ENTERPRISE RESOURCE PLANNING (ERP)

1. 7 Jan. 2005 Dr. Syed Irfan Hyder IT consultant PSM made a presentation options for IT
up-gradation.
2. 12 Jan 2005 Competent Authority constituted a committee under the convener ship of
PEO (Production)to look into the matter for up-gradation of MIS, along with
options. Dr. Irafn Hyder was also a member of the committee.
3. 26 Jan. 2005 Mrs. Qasir Hassan GM (MIS)/PSO to Chairman was appointed as project
Incharge for up-gradation of MIS.
4. Options Suggested 1. In-House (Migration of existing applications to a new server
by the Consultant followed by in-house development of additional applications and
other enhancements.)
2. Hybrid (Existing applications that are fulfilling 40-60%of the
current requirement are continued while readymade ERP is selected
and its modules are deployed in a progressive, phase-wise manner.)
3. ERP ( It is a software to meet the organizational goals, integrating
functional areas, depending 40-60% modules, covering the entire
range of business functional areas)
5. success factors of 1. Project Startup 2. Management Commitment 3. Project Scope
ERP 4. Project Team 5. Change Management, Communication and
Training 6. Customizations/Modifications 7. Budget 8. Project
Closure
6. Common Modules 1. Human Resource 2. Inventory 3. Sales & Marketing 4. Purchase 5.
Finance & Accounting 6. Customer Relationship Management
(CRM) 7. Engineering/ Production 8. Supply Chain Management
(SCM)
7. 1. Inherent Complexity of ERP Implementation 2. Outside Consultant
Factors Issue 3. Unrealistic Expectations 4. Inadequate Training 5. Timeline
contributing to Flexibility 6. Process Risk and process barriers 7. Corporate Culture
failure 8. Using IT to solve the problem
8. Cost 15 Million Dollars for software only.
9. Timeline for 1-3 Years
installation
10. Advantages of ERP 1. Online stock position: stores, materials, tools, stock status.
2. Online production monitoring: target vs. progress.
3. Online evaluation of accounts budgets and costs.
4. Reduction of paperwork, procedural delays, redundancies,
streamlining of process
5. Efficient utilization
6. Saving time and energy.
11. Disadvantages of 1. Very expensive to purchase, more costly to customize.
ERP 2. Require major changes in the company and its processes to
implement.
3. Due to complexity many companies cannot adjust to it.
4. Involves an ongoing process for implementation.
5. Expertise in ERP is limited with staffing and ongoing problem.
12. Recommendations ERP approach with a big bang is not feasible, not realistic and not
practical for Pakistan Steel. It has high risks of budget and time over
runs.