FAQ -Frequently asked questions

Header Note

Whoever said LET'S Computerize with ERP... didn't tell you the whole story....read this FAQ.. to know it...

Q. What is ERP, XRP, IRP ? How it works ? What is the need for it ?.

ERP is Enterprise Resource Planning, XRP is Exchange Resource Planning, IRP is Intelligent Resource Planning. ERP, XRP & IRP is a software that helps to integrate nearly all the functions of an organization, enabling it to plan, track and see its resources ( material, machine, man and money ) in the best possible way to service customers and reduce costs.
Say, I'm surfing the Net. I place an order through the Net. What ERP does is that, it shifts the orders, and then allocates them to manufacturing plants; at the same time it is placing orders for raw materials based on stock with the unit and what's needed to fulfill the order. Again, at the same time, it is updating the financial position of the company with respect to suppliers and its inventory position. Thus ERP is a complete software system that has Accounts, MRP based Production Planning, Payroll and Marketing Softwares tightly integrated for efficiency. Some people have given new names to extended parts of ERP such as e-Business, c-Business, m-Business, CRM, SCM, BI, KM, DSS, ES etc... This are just extended parts of ERP. Don't confuse yourself with such heavy names. XRP is used as business exchange or for collaborative planning, whereas IRP is used for Intelligent planning based on Decision Support Systems & Agent Technology. Even XRP & IRP is broadly termed as ERP for simplicity.
There are no two thoughts about whether to have ERP or not. If you want to survive with low overheads and run your business efficiently and make money, like it or not, you have no choice, but to opt for ERP. Excuses like "ERP is too costly", "we do not have funds", "it will not work here because we are different", etc. are an eyewash or smoke to ensure failure of your organization. With ERP Softwares few employees are required to produce reports, handle correspondence, bill customers, and maintain a credible business presence thru Internet - all surprisingly easily.

Q. What is BPR (, or Business Process Re-engineering)? What is the need for it ?.
Along with ERP you will have to opt BPR to eliminate all non value added business processes and paperwork. By implementing an ERP system you are replacing one set of rules and procedures with another. Simplification of the process may involve rearranging layout of shop floor, revising manufacturing practices and administrative procedures. About 80% of the benefits come from what you change in your organization for better. The ERP Software is just the enabler.
Internet & WEB if used with ERP software's & with BPR will allow small business to compete more effectively with big players than at anytime in past. As email is reducing your communication & traveling costs by replacing memos, faxes, phone calls & meetings. Websites solves the real problem of reaching to far away customers round the clock without offices & employees. It reduces your investment, overheads & risks. So, only key questions to reexamine include: How will customers find out about your products? How will customers order? What new competitors will emerge as geography becomes less a barrier? What will be your marketing and pricing strategy to meet customers demands quickly in best possible manner?. A successful implementation of an ERP with BPR can lead to higher productivity, reduction in inventories, better response to customers resulting in improved satisfaction and higher employee productivity and morale.

Q. What are real challenges invisible to my organization? What are real pitfalls?.
Companies often makes wrong decisions of buying computers & software's because of partial knowledge. Instead of rushing out to buy the latest and greatest equipment for every employee or investing in a network, managers in a company of any size should first step back and think about how they'd like their business to work. What are its essential processes and its key data?. Ideally, how should information move?. Finally, think how computerization will benefit your organization?.
Today, small businesses face number of technology challenges. Purchasing a network or upgrading poor-performing old networks can be a confusing and intimidating proposition for many small businesses, since many of us have limited technology expertise. In addition, small business are more likely to purchase separate software applications for networking, accounts, payroll, Internet access, office suites etc. Simply speaking small-business owners should focus on running company, not on learning new technology. In addition, the day-to-day user support often falls on the accountant, business manager or office administrator, since these people have generally been using computers longer than others. Supporting computers often takes from 20% to 50% of their time, leaving them less time to do their primary jobs. Most of these "administrators by default" are self-taught. As a result, small business need products that are easy to use and learn. Remember it is software that is more important for your business than hardware. You can still run your entire company on 486 machines. Try to minimize hardware investment and select correct web-enabled software's that are globally functional & easy to use. Save your company from big mistakes of doing wrong computerization. Use ERP to avoid pitfalls...

Q. ERP Projects never ends! - If it ends = Death of your companies growth.....why?

When it comes to ERP projects, Fortune 500 companies are beginning to sound like kids in the back seat of the car on a long drive. Are we there yet? Are we done yet? No! We're not there and we're not done. And we may never be done, so pipe down, OK?!

Enterprise resource planning (ERP) projects do not end. Not only does implementation take forever (many companies already have been at it for years), but once the software is installed, the enterprise will be operating in a totally new way. Everyone's job is going to change—radically. Order entry clerks who type will become business people who make decisions that affect the company's bottom line. Finance managers will have to know what warehouse managers are doing. At all times. In real-time. IS engineers will become business process leaders and owners. ERP team members, chosen from every part of the company, will never be able to go back to their old jobs. Of course, it will be hard to keep exhausted, under-rewarded ERP veterans—who now know more about the business than anyone else—from bolting as soon as the software is up and running. And they'll need more than money to stick around. They'll need the power to do with the business what they just did with the software: change everything. It's up to CIOs to find permanent places for these people if there's going to be any hope of delivering the value from ERP that was promised those many years ago when the project was approved.

If the ERP project ever really ends, if the project team is broken up and sent home, so ends the potential for the company's growth, for change, for adding more value down the road. CIOs who think of ERP projects in terms of just getting the stuff on users' desktops don't have much of a future. ERP changes everything, and CIOs need to learn an entirely new set of rules. Now is a good time to start.

Q. What advantages does ERP provide?

ERP offers only one real advantage, but it is a big one: integration. Prior to ERP, when a customer placed an order, it began a mostly paper-based journey from in-basket to in-basket, often being keyed and re-keyed into different departments’ computer systems along the way, which invited errors, delays and lost orders. Meanwhile, no one could update the customer on an order’s status because the finance department, for example, had no access to the warehouse’s computer system to see whether the item had been shipped. In ERP, an order is typed in once and it is instantly accessible to all the departments around the company that need to see it.

Q. What about all those horror stories you hear about ERP being so difficult?

Consider those inboxes again. That process may not have been efficient, but it was simple. With ERP, the customer service representatives must become businesspeople. Their ERP screens flicker with the customer’s credit rating from the finance department and the product inventory levels from the warehouse. Will the customer pay on time? Will we be able to ship the order on time? These are decisions that customer service representatives have never had to make before. ERP means changing how people do their work, how they communicate with others and how they view their role in the company. Bringing about such dramatic organizational change is painful, expensive and time consuming—it’s why companies spend years trying to get their ERP systems up and running.

Q. How do I know whether ERP is right for my company?

It’s critical to decide whether your ways of doing business will fit within a standard ERP package. The most common reason that companies walk away from multimillion-dollar ERP projects is that they discover that the software does not support one of their important business processes. At that point there are two things they can do: They can change the business process to accommodate the software, which will mean deep changes in long-established ways of doing business. Or they can modify the software to fit the process, which will slow down the project, introduce dangerous bugs into the system and make upgrading the software to the ERP vendor’s next release excruciatingly difficult, because the customizations will need to be torn apart and rewritten to fit with the new version. Needless to say, the move to ERP is a project of breathtaking scope, and the price tags on the front end are big. In addition to budgeting for software costs, financial executives should plan to write checks to cover consulting, process rework, integration testing and a long laundry list of other expenses before the benefits of ERP start to manifest themselves.

TEN GOLDEN RULES OF ERP :

Relationships matter : The most important ERP solutions help you improve your relationships with customers, suppliers, and employees. Go for web based ERP which connects your Customers, Suppliers & Employees.
Size matters: Big companies like Microsoft, Intel, Polo, Sony are winners. Small companies in specific niches can be, too. But being in-between is hard. Big companies pumps in resources unless and until they succeed. Small companies mostly lacks vision & resources. Mostly they break if project is extended beyond 6 months because of resource shortages.
Velocity matters: Getting a quick solution is more important than finding the perfect solution. The key is to get a solution that works. First implement solution, make it workable as it is & then only customize if necessary is a way to go.
Integration matters: The ideal ERP solution works for your whole business, not just one department. That means always go for web based ERPs as your ideal e-Business solutions instead of parts & pieces here & there.
Technology matters: Existing systems matter, but don't let them dictate your future. Investment in large number of client PCs are very high in any organization. So buy solution that allows you to work on your existing Hardware Infrastructure.
Partners matter: When choosing an ERP Solution, you want a partner that you can trust to stick around. Select your System Integrator or ERP Consultant with great care. Your ERP Projects success greatly depends on this people.
Uptime matters: No one cares how good your system would have been if it had been working. So start working on whatever you have. Later on keep on adding new things to it. Train & Re-train people for change. It is way of life....
Security matters: You must make sure that private information is kept private.
Flexibility matters: Listen carefully to your customers and suppliers so that you can be prepared for the changes that will come. Select an ERP solution that can be customized very fast without writing programs or coding.
Bottom line matters: While retail B2C (Business to Consumer) business increases revenue, B2B (Business to Business) business reduces cost, B2E (Business to Employees) business increases productivity. Go for the maximum gain or the greatest reduction of pain or greatest productivity & efficiency.

Q. What is e-Business & why it is mentioned separately than ERP?.

Doing business with Internet Technology is e-Business. It's full form is electronic Business. When you use web based ERP you are already doing e-Business. Putting just a website on internet is simplest form of e-Business. It is often called 1st Generation of e-Business. 2nd Generation is putting an online e-Commerce shop on Internet. 3rd Generation is using CRM & SCM to connect Supplier & Customers. 4th Generation is running your entire company using web based ERP. That means running Manufacturing, Accounts, HRD, SCM, CRM etc. on Internet, Intranet & Extranet. Thus e-Business is part of any web based ERP Software. e-Business is more an business terminology than a software terminology. It is just an another business course for MBA, called eMBA. It is IT industries madness to bring in new terminology just to prove their supremacy & sell old wine in new bottles. IBM brought this terminology e-Business. SAP gave new name called c-Business, ORACLE follows this with slight difference. HP gave new name to e-Business called e-Services. Microsoft is giving new name called web services. Then people started renaming e-business itself to m-Business, c-Business, t-Business. Playboy may soon start x-business. Joking. After all, e-business, m-business or c-business are parts of web based ERP only. This is just a marketing gimmick & nothing else. Wise customers will not fall in this....

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