Enterprise Information

Systems
Péter Halász - peter.halasz@live.com
Timetable
8th week: Mid-term exam - 04.03

10th week: Easter holiday - Project deadline - 04.23

11th week: Presentations

12th week: Hungarian national holiday

13th week: Presentations

14th week: Repeating exam

Recap
● Recap
● System service functions
● Controls
● EDI
● E-Business
Enterprise functions
Sales Procurement

Items & Stock Production

Finance HR
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Enterprise functions
Customers Suppliers

CQ&O SQ&O
Items & Stock
Invoicing SCA

CCA
Integrated System - Definition
● Covers every essential business function
● No need to buy or develop separate subsystems
● Every data or record is inserted only once into the system
○ When the data is created
● The data is consumed from the central
database without changing media
Standard system - Definition
● An integrated system designed for an imagined enterprise
and its processes
● The business model and the data model has multiple
alternatives
● Customizable
● Scalable
History of Enterprise information systems
Key factors

● Hardware evolution
● Software evolution
● Price changes
History of EIS (Hardware)
1. Undeveloped computers and very few peripheries
2. Developing phase
a. Huge computers
b. Middle sized computers
c. Mini computers
3. Rapid developing phase
a. Mainframes / Servers
b. PCs
c. Networks
History of EIS (Software)
● Software crysis
● Operating systems
● Advanced programming languages (OO)
● Database management systems
● Design tools (UML)
History of EIS
Isolated sub-systems

Sub-System1 Sub-System2

Sub-System3
History of EIS
● Individually developed systems
○ Integrated
○ Partly-integrated
● Standard systems
Evolution of Enterprise information
systems
TEI

ERP

MRP II.

MRP I.
Evolution of Enterprise information
systems
MRP I. - Materials Requirements Planning (1960’s)

MRP II. - Manufacturing Resource Planning (1970’s)

ERP - Enterprise Resource Planning (1990’s)

TEI - Total Enterprise Integration (Future, ERP II.)

Evolution of Enterprise information
systems
TEI
ERP
MRP II.
MRP I.
MRP I.
● Material consumption planning
● Parts consumption planning
● Semi-finished product consumption planning
● Used by manufacturing enterprises
MRP II.
● MRP I.
● Customer need estimation
● Customer serving
● Order processing
● Manufacturing planning
● Capacity requirement calculation
MRP II.
● Procurement
● Items and stock
● Finance
ERP
● MRP II.
● Production development
● Supply chain management
● Decision support
● HR
● …
ERP
● JIT Support
● Distribution
● Quality control
● Maintenance management
● Service management
TEI
● ERP
● Strategy planning
● Sales planning
● R&D
● Product design and development
● Need management
TEI
● Financial planning
● CRM
● Marketing
● …
Possible advantages of TEI
● Faster customer serving
○ From the RfQ to delivery
● Better adherence to delivery dates
● Better defective product ratio
● Decrease of sales prices
● The elaboration of prices will depend on real expenses
● Faster inventory turnover
● Less pressure on the employees
Disadvantages of TEI
● There’s no vendor offering a complete TEI system
● Huge complexity
● Long introduction times
● A lot of BPR needed to utilize the TEI
TEI vs ERP
The surplus of TEI functionality

● Integrated management decision support

● Integrating all the systems in the enterprises’ environment
● Faster communication in the company
● Faster communication with the external parties
Getting a system
● Development
● Standard system
● Outsourcing
Buying a standard system
● Controlled process
○ A lot of alternatives
○ Decision points
● Highly configurable
● Cheaper than development
● Support
● Battle-tested solutions
Buying a standard system
● Not tailored to our needs
● BPR is needed in order to use
● Continuously expensive
○ Monthly, yearly fees
Choosing a system
1. Creating a vision
2. Gathering a feature list
3. List of possible solutions
4. Narrowing possible list
5. Wish list for request for quotation
Choosing a system
6. Evaluating offers
7. Choose the top three
8. Demos
9. Choosing the solution
10. Contract, pilot project
Choosing a system - Vision
Creating a vision

● Checking the goals of our enterprises area (competitors)

● ROI maximization
● Creating a common future goal helps the department's communication
● It has to be comprehensive (for every department)
● Employees has to see the change and its results
● Clear effect for every function
Choosing a system - Feature list
● Desired functionality list
● The vision is the starting point
● Short documentation from every department
● Main functionalities
○ Detailed descriptions
● Software independent
Choosing a system - Software list
● Research for the possible vendors and solutions
● Determining factors
○ Size of the enterprise
○ Area of business
○ IT platform
● Source
○ Competitors systems
○ Advertisements
○ Offerings from vendors
Choosing a system - Narrowing
candidates
● Consultants can help
● Filter out the non-responsive vendors
● Create a list of “hard” questions
● Communicate with vendors
Choosing a system - Wishlist
● Description of the enterprise and its operation
● Desired date of contract, demos, pilot project, introduction
● Planned business model
● Planned and current hardware and software infrastructure
Choosing a system - Offer evaluation
● Evaluating all the answered quotation
● Gather and mark the strengths and the weaknesses of the
vendors
● Clarify the grey areas
● Inform about the vendor
Choosing a system - Choosing the three
best
● Goal is to ask for demos
● Reference visits
○ Visit companies that already use the solution in production
○ Software quality
○ Introduction difficulties
○ Support quality
○ Operating
○ Check the documentation
○ Education
○ Why did they choose this? Would they recommend the software?
Choosing a system - Demos
● With our data
● How can the system handle our area's specific needs
● Pre-written scenarios
● Discussion
● Rating
Choosing a system - Choosing
Main points

● Price
● Support
● Ease of introduction
● Business area compatibility
● Technology risk
● ROI
● Possible advantages
Choosing a system - Contract, pilot
project
● Contract with vendor
● Clarify deadlines
● Pilot project
○ A whole day’s work simulation NOTE:
○ Needs vendors consultants So far we’ve only bought a new
system, it’s still not ready to use
● Result before the introduction.
○ Implement missing features
○ Check the reliability of the product
○ Create a restoration plan
● Verify the decision
Conclusion
● History of Enterprise Information Systems
● EIS evolution
● Ways of getting a system
● Buying a standard system
● Process of choosing a system
Thank you for your attention
Example questions
● What’s the key difference between ERP and TEI?
● What it the TEI?
● What are the possible advantages of TEI?
● How can you get a system?
● What are the advantages of buying a standard system?
● What are the disadvantages of buying a standard system?
● What’s the process of choosing an EIS?