Enterprise Resource Planning Systems

Muscatello, Small, and Chen (2003) state that ERP systems, when they are implemented effectively, can bring impressive strategic, operational and information-related benefits to those firms that adopt them. However, in such situations, a failure in implementation might bring about the financial collapse of the firm. They further state that in the modern world, most of the information about the failures and successes are based on reports that are made concerning ERP implementation in big manufacturing and service organizations. However, it is stated that those who sell ERP systems are now steadily turning their marketing sights on small and medium-sized manufacturers. It is because of this that Muscatello et al state that researchers have been given the opportunity to gather, analyze and disseminate information that will help these firms to

Today Enterprise Resource Planning (ERP) is extensively adopted by many organizations regardless of kind and size, mainly because it provides enterprise-wide view of information across all their business operations and help organizations achieve consistency across all their functional departments. The potential benefits of ERP system implementation include improved coordination across functional areas, increased efficiency, reduced operational costs, rapid access to information for decision making, managerial control and support for strategic planning.

Enterprise resource planning enables firms to replace different departmental information systems and database silos with systems that collectively work as a single cross functional database. ERP systems are available for every key business function such as order processing, production control, HR, warehouse, marketing, finance and much more. By having a common technology and database platform throughout the firm, systems and processes from various departments can be integrated that achieve superiority in terms of enhanced cost, operational and productivity benefits. Implementing an ERP system requires careful planning to achieve the targeted benefits and minimize the risk of project failure.

The object of this research paper is to describe the implementation challenges of an enterprise system, then to analyze the changes required in its implementation and discuss the advantages of ERP over legacy systems. Some of the informational background will be discussed in this paper regarding enterprise resource planning systems. This paper will construct some examples from my research findings to show why ERP has advantages over legacy systems. This paper will also not only provide strengths of having an enterprise system, but will show weaknesses as well. And to conclude, this paper will explain why and how enterprise systems will be of benefit for organizations and business with decision-making processes.

Enterprise Resources Planning (ERP) is the core system of any company. In order to facilitate all departments in a manner to improve issues, there are a few things that must be meet to successfully utilize a software system such as ERP. This allows any member within the company to access a single and centralized data source with information regarding products, services, customers and suppliers (Sadrzadehrafiei, Chofreh, Hosseini, & Sulaiman, 2013). The ability to share and access one software benefits the company to improve in areas such as sales and marketing, customer satisfaction, human resources, operations, and more. In addition, business intelligence tools such as ERP systems provide the techniques and solutions managers need to analyze and understand complex business situations, and simplify decision making processes that is of crucial importance during times of financial and economic crisis (Antoniadis, Tsiakiris, & Tsopogloy, S. 2015). This paper explores the definition and functions of an ERP system and the successes and costs of implementation.

"Enterprise Resource Planning is an integrated information system that serves all departments within an enterprise. Evolving out of the manufacturing industry, ERP implies the use of packaged software rather than proprietary software written by or for one customer. ERP modules may be able to interface with an organization's own software with varying degrees of effort, and, depending on the software, ERP modules may be alterable via the vendor's proprietary tools as well as proprietary or standard programming languages" (pcmag.com). After researching companies who offer ERP solutions, I have decided to cover the following; SAP, IBM, AMS, and Oracle.

To avoid struggling with integrating myriad IT applications, many companies implemented ERP systems that required substantial investment of time, internal resources, and capital, resulting in significant organizational change (Dorien & Wolf, 2002). Often, ERP system implementation is accompanied by other improvements and enhancements in existing legacy systems. Due to many simultaneous changes that accompany ERP system implementation, it is hard to attribute any performance changes after ERP system installation solely to ERP systems. However, ERP system implementation is, by far, the most criticized aspect of IT investments. ERP systems require outlays ranging from a few million dollars to several hundred million dollars (Mabert et al., 2001). Despite high expenditures, ERP implementations have resulted in problems. Rushed software installations and inadequate training are blamed for well-publicized troubles with ERP. In 1999, soon after the rollout of its ERP system, Hershey Food Corp., in the third quarter of that year, lost $60.4 million due to problems in customer service, warehousing, order processing, and

Successful implementation of an Enterprise Resource Planning (ERP) is not impossible in real life but for that it must be developed through a proper planning and implementation. ERP are designed to upgrading an organization’s ability to generate more timely and accurate information for its supply chain. Organization must be ready for reengineered before the success of productivity can be realised. Most of the companies have faced heavy problems while trying to implement ERP systems and have led to serious problems.

Enterprise Resource Planning (ERP) system is a software package or one integrated system that is designed to institutionalize the collection and sharing of organizational data resources (Klaus et al., 2000; Mabert et al., 2003; Wang et al., 2008). Since this kind of systems allows inputting and outputting information and the information could be shared across the whole organization in time, companies all over the world are now utilizing the ERP systems to improve operational efficiency (Davenport, 1998; Klaus et al., 2000).

In this regard, (Hunton et al 2002) state that the ERP implementation enhances value to organizations. In the same line, (Poston and Garbksi 2000) explored a number of organizations implementing the ERP systems where as a result they found a decrease in employees’ ratio and cost of goods transferred in revenues.

In this world with a high level of competition at the top, companies have turned to ERP to gain a competitive advantage over rivals. ERP systems are an instrument used to “build strong capabilities, improve performance, undertake better decision making and achieve competitive advantage” (Keong, Ramayah, Kurnia and Chiun, 2012) (Al-Mashari and Al-Mudimigh, 2003) (2 and 3)

ERP system implementation can be a difficult transition for a company but properly planned, adequately supported and

Due to dramatic changes in organisational management, technology plays an important role in today business environment. According to Groomer & Murthy (1989) incorporation of information technology solutions are becoming increasingly important for all businesses in order to operate successfully. One way that many businesses have implemented information technology on a large scale (Groomer & Murthy, 1989) is by setting up Enterprise Resource Planning (ERP) systems to achieve their business transaction and data processing needs. According to the business need, selecting the appropriate information system such as Enterprise resource planning (ERP) will be appropriate and suitable because it improves efficiency. However it should be borne in

ERP can be a difficult task, it takes more than months to setup and it costs more than software and hardware, but if everything is prepared with proper resources than implementation of ERP system can be completed with in budget in a proper or required time frame and deliver

In present era, Information systems existence is unavoidable in all working environment. Information system is globally recognized & widely accepted as a basic necessity for running successful business. Kim et.al (2007), Information Technology plays an important business tool in modern era to attain competitive advantage for the organization as well as improving employee’s efficiency and productivity. Enterprise Resource Planning system shortly known as ERP system is one of the primary information systems used in various industries to run their business operations. ERP attained various industry attentions due to its cross functional integration, business process reengineering, real time reporting and many other useful functionalities and capabilities. Initially, ERP system was predominantly implemented in large enterprises due to its high implementation cost and implementation time consuming. For the past few decades, SME’s businesses environment are rapidly changing in order to stay more competitive in fast paced competitive market. Organizations want to upgrade their business communications, business and employee capabilities and business process automation to latest technologies. During the last few decades, large number of small & medium size enterprises started implementing ERP systems to stay competitive in global market. Amoako (2007) and Kemp et al (2008) explains the usage of ERP system in different business divisions. From