ASSIGNMENTS- MBA Sem-III

OM0002
Set 2
ENTERPRISES RESOURCE PLANNING

Q 1. ERP system can prove to be effective tool in unorganized sectors and

in small scale industries. Justify with examples.

Ans 1: An Enterprise Resource Planning (ERP) system is an integrated

computer-based application used to manage internal and external resources,
including tangible assets, financial resources, materials, and human resources.
Its 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. Built on a centralized database and normally utilizing a common
computing platform, ERP systems consolidate all business operations into a
uniform and enterprise-wide system environment.
An ERP system can either reside on a centralized server or be distributed across
modular hardware and software units that provide "services" and communicate
on a local area network. The distributed design allows a business to assemble
modules from different vendors without the need for the placement of multiple
copies of complex and expensive computer systems in areas which will not use
their full capacity.
Effective tool in unorganized sectors:-
• Unorganized retailers in the vicinity of organized retailers experienced a decline
in their volume of business and profit in the initial years after the entry of large
organized retailers.
• The adverse impact on sales and profit weakens over time.
• There was no evidence of a decline in overall employment in the unorganized
sector as a result of the entry of organized retailers.
• There is some decline in employment in the North and West regions which,
however, also weakens over time.
• The rate of closure of unorganized retail shops in gross terms is found to be 4.2
per cent per annum which is much lower than the international rate of closure of
small businesses.
• The rate of closure on account of competition from organized retail is lower still
at 1.7 per cent per annum.
• There is competitive response from traditional retailers through improved
business practices and technology upgradation.
• A majority of unorganized retailers is keen to stay in the business and compete,
while also wanting the next generation to continue likewise.
• Small retailers have been extending more credit to attract and retain customers.
• However, only 12 per cent of unorganized retailers have access to institutional
credit and 37 per cent felt the need for better access to commercial bank credit.
• Most unorganized retailers are committed to remaining independent and barely
10 per cent preferred to become franchisees of organized retailers.
Impact on Consumers
• Consumers have definitely gained from organized retail on multiple counts.
• Overall consumer spending has increased with the entry of the organized retail.
• While all income groups saved through organized retail purchases, the survey
revealed that lower income consumers saved more. Thus, organized retail is
relatively more beneficial to the less well-off consumers.
• Proximity is a major comparative advantage of unorganized outlets.
• Unorganized retailers have significant competitive strengths that include
consumer goodwill, credit sales, and amenability to bargaining, ability to sell
loose items, convenient timings, and home delivery.
Impact on Intermediaries
• The study did not find any evidence so far of adverse impact of organized retail
on intermediaries.
• There is, however, some adverse impact on turnover and profit of
intermediaries dealing in products such as, fruit, vegetables, and apparel.
• Over two-thirds of the intermediaries plan to expand their businesses in
response to increased business opportunities opened by the expansion of retail.
• Only 22 per cent do not want the next generation to enter the same business.
Impact on Farmers
• Farmers benefit significantly from the option of direct sales to organized
retailers.
• Average price realization for cauliflower farmers selling directly to organized
retail is about 25 per cent higher than their proceeds from sale to regulated
government mandi.
• Profit realization for farmers selling directly to organized retailers is about 60 per
cent higher than that received from selling in the mandi.
• The difference is even larger when the amount charged by the commission
agent (usually 10 per cent of sale price) in the mandi is taken into account.
Impact on Manufacturers
• Large manufacturers have started feeling the competitive impact of organized
retail through price and payment pressures.
• Manufacturers have responded through building and reinforcing their brand
strength, increasing their own retail presence, ‘adopting’ small retailers, and
setting up dedicated teams to deal with modern retailers.
• Entry of organized retail is transforming the logistics industry. This will create
significant positive externalities across the economy.
• Small manufacturers did not report any significant impact of organized retail.
ERP an effective tool in small scale industries:-
Axis Softech proudly announces the new version of ERP for Small Industries of
India and particularly Delhi and NCR. This ERP has all possible modules for all
business areas to the optimum value to integrate. Axis Softech is already
enabled so many companies to automate the manufacturing sector and the other
segment, its services and decisions. The core of the intention of the introduction
of the new version of the ERP is to facilitate the customers covered with a low-
cost product with excellent properties and widely modules. The basic idea of
ERP Software, ERP application tailor-made ERP for ERP users with cheap offers
at the same time with the best featured ERP and wide range of modules. Axis
Softech is one of the best selling companies in the ERP market for the past
seven years and founded on the many catering market demands of the industry.
Axis uses the best technology currently available tools on the market. The tools
are mainly ASP. NET and SQL. These tools have an edge in order to promote a
product by the users in different ways. In particular, these language tools a
crucial set of security for the customer in the form of data theft and other related
thefts. The language is completely Web-based support from nearly all operating
system platforms in every way possible. Not only this, but Axis Softech ERP
allows users to access his / her account online, by every possible situation, with
the help of the Internet. All you have to do is in the by using a unique ID /
password and access to the rights of the super-administrator of the company as
the necessary measures to carry out simultaneously and use characters from the
application directly after login. This ERP is not only a general ERP, but a
revolution in the field of ERP. The company would never get over with the
facilities and features of Axis Softech by this means provided. This company
offers the best ERP solutions for Small Scale Industries. The company uses the
best tools are presented in the market. Axis Softech has been able to for an
online demonstration of the interested buyers and interested parties arranged to
send the demo request via the contact details. Conclusion: At the present time
the demand for ERP is very fast. Axis Softech is a software company with the
best ERP solutions for small industries offers. In addition, the best technology
currently uses tools.
Q 2. The Kanban process of production is sometimes incorrectly described
as simple juist-in-time management technique. Comment

Ans 2: KANBAN PROCESS- MORE THAN INTERNAL 'JUST IN TIME

PRODUCTION' TECHNIQUES:-
Most Japanese manufacturing companies view the making of a product as
continuous-from design, manufacture, and distribution to sales and customer
service. For many Japanese companies the heart of this process is the Kanban,
a Japanese term for "visual record", which directly or indirectly drives much of the
manufacturing organization. It was originally developed at Toyota in the 1950s as
a way of managing material flow on the assembly line (Perelman, 1994: 85).
Over the past three decades the Kanban process, which Bernstein (1984: 48)
identifies as "a highly efficient and effective factory production system", has
developed into an optimum manufacturing environment leading to global
competitiveness.
The Japanese Kanban process of production is sometimes incorrectly described
as a simple just-in-time management technique, a concept which attempts to
maintain minimum inventory. The Japanese Kanban process involves more than
fine tuning production and supplier scheduling systems, where inventories are
minimized by supplying these when needed in production and work in progress in
closely monitored. It also encourages; Industrial re-engineering, such as a
'module and cellular production' system, and, Japanese human resources
management, where team members are responsible for specific work elements
and employees are encouraged to effectively participate in continuously
improving Kanban processes within the Kaizen concept (Stainer, 1995: 11).
THE KANBAN
The Japanese refer to Kanban as a simple parts-movement system that depends
on cards and boxes/containers to take parts from one work station to another on
a production line. Kanban stands for Kan- card, Ban- signal. The essence of the
Kanban concept is that a supplier or the warehouse should only deliver
components to the production line as and when they are needed, so that there is
no storage in the production area. Within this system, workstations located along
production lines only produce/deliver desired components when they receive a
card and an empty container, indicating that more parts will be needed in
production. In case of line interruptions, each work-station will only produce
enough components to fill the container and then stop (Roos, 1992: 112). In
addition, Kanban limits the amount of inventory in the process by acting as an
authorization to produce more inventory. Since Kanban is a chain process in
which orders flow from one process to another, the production or delivery of
components are pulled to the production line. In contrast to the traditional
forecast oriented method where parts are pushed to the line (Roos, 1992: 113).
The Kanban method described here appears to be very simple. However, this
"visual record" procedure is only a sub-process in the Japanese Kanban
management system.

Q 3. How does ERP inventory module maintain inventory items? List

outthe different modules under ERP inventory management.

Ans 3: ERP Inventory module is a simple yet dominant inventory tracking

module that facilitates the process of tracking and controlling the inventory and
also provides the flexibility of customisation. Earlier, paper based systems were
used to process information from various departments of an organisation and it
consumed time.
ERP inventory management system reduces time lag and makes the entire
process efficient, by maintaining the appropriate level of stock in the warehouse.
It helps in maintaining the suitable level of stock in the warehouse. The activities
of inventory control involve:
• Identifying inventory requirements
• Setting targets
• Providing techniques and options
• Monitoring item usages
• Integrating inventory balances
• Reporting Inventory
Changes in inventory are automatically updated. This enables inventory
management employees to see if an item is currently in stock. Since the
database is centralised, the ERP inventory system allows flexibility in
customisation and configuration with various applications from different
departments of an organisation. However, the systems that deploy ERP
management are dependent on networks.
Features of ERP Inventory Management
ERP inventory management has many features .Some of them include:
• Quality control based on QC Parameters
• Analysis which help in maintaining best possible stock level
• Extensive verification of stock
• Online status of item quantity in terms of on-hand, on –hand
available, reserved, ordered, to order, rejected, defective and
rework-able quantities
 • High degree of flexibility for managing complex storage needs and
automatic update of warehouse
ERP management uses bar codes to maintain inventory items. A bar code is a
small image that has bars (lines) and spaces fixed on the store items and used
as an identification mark of a particular product. This makes tracking stock much
easier. Once the items are bar-coded, they get scanned and their product
information is entered into the ERP inventory management system.
Introducing bar code labels on stock helps companies save money as it keeps
the list of stock updated. Employees can easily see when certain quantities are
low and need to re-stock. Customers also benefits from this as customers can
see what products are currently in stock.
The main purpose and benefit that the organisation can derive from ERP
management system is that the ERP system is company-wide and has a single
software system, where as organisations that do not employ ERP management
will have dissimilar and diverse software applications that may not be compatible
with one another.
Benefits and Limitations of ERP Inventory Management
ERP inventory management system has many benefits. Some of them include:
• Tracking of orders from the point the order is received to its release.
• Facilitating appropriate communication between different areas.
• Reducing the threat of loss of information.
• Providing a ‘top down’ summary of the mechanism of a company.
• Setting up an outline of security to protect against theft from external
or within a company.
• Replacing old and primitive paper based systems that improves
efficiency.
Limitations of ERP Inventory Management
• ERP inventory management helps an organisation in many ways.
However, it also has some limitations. They are:
• Limited customisation
• Expensive
• Not friendly with every type of business like small organisations.
• Harder to fix responsibility as it is a company-wide system that
connects all areas
• When all departments in a company are not willing to share
information, maintenance of sensitive data can disturb the work flow
Installing ERP Inventory System
ERP Inventory systems are expensive, and are complex to install. Usually a third
party contractor is hired to install the software and hardware, and these vendors
who provide installation also suggest consultation and customise the system to
the business needs.
However, installation is a tedious task and consumes time depending on the size
of the organisation and the requirements of the company. Typically, installing
ERP Inventory system takes more than a few months, and larger organisations
can take up to a year to install ERP Inventory system.
There are many consulting vendors or firms available in the market to install ERP
Inventory system; besides installing the system, they also train the employees to
use the installed system.
An ideal installed inventory system should always be able to have answers to the
most anticipated questions such as:
• What and how much stock is available in the warehouse?
• What is sold and to which organisation?
• What are the financial issues related to price and margin?
• What orders that are placed, but remains undelivered?
Installation of ERP Inventory systems is complex and not a simple job. However,
deploying web based Inventory management ERP is simple and consumes less
time for installation.
Failure of ERP Inventory installation
Many times, when installation of ERP software fails, ERP software vendors are
held responsible. However installation failure can occur due to the following
factors:
• Operating strategy did not suit organisation design and operation.
• The implementation and completion took longer than anticipated.
• Pre-implementation actions were not well planned.
• People were not well ready to learn and operate the new ERP
system.
• Cost related issues leads to difficulties in implementing and using
ERP Inventory systems.
Q 4. A mobile service provider call centre wants to add a short customer
survey at the end of each customer call. Create a questionnaire for the
customers.

Ans 4: Multinational companies are the organizations or enterprises that

manage production or offer services in more than one country. And India has
been the home to a number of multinational companies. In fact, since the
financial liberalization in the country in 1991, the number of multinational
companies in India has increased noticeably. Though majority of the
multinational companies in India are from the U.S., however one can also find
companies from other countries as well.

Q 5. Explain the three types of CRM. Briefly explain the functionalities of

CRM sub modules.

Ans 5: Customer relationship management (CRM) is a widely-implemented

strategy for managing a company’s interactions with customers, clients and sales
prospects. It involves using technology to organize, automate, and synchronize
business processes—principally sales activities, but also those for marketing,
customer service, and technical support. The overall goals are to find, attract,
and win new clients, nurture and retain those the company already has, entice
former clients back into the fold, and reduce the costs of marketing and client
service. Customer relationship management describes a company-wide business
strategy including customer-interface departments as well as other departments.
Types
The three types in which CRM support the relationship between a business and
its customers are to:
• Acquire: CRM can help a business acquire new customers through
contact management, selling, and fulfillment.
• Enhance: web-enabled CRM combined with customer service tools
offers customers service from a team of sales and service specialists,
which offers customers the convenience of one-stop shopping.
• Retain: CRM software and databases enable a business to identify
and reward its loyal customers and further develop its targeted
marketing and relationship marketing initiatives.
Functionalities of CRM sub modules:-
Customer Relationship Management or CRM software supports a broad set of
activities for acquiring, enhancing or retaining customers. The functionality of
CRM software varies from vendor to vendor. There're a few modules common to
most of packaged CRM software.
Direct Marketing Module
Direct marketing is a set of promotional activities in which direct contact is made
with the target customer. Direct marketing software allows companies to identify
target customers for particular promotional criteria, generate direct mails, analyze
response from target customers. Common techniques include direct mail,
telemarketing, and etc. Direct marketing module can automate and streamline
many of those marketing efforts.
CRM Sales Module
Revenues from sales are live blood for commercial organizations. Sales module
implements functions of pre-sales support, order placement, order scheduling,
shipping and invoicing. Sales module is closely integrated with organizations'
ecommerce websites. Many sales modules from CRM vendors offer online
storefront as part of CRM system.
Call Center Module
A call center is a sophisticated voice operations center that provides a full range
of high-volume, inbound or outbound call-handling services, typically including
customer support, operator services and directory assistance. It generally refers
to reservations centers, help desks, information lines or customer service
centers. A call center consists of a complex telecommunication infrastructures,
sophisticated computer systems and skilled service representatives organized to
effectively manage the incoming and outgoing telephone calls. CRM call center
module captures the vast amount of data in call center operation, prioritize call
center service, and direct incoming calls to the appropriate service
representatives.
Help desk Module
Help desk software can improve customer satisfaction and productivity by
automating customer support processes. Basic features of help desk software
includes requests submission, email notification, searching Knowledge Base and
administration interfaces. Web-based helpdesk software allows users to search
support knowledge base so that users can either find the answer online without
calling a support representative or ask more specific questions when they do
need to talk to a live person for support.

Q 6. Describe how you would go about the different phases of the ERP
implementation lifecycle, if it were being done in your company.

Ans 6: The process of ERP implementation is referred as d as "ERP

Implementation Life Cycle". The following are the steps involved in completing
the lifecycle.
Shortlist on the basis of observation
Selecting an ERP package for the company can nevertheless be compared with
the process of "Selecting the right Person for the Right Job". This exercise will
involve choosing few applications suitable for the company from the whole many.
Assessing the chosen packages
A team of Experts with specialized knowledge in their respective field will be
asked to make the study on the basis of various parameters. Each expert will not
only test and certify if the package is apt for the range of application in their field
but also confirm the level of coordination that the software will help to achieve in
working with other departments. In simple terms they will verify if the synergy of
the various departments due to the advent of ERP will lead to an increased
output. A choice is to be made from ERP implementation models.
Preparing for the venture
This stage is aimed at defining the implementation of ERP in all measures. It will
lay down the stipulations and criterias to be met. A team of officers will take care
of this, who will report to the person of the highest hierarchy in the organization.
Gap Analysis
This stage helps the company to identify the gaps that has to be bridged, so that
the companys practice becomes akin to ERP environment. This has been
reported as an expensive procedure but it is inevitable. The conglomerate will
decide to restructure the business or make any other alterations as suggested by
GAP analysis inorder to make ERP user friendly. Click here for a detailed study
on GAP analysis. A choice is to be made from ERP implementation models.
Business process reengineering
Changes in employee rolls, business process and technical details find place in
this phase of restructuring most popularly refered as business process
engineering. For more details on BPR click here.
Designing the System
This step requires lot of meticulous planning and deliberate action. This step
helps to decide and conclude the areas where restructing have to be carried on.
A choice is to be made from ERP implementation models.
In-house Guidance
This is regarded as a very important step in ERP implementation. The employees
in the company are trained to face crisis and make minor corrections as well
because the company can neither be at liberty nor afford the bounty to avail the
services of an ERP vendor at all times. For more details on ERP training click
here.
Checking
This stage observes and tests the authenticity of the use. The system is
subjected to the wildest tests possible so that it ensures proper usage and
justifies the costs incurred. This is seen as a test for ERP implementation.
The real test
At this stage the replacement takes place viz the new mechanism of operation
and administration takes over the older one.
Preparing the employees to use ERP
The employees in the organization will be taught to make use of the system in
the day to day and regular basis so as to make sure that it becomes a part of the
system in the organization.
Post Implementation
The process of implementation will find meaning only when there is regular follow
up and proper instruction flow thereafter and through the lifetime of ERP. This will
include all efforts and steps taken to update and attain better benefits once the
system is implemented. Hence an organization has to perform ERP
implementation safely and correctly.