Name: Mahrukh D/O Muhammad Yaqoob

Student I’d: BUS-17F-042

Semester: 5th – A
Subject: Supply chain management
Topic: ERP
Assigned by: sir Danish
 Enterprise Resource Planning
Over a period of past few decades, business had been using smart business automation software
to gain more efficiency, productivity and enhance profitability of an organization. With the
passage of time, business evolved and they need to move with the time, so they adapt the various
changes in market scenario. This is how the new software came into use i.e. ERP (enterprise
resource planning).
ERP is an acronym derived from enterprise resource planning. It is a software which integrates
all the core process to run any business such as inventory, finance and accounting, procurement,
HR, customer relationship management (CRM) and supply chain management into one unified
system.
The central feature of ERP system is to support the shared database system by multiple business
unit of an organization. It means that member of a same workforce from a dissimilar divisions
such as accounting and HR can count on the identical information for their specific needs. In other
word from CEO to account payable clerks can generate, store and utilize the piece of data which
derived through common processes.
As ERP tie together a business processes and allow the flow of informational data between them
so it become the core part of any organization or industry for the error free transaction,
production and enhancing efficiency of the business. By collecting the organizational data from
multiple sources there is a high chances of duplication, ERP provides solution to this problem that
is, it eliminate the data duplication and provide data integrity and for this reason many of small
and huge businesses production based on this software. For these industries and organization
ERP system is as important as electricity to keeps the light turn on. In short ERP system allow
business to identify waste, eliminate the inefficiencies and enhance the organization capability.

ERP improves business performance:

ERP is an automation software. It becomes a core part for the survival of the business. It boost
your business by performing various tasks more efficiently and provide information that would
not be available. It simplifies most of the work for the user that ultimately improve the core
process which is order fulfillment in which company takes order from the customer, ships it, bills
it and provides services after sales. It covers all the business processes. It provides a road map to
the organization that the business can fulfill the requirements of the customer. ERP helps in
reporting, sharing departmental or organizational information.
For any business to achieve profitability is the main and the core goal and for this purpose cost
reduction can play a vital role. As the company reduces its cost, they get near to achieving
organizational goal which is profit maximizing. ERP software helps in cost cutting and it reduces
the cost in a different ways. It reduces the daily operational cost which results in less human
resource needed, reporting of any information can be improved, Data security can be assured
and it also improved the workflows between employees. Through ERP organization can track
over their late activity can find faster solution to the issue. Better the speed, less cost and more
profit.
By providing a good communication inside and outside of an organization, cost reduction can
also be possible that is the distance among the communicator reduces the time limitations which
indirectly reduces the cost of that particular task. This software also reduces the time of current
given tasks which ultimately leads to less cost.
Inventory cost is also a major contributor to decrease profit margin of any organization. The more
stock you have the cost company bear. ERP solution provides the increased communication and
collaboration to the suppliers. Due to the maintenance of relation with suppliers and renders the
cost of wasted inventory space reduces.
Decision making is the intelligence tool to run any business. ERP provides an intelligence decision
support system through which right decision can be taken at the right time. Early warning system,
data mining, executive reporting system, reporting can also be done through ERP and improves
business procedures.

ERP in supply chain management:

Supply chain management involves planning, execution, control and monitoring of supply
activities. An ERP solution deals with the physical aspects of supply that includes inventory and
trade or manage the supply and demand to meet customer need and satisfaction. This software
also added value to the entire chain of supply which starts from the material procurement to the
end customer.
Supply chain management has becoming an integral part of the ERP solutions adopted by the
several organization. Processors and producer need to interact with suppliers and collaborator
to obtain the raw material in order to bring finished goods to the market at the right time. World
is getting advanced and globalized for this purpose businesses are actively focusing to boost
productivity by having a valuable relationship with the customer. They also focus on cost cutting
in the manufacturing process i.e. form the less input they could have a more output and for all
this problems ERP provides a solution to them. ERP solution can support at multiple steps. ERP
solution provides the path to their products to go through from suppliers to warehouse and till
the end consumer. As a result of ERP solution business can avoid supply chain disruption.

Role of ERP in Supply Chain Management:

Demand and planning: In supply chain management, ERP system creates demand
when orders are received. ERP can track your whole data which helps in forecasting that how
much production should be and how much of the product to be store. It can also help in making
the effective schedule. This results the supervisor to have an idea that what resources have
consumed and which resources are to be used. It enhance the plan about product delivery, and
other planning regarding production policies, replenishment and so on.

Procurement:
An ERP enables more effective way to manage the procurement and supply for the good, services
and other resources and product. All the processes from manufacturing till the services to the
end consumer, ERP solutions provide a better way to manage. Communication with the vendors
and suppliers can easily be automated with this software.

Production:
All the resources about machine and labor resources are maintain and updated after the
production has start or done that is the creation of BOM (bill of material). Through the ERP
system, supply chain management is eliminating the errors. The system must ensure that
products must be reached in time and must be delivered on the due date. It simplifies and
modified the work and job, so the production and manufacturing process can be completed
before allocating time period.

Shipment:
After the production has done now, it’s the time to deliver the product to the customer through
shipment. Once the item or product is shipped, ERP system provide a central position to the
details of all the delivery and customer shipments either the items are delivered or not.
Furthermore, it helps in deciding packaging methods and decide the standard for the quality
checking of both the internal and external packages.

KEY Features:
Among the most powerful data management availability and comprehensively software, ERP
(enterprise resource planning) ranks first. For most of the businesses ERP is an ideal solution for
the data analysis, automation and full-scale infrastructure integration. Yet, with many systems
available, selecting the right ERP software seems to be difficult. Following are the key features
that must be present in the state of art of ERP solution which make this software different from
other software.

Integration:
ERP provides an integrated platform where you can analyze the data, monitor and conduct the
task through a single data base. It combines all the task done at one place. Through this
employees can work harmoniously, all department work integrated at one place then when
someone required data regarding other department so it can easily be available through the
integration feature.

Automation:
ERP software must has automation feature. ERP with automation capability automates the order
entry, payroll, accounting, invoicing, reporting and more. It cuts down the many hours of your
employee that they could spend and focus on more important task rather than spending their
time in accounting and other mentioned work. It helps to optimizes your time effectively or give
an effective outcome for the better future.
Automating your task can also help in the reduction of human error. When the work is done over
and over so it has high probability that error can be present. It allow data to move from one point
to another without any error which can also reduce the organization cost.

Data Analysis:
From the business functions, ERP is already collecting and processing the data. Through analysis
on collected data the errors can have a reduction. It basically provide future forecast by analyzing
on the facts.
It analyzes data regarding all the business operation necessary to run an organization including
client data, sales data and much more. It gives easy access to vital business data and provide us
tools that you need to track organizational productivity and efficiency.

Reporting:
When we talk about ERP, mist if us consider reporting and analysis is considered a as a same. Buy
it can be distinguish. ERP reporting is needed to convey analysis to an end user. These tools often
include charts, graphs, customizable dash boards and many other visual representation. It helps
in traceability that all error regarding the task can be traced, corrected prevented. In targeting
the weakness of your business and lead to change that weakness into strongest point is done by
this feature.

Customer relationship management:

The couple of tasks can run easily through it. First, it is a great option for those companies whose
customer base has become too large for spreadsheets. Spread sheets work has easily done
through this feature and can be updated too. Second, it allows a quick work when working with
other parts of the system such as it can enables user to billing information and customer
addresses when the product is ready for the processing of shipment.
In addition it also handles marketing automation by creating campaigns, track customer through
the sales lifecycle and help to make long-term customer retention.
Accounting:
Finance plays a very important role in any business to run. Feature of this ERP system contain
strong accounting tool and help to manage the processes like account payable, account
receivables, risk management tax management and so on. It is very important for the
organization that there business id globally spread.