ERP Assignment

1. Discuss the three types of data in an enterprise system and how they are
related ?
Ans: All business enterprises have three varieties of physical data located within

their numerous information systems. These varieties of data are characterized by

their data types and their purpose within the organization.
Transactional Data
Analytical Data
Master Data

Transactional data supports the daily operations of an organization (i.e. describes

business events). Analytical data supports decision-making, reporting, query, and
analysis (i.e. describes business performance). While master data represents the
key business entities upon which transactions are executed and the dimensions
around which analysis is conducted (i.e. describes key business entities).
Transactional Data
Transactional data are the elements that support the on-going operations of an
organization and are included in the application systems that automate key
business processes. This can include areas such as sales, service, order
management, manufacturing, purchasing, billing, accounts receivable and accounts
payable. Commonly, transactional data refers to the data that is created and
updated within the operational systems. Examples of transactional data included

the time, place, price, discount, payment methods, etc. used at the point of sale.
Transactional data is normally stored within normalized tables within Online
Transaction Processing (OLTP) systems and are designed for integrity. Rather than
being the objects of a transaction such as customer or product, transactional data is
the describing data including time and numeric values.
Analytical DATA
Analytical data are the numerical values, metrics, and measurements that provide
business intelligence and support organizational decision making. Typically
analytical data is stored in Online Analytical Processing (OLAP) repositories
optimized for decision support, such as enterprise data warehouses and department
data marts. Analytical data is characterized as being the facts and numerical values
in a dimensional model. Normally, the data resides in fact tables surrounded by key
dimensions such as customer, product, account, location, and date/time. However,
analytical data are defined as the numerical measurements rather than being the
describing data.
Master Data
Master data is usually considered to play a key role in the core operation of a
business. Moreover, master data refers to the key organizational entities that are
used by several functional groups and are typically stored in different data systems
across an organization. Additionally, master data represents the business entities
around which the organizations business transactions are executed and the primary
elements around which analytics are conducted. Master data is typically persistent,
non-transactional data utilized by multiple systems that defines the primary
business entities. Master data may include data about customers, products,
employees, inventory, suppliers, and sites.

2. Explain the challenges faced by purchaser in selecting any ERP

Package?
Ans: 1. It is very important, that implementation is done in stages. Trying to
implement everything at once will lead to a lot of confusion and chaos.

2. Appropriate training is very essential during and after the implementation.

The staff should be comfortable in using the application or else, it will backfire,
with redundant work and functional inefficiencies.
3. Lack of proper analysis of requirements will lead to non-availability of
certain essential functionalities. This might affect the operations in the long run
and reduce the productivity and profitability.
4. Lack of Support from Senior Management will lead to unnecessary
frustrations in work place. Also, it will cause delay in operations and ineffective
decisions. So, it is essential to ensure that the Senior Management supports the
transformation.
5. Compatibility Issues with ERP Modules lead to issues in integration of
modules. Companies associate different vendors to implement different ERP
modules, based on their competency. It is very essential that there is a way to
handle compatibility issues.
6. Cost Overheads will result, if requirements are not properly discussed and
decided during the planning phase. So, before execution, a detailed plan with a
complete breakdown of requirements should be worked out.
7. Investment in Infrastructure is very essential. ERP applications modules will
require good processing speed and adequate storage. Not allocating suitable budget
for infrastructure will result in reduced application speed and other software issues.
Hardware and Software Security is also equally important.
These are certain generic challenges while implementing ERP solutions.
Depending on the sector in which the company operates in, the extent of
complications may vary. So, it is very essential to bring onboard, an expert team of
consultants. This will ensure the implementation process is smooth without any
glitches.

3. Describe different phases of ERP implementation Life Cycle?

Ans: ERP life cycles, which encompass entire 10 to 20 years of effective operating
life, are often confused with ERP Implementation Life Cycle. Some of the phases
of ERP life cycle is shown in the following diagram

1. ERP Roll out: The initial roll out of an ERP system itself consists of various
phases commencing with Request for Proposal (RFP) and vendor select on
and ending with go live and hand holding phase. Some important matter
concerning this phase as given below, will have direct bearing on subsequent
phases of ERP lifecycle:
Degree of matching of vanila ERP product to current business need
and extent of customization done, particularly source code
customization.
Commitment of the vendor for future development and their financial
health
Support issues including License fees and escalation thereof.
2. Optimization: After the system is live and rolled out, there will be a period
of turmoil. Due to lack of understanding, lot pf confusion will prevail
amongst users. There will be teething problems and some software bugs will
invariably appear. With retraining, some tweaking of the system and
assistance from a responsive help desk, this phase should be over within six
months to one year and the system should start stabilizing.

3. Maintenance: This is the longest period of life cycle, when the organization
starts realizing value of their investment. Users will get familiar and start
owning the system. Some changes will be continuing such as new reports,
different workflows, some localization on taxes etc. Maintenance will be
covered by service level agreement, entailing payment of license fee to the
vendor. For a complicated system, there may be a third party vendor, helping
maintenance at site. The license fee, due to provision of escalation, gets
escalated at regular intervals and after some years, adversely effects Total
Cost of Ownership (TCO).
4. Extending Values: This phase overlap with the phase of maintenance. New
or changed business processes necessitate minor or moderate changes in the
system. There may be extensive changes under scenario such as
i)
ii)
iii)
iv)

Implementing a new accounting system e.g. International

Finance Reporting standard (IFRS)
A new regulatory requirement like Sarbanes Oxley
Mergers and acquisitions/ restructuring.
Extending the system with add on products such as
Customer Relationship Management and Business
Intelligence (BI). Sometime the cost changes may be
prohibitive, particularly for systems where a lot of
customization has been done during implementation phase.

Parallel to business changes, technological changes also occur. New release

and versions appear for underlying technological platforms like Operating
System and Data Base. ERP vendors release patches and versions of their
products at regular intervals which needed to be incorporated in the existing
system. This usually involves minor or moderate efforts. But, problem arises
where many software objects were customized during implementation.
Retrofitting these objects for making them compatible with later versions,
may turn out to be a major migration exercise involving exorbitant cost and
effort.
5. Decaying Performance: For an enterprise, business need and technological
requirement continue to evolve. Cost, Complexity and difficulty to modify
and update the existing system mount. Fixing existing system is no more
viable and provides diminishing return. Alternatives are investigated and
decision of reimplementation is taken.

6. Reimplementation: Similar to Roll Out phase as mentioned above.

However, the organizations are better organized now. Initial process will be
carried out more professionally. It is likely that they will adopt more of a
vanilla version with minimum need of customization, so that the next cycle
gives a better Return on Investment (ROI).

4. Discuss in detail the key issues in Supply Chain Management?

Ans: 1. Globalization of manufacturing operation

With the globalization of manufacturing operations, having a global procurement

network that can support and react to your supply chain needs is important.
According to many chief procurement officers, selecting a strategic supplier that
provides manufacturing locations with consistent global quality and a reliable local
service is a challenge.
2. Safety and quality products

The pressure on manufacturers to produce high-quality products that are safe is an

increasing challenge. The number of product recall cases is growing each day. It
can damage a companys re . Shorter lead time, less inventory and better
throughput

With shorter product life cycles and changing market demands, companies are
forced to embark on a lean journey. It is important to note that the supply strategies
in a lean environment support the operations strategy. The challenge is always to
find not just a lean concept, but a working lean solution.

3.upplier base consolidation

Consolidation of the supplier base can bring many advantages. It eliminates supply
base variances and overheads, especially in the supply of C-parts. The challenge is
to find a supplier with solutions and experience in supplier-based consolidation
processes.

4. Access to latest technology

Access to the latest technology in various fields by having the right experts has
proven to be a great support in new product development.
4. Define BOP and explain different categories of transactions in BOP?
Ans: A statement that summarizes an economys transactions with the rest of the
world for a specified time period. The balance of payments, also known as balance
of international payments, encompasses all transactions between a countrys
residents and its nonresidents involving goods, services and income; financial
claims on and liabilities to the rest of the world; and transfers such as gifts. The
balance of payments classifies these transactions in two accounts the current
account and the capital account. The current account includes transactions in
goods, services, investment income and current transfers, while the capital account
mainly includes transactions in financial instruments. An economys balance of
payments transactions and international investment position (IIP) together
constitute its set of international accounts. Some of the categories of transactions of
balance of payments are : 1. Autonomous transactions and 2. Accommodating
transactions!
The transactions recorded in the balance of payments accounts can be categorized
as Autonomous Transactions and Accommodating Transactions.
Let us discuss each of them in detail:
Autonomous Items:
Autonomous items refer to those international economic transactions, which take
place due to some economic motive such as profit maximization. These items are
also known as above the line items. Autonomous transactions are independent of
the state of BOP account.

For example, if a foreign company is making investments in India with the aim of
earning profit, then such a transaction is independent of the countrys BOP
situation. Autonomous transactions take place on both current and capital accounts.
1. On the current account, merchandise exports and imports of goods are
autonomous transactions.
2. On the capital account, receipts and repayments of long-term loans by private
individuals are autonomous transactions.
Accommodating Items:
Accommodating items refer to the transactions that are undertaken to cover deficit
or surplus in autonomous transactions, i.e. such transactions are determined by net
consequences of autonomous transactions. These items are also known as below
the line items.
Accommodating transactions are compensating capital transactions which are
meant to correct the disequilibrium in autonomous items of balance of payments.
For example, if there is a current account deficit in the BOP, then this deficit is
settled by capital inflow from abroad.

5. Write short notes on the following?

a. BAAN IV: Baan IV
An integrated family of client/server applications from Baan. It included
manufacturing, distribution, finance, transportation, service, project and
features enterprise modeling via its Orgware modules. Earlier versions of the
software were named TRITON. It later evolved into BaanERP (later SSA Baan
ERP), which was more modular with added components for procurement, order
management and warehousing. Baan was a vendor of enterprise resource
planning (ERP) software that is now owned by Infor Global Solutions.

b. Product data management

Product data management (PDM) is the process of capturing and managing the
electronic information related to a product so it can be reused in business processes

such as design, production, distribution and marketing. It usually involves the use
of a dedicated software application and centralized database.
PDM typically encompasses multiple products' technical specifications,
engineering models, design drawings, bills of materials (BOMs) and related
documents. PDM software provides version control and security to ensure that the
information stored in the central repository is accurate and up to date, which in turn
can reduce data processing and make operations, such as manufacturing, more
efficient. While engineers are typically the heaviest users, PDM is also employed
by operations managers, salespeople, marketers and others who work with a
product throughout its lifecycle.
PDM is a precursor and major component of product lifecycle management
(PLM), a broader strategy for managing and collaborating around product
information. PDM sprung from the computer-aided design (CAD) industry as a
way to track CAD drawings and information. While PDM is a standard component
of PLM, it is also offered as a dedicated module in many ERP suites.

6. Advantages & Disadvantages of ERP?

Advantages of ERP (Enterprise Resource Planning) System:
1. Complete visibility into all the important processes, across various departments
of an organization (especially for senior management personnel).
2. Automatic and coherent workflow from one department/function to another, to
ensure a smooth transition and quicker completion of processes. This also ensures
that all the inter-departmental activities are properly tracked and none of them is
missed out.
3. A unified and single reporting system to analyze the statistics/status etc. in realtime, across all functions/departments.
4. Since same (ERP) software is now used across all departments, an individual
department having to buy and maintain their own software systems is no longer
necessary.

5. Certain ERP vendors can extend their ERP systems to provide Business
Intelligence functionalities, which can give overall insights on business processes
and identify potential areas of problems/improvements.
6. Advanced e-commerce integration is possible with ERP systems most of
them can handle web-based order tracking/ processing.
7. There are various modules in an ERP system like Finance/Accounts, Human
Resource Management, Manufacturing, Marketing/Sales, Supply Chain/Warehouse
Management, CRM, Project Management, etc.
8. Since ERP is a modular software system, its possible to implement either a few
modules (or) many modules based on the requirements of an organization. If more
modules implemented, the integration between various departments may be better.
9. Since a Database system is implemented on the backend to store all the
information required by the ERP system, it enables centralized storage/back-up
of all enterprise data.
10. ERP systems are more secure as centralized security policies can be applied to
them. All the transactions happening via the ERP systems can be tracked.
11. ERP systems provide better company-wide visibility and hence enable
better/faster collaboration across all the departments.
12. It is possible to integrate other systems (like bar-code reader, for example) to
the ERP system through an API (Application Programming Interface).
13. ERP systems make it easier for order tracking, inventory tracking, revenue
tracking, sales forecasting and related activities.
14. ERP systems are especially helpful for managing globally dispersed enterprise
companies, better.
Disadvantages of ERP (Enterprise Resource Planning) Systems:
1. The cost of ERP Software, planning, customization, configuration, testing,
implementation, etc. is too high.

2. ERP deployments are highly time-consuming projects may take 1-3 years (or
more) to get completed and fully functional.
3. Too little customization may not integrate the ERP system with the business
process & too much customization may slow down the project and make it difficult
to upgrade.
4. The cost savings/payback may not be realized immediately after the ERP
implementation & it is quite difficult to measure the same.
5. The participation of users is very important for successful implementation of
ERP projects hence, exhaustive user training and simple user interface might be
critical. But ERP systems are generally difficult to learn (and use).
6. There may be an additional indirect cost due to ERP implementation like new
IT infrastructure, upgrading the WAN links, etc.
7. Migration of existing data to the new ERP systems is difficult (or impossible) to
achieve. Integrating ERP systems with other stand alone software systems is
equally difficult (if possible). These activities may consume a lot of time, money &
resources, if attempted.
8. ERP implementations are difficult to achieve in decentralized organizations
with disparate business processes and systems.
9. Once an ERP systems is implemented it becomes a single vendor lock-in for
further upgrades, customizations etc. Companies are at the discretion of a single
vendor and may not be able to negotiate effectively for their services.
10. Evaluation prior to implementation of ERP system is critical. If this step is not
done properly and experienced technical/business resources are not available while
evaluating, ERP implementations can (and have) become a failure.

6. Justify why ERP is called E-business backbone for corporate sectors?

Ans: Business enterprises in India are in the process of a major transformation due
to globalization and the deregulation of Indian economy, coupled with fundamental
changes in the business models due to the emergence of Information Technology
based business practices.
Most of the enterprises in developing countries, such as India, are in the process of
implementing Enterprise Resource Planning (ERP) system in alignment with
organizational transformation and process of re-engineering initiatives. ERP
system promise benefits that range from increased efficiency to transformation of
quality, productivity and profitability.
However, its implementation poses some unexpected organizational challenges and
changes that can be structural as well as cultural in nature. ERP not only helps
establish world-class best business practices and brings transparency to the
organization but also demands for empowerment and flexibility in decision making
process.
The most promising argument is that, to thrive in the e-commerce world companies
need to transform their internal business process with the deployment of ERP
system. Hence, ERP is considered to be the backbone of e-business.

7. Why Business Process Re-engineering is an important component of

ERP Implementation?
Ans: 1. Maintain your competitive advantage. Yes, your current enterprise
systems are probably a mess if they even exist. You probably have a ton of
spreadsheets, manual workarounds and other inefficiencies that make you wonder
how your organization has managed to survive and thrive for this long. But you
probably also have business processes that give you a competitive edge, no matter
how painful or inefficient they may be. Business process reengineering without the
constraints of software configuration ensures that you maintain these competitive
advantages as you select and implement your new ERP systems.
2. Best practices are a farce, but lean Six Sigma isnt. Best practices are a lot
like unicorns and Santa Clause they sound mythical, magical, and represent what
we all hope really exists, but then we realize one day that they dont. Best practices
sound good in theory, but the reality is that they are simply best practices for how

any particular ERP vendors software works rather than for your operations. An
exception to this rule is vanilla, back-office functions such as HR and accounts
payable. Lean Six Sigma, on the other hand, is a set of tools that can be used to
define your own set of best practices, efficiencies, and competitive advantages that
you likely dont want to be replicated by industry peers. The graphic below
illustrates some of the lean Six Sigma activities that Panoramas team has built into
its business process reengineering methodology:

3. Faster realization of business process improvements and business benefits.

When we help clients identify process improvements, we often find that although a
new ERP system may help automate and further enable process changes, many
improvements can be rolled out independent of the chosen ERP software. For
example, if a company decides that it wants to incorporate a purchase order
approval workflow to institute tighter controls on procurement costs, it may decide
to do so via email approvals until a more robust ERP system is in place to further
automate this change. In addition, from an organizational change management
perspective, spoon feeding changes to employees sooner is more effective than
waiting to implement a massive degree of change all at once during an ERP
implementation.
4. Avoid the paving the cowpaths trap. Companies that fail to define business
process improvements prior to their implementations are much more likely to

simply automate their existing broken processes. The reason? Once an

implementation starts, the meter is running on expensive technical consultants, so
every minute spent making process decisions or agreeing to changes costs time and
money. This set-up forces most project teams into the path of easiest resistance
(i.e., simply configuring or customizing the software to fit existing processes). On
the other hand, companies that take the time to define processes up front ultimately
end up accelerating their implementation durations and minimizing extra costs,
allowing the technical resources to focus on how the software can be best
configured to meet those processes.
Business process reengineering is one of the holy grails of ERP implementations.
Everyone wants it, but few know how to achieve it. By having a realistic
understanding of how processes are best defined and incorporated into an ERP
implementation, projects teams will be much more likely to succeed. In addition,
your implementation will be faster, less expensive, and more widely embraced by
employees with these tips and guidelines in place.

8. What is data modeling? How it is important in business intelligence?

Ans: Data modeling is the process of documenting a complex software system
design as an easily understood diagram, using text and symbols to represent the
way data needs to flow. The diagram can be used as a blueprint for the construction
of new software or for re-engineering a legacy application.
Through data modeling of BI systems, we can meet many of todays data
challenges. Through logical and physical modeling of BI systems, we can enable
the delivery of the correct business information to business users. Key benefits
include:
1. Reduced development time of BI systems through a thorough understanding
of source systems.
2. Increased accuracy of BI results.
3. Increased transparency to enable business users and developers to realize the
information that is available to them

10. What is reporting? How business intelligence module helps in reporting?

Ans: Reporting means collecting and presenting data so that it can be
analyzed.When we talk about reporting in business intelligence (BI), we are talking
about two things. One is reporting strictly defined. The other is reporting taken
in a more general meaning.
In the first case, reporting is the art of collecting data from various data sources
and presenting it to end-users in a way that is understandable and ready to be
analyzed. In the second sense, reporting means presenting data and information, so
it also includes analysisin other words, allowing end-users to both see and
understand the data, as well as act on it.
Reporting can be classified in many different ways. One is to differentiate
reporting by the role of the person(s) preparing the report: managed reporting is
reporting prepared by technical personnel such as developers; ad-hoc reporting is
instead the realm of the nontechnical end-user. Another way in which reporting can
be classified is by identifying the most important features of a report, such as data
tables, cross-tab reports, visualization features, etc.

11. What is the difference between what-if analysis and goal seeking analysis?
Ans: What-if Analysis consists of a process of determining the effects on outcomes
in a model through changes in input. For example, this can be performed in a
spreadsheet calculation.

An example table for determining income from visitor numbers is included below.

Goal Seeking
Goal Seeking occurs when the decision maker has a specific outcome in mind and
need to determine how it can be achieved.
The table below demonstrates Goal Seeking with the specific outcome being a
certain value for profit. The decision maker wants to make $630. To achieve this, it
is determined that 35 units will need to be sold at the cost of $18 to achieve this
outcome.
12. What is info provider in business intelligence? Explain the different type of
info providers?
Info Providers that contain real-time Info Cubes provide the data basis for BI
Integrated Planning. Aggregation levels are a type of virtual Info Provider and are
created on the basis of a real-time Info Cube, or a Multi Provider that contains Info
Cubes of this type. Aggregation levels are specifically designed so that you can
plan data manually or change it using planning functions.

Info Provider Types

Info Providers can have widely differing characteristic values. Every Info Provider
provides data for a query however.
Most Info Providers are modelled in the BW system. Some basis objects can be
used both on their own and in other Info Providers.
Info Objects as Info Providers
Info Cubes that are:
o Standard, with data persistence in the BW system or in BWA
o Standard, SAP HANA-optimized
o Real-time capable
o Semantically partitioned
Data Store objects that are:
o Standard
o Write-optimized
o Data Store objects for direct update
o Semantically partitioned
These Info Providers are loaded with data using staging. There are also Info
Providers that are modeled in the BW system and are comprised of other Info
Providers:
Info Set
Multi Provider
Aggregation level

 Hybrid Provider, with the following types:

o Based on a Data Store object
o Based on direct access
Composite Provider
You can also make a BEX query - that was a defined on Info Providers available as
an Info Provider again.
Query as Info Provider
Some Info Providers are modeled in the BW system but their data is usually not in
the BW system:
Virtual Providers that are:
o DTP-based
o With BAPI
o With Function module
o Based on an SAP HANA Model
Some Info Providers, Transient Providers, are not modeled in the BW system.
They are derived from another object instead:
Transient Provider Derived from a Classic Info Set
Transient Providers Derived from an Analytic Index
Creating Transient Providers on SAP HANA Models

13. What is the difference between closed database architecture and ERP
architecture on business enterprise?

Ans: CLOSED DATA BASE ARCHIETCTURE

Similar in concept to flat-file approach
Data remains the property of the application
Fragmentation limits communications
Existence of numerous distinct and independent databases
Redundancy and anomaly problems
Paper-based
Requires multiple entry of data
Status of information unknown at key points
On the other hand
ERP ARCHITECTURE
In typical two-tier architecture, the server handles both application and
database duties. The clients are responsible for presenting the data and
passing user input back to the server. While there may be multiple servers
and the clients may be distributed across several types of local and wide area
links, this distribution of processing responsibilities remains the same.
In three-tier architectures, the database and application functions are
separated. This is very typical of large production ERP deployments. In this
scenario, satisfying client requests two or more network connections.
Initially, the client establishes communications with the application server.
The application server then creates a second connection to the database
server.
In the recent times majority of the ERP systems utilize a relational database
for the data layer in three-tier client/server architecture. The logic or
processing layer is the second tier in such architecture. Herein lays the
implementation of business logic, business processes, business rules, and
authentication and user management. The presentation layer forms the third
tier. This is usually in the form of a user interface on a multitude of devices
ranging from workstations to mobile devices. As users interact with the

presentation layer, data is transmitted, read, written, deleted or updated in

the data layer. The orchestration of the read/write/update is done by the logic
layer. In recent times, new technologies have developed that make ERP
software less monolithic and more flexible. As the amount of data stored in
the database and the number of sources of data increase, there is a need for
efficient storage and retrieval of corporate data from a business intelligence
perspective. Data warehouses have evolved to handle this explosive growth.