Erp and case analysis On Johnson and johnson Presented by Hepsy verghese Tracy H imanshu sati

ERP SYSTEM Stands for Enterprise Recourse Planning. Way to integrate data and processes of an organization into a single system. ERP major components are Hardware and Soft ware. Uses a unified database to store data for various functions of organizatio n. Functions such as HR, Supply Chain Management(SCM) and Warehouse Management f un are integrated under ERP.

Integration is a key for ERP ERPs main goal is to integrate data and processes from all the areas of the organ ization. Provide easy access to data and workflow in the organization. It create s a single database that employs multiple software providing different areas of organization with various functions.

ERP System Concept

Advantages of an ERP system A totally integrated system. The ability to streamline various processes and wor kflows. The ability to easily share data among various departments in an organiz ation. Improved efficiency and productivity levels. Better tracking and forecast ing. Lower cost. Improved customer service.

Disadvantages of ERP system Time consuming. Expensive. Conformity to the modules. Vendor dependence. Feature s and complexity. Scalability and global outreach.

Some of the ERP modules are Accounting Management. Financial management. Manufacturing management. Productio n Management. Transportation Management. Sales and Distribution Management. Huma n Resource Management. Supply Chain Management. E-Business.

COMPANY OVERVIEW Originated in. 1920s. Corporate headquarters-Atlanta 1988-Genuine parts /NAPA acquir ed Johnson industries. Largest OEM auto parts distributer in the country. Annual s ales-$150m It now serves automotive repair facilities throughout the United State s. Largest distributers of acdalco, motorcraft

CHALLENGES FACED Johnson industries procured businesses in similar markets. Cont ract with JD Edwards software implementation. C.D groups audit discovered follow ing problems in the implementation. Only the general ledger module was implemente d with the entire

Functions and duties across the organization were not consolidated. No clear strat egy or solution were defined with regard to centralization of business processes . Critical business practices were distributed across several DCs.

Job duties were duplicated creating inefficiencies. Created high degree of complex ity. Generation of multiple statements creating multiple identities.

DRAWBACKS OF CURRENT LEGACY SYSTEM No longer supported its needs.duplicate and inconsistent business practices and rules No support for multi-warehousing functionality. Limited ability to smooth slower moving inventory between distribution centers. Absence of automation crea ted

Solution New business model implemented by CD Group which represented Johnson Industries as a single entity. The new model used JD Edwards OneWorld in a centralized foot print, using an NT operating system and a SQL database to support multiple wareh ouses as a standard for all distribution centers.

Changes brought in Incorporated centralized, critical business processes (i.e. journal entries, pur chasing, paying suppliers, etc.) in all DCs to ensure consistent Best Practices ac ross the organization. Benefits enabled customers to receive one statement for all purchases Ability to forward al l payments to a single location. Standardizing customer and item numbers

Step 1 RF technology was leveraged to automate the tracking of inventory movement withi n a DC Benefits Inventory balances updated immediately Eliminating of paper trail and human inte rvention required to manually update inventory.

Step 2 Implemented a warehouse location system to improve inventory tracking. Be nefits - provided visibility to inventory on the receiving dock, in a staging ar ea, in product overflow, or on the shelf. Step 3 Applied a consistent cycle count program that validated and maintained in ventory accuracy. Benefits - Rebuilt confidence among management regarding inven tory accuracy

Business Benefits Streamline future acquisitions Increase inventory turns and im prove cash flow Ensure the consistent and timely application of price changes Pr esent a single company image to its customer base Defer the need for warehouse e xpansions Close the month earlier

 Increased inventory visibility across DCs and among customer service personnel. Johnson Industries received a one-time reduction in inventory estimated at $7.6M in annual inventory carrying costs. Consolidation of the different IT systems c aused reduced hardware and software maintenance expenses. Incorporation of Best Practices standards model reduced employee training costs. and

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