluation
The vendor evaluation component has been completely integrated into the Materials
Management module. Information such as delivery dates, prices and quantities can be taken from
purchase orders. Vendor Evaluation also uses data from Quality Management, such as the results
of incoming inspections or quality audits. It also accesses basic data in Materials Management,
such as goods receipt data from Inventory Management.
The Vendor Evaluation System supports the optimization of the procurement processes in
the case of the materials and service. In the case of procurement of materials, the system helps you
select sources of supply and facilitates the continual monitoring of existing supply relationships.
It provides you with accurate information on prices, and terms of payment and delivery. But
evaluating vendors, you can improve your enterprises competitiveness. You can quickly
determine and resolve any procurement problems that may arise on the basis of detailed
information and in collaboration with the relevant vendors. In the case of procurement of
services, you can check the reliability of the vendors form which you procure services on a plant
by plant basis. You can determine whether the vendors perform the services within the specified
timeframes and appraise the quality of the work carried out.
Inventory Management
Inventory Management system allows you to manage your stocks on a quantity and value
basis, plan, enter and check any goods movements and carry out physical inventory. In the
Inventory Management system, the physical stocks reflect all transactions resulting in a change in
stock and thus, in updated inventory levels. The user can easily obtain an overview of he current
stocks of any given material. For each material, not only are the stocks in the warehouse shown,
but also the stocks ordered but not yet delivered, reserved for production or for a customer, and
VEL TECH

VEL TECH MULTI TECH

63

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

the stocks in quality inspection can be monitored. If a further subdivision by lots is required for a
material, one batch per lot is possible. These batches are then managed individually in the stock.
Special from the vendor or from the customer (for example, consignment stocks) are managed
separately from the companys own stock.
The stocks are managed not only on a quantity basis but also by value-a prerequisite for
cost accounting. With every goods movement, the following values are updated:
Stock value for inventory management
Accounting assignment for cost accounting
Corresponding G/L accounts for financial accounting via automatic account assignment
Invoice Verification and Material Inspection
The Invoice Verification component is part of the Materials Management system. It
provides the link between the Materials Management component and the Financial Accounting,
Controlling and Asset Accounting components. Invoice Verification in Materials Management
serves the following purposes:
It completes the materials procurement process-which starts with the purchase requisition,
continues with purchasing and goods receipt and ends with the invoice receipt
It allows invoices that do not originate in materials procurement (for example, services,
expenses, course cost, etc.) to be processed
It allows credit memos to be processed, either as invoice cancellations or discounts

VEL TECH

VEL TECH MULTI TECH

64

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

UNIT IV
PART A
1. What are three primary factors for continued growth in ERP market?
ERP vendors are continuing to expand market presence by offering new applications such
as supply chain management, sales force automation, customer support and human
resources.
To sustain their rapid growth, ERP vendors will try to sell more licenses into their installed
base. Currently, ERP vendors have a 10 20 per cent penetration (i.e. percentage of total
employees currently using the RP system). This will grow to 40 60 per cent with in the
next five years.
While ERP originated in the manufacturing market, ERP usage has spread to nearly every
type of enterprise including retail, utilities, and the public sector and healthcare
organizations. Most will purchase new ERP systems over the next five years, often for the
first time.
2. Write briefly about SAP AG.
Founded in 1972, SAP (Systems, Applications and Products in Data Processing), based in
Walldorf, Germany, is the leading global provider of client/server business application solutions.
Today, SAP has installations in more than 107 countries.
3. What are two versions of SAPs ERP package?
SAPs ERP package comes in two versions: the mainframe version (SAP R/2) and the
client/server version (SAP R/3).

VEL TECH

VEL TECH MULTI TECH

65

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

4. Describe SAP.
The power of SAP software lies in real-time integration, linking a companys business
processes and applications, and supporting immediate responses to change throughout the
organization on a departmental, divisional or global scale.
5. Describe R/3.
R/3 employs a three-tier client/server architecture widely recognized by SAP customers,
technology partners and industry analysts as a winning approach to solving some of todays most
demanding information management challenges. The three-tiered architecture separates a system
into three functional layers, each structured to support the demands of its function.
1. The Database layer resides on central servers or mainframe host computers.
2. The Application layer holds the processing logic of the system, preparing and formatting
data for individual offices or departments.
3. The Presentation layer, typically on personal computers, handles all the tasks related to the
presentation of data, including user interfaces that enable easy access to complex
applications and data.
6. What is Intranet?
There is no technical difference between the Internet and the Intranet, except that not
everybody is allowed to current to an intranet. Intranet is an application of the internet technology
to a closed network. It provides a relatively cost efficient way to connect and manage corporate
networks and distributed information. Intranet uses Internet derived communication protocols
(TCP/IP), networking (IP network) and user interface (Web browsers, e-mails etc.). The surprising
speed with which intranets have grown among corporate users, demonstrates the strength of the
Internet networking. Several surveys contend that corporate intranet expenditure far out-paces
the level of spending on consumer oriented Web businesses (Web stores). The compatibility of
corporate intranets with the Internet will be a significant factor in the digital economy. In a sense,
producer and seller information is readily accessible by outsiders, making it easy to manage and
disseminate information to consumers.
7. Define R/3 module.
R/3s applications are modules. They can either be used alone or in combination with
other solutions. From a process-oriented perspective, greater integration of applications increases
the benefits derived.
8. What are the modules in R/3?
VEL TECH

VEL TECH MULTI TECH

66

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Financial Accounting

Treasury

Controlling

Enterprise Controlling

Investment Management

Production Planning

Material Management

Plant Maintenance and Service Management

Quality Management

Project System

Sales and Distribution

Human Resources Management

9. Write briefly about BAAN.

Baans product line features multi-tiered architecture for maximum scalability environment,
enabling support of new hardware, operating systems, databases, networks and user interfaces
without any modification to the application code. Baan Company supports popular Unix
platforms as well as Microsoft NT, and was the first solution provider in its class to earn the
Designed for Microsoft BackOffice logo certification. Products also support major relational
database systems (Oracle, Informix, DB2, Sybase and Microsoft SQL Server), and are Year 2000
compliant.
10. What are the BAAN series based products?
The Baan Series-based product family includes Baan Enterprise Resource Planning
(BaanERP); BaanFrontOffice; BaanCorporateOffice Solutions; and BaanSupplyChain Solutions.
11. Describe serving vertical industries.
Aerospace and Defense (A&D): Baan offers specific vertical industry solutions for aerospace and
defense companies engaging in multi-level projects and contracts. Baans A&D offering includes
BaanProject to enable the effective management of key functional business process areas. This
unique, industry specific approach solves the problems faced by organizations engaged in large,
extensive projects. Today, Baan is recognized as the leader in the Aerospace and Defense industry
segment for ERP.
Automotive: Baan also offers specific vertical industry solutions for automotive companies. Many
of the worlds leading automotive companies use Baans business applications to support
worldwide manufacturing, distribution and financial operations. Baans product suite offers
VEL TECH

VEL TECH MULTI TECH

67

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

automotive companies next-generation information technology across manufacturing, supply

chain and front office operations. With Baan, businesses choose best-of-breed components, add
functionality without complex and costly upgrades and integrate Baan Company enterprise
applications with existing and third-party applications. The BaanSeries-based family of products
delivers real-time information across the entire value chain, from engineering design to
manufacturing, distribution and financial reporting.
12. What are the components in BAAN ERP?
BaanERP includes the following components: manufacturing, finance, project and
distribution.

13. What are the features in Runtime tools?

Allows Baan application developers to focus on application specific issues only

Removes the overhead of developing and generating a native application code for
each combination of platform, operating system, database and so on.
Greatly reduces the complexity of providing and maintaining application product
updates
Reduces the overhead of ensuring cross platform compatibility by bundling and
maintaining computer environment specific code separately from the BaanERP
applications.

14. Define software configuration management.

Software configuration management offers the ability to create, modify and test BaanERP
software components in a run-time environment that does not affect the live environment. It
includes functionally for detailed tracking and version control of modifications.
15. Define Authorization Management system.
Authorization management system allows for the detailed management of user privileges,
either per individual or per role.
16. Define Database Management system.
Database management system Enables a single environment to manage database related
issues, regardless of the database(s) used.
VEL TECH

VEL TECH MULTI TECH

68

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

17. Define Exchange control.

Exchange control A utility to exchange static or dynamic data between BaanERP
installations or between BaanERP and third party products.
18. Define Dynamic form editor.
Dynamic Form Editor A Windows NT client used to create or modify BaanERP forms. The
Dynamic Form Editor allows the dragging, and dropping, of form elements and automates the
process of consistent positioning of form elements.
19. Define 4GL Program Editor.
4GL Program Editor Developers can modify BaanERP or create add-ons using BaanERPs
4GL development language, which is similar to C++ in syntax and structure. The 4GL
environment automates many of the user interface and event handling issues, which allows the
developer to focus on the required functionality.
20. What is Three I Philosophy?
1. Integrity: In its interactions with its customers, colleagues, partners and shareholders
2. Innovation: In what it builds and how it delivers.
3. Initiative: In the speed and focus it brings to all aspects of its market opportunity.
21. Define Baan Education.
Baan Education: As a partner in lifetime learning, Baan Education helps maximize the return on
investment in people and technology. Baan Education addresses the education needs of every one
in an organization, from newly hired employees to seasoned professionals who are maturing with
technology. Bann Education offers new Internet based learning called virtual Campus. With
Baan Education, a partner can realize the companys goals of profitability, productivity and
competitive advantage. Baan Educations process based curriculum, addresses not only specific
Baan Companys enterprise applications, but also provides an in depth under standing of the
business processes that its applications automate. Thus, Baan Company extends education beyond
simple functionality, taking into account the context within which its applications are used in their
manufacturing, sales, financial, and technical environments. This lifetime learning approach
means that a companys workforce is always abreast with the latest technology and business
developments.
22. Define Baan Consulting.
VEL TECH

VEL TECH MULTI TECH

69

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Baan Consulting: Baan Consulting is dedicated to implementing Baan Company enterprise

applications around the globe. In addition to the thousands of customers served by its consulting
partners, Baan Consulting has a successful track record with well over 1,000 customers worldwide,
in almost every business environment. Baan consulting provides a wide range of services, such as
Project Management, Business consulting, Applications Consulting and Technical Consulting.
Throughout the implementation and after a company goes live, Baan Consulting is by its side with
its Internet based Baan Cyber Consult offering.
23. Describe oracle.
Oracle software runs on network computers, personal digital assistants, set top devices,
PCs, workstations, minicomputers, mainframes and massively parallel computers. Oracle8i, the
latest version of Oracle industrys leading database,, is the database for Internet Computing.
Oracles family of database, networking and gateway products enable corporations to access any
data, on any server, over any network, from any client device.
24. Describe oracles Warehouse Technology Initiative.
Oracles Warehouse Technology Initiative (WTI), one of the fastest growing and most
comprehensive alliance programs in the data warehousing industry, provides customers with a
complete data warehousing solution, based on the industry-leading Oracle database and more
than 60 complimentary third-party software products and services. WTI is designed to increase
the quantity and quality of Oracle-based data warehousing solutions, provide customers with
greater choice, specialized tools, Oracle-optimized products and streamlined support as they build
data warehouses.
25. Define OLAP.
OLAP On-Line Analytical Processing: A category of applications and technologies for collecting,
managing, processing and presenting multidimensional data for analysis and management
purposes.
26. Define OLAP Client.
OLAP Client End user applications that can request slices from OLAP servers and provide two
dimensional or multi dimensional displays, user modifications, selections, ranking, calculations,
etc. for visualization and navigation purposes. OLAP clients may be as simple as a spreadsheet
program retrieving a slice for further work by a spread sheet literate user or as high functioned
as a financial modeling or sales analysis application.

VEL TECH

VEL TECH MULTI TECH

70

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

27. What is OLAP product?

OLAP Product A product capable of providing fast analysis of shared multidimensional
information. Ad-hoc analysis must be possible either within the product itself or in a closely
linked product.
28. Define OLAP/ROLAP.
OLAP/ ROLAP on-line Analytical Processing / Relational On-Line Analytical Processing
(OLAP/ROLAP) are applications that a seek to verify complex hypotheses. An example of an
OLAP query might be Compare the costs of shipping to customers in the east to those in the
west.
29. Define supply chain management.
Supply Chain Management People Soft has the industrys only complete enterprise resource
planning solution that is built around supply chain optimization. A Demand Planning module
enables sophisticated forecasting, using real time and historical information. peopleSofts
complete suite of Supply Chain Management products provides comprehensive support for any
organization that produces or markets a physical product.
30. Define service industry solution.
Service Industry Solutions People Soft also provides a complete commercial support solution
for service industries. The Service Revenue Management suit features modules supporting the
tracking of time and labour, payroll processing. A suit of Procurement modules is also available
supporting purchasing, inventory management, payable and expense processing, and asset
management.
31. Define people tools.
People Tools is an integrated set of client / server business application development and
customization tools from PeopleSoft. These tools enable customers to implement, tailor and
maintain People Soft applications as well as to extract, analyze and manipulate data. People Tools
includes several tools for reporting, customization and work flow.
32. What are different product modules available from JD Edwards?
Foundation Suite, Financial Suite, Logistics/Distribution Suite, Service suit, Manufacturing
Suite, Architecture, Engineering, Construction, Mining and Real Estate Suite, Energy and
VEL TECH

VEL TECH MULTI TECH

71

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Chemical Suite, Payroll suite, Human Resource Suite, Customer Service Management Suite,
Government, Education, and Not-for-Profit Solutions, Utility and Energy Solutions.

PART - B
1. Describe SAPAG.
Company Profile
Founded in 1972, SAP (Systems, Applications and Products in Data Processing), based in
Walldorf, Germany, is the leading global provider of client/server business application solutions.
Today, SAP has installations in more than 107 countries.
SAPs ERP package comes in two versions: the mainframe version (SAP R/2) and the
client/server version (SAP R/3). Most prominent among SAPs product range is the enterprise
application suite R/3 for open client/server systems. With SAP Systems, customers can opt to
install the core system and one or more of the functional components, or purchase the software as
a complete package.
SAP customers have chosen to install SAPs client/server suite in more than 19,750 sites
worldwide. They System are accepted as the standard in key industries such as oil, chemicals,
consumer products and high technology and electronics. The SAP group employs a work force of
over 19,300 and has offices in more than 50 countries worldwide. SAP is the Most Successful
vendor of standard business-application software and is the fourth-largest independent software
supplier in the world. In its most recent fiscal year, ending December 31, 1998, SAP AG reported
revenues of DM 847 billion, a 41% increase over 1997s revenues. In the same period, sales of R/3
VEL TECH

VEL TECH MULTI TECH

72

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

rose by 31%.
Since 1998, SAP AG has been a publicly held corporation, with its shares being traded on
the German and Swiss stock exchanges. In 1995, the company was added to the DAX, the index of
German blue-chip companies. SAP listed its ADRs (American Depository Rights) on the NYSE
(New York Stock Exchange) in August 1998.
Products and Technology
SAP products feature a sophistication and robustness unmatched by other business
software solutions. SAP has developed an extensive library of more than 800 predefined business
processes, spanning each functional software requirement. These processes may be selected from
the SAP library and included with in installed SAP applications, after tailoring the application
solution to suit the users exact requirements. New business processes and technologies become
available regularly, enabling SAP customers to add state-of-the-art solutions to meet ever-changing
business demands.
The power of SAP software lies in real-time integration, linking a companys business
processes and applications, and supporting immediate responses to change throughout the
organization on a departmental, divisional or global scale. The international strength of the
products extends to every aspect of the applications, such as the support of multiple currencies
simultaneously and the automatic handling of country-specific import/export, tax, legal and
language requirements. The complete suite of R/3 applications is available in 24 languages,
including Japanese (Kanji) and other double-byte character languages.
R/3-An Overview
R/3 employs a three-tier client/server architecture widely recognized by SAP customers,
technology partners and industry analysts as a winning approach to solving some of todays most
demanding information management challenges. The three-tiered architecture separates a system
into three functional layers, each structured to support the demands of its function.
1. The Database layer resides on central servers or mainframe host computers.
2. The Application layer holds the processing logic of the system, preparing and formatting
data for individual offices or departments.
3. The Presentation layer, typically on personal computers, handles all the tasks related to the
presentation of data, including user interfaces that enable easy access to complex
applications and data.

VEL TECH

VEL TECH MULTI TECH

73

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

SAP has also incorporated and integrated the intranet and Internet technologies into
business solutions for its customers. Both internally and together with its partners, the company is
defining and creating a number of Internet standards-based interfaces, applications and business
processes that will extend the usefulness of SAP software in entirely new ways and to new classes
of customers.
Through its Industry Business Units (IBUs) and its extensive development network, SAP
works closely with its customers to develop new information technology, approaches, to meet the
unique demands of a wide spectrum of industries. With this approach, customers become
members of the SAP development team, sharing their best practices and solutions.
2. Explain R/3 modules.
R/3 Modules
R/3s applications are modules. They can either be used alone or in combination with
other solutions From a process-oriented perspective, greater integration of applications increases
the benefits derived. The following are the R/3 modules:
Financial Accounting Collects all the data in your company relevant to accounting, provides
complete documentation and comprehensive information, and is at the same time an up-tothe-minute basis for enterprise-wide control and planning.
Treasury A complete solution for efficient financial management that ensures the liquidity
of your company worldwide, structures financial assets profitably and minimizes risks.
Controlling A complete array of compatible planning and control instruments for companywide controlling systems, with a uniform reporting system for coordinating the contents
and procedures of your companys internal processes.
Enterprise Controlling Continuously monitors your companys success factors and
performance indicators on the basis of specially prepared management information.
Investment Management Offers integrated management and processing of investment
measures and projects form planning to settlement, including pre-investment analysis and
depreciation simulation.
Production Planning Provides comprehensive processes for all types of manufacturing:
from repetitive, make-to-order and assemble-to-order production, through process, lot and
make-to-stock manufacturing, to integrated supply chain management with functions for
extended MRP-II and electronic Kanban, plus optional interfaces for PDC, process control
systems, CAD and PDM.
Material Management Optimizes all purchasing with workflow-driven processing
functions, enables automated supplier evaluation, lower procurement and warehousing

VEL TECH

VEL TECH MULTI TECH

74

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

costs with accurate inventory and warehouse management and integrates invoice
verification.
Plant Maintenance and Service Management provides planning, control and processing of
scheduled maintenance, inspection, damage-related maintenance and service management
to ensure availability of operational systems, including plants and equipment delivered to
customers.
Quality Management Monitors, captures and manages all processes relevant to your quality
assurance along the entire supply chain, coordinates inspection processing, initiates
corrective measures and integrates laboratory information systems.
Project System Coordinates and controls all phases of a project, in direct cooperation with
Purchasing and Controlling, from quotation to design and approval, to resource
management and cost settlement.
Sales and Distribution Actively supports sales and distribution activities with outstanding
functions for pricing, prompt order processing and on-time delivery, interactive multilevel
variant configuration and a direct interface to Profitability Analysis and Production.
Human Resources Management Provides solutions for planning and managing your
companys human resources, using integrated applications that cover all personnel
management tasks and help simplify and speed the processes.

3. Explain BAAN.
Company Profile
Baan Company is a leading global provider of enterprise business software. Baan Company
offers a comprehensive portfolio of best-in-class, component-based applications for front office,
corporate office and back office automation. These applications are in use at over 7,000 customer
sites worldwide. Baan Company products reduce complexity and cost, improve core business
processes, are faster to implement and use, are more flexible in adapting to business changes and
optimize the management of information throughout the entire value chain.
Baans product line features multi-tiered architecture for maximum scalability environment,
enabling support of new hardware, operating systems, databases, networks and user interfaces
without any modification to the application code. Baan Company supports popular Unix
platforms as well as Microsoft NT, and was the first solution provider in its class to earn the
Designed for Microsoft BackOffice logo certification. Products also support major relational
database systems (Oracle, Informix, DB2, Sybase and Microsoft SQL Server), and are Year 2000
compliant.

VEL TECH

VEL TECH MULTI TECH

75

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

The Baan Series-based product family includes Baan Enterprise Resource Planning
(BaanERP); BaanFrontOffice; BaanCorporateOffice Solutions; and BaanSupplyChain Solutions.
Serving Vertical Industries
Aerospace and Defense (A&D): Baan offers specific vertical industry solutions for aerospace and
defense companies engaging in multi-level projects and contracts. Baans A&D offering includes
BaanProject to enable the effective management of key functional business process areas. This
unique, industry specific approach solves the problems faced by organizations engaged in large,
extensive projects. Today, Baan is recognized as the leader in the Aerospace and Defense industry
segment for ERP.
Automotive: Baan also offers specific vertical industry solutions for automotive companies. Many
of the worlds leading automotive companies use Baans business applications to support
worldwide manufacturing, distribution and financial operations. Baans product suite offers
automotive companies next-generation information technology across manufacturing, supply
chain and front office operations. With Baan, businesses choose best-of-breed components, add
functionality without complex and costly upgrades and integrate Baan Company enterprise
applications with existing and third-party applications. The BaanSeries-based family of products
delivers real-time information across the entire value chain, from engineering design to
manufacturing, distribution and financial reporting.
Manufacturing Module (includes Bills of Material, Cost price Calculation, Engineering
Change Control, Engineering Data Management, Hours Accounting, product Classification,
Product Configuration, Production Control, Production Planning, Project Budgeting,
Project Control, Repetitive Manufacturing, Routings, Shop Floor Control, Tool
Requirements, Planning and Control, Capacity Requirements planning, Master production
Scheduling and Material Requirements planning)
Finance Module (includes Accounts payable, Accounts Receivable, Financial Budgets
System, Cash Management, Financial Reporting System, Fixed Assets, General Ledger, Cost
Accounting and Sales Invoicing)
Project Module (includes Project Budget, Project Definition, Project Estimating, Project
Invoicing, Project Invoicing, Project Monitoring, Project Planning, Project Progress and
Project Requirements Planning)
Distribution Module (includes Sales Management, Purchase Management and Warehouse
Management)

VEL TECH

VEL TECH MULTI TECH

76

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

BaanERP Tools
BaanERP Tools consists of a number of software components, which together form the
technical foundation for all BaanERP components. The BaanERP Tools can be described as a
computing platform that provides an independent, flexible, open and distributed computing and
development environment. The open architecture of the BaanERP Tools makes it possible to:
Quickly react to new trends in the marketplace that require software or software configuration
changes.
Develop the Baan applications in such a way that they are kept independent of third party
products such as hardware, operating systems and databases.
Easily integrate with third-party products.

Create customer-specific solutions.

Allows Baan application developers to focus on application-specific issues only.
Removes the overhead of developing and generating a native application code for each
combination of platform, operating system, database and so on.
Greatly reduces the complexity of providing and maintaining application product updates.
Reduces the overhead of ensuring cross-platform compatibility by bundling and maintaining
computer-environment-specific code separately from the BaanERP applications.
Software configuration management Offers the ability to create, modify and test BaanERP
software components in a run-time environment that does not affect the live environment. It
includes functionality for detailed tracking and version control of modifications.
Authorisation management system Allows for the detailed management of user privileges,
either per individual or per role.
Database management system Enables a single environment to manage database related issues,
regardless of the database(s) used.
Exchange control A utility to exchange static or dynamic data between BaanERP installations
or between BaanERP and third party products.
Dynamic Form Editor A Windows NT client used to create or modify BaanERP forms. The
Dynamic Form Editor allows the dragging, and dropping, of form elements and automates the
process of consistent positioning of form elements.

VEL TECH

VEL TECH MULTI TECH

77

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

4GL Program Editor Developers can modify BaanERP or create add-ons using BaanERPs 4GL
development language, which is similar to C++ in syntax and structure. The 4GL environment
automates many of the user interface and event handling issues, which allows the developer to
focus on the required functionality.
4. Explain Oracle Corporation.
Company Profile
Oracle Corp (founded in 1977) is the worlds second largest software company and the
leading supplier of software form enterprise information management. With annual revenues
exceeding $8.0 billion, the company offers its database,, tools and applications products, along
with related consulting, education and support services. Oracle employs more than 41,000 people
in more than 145 countries around the world. Headquartered in Redwood Shores, California,
Oracle is the first software company to implement the Internet computing model for developing
and deploying enterprise software across its entire product line databases and relational servers,
application development and decision support tools and enterprise business applications.
Technology
Oracle software runs on network computers, personal digital assistants, set top devices,
PCs, workstations, minicomputers, mainframes and massively parallel computers. Oracle8i, the
latest version of Oracle industrys leading database,, is the database for Internet Computing.
Oracles family of database, networking and gateway products enable corporations to access any
data, on any server, over any network, from any client device.
Oracles Warehouse Technology Initiative (WTI), one of the fastest growing and most
comprehensive alliance programs in the data warehousing industry, provides customers with a
complete data warehousing solution, based on the industry-leading Oracle database and more
than 60 complimentary third-party software products and services. WTI is designed to increase
the quantity and quality of Oracle-based data warehousing solutions, provide customers with
greater choice, specialized tools, Oracle-optimized products and streamlined support as they build
data warehouses.
Oracles integrated Business Intelligence solutions deliver powerful capabilities to users
anywhere in the enterprise, at any time. End users benefit from intuitive tools that provide easy
access to business data and fast answers to any question. Oracles Business Intelligence family of
products includes integrated releases of Oracle Reports, Oracles enterprise reporting tool; Oracle
Discoverer, Oracles award-winning an-hoc query and analysis tool; and Oracle Express, Oracles
VEL TECH

VEL TECH MULTI TECH

78

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

industry-leading enterprise online analytical processing (OLAP) engine. Oralce also offers prebuild OLAP applications-Oracle Financial Analyser and Oracle sales Analyser-to further reduce
implementation time and costs.
Oracle Applications is a leading provider of packaged and integrated front office and ERP
solutions for the enterprise and a division of Oracle Corporation, the worlds second-largest
software company and the largest supplier of software for information management. Oracle
Applications strategy is to offer all the enterprise solution components-proven applications,
advanced technologies, business expertise and partnerships required-to enable customers to
execute strategies quickly, manage the risk of change and lead their respective industries.
Oracle Applications is the only suite of enterprise business applications from a major
Enterprise Resource Planning (ERP) vendor that follows the Internet Computing model. Each of
the over 45 modules for financials, human resources, manufacturing, supply chain and front office
automation is webenabled, allowing it to be deployed on corporate intranets with no software,
other than a browser, required on users desktops. This architecture allows companies to shift the
complexity of application management, maintenance and upgrading from users desktops onto
centralized, professionally managed servers, thereby dramatically reducing the cost of deploying
and administering software. By minimizing network traffic, this approach also makes it
economical to deploy the applications over Wide Area Networks (WANs) to hundreds or
thousands of users, making it possible to distribute critical business information much more
broadly than is feasible in the client/server model.

Oracle Applications further exploit the low-cost and universal access inherent in the
Internet Computing model, by providing a set of applications specifically designed for secure, selfservice business transactions across the Internet and corporate intranets. These applications are
integrated with Oracle Workflow to completely automate business processes.
Oracle Applications comprise of 45-plus software modules, which are divided into the
following categories:
Oracle Financials
Oracle Human Resources
Oracle Projects
Oracle Manufacturing
Oracle Supply Chain
Oracle Front Office

VEL TECH

VEL TECH MULTI TECH

79

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

More than 6,000 customers in 76 countries use Oracle Applications. Available in 29

languages, Oracle Applications lets companies operate in multiple currencies and languages,
support local business practices and legal requirements, and handle business-critical operations
across borders. A brief overview of the Oracle Application categories is given below:
Financials Oracle Financial Applications can transform a finance organization into a
strategic force. In todays fast-moving corporate arena, organizations require access to
critical financial management functions. With Oracle Financial Applications, companies
will be able to work globally, lower their administrative costs, close their books faster and
improve cash management-while providing the strategic information required for making
timely and accurate decisions.
Projects Oracle Projects Applications improve operational efficiency by providing an
integrated project management environment that supports the full lifecycle of every project
in your enterprise, increasing to-line revenue growth and bottom-line profitability. As the
bridge between operations systems and corporate finance, Oracle Projects Applications
provide a central repository of validated cost, revenue, billing and performance data
associated with your business activities or projects.
Human Resources Well-managed human resources directly improve the bottom line and
contribute to competitive advantage. The ability to hire, motivate and retain the most
capable workforce; engage employees and line managers directly in managing their skills
and careers; and provide comprehensive and up-to-date workforce information for
management-on a global basis-are a few of the characteristics important for success. The
Oracle Human Resource Management System (HRMS) provides comprehensive facilities
for organizations to achieve such goals.
Manufacturing Oracle Manufacturing Applications are the industry leading mixed-mode
manufacturing solution that enables companies to achieve market leadership by becoming
more customer-responsive and efficient. This product family supports companies from
small, single-facility environments to multi-plant, global manufacturers with complex
requirements. Oracle Manufacturing Applications help companies increase revenue,
profitability and customer loyalty by universally capturing demand, planning the extended
enterprise in one rapid step and by ensuring that the most efficient manufacturing process
is used to produce each product.
Supply Chain oracle Supply Chain Management Applications simplify supply-chain
processes by providing a single, integrated environment for managing the extended
enterprise. From your suppliers suppliers to your customers customers, Oracle enables
VEL TECH

VEL TECH MULTI TECH

80

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

effective trading partner collaboration and supply-chain optimization capabilities that are
vital to gaining and sustaining competitive advantage. Oracle Supply Chain Management
Applications help in increasing market share while improving, customer service and
minimizing costs across the networked supply chain.
Front Office Oracle Front Office Applications provide a true customer centric approach,
allowing you to better understand your customer relationships, their value and profitability.
Oracle Front Office Applications increase top-line revenues, decrease sales and service
costs, and maintain customer retention and satisfaction. The sales, marketing and service
solutions provide deep integration with the entire enterprise suite of applications, and
enable you to attract and retain profitable customers through a unified set of deployment
channels, including Web mobile and call centre.
Vertical Solution
Oracle also provides vertical solutions with a full line of modular product components
aimed at the unique requirements of many major industries, including automotive, aviation,
aerospace and defense, communications, consumer packaged goods, energy downstream, energy
upstream, financial service, high-tech, public sector and utilities.
5. Explain People soft.
People Soft solutions run on a variety of leading hardware and database platforms,
including Compaq, Hewlett Packard, IBM, Sun Microsystems, Informix, Microsoft SQL Server,
Sybase, DB2 and others, People Soft delivers Web-enabled applications, workflow, online
analytical processing (OLAP), etc.
People Soft has over 2,900 customers in nearly every industry and geographic region in the
worked, including a large cross section of the Fortune 1000.
The companys products are sold through direct sales offices and distributors in the United
States, Canada, Europe, Asia /Pacific, Latin America and Africa. With award winning customer
service, people Soft dedicates approximately 47 percent of its staff to customer service in the areas
of account management, product support, professional services, education services and
communication services.
The people Softs business management solutions are in the areas given below:
1. Human Resources Management
2. Accounting and Control
3. Treasury Management
VEL TECH

VEL TECH MULTI TECH

81

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

4. Performance Measurement
5. Project Management
6. Sales and Logistics
7. Materials Management
8. Supply Chain Planning
9. Service Revenue Management
10. Procurement
Commercial Solutions
Supply Chain Management People Soft has the industrys only complete enterprise resource
planning solution that is built around supply chain optimization. A Demand Planning module
enables sophisticated forecasting, using both real time and historical information. peopleSofts
complete suite of Supply Chain Management products provides comprehensive support for any
organization that produces or markets a physical product.
Service Industry Solutions People Soft also provides a complete commercial support solution
for service industries. The Service Revenue Management suit features modules supporting the
tracking of time and labour, payroll processing. A suit of Procurement modules is also available
supporting purchasing, inventory management, payable and expense processing, and asset
management.
People Tools
People Tools is an integrated set of client / server business application development and
customization tools from PeopleSoft. These tools enable customers to implement, tailor and
maintain People Soft applications as well as to extract, analyze and manipulate data. People Tools
includes several tools for reporting, customization and work flow.
6. Explain People Soft Technology.
Technology
People Soft Continually adds and refines technology to optimize their customers information
systems. They help customers take advantage of new and emerging technologies, giving them
more choices and freedom to develop their own innovative business processes. Some of them are
given below:
Self Service Applications To improve productivity throughout the organization, People Soft
focuses on providing the occasional user with easy access to information and functionality
VEL TECH

VEL TECH MULTI TECH

82

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

specific to their role. They have developed a set of self-service applications to help companies
quickly and cost effectively distribute functionality throughout the enterprise over the
Internet, intranets and extranets. Built with an intuitive interface based on a standard Web
browser such as Netscape Navigator or Microsoft Explorer these Java based, cross
platform applications enable employees, customers, suppliers and other occasional users to
perform self service administrative tasks easily. Self-service applications are linked to
People Soft core product lines, including PeopleSoft Accounting Control, Human Resources
Management and Materials Management.
Web Client Self- service applications use the People Soft Web Client. The web Client is
downloadable on demand and runs on a web browser across multiple platforms. Its
affordability, open architecture and simplicity provides and ideal framework for delivering
enterprise solutions , to a large number of people. Applications, dont need to be installed at
every desktop; they are accessed easily through a browser. In addition to supporting self
service applications, the People Soft Web Client has a Worklist and Query interface to help
incorporate occasional users in the flow of a companys business processes and improve
access to information. Furthermore, all data transmitted between the Web Client and the
application server is encrypted for added security. Because the Web Client takes advantage
of People Tools, self-service applications can be deployed across the Internet or existing
corporate intranets with common business rules workflow logic and security features.
Multitier Transaction Processing The ability to support large number of concurrent users,
while maintaining reliable and superior performance, is critical to enterprise Wide data
processing. Recognising that PeopleSoft works in a variety of settings-over local area
networks (LANs) and wide area networks (WANs), throughout organizations of varying
sizes there is an option of two tier or three tier processing. In the latter, the application
logic runs on an applications server instead of the client. The application server is designed
to relive the client from processing intense SQL transactions, thereby reducing LAN traffic
and improving performance across WANs. A three tier architecture also provides increased
scalability to accommodate high volumes of concurrent users while maintaining a consistent
and reliable performance level. PeopleSoft continues to support its traditional two tier
architecture as well.
Online Analytical Processing Companies must be able to quickly extract and analyze the
information they require for effective decision making. OLAP, or online analytical
processing, is a powerful method for interactively analyzing data online. PeopleSoft
integrates popular OLAP stools including Cognos Power play and Arbor Essbase that
enable users to easily slice and dice multidimensional data stored in various locations. With
the cube Manager, users can define the data they want to extract into an OLAP cube,
enabling them to quickly view information from all different angles to test conclusions,
VEL TECH

VEL TECH MULTI TECH

83

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

conduct what-if scenarios and compare alternative strategies. With multidimensional

information presented in quick-read formats, managers can make better decisions, react
faster to competitive threats and identify inefficiencies.
Work flow An essential part of our solution, PeopleSoft workflow capabilities help
communications companies achieve enterprise wide integration of information,
applications and people, Workflow enables a company to automate many time consuming
clerical tasks, while putting useful data into the hands of users. With workflow, the
companys PeopleSoft applications do more of the work. For example, if managerial approval
is needed for a work order, the system automatically forwards the request. Workflow can also
help the company track projects, by initiating a workflow message to the appropriate person
when a project exceeds a predetermined cost. The company can even bring non-PeopleSoft
users into the workflow process, using e-mail systems and the Internet for collecting and
distributing data.
7. Explain JD Edwards World Solutions Company.
Company Profile
1977, Derver, Colorado. Three men left the accounting world to form a software company
that would specialize in midrange computing solutions. Each of the three founders Jack
Thompson, Dan Gregory and EdMcVaney-lent a small portion of his name for the company name.
On March 17, JD Edwards was formed.
In the early years, JD Edwards designed software for several small and medium-sized
computers, eventually focusing on the IBM System/38 in the early 1980s. It was in this effort that
JD Edwards pioneered the CASE software development and design tool, which lends consistency
across the broad range of JD Edwards integrated applications.
Technology
JD Edwards offers its solutions primarily for the AS/400 platform. JD Edwardss two
application suites, One World and WorldSoftware/WorldVision, provide comprehensive supply
chain management functionality across the technology continuum, from host centric, to thin
client, to network-centric computing. All three can run concurrently on the same AS/400, share
data and interact with each other as a unified solution.
In the age of technology change, the popularity of many enterprise software solutions is
fleeting. The resulting obsolescence is frustrating and costly. It is better to have a system that has
the necessary functionality with built in longevity. More than 4,000 customers have found this
staying power in JD Edwards WorldSoftware. On its strength and the reliability of its host centric
VEL TECH

VEL TECH MULTI TECH

84

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

IBM AS/400 foundation, WorldSoftwares global popularity has endured in the ERP market place
for over a decade.
Inherently flexible and easy to use, WorldSoftware readily adapt to your situation, letting you:
Selectively mix, match and integrate software applications from among its diverse industry
product suits.
Easily tailor it to ongoing business, local and organization specific requirements.
Add WorldVision, its advanced graphical user interface, to gain client/server benefits.
Optionally run it alongside OneWorld, JD Edwawrds network-centric solution, to gradually
incorporate other computing platforms into your network.
JD Edwards WorldVision is a thin client bridge that provides the graphical user interface
(GUI) with a look and feel common to the PC, while protecting your investment in WorldSoftware
and the AS/400. WorldVision also allows you to:
Maximise productivity by shrinking the amount of training users
need.
Make a safe move to client / server by leveraging your existing host
centric WorldSoftware applications.
And like WorldSoftware, WorldVision is continually enhanced for the future. For example, you
can have WorldVision as a windows 95/NT style GUI for a PC and as Java based interface for use
across the Internet, intranets, or extranets.
Modules The different product modules available form JD Edwards are:
Foundation Suite (Black Office, CASE Foundation, Environment/ Toolkit, financial
Analysis Spreadsheet Tool and Report Writer, WorldVision GUI, Electronic Burst &
Bind).
Financial Suite (General Accounting, Accounts Payable, Accounts Receivable, Fixed
Assets, Financial Modeling and Budgeting, Multi-currency Processing, Cash Basis
Accounting, Time Accounting)
Logistics/Distribution Suite (Forecasting, Requirements Planning, Enterprise
Facilities Planning), Sales Order Management, Advanced Pricing Procurement,
Work Order Management, Inventory Management, Bulk Stock Management, Quality
Management, Advanced Warehouse Management, Equipment Management,
Transportation Management, Job Cost. Service Billing)

VEL TECH

VEL TECH MULTI TECH

85

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Service suit (Contract Billing, Subcontract Management, Change Management,

Property Management)
Manufacturing Suite (Configuration Management, Cost Management, Product
Data Management, Capacity Planning, Shop Floor Management, Advanced
Maintenance Management)
Architecture, Engineering, Construction, Mining and Real Estate Suite
(Procurement, Inventory Management, Equipment Management, Job Cost, Work
Order Management, Subcontract Management, change Management, Contract
Management, Contract Billing, Service Billing, Homebuilder Management, Property
Management)
Energy and Chemical Suite (Agreement Management, Advanced Stock Valuation,
sales Order Management, Bulk Stock Management, Load and Delivery
Management)
Payroll suite
Human Resource Suite
Customer Service Management Suite
Government, Education, and Not-for-Profit Solutions (Financial Administration
and Reporting, Budget Administration, Fund and Encumbrance Accounting, Grant
and Endowment Management, Purchasing and Material Management, Warehousing
and Central Stores Management, Human Resources Management, Service and Work
Order Management, Capital Project Construction Management, Contract
Management, Plant, Equipment, and Fleet Maintenance.
Utility and Energy Solutions (Customer information System, Human Resources
Management, Work Management, Regulatory Reporting, Supply Chain
Management, Project Management, Enterprise Maintenance Management)
8. Explain System Software Associates.
Company Profile:
SSA was founded in December 1981 and has its headquarters in Chicago, USA. SSA has its
presence in 91 countries and employees more than 2000 employees. The 1998 revenues of the
company was $venues of the company was $ 420.8 Million. The Companys product line, BPCS
Client/Server V6, is currently live or being implemented in more than 1,000 major industrial sector
firms in over 4,000 sites world wide.
VEL TECH

VEL TECH MULTI TECH

86

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

SSAs vision is to be the global partner to the worlds industrial sector companies. SSAs
mission statement, which has been the same since SSA was founded in December 1981, is to
provide competitive advantage for Clients through the implementation of their business enterprise
information system. This mission statement is underwritten by six key goals:
1. Best Client Satisfaction. This means that the company wants their clients to achieve the
greatest possible business benefit from their-relationship with SSA.
2.

Single Image Worldwide Means that the clients get the same high level of support and
expertise all around the world.

3. Enterprise Solutions Leadership It means that the company is focused on building and
delivering solutions, which bring together the entire enterprise.
4. Proven Leading Technology This means that every piece of technology applied by SSA
will already be proven for high transaction volume enterprise-wide applications.
5. Highly skilled and motivated professionals It means that SSA is committed to having
the best professionals and resources in the application software business.
6. Strong Financial Results This means that SSA can continue to invest in the improvement
of its software and professionals, and will be a stable partner in the long run.
BPCS Client / Server:
BPCS Client/Server is a comprehensive set of integrated client / server applications that
addresses the core system needs of industrial sector enterprises on a global scale. BPCS Client /
Server coves Configurable Enterprise Financials applications, Supply Chain Management
applications, Multi-Mode Manufacturing and CIM applications, as well as Electronic Commerce
applications such as EDI. BPCS Client/Server is based on SSAs proven object technology
foundation that ensures that it operates identically from an end-users perspective across any
supported server, be it HP 9000, AS/400, or Windows NT.
BPCS Client/Server products offer numerous full function applications with capabilities to
support solutions needed by the industrial sector. Major objectives of industrial managers have
been to improve customer satisfaction, improve product quality, remain cost competitive, and
reduce the time in launching a product in the market. SSAs BPCS Client/Server products provide
a wealth of features and functions enabling industrial managers to achieve these objectives.
VEL TECH

VEL TECH MULTI TECH

87

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

The Microsoft Desktop is the BPCS Client /Server Desktop: the BPCS Client/Server user
interface is graphically and fully compliant with Microsoft Windows 95. The look and feel is the
same as other Microsoft desktop applications, resulting in a system that is easy to learn and use.
Examples of Microsoft desktop functions include full use of hypertext and other point-of-demand
education, such as field sensitive help text, bookmarks, annotations and other Windows help text
functions. BPCS Client/Server also includes hypertext linking related topics.
The BPCS Client/Server graphical user interface icons, messages, scroll bars, tool bars, pulldown menus, radio buttons, check boxes and other Microsoft desktop features. In addition, the
BPCS Client/Server applications are interoperable with other windows compliant applications
through the windows cut-and-paste feature.
BPCS Client/Server is used worldwide by more than 8500 companies, at 25,000 sites, and
by 3,000,000 end users, representing various vertical markets-automotive, chemical, consumer
goods, electronics, fabrication and assembly, food and beverage, forest products and
pharmaceuticals. SSA and its strategic partners provide full implementation support for BPCS
Client/Server in over 90 countries worldwide.
The BPCS Client/Server solution delivers unparalleled agility and re-configurability to
meet changing market demands, through a quantum leap forward in ERP technology that delivers
significant business benefits, including century dating.
With BPCS Client/Server version 6.0, SSA has successfully addressed the most crucial
issues facing the ERP market place, the implementation and integration of package applications.
SSA has reduced time-to-benefit implementation cycles to 6-12 months, down from an industry
average of 12-24 months. At the core of BPCS Client/Server is its object-based architecture, called
DOCA (Distributed Object Computing Architecture), which is specifically designed for enterprisewide application in industrial sector companies. DOCA is optimized to support high transaction
volumes in a functionally rich, distributed data processing, client/server environment. DOCAs
object-based architecture provides inherent flexibility, enabling the rapid reconfiguration of BPCS
Client/Server applications. This allows organizations to quickly and easily alter the solutions in
response to new business and market challenges.
9. Explain QAD.
Company Profile:
QAD was founded in 1979 and now has a presence in 21 countries and employs more than
1100 people. The companys products include MFG/PRO, On/Q, Service / Support Management,
Decision Support, and Qwizard. The companys flagship product is its ERP solution MFG/PRO.
VEL TECH

VEL TECH MULTI TECH

88

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

It is available in 26 languages and has more than 4,000 installed sites in over 80 countries. The
company got the ISO certification in 1995.
Products:
QAD offers a variety of supply chain and Enterprise Resource Planning (ERP) sort ware
products to manufacturing industries within the automotive, consumer products, electronics, food
and beverage, industrial products and medical sectors. QAD soft ware optimizes your enterprise
by increasing the speed of internal processes and by synchronizing distributed operations.
QADs flagship product, MRG/PRO software, provides multinational organizations with
an integrated Global Supply Chain Management solution that includes manufacturing,
distribution, financial, service/support management applications within an open system
environment. Internet-Enabled MFG-PRO allows you to share information and conduct
commercial transactions over the Internet.
QADs On/Q Extended Supply Chain Applications manage the complex demand and
fulfillment transactions of large multinational corporations with dynamic, collaborative
relationship spanning multiple enterprises. Service/Support Management is designed for
companies who not only manufacture and sell their products but also offer after-sales service and
support. QADs Decision Support is a tool designed to provide manufacturers with access to
information necessary for informed decision-making. Qwizard, QADs interactive mentor for
users of MFG/PRO software, is a value-added tool that provides easy-to-use business modeling,
implementation and interactive learning tools.
QAD had currently developed a number of business arrangements with Product Alliance
Partners to enhance the effective functionality of QADs products.
10. Explain MFG/PRO.
MFG/PRO software is one of the successful client/server ERP applications as it
dramatically increases the internal efficiencies of distributed operations within months of
purchase. The software is comprehensive, open, flexible, scalable, interactive, and designed to
address the operations requirements of todays manufacturers. It is available in 26 languages, is
year-2000 compliant, and supports multiple currencies including the Euro.
MFG/PRO includes an extensive set of solution components for manufacturing,
distribution, financial, supply chain, and service/support management. Configurable and
interoperable, it is open to best-of-breed components, uses either Oracle or Progress databases,
VEL TECH

VEL TECH MULTI TECH

89

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

and runs in UNIX, Windows, and Windows NT environments.

MFG/PRO can be implemented at multiple sites and it easily scales to meet the changing
business requirements. MFT/PROs user interface is an ultra thin Java browser. MFG/PRO is also
available with a Windows graphical user interface (GUI) or a character user interface.
Manufacturers need a solid strategy for achieving and maintaining competitive advantage.
MFG/PRO soft ware quickly synchronizes distributed operations within your enterprise, enabling
you to balance supply and demand across multiple sites. MFG/PROs supply chain functions
include centralized order processing, centralized purchasing, enterprise operations planning,
distribution requirements planning and enterprise materials transfer. By using MFG/PROs
enterprise-level supply chain functions, you can manage supplies within your enterprise far more
effectively, no matter how widely distributed your sites are. This means you will be able to
respond to customer needs much more rapidly.
MFG/PRO is a fully integrated soft ware package available on a module by module basis.
MFG/PRO addresses the entire manufacturing spectrum from repetitive to configure-to-order. It
is appropriate for process, batch process, make to stock, configure-to-order and repetitive
manufacturing environments. With world class supply chain management tools, it is particularly
useful for multinational companies. The various modules of MFG/PRO are:
Distribution : The Distribution Modules of MFG / PRO are used to monitor inventory
balances and manage purchasing and sales order entry activities.
Manufacturing : The Manufacturing Modules are used to regulate all manufacturing
activity within the various types of production environments.
Financials : The Financial modules interface with the Distribution, Planning and
Manufacturing modules to report the financial implications of the companys activities.
Service/Support : Service / Support Modules are designed for companies which not only
manufacture and sell their products, but also offer after-sales service and support.
Supply Chain : Supply Chain Management is the control of goods and information from
supplier to customer.
Master Files functions provide access to series of foundation modules that are used by the
rest of the MFG/PRO applications. These master files include: Items / Sites, Addresses /

VEL TECH

VEL TECH MULTI TECH

90

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Taxes, Inventory Control Settings, Physical Inventory, Multiple Database configurations and
Manager Functions.

UNIT V
1. Define E-Commerce.

PART - A

Most companies will conduct at least part of their business operations through
e-commerce, that is, on the Internet. When people think of e-commerce, they often think of retail
e-commerce, typified by companies like Amazon.com. Most of the sales growth on the Internet,
however, has been in the area of business-to business (B to B) e-commerce, rather than in retail
business to consumer (B to C) e-commerce.
2. Define Business to Business ecommerce.
Business to business e-commerce is defined as buying and selling between two
companies over the World Web. The companies might be manufacturers, suppliers, wholesalers,
or retailers.
3. Define EDI.
Companies electronically transferred purchase orders through a system known as
Electronic Data Interchange (EDI). EDI is an electronic computer-to-computer transfer of
standard business documents.
4. What are the Benefits of EDI?
Costs of paper, printing, and postage have almost disappeared from ordering system.
Errors have been brought to a minimum because orders do not have to be rekeyed into a
suppliers system.
Ordering is fast and efficient. As s result, large companies have forced their smaller
suppliers to use EDI, via a VAN if necessary. The supplier pays the VAN per amount of
information sent and received.
Suppliers and buyers are locked into business relationships: Once a company sets up an
EDI system with its supplier, it takes effort to change suppliers, and most do not, hence

VEL TECH

VEL TECH MULTI TECH

91

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

locking in the relationship. This is an advantage as long as both suppliers and buyers
remain satisfied.
5. Why companies are morning from EDI to Internet Based Procurement?
The following reasons:
1. The Internet is a lower-cost network than private EDI networks.
2. Purchasing costs are further reduced as suppliers compete for orders on the buyers Web
site.
6. Define back-office processing.
When a company receives an order through its Web site, the company cant merely file or
print orders for later handling, like e-mail updates and order tracking. The orders must be
efficiently fed into the companys marketing, manufacturing, shipping, and accounting systems a
series of steps sometimes called back-office processing.
7. Define ASP.
An Application Service Provider (ASP) is a company that delivers software applications to a
company over a network. Usually that network is the Internet.
8. What are the advantages of using an ASP?
Affordability Companies that once thought they couldnt afford an ERP system can
now pay for it on a monthly basis. Gaining access to an ERP system through the Internet
is even cheaper than using private leased lines. ASP services can be received through an
Internet connection using a regular browser and the SAP graphical user interface.
Shorter implementation times The time for implementation is shorter for those who
choose to implement ERP through an ASP. ASPs already have similar systems running
and are experienced in software delivery. They have servers, telecommunications, and
highly trained personnel already in place.
Expertise ASPs are experts in delivering IS applications. They do all the maintenance,
including backups, training, and customizing of the system. That lets their customers
eliminate. IT headcount to focus on their business. ASPs can also run information
systems more efficiently because they do it on a large scale. ASPs can spread fixed costs
over many users, thus achieving economies of scale that might translate into low lease
VEL TECH

VEL TECH MULTI TECH

92

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

rates. And, in this tight IS labor market, an ASP may have a better chance of attracting
and retaining a talented work force.
9. What are the disadvantages of using an ASP?
Security Companies using ASPs are turning their information systems over to a third
party; therefore, they must be confident that the ASP has a high level of security. How
hardware will be shared is also a security concern: The ASP will have multiple users on
a single piece of hardware. Each customers data must be shielded from other
customers. An ASP might have better security, however, technology than a small
company can obtain.
Bandwidth/response time The telecommunications channel from the ASP to its
customers must be fast enough to handle multiple users. An ASPs servers must be
sufficient in terms of processing capabilities.
Flexibility An ASP should be flexible in working with its users and satisfying their
requests for processing modifications.
No frills An ASP can usually provide basic systems well, but asking for unusual
configurations may cause problems. An ASP might not allow for third-party add-ons
either. Further, the ASP might not want to do much customization using the SAP R/3
programming language, ABAP.
Technical, not business An ASP knows the technical aspect of the software, but it will
need the customer to define the business processes and make the configuration
decisions.
10. What is NPV?
Net Present Value (NPV) is a way to figure out whether an investment is profitable, or in
this case, compare outlay of funds from one method to another. NPV can be calculated over a
number of years; in our case, a five-year outlay of funds for the ERP project. The syntax of NPV is
= NPV (hurdle rate %, range of values) within an Excel spreadsheet. The values in the range can be
positive or negative numbers.
11. Define Hurdle rate.
The hurdle rate (written in the spreadsheet as a decimal, not a percentage) is the rate of
discount over the period. The hurdle rate is the minimum acceptable rate of return on a project
VEL TECH

VEL TECH MULTI TECH

93

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

that a company will accept.

12. What are the advantages of connectivity?
Efficiency For the traveling representative, connectivity means faster response time to a
customers order or request.
Productivity More time is productive since access to the system can be made from
virtually any where.
Data Collection The user can easily collect data in the field and transmit it to the office,
which can mean connecting to the companys back-office system.
Profits Profits may eventually rise with the increased efficiency and productivity.
13. What are the perceived benefits of ERP for a company like yours?
Business in the past 10 years has gotten more complex and now has many dimensions ERP can
help our company in two major areas:
1. Globalization: Different countries have different ways of doing business. ERP can replace
those global differences.
2. Regulatory environment: In our business, there are strict regulatory rules, and they are
different in different markets. ERP can help manage company wide compliance with all
those complex regulations.
ERP is basically using system to coordinate the flow of information to maximize profits. You need
to strike a balance, how ever, between total integration and nonintegration.
There can be problems with total integration. The complexity of business is so high that
implementing a total ERP system for a large multinational company is very difficult. One needs to
approach ERP with reality in mind. For example, one of our factories in Brazil had an ERP system
in place. It worked well and the factory was profitable. It was not a good business decision for
them to change their non SAP system to our headquarters SAP system, so an interface was
written to bridge the two systems.
14. Why is ERP an easy sell to top management?
There is a one word answer to that question: control. All upper-level managers want to
control their organization. They often do not have access to proper information at the proper time.
Any system that can give them accurate, timely information is fantastic. In fact, years ago, we
implemented the old SAP system, R/2, just for that purpose. The workers in our factory were
incredulous because we went from a Windows-based graphical user interface to a text based
VEL TECH

VEL TECH MULTI TECH

94

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

interface with R/2, To them, it seemed like a step back in technology, but that new system could
give upper-level management the information they needed to control the companys operations.
15. Are there any unusual concerns for ERP in the pharmaceutical industry?
In the pharmaceutical industry, certain forces lead to fragmented systems, not integrated
systems. For example, an individual Customers genetic code is one type of information that
would not be widely available on an integrated system due to privacy concerns. Also, in this
regulated business, ERP systems have different flows than that seen in the traditional paper-based
system that the FDA [Food and Drug Administration] still uses. The FDA is moving into the
electronic age, but government regulators dont move at the same pace as industry.
16. How is ecommerce changing the face of ERP in your industry?
E-commerce is forcing business into an environment that is faster than ever and more
uncertain than ever. One interesting part of the e-commerce puzzle in our industry is the area of
electronic medical records. The concept of integrated information for medical records has appeal
for all healthcare practitioners, insurance companies, and pharmaceutical companies. Freely
available electronic patient records, however, are the last thing the public wants. So although the
concept of a fully integrated system for medical records is appealing to the industry, it is not now
possible due to privacy concerns.
For example, assume that all clinical trial data were in an ERP system, accessibly by many
type of users such as pharmaceutical companies, doctors, and researchers. Cost savings and
research advances would result. Many users would like this, but the patients in the clinical trials
would be concerned their privacy was being invaded.
17. What is the future of ERP?
It is true that the back office systems need to be in place for e- commerce to take place
successfully, E-commerce is impossible without the infrastructure ERP provides. ERP faces risks in
the new electronic environment, however, because of the Webs research, speed, and lack of time to
retract errors. Time is now compressed and mistakes that happen can be big. So there in
uncertainty in the future of ERP and for all businesses, Business people will have to work hard to
respond to the speed at which ERP and the Web can deliver information.

18. Define Business to consumer e-commerce.

VEL TECH

VEL TECH MULTI TECH

95

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Business to consumer e-commerce can stream line a companys ordering operations are
record information about customers, making the company more competitive.
19. What is wireless connectivity?
Wireless connectivity is rapidly gaining popularity globally, and ERP systems are becoming
connected to those wireless devices. Access to better information can provide a competitive edge.
20. Write the benefits of E-Commerce.
The electronic commerce gives the possibility of facing the storage in real time in order to
reach clients through the web. It combines the product information with the multimedia
information and manages the sales process from beginning to the end.
21. What is EIA?
Enterprise Integration Applications (EIA) is a tool which is used to integrate the data of one
enterprise with other enterprises or Divisions. It is also used to link the external systems with the
ERP system.

PART B
VEL TECH

VEL TECH MULTI TECH

96

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

1. Describe ERP & e-commerce.

E-Commerce and ERP
E-Commerce
Web Store
Web site
Customer portal
Vendor portal

ERP
Financials
Inventory
Payroll
Purchasing

You might ask yourself, what does e-commerce have to do with ERP? The answer is that
each technology complements the other, and each is necessary for total success. Without ecommerce, a company cannot compete with companies offering similar goods. Without ERP a
company cannot fill Web orders expeditiously. Heres why.
When a company receives an order through its Web site, the company cant merely file or
print orders for later handling, like c-mail updates and order tracking. The must be efficiently fed
into the companys marketing, manufacturing, shipping, and accounting systems-a series of steps
sometimes called back-office processing.
An efficient back-office operation is crucial for any companys success E-commerce often
exacerbates problems and reveals weaknesses in current back-office systems. For example,
Amazon.com invests its cash flow back into warehouses and other support that the company
needs to keep its back office in order, so it can continue its success. Some Web only businesses are
frightened that companies like Wal-Mart will enter the Web market. Why? Because those
companies already have well-established, integrated back-office and distribution systems.
Some companies with unintegrated information systems have built Web sites before
creating an integrated back-office system. As a result, those companies often cant fill orders in a
timely fashion, as was apparent with many e-commerce businesses during the 1999 holiday
season. One large toy company announced less than a week before Christmas that it would not be
able to fill all its Web orders. Surprisingly enough, all the toys were in the warehouse, but the
company couldnt organize basic functions-like picking, packing, and shipping-to get toys to
consumers on time. So integrating the Internet front-office operation and the ERP back-office
operation is fundamental in todays business environment.

VEL TECH

VEL TECH MULTI TECH

97

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

2. Explain ERP and internet.

Internet-Based Procurement
Even though EDI has been useful, companies are moving from EDI to Internet-based
procurement for the following reasons:
1. The Internet is a lower-cost network than private EDI networks.
2. Purchasing costs are further reduced as suppliers compete for orders on the buyers Web
site.
Thus, locking in suppliers is not the same and may not take place at all in Internet-based
procurement. Suppliers that cannot compete on price may fall by the wayside, leaving the buyer
with relationships with only viable suppliers. Here are three recent examples of this
phenomenon:
In 2000 Ford Motor Company and General Motors announced that they are putting together
an enormous Web site called a B-to-B automotive trading exchange. This venture is in
conjunction with Commerce One and Oracle, which is providing the necessary software.
Each company, along with its suppliers, can buy and sell automotive parts on this Web site.
Purchasing auto parts will be fast and efficient, and auto manufacturers can maintain a low
inventory. These savings could translate to more than 10% of the purchase price of a car.
Other industries, in addition to the auto industry, are setting up exchanges.
ERP companies like SAP have also entered the B-to-B- e-commerce market. SAP has
proposed a joint effort with Stat oil, the worlds second-largest supplier of crude oil, to
develop a vertical market place for oil and gas services. SAPs mySAP.com supports
exchanges in buying and selling raw materials with large companies like Stat oil as
partners. Stat oil is linking with SAP and offering a Web site to find all types of equipment
and services for the oil and gas industry. SAP hosts the marketplace, which will provide
sources for services, equipment, and maintenance to the oil and gas industry. Stat oil
expects large savings by using a single marketplace. Other companies are expected to use
the marketplace as well. As the long-established oil and gas industry has matured, pricing
has become highly competitive. Any product that makes the industry more efficient it
welcomed.
The World Chemical Exchange allows companies to buy, sell, and trade chemicals at
chemconnect.com. The Web site claims the following advantages:
1. Best prices without traditional negotiations
VEL TECH

VEL TECH MULTI TECH

98

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

2. Faster contracts
3. Access to new worldwide and new trading partners
4. Instant market information
Internet Auctions and Reverse Auctions
B-to-B e-commerce also features online bidding through auctions and reverse auctions. In a
standard auction, a company might put up for bid its products or even its obsolete equipment. In
a reverse auction, a company might ask for bids to supply it with goods, services, or even
telecommunications capacity. Heres how a reverse auction works. Lets go back to our example
company, Fitter Smacker. The company needs raw materials such as oats and wheat germ, which
for FS are essentially commodities. The company can go to a bidding Web site and set up a
program to run overnight. The program uses the Internet to solicit bids to supply those raw
materials. In the morning, FSs purchasing agent can choose the lowest price offered for the oats
and wheat germ.
Internet-based auctions are changing the way in which commodities are purchased. A few
years ago, commodities would have been purchased through a supplier, or middleman, who
negotiated prices of raw materials with suppliers. Now, the Internet and its bidding programs
have threatened the middlemans role and made the buying process more efficient-in a sense, the
Internet has become the middleman. Pricing is dynamic and open.

In fact, dynamic pricing is not only forcing out middlemen, but it is also putting pressure
on sellers. Sellers must be nimble and flexible to participate in this fast-paced market. This
requires a sellers accounting and logistics operations to be in excellent shape before trying to sell
in the auction market.
3. Write future direction of ERP.
New Markets
As larger enterprises become saturated with new-generation client/server ERP systems,
vendors are being forced to find new markets for their product suites in order to grow. This
pressure is causing ERP vendors to increase their appeal to small business clients through a
number of initiatives. These initiatives include the following:

Supplementing their direct sales force with reseller channels

Lowering the entry price point of their software to make it financially viable
Stratifying their software offerings to appeal on the basis of reduced functionality

VEL TECH

VEL TECH MULTI TECH

99

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Improving the implementation methodologies for faster deployment

Porting the products to platforms such as Microsoft Windows NT.
New Channels
Vendors such as SAP AG Inc., Oracle Corporation, and Baan Co. have been building
reseller channels-both in the US and worldwide-o reach the smaller businesses that are looking for
the complete-one-stop shopping for their ERP solutions. The ERP software is made more
financially attractive by lowering the entry price point for each module and by ramping up the
total costs by basing price on user licenses.
Oracle is being particularly aggressive in this respect with software pricing comparing
favorably with middle-market client/server offering from companies such as Platinum Software
and Great Plains Software. Although JD Edwards ventured in these waters by complementing its
One World suite with a lower-cost line called Genesis, most of the vendors have avoided
producing loss-expensive lite versions of their software. SAP abandoned its SAP Lite project
some time ago and it looks as if the lite versions will have to wait for some more time.
Faster Implementation Methodologies
All ERP vendors have suffered from the perception that their software is difficult and costly
to implement. This perception has provided huge profits to the Big 6 accounting firms (now Big
5 with the merger of Price Waterhouse and Coppers & Lay brand) that have generated billions in
fees from their ERP software implementation practices. Even though only 10-15% of the
implementations have taken years to complete and have eaten up millions of dollars of consulting
costs, the fact remains that implementing ERP packages is difficult.
As ERP system may consist of dozens of modules that are deployed on a multinational
basis to service hundreds of users from many different business departments. There may also be a
complete change of IS infrastructure-say from a mainframe to a UNIX platform-while a number of
core business processes are being simultaneously reengineered. ERP vendors have thus begun to
focus their effort on making the implementation process easier by providing more effective tools
and methodologies to speed up the process, creating elite consulting teams to intensify resources
when required, and using model-based approaches and opening up their systems for easier
integration.
For example, SAP has introduced a program called Accelerated SAP (ASAP) that takes the
knowledge gained from thousands of R/3 implementations to date and consolidates this expertise
in a product called the Business Engineer. This product helps implementation teams configure the
SAP modules to conform to the processing style of some 100 business operating scenarios.
VEL TECH

VEL TECH MULTI TECH

100

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Methodologies such as ASAP help reduce SAP implementation times to less than six months in
many cases. Oracle recently introduced a similar program called Fast Forward, to help speed up
implementations of Oracle Applications suites and nail down the costs up-front.
Despite the availability of new channel partners and implementation methodologies of the
major consulting firms, ERP systems have often been difficult to implement because of a dearth of
skilled consultants. As a result, initiative such as Oracles Oracle One or SAPs Platinum
consulting services are leading the way in creating highly skilled consulting teams and are
charged with delivering fully trained and experienced consultants on a worldwide basis to push
implementations through faster.
Business Models And BAPIs
Using products such as Intellicorp Inc.s Live Model, implementation teams can review and
simulate changes to the SAP R/3 applications Reference Model that provides views of R/3
processes, data models and functions. The Reference Model and any changes made to it are stored
in the Live Model repository and can thus be audited and changed on demand. Furthermore,
because Live Model is OLE complaint, the R/3 models can be manipulated and documented
through desktop OLE applications such as Microsoft Word.
SAP has attacked the notion that the R/3 system is not open by releasing the specifications
for some 170 business application programming interfaces (BAPIs), which help third-party
applications interact with R/3 directly. BAPIs are simply, sets of methods that allow external
applications to collaborate with specific R/3 business objects, such as customers, accounts, or
employees. The fact that the R/3 data is addressable through these callable methods, (BAPIs)
gives the third party application vendors a lot of flexibility to build supporting applications for the
R/3 system.
In a similar manner, Baan provides an offering called OrgWare that is based on the use of a
tightly integrated business-modeling tool, combined with business-specific templates that help to
automatically configure the software to suit specific operational needs. Baan is currently in the
process of enhancing this tool with new setup wizards to accelerate software implementation on
the Windows NT platform.
Convergence on Windows NT
The growing popularity of Windows NT has forced almost all ERP vendors to offer
products that cater or this segment SAP R/3 has been available since April 1994 on NT and since
October 1995 on SQL Server-while Baan, Oracle, and PeopleSoft have announced the general
availability of their applications on the BackOffice platform in 1997.
VEL TECH

VEL TECH MULTI TECH

101

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

SAP claims to have over 2,000 R/3 installations on NT and holds Microsoft itself as the
companys best customer. Baan sports the Designed for Microsoft BackOffice certification. Oracle
touts its support for its own NT-based clustering technology, and people Soft shown off its recent
switch to BackOffice as its primary development and initial rollout platform. As Microsoft scales
up its enterprise versions of NT and SQL Server to support more processors as well as failover
clustering and row-level locking, BackOffice is simply becoming amore viable platform for
running demanding ERP applications. The BackOffice platform is already the platform of choice
among the middle market vendors of accounting and distribution software, with the NT/SQL
Server combination grabbing nmarket share form the popular Novell/Btrieve platform.
Application Platforms
ERP vendors already deliver comprehensive suites of application modules that support
multinational deployment, Year 2000 compliance, and the Euro (European single currency). But
each vendor is trying to extend the reach of its software and make it more like an application
platform than a suite of modules. SAP is already ahead in this race; its R/3 product is one of the
fex that can be managed, centrally using popular platform management tools from vendors such
as Computer Associates (UniCenter TNG) and Tivoli (TME)
New Business Segments
All the ERP vendors are now capable of delivering specialized variants of their applications
to service vertical markets such as government, healthcare, financial service, or retail
environments. Some vendors are also moving into more specialized areas, such as supply chain
management and demand forecasting or sales automation and marketing.
PeopleSoft bought Red Pepper Software to enhance its supply chain offering, while Baan
recently acquired Aurum Software for its Aurum Customer Enterprise suite of customer
relationship management tools. To strengthen its financial modules, Baan also teamed up with
Hyperion Software to link Hyperions financial accounting, budgeting and reporting solutions to
Baans distribution and manufacturing modules.
More Features
Improving decision support has been another focus of almost all the ERP vendors. Baan is
linking its applications to the Gentia product (from Gentia Software Inc.) to provide OLAP
capabilities, and for the setup and monitoring of key performance indicators. JD Edwards teamed
up with Information Builders to deliver a data mart, based on Information Builders Inc.s Smart
VEL TECH

VEL TECH MULTI TECH

102

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Mart suite of database access middleware, data transformation, reporting, and OLAP tools. Oracle
provides a data mart designer and builder tool for creating data marts, and Oracle also offers
Oracle Discoverer, and end-user tool for querying, charting and reporting data from Oracles
Applications suite. The next version of PeopleSoft will include closer integration between
PeopleSoft applications and both, the client-based Cognos Corp. Power Play multidimensional
OLAP tool and Arbor Software Corp.s multidimensional Essbase server. SAP has also previewed
its own Business Information Warehouse product for synchronizing the R/3 transaction system
with a data warehouse that can manage both R/3 and non-R/3 data, through use of a metadata
repository and a front-end OLAP engine.
Web Enabling
A with every other software market, ERP vendors are being forced to move from a
client/server to browser/server architecture to Web-enable their software and thus, deliver selfservice and electronic commerce capabilities. Baan is working to deliver a java-based Web
interface to all its products. The company is also focusing on the automation of supply-chain
relationships via the Internet, on e-commerce via the Microsoft Merchant Server (now known as
Site Server), and on using Hyperion Software Corp.s Spider-Man technology for report and alert
distribution across the Web. PeopleSoft is set to deliver its Universal Applications-Java-based selfservice applets-with its PeopleSoft 7. JD Edwards is also using Java to allow its One World
functionality to be available either through a Windows client or a Web browser, while Oracle has
used Java to deliver its Oracle Web Employees, Oracle Web Customers, and Oracle Web Suppliers
modules. In 1997, SAP released 25 Web applications for version 3.1 of the R/3 and recently
previewed links to online catalogs for Web-based procurement. Unlike the Microsoft-centric
middle market applications, the ERP vendors are all using java, rather than Microsofts ActiveX,
for their first generation of Web-enabled applications.
The move by the ERP vendors to embrace Java as a means to deliver and deploy their web
functionality is the first move away from proprietary technologies to more open tools. One reason
why implementing solutions from SAP and PeopleSoft can be expensive is because the tools for
customizing their products-ABAP4 and People Tools-are proprietary. Whereas many lower-tier
software vendors have built their application front ends using popular-the ERP vendors have not
taken this route. As a result, the customer will have to pay a premium for ABAP4 and people
Tools programmers, instead of leveraging the Power Script of Visual Basic expertise that they may
already have in-house. Because Oracle is already a tool vendor, the company uses Oracle Forms,
Developer 2000, and Designer 2000 to develop its Oracle Applications.
Market Snapshot

VEL TECH

VEL TECH MULTI TECH

103

VEL TECH HIGH TECH

VEL TECH

VEL TECH MULTI TECH

VEL TECH HIGH TECH

Even with zero growth at SAP, it would still take any competitor a couple of years of tripledigit growth to overtake the German giant. PeopleSoft has not made a wrong move so far, and
Baan is also showing that it has the mentality and results to become a top-three player. Oracle has
lately, focused more attention on its applications business as a growth engine and seem to be
reaching, most aggressively, into the territory targeted by the middle-market client/server
accounting players. JD Edwards seem to be in the most vulner able position, with their continued
reliance on the momentum of IBMs AS/400 line, coupled with their need for transition to new
product lines and platforms, where their previous market-leading positioning was less than clear
cut.
ERP vendors are definitely extending their reach as they fight to maintain their growth
momentum, during the transition from client/server through browser/server to the promised
land of distributed components. We can expect to see many more acquisitions along the lines of
the Baan/Aurum deal, an increasing focus on the Microsoft BackOffice platform, and ERP
packages turning up more and more in businesses that previously, could just envy functionality
available to those with deeper pockets.
One thing is clear, no one wants just ERP anymore. The emerging trends in the enterprise
packaged application industry are its integration with new cutting-edge technologies, such as
sales force automation (SFA) and customer management. Driven in part by the huge impact of
Internet-based commerce, these new applications are leading to a seeming divergence between socalled Back. Office and Front Office functionalities.

*********************

VEL TECH

VEL TECH MULTI TECH

104

VEL TECH HIGH TECH