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BUSINESS B5
Enterprise Resource
Planning (ERP)
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Learning Outcomes
Compare core ERP components andextended ERP components
Describe the three primary components
found in core ERP Describe the four primary components found
in extended ERP systems
Explain the benefits and risks associatedwith ERP systems
Assess the future of ERP systems
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Introduction
ERP integrates all departments and functionsthroughout an organization into a single IT system sothat employees can make enterprisewide decisionsby viewing enterprisewide information on all business
operations
Core ERP components traditional componentsincluded in most ERP systems and they primarilyfocus on internal operations
Extended ERP components extra componentsthat meet the organizational needs not covered bythe core components and primarily focus on externaloperations
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Accounting and Finance Components
manage accounting data and financialprocesses within the enterprise with functionssuch as general ledger, accounts payable,
accounts receivable, budgeting, and assetmanagement
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Production and Materials
Management Components
handle the variousaspects ofproductionplanning and
execution such asdemandforecasting,production
scheduling, jobcost accounting,and quality control
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Human Resource Components
track employee information including payroll,benefits, compensation, performanceassessment, and assumes compliance with
the legal requirements of multiple jurisdictionsand tax authorities
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Extended ERP Components
Business intelligence - information that people useto support their decision-making efforts
CRM - involves managing all aspects of acustomers relationship with an organization to
increase customer loyalty and retention and anorganizations profitability
SCM - involves the management of informationflows between and among stages in a supply chainto maximize total supply chain effectiveness andprofitability
E-business - means conducting business on theInternet, not only buying and selling, but also servingcustomers and collaborating with business partners
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E-Business Components
E-logistics manages the transportation andstorage of goods
E-procurement the business-to-business(B2B) purchase and sale of supplies andservices over the Internet
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ERP Benefits
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ERP Risks
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The Future of ERP
Lines between SCM, CRM, and ERP will
continue to blur
Internet continue to help organizations
integrate data and process across functionaldepartments
Interface customizable employee browsers
Wireless technology support a mobileworkforce
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Closing Case One:
PepsiAmericas Enterprises
PepsiAmericas generates $2.97 billion inrevenues yearly
The company implemented PeopleSofts ERP
solution to provide complete integrationbetween PepsiAmericas front-office andback-office systems
PepsiAmericas also implementedPeopleSofts supply chain management
component to automate its inventory
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Closing Case Two Questions
1. How have core ERP components helpedPepsiAmericas improve its business?
2. How have extended ERP components helpedPepsiAmericas improve its business?
3. Explain how future ERP systems will helpPepsiAmericas increase revenues4. Assess the impact on PepsiAmericas business if it
failed to implement the CRM component ofPeopleSofts ERP system
5. Review the different PeopleSoft components inFigure B5.5. Which component would yourecommend PepsiAmericas implement if it decidesto purchase an additional PeopleSoft component?
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Closing Case Two: Demanding Chocolate
Ghirardelli is the longest continuouslyoperating chocolate manufacturer in theUntied States
Ghirardelli improved inventory managementand profitability through the implementation ofan ERP system
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Closing Case Two Questions
1. Which additional core ERP componentswould you recommend Ghirardelliimplement?
2. Which additional extended ERP componentswould you recommend Ghirardelliimplement?
3. How can implementing an AdvancedPlanning ERP component help Ghirardellis
business?
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