ENTERPRISE RESOURCE PLANNING - CIMA

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ENTERPRISE RESOURCE PLANNING
Tectura UK | Focus On Quality Service

Enterprise Resource Planning
Agenda
• Introduction
• What is ERP?
• Benefits of implementing ERP
• Success factors and related pitfalls
• Questions and answers
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Enterprise Resource Planning
Introduction
• Presentation given by:
• Andy.Blatch@Tectura.com
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Enterprise Resource Planning
What is ERP? - Definition
• Enterprise resource planning (ERP) is an integrated computerbased
system used to manage internal and external resources
including tangible assets, financial resources, materials, and
human resources.
• It is a software architecture whose purpose is to facilitate the flow
of information between all business functions inside the
boundaries of the organization and manage the connections to
outside stakeholders.
• ERP systems consolidate all business operations into a uniform
and enterprise wide system environment.
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Enterprise Resource Planning
What is ERP? - Historical perspective
• Disparate systems
• Materials Requirements Planning (MRP)
• Manufacturing Resource Planning (MRP II)
• Enterprise Resource Planning (ERP)
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Enterprise Resource Planning
What is ERP? – Functional perspective
• Financials
• Distribution
• Supply Chain Management
• Manufacturing
• Human Resources
• Customer Relationship Management
• Project Management
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Enterprise Resource Planning
What is ERP? – General traits
• Integrated (no need for IS intervention)
• Real time (no periodic batch updates)
• Same look and feel throughout
• Single data definitions
• Security permissions
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Enterprise Resource Planning
What is ERP? – Advanced traits
• Multi country (including multi-lingual and multi-currency)
• Out of the box integration with standard tools (Excel, etc)
• IFRS, Sarbanes-Oxley, Basel II compliant
• “Best practices” included
• Role based
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Enterprise Resource Planning
What is ERP? – Vendors
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Enterprise Resource Planning
What is ERP? – Structure
• Core
• Localisation
• Industry solution
• Customisation
• Configuration
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Enterprise Resource Planning
What is ERP? – The future
• Software as a service
• Web enabled self service
• Improved BI
• Industry specific functionality
• Role based
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Enterprise Resource Planning
Advantages of ERP – General objectives
• Replace legacy systems
• Improved information flow
• Enable business growth
• Standardised working practices
• Reduced costs
• Faster response times
• Single data entry
• Reduce reliance on individuals
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Enterprise Resource Planning
Advantages of ERP – Tangible benefits 1
• Reduction in stock levels due to improved planning
• Monthly accounts closing in fewer days
• Improved financial accuracy and financial efficiency
• Meaningful reports
• One version of the truth
• Improved visibility and access to information
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Enterprise Resource Planning
Advantages of ERP – Tangible benefits 2
• Improved financial control
• Reduction in staff due to automation of tasks
• Cost saving through shared services
• Reduction in cost of maintaining multiple systems
• More time for managing the business
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Enterprise Resource Planning
Advantages of ERP – Management Accounting perspective 1
• Reduction in time spent on data collection
• Increase in time spent on data analysis
• Increased involvement in decision making
• Improved focus on internal reporting
• Improved focus on external environment

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Enterprise Resource Planning
Advantages of ERP – Management Accounting perspective 2
• Shift in focus from historical to forward looking analysis
• Shift from domain specific to cross-functional analysis
• Changes required in communication skills
• Improved long term job satisfaction

Enterprise Resource Planning
10 Critical Success Factors – 1
• Executive sponsorship
Once an implementation is undertaken it must be at least the second
highest priority of the business after the normal functioning of the
business.
The project must be business driven not IT driven.
The sponsor is responsible for setting goals and communicating the
corporate IT strategy to all employees.
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Enterprise Resource Planning
10 Critical Success Factors – 2
• Project management
Plan and control (including change control) the project scope to meet the
deliverables within the given time and budget
Issue and risk management
Facilitate change management (the implementation is as much about
business change as it is about technology change)
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Enterprise Resource Planning
10 Critical Success Factors – 3
• Solution selection
Degree of solution fit to your business processes and future needs
Due diligence of software supplier and consulting partner
Total Cost of Ownership – elements include:
• Licence cost per user
• Degree of customisation and ease of customisation
• Consulting rates
• Ease of adoption
• On-going support
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Enterprise Resource Planning
10 Critical Success Factors – 4
• Clear goals and objectives
Set prior to seeking executive sponsorship
Reference these throughout the life cycle
Communicate appropriately to project team
Ensure other business initiatives do not conflict
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Enterprise Resource Planning
10 Critical Success Factors – 5
• User education
Do not underestimate the importance of training
Training may be wider than just the ERP system
Train the core team early
Continue training/familiarisation throughout the implementation
Plan for training needs after the go-live
Provide training in multiple media
Use subject matter experts to provide key training
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Enterprise Resource Planning
10 Critical Success Factors – 6
• Business Process Re-engineering
Review prior to implementing the ERP solution
Deficiencies in current system and processes
Strengths of current system and processes
Business critical processes
Competitive advantage
Increase productivity through organisation restructuring
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Enterprise Resource Planning
10 Critical Success Factors – 7
• Dedicated project team
Plan individual commitment required
Recognise other business events that may be constraints
Detailed business knowledge
Backfill where appropriate
Plan an individual exit strategy
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Enterprise Resource Planning
10 Critical Success Factors – 8
• Project team competency
Knowledge, skills, abilities and experience
Relevant business experience
Support of the wider business community
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Enterprise Resource Planning
10 Critical Success Factors – 9
• Vendor support
Software vendor support
Implementation partner support
Hot fixes, service packs and version upgrades
Global or local
Technical reviews
Performance reviews
Health checks
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Enterprise Resource Planning
10 Critical Success Factors – 10
• Communication
Interdepartmental
Realistic
Celebrate successes
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Enterprise Resource Planning
Questions and answers
• Please feel free to ask any questions
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