ENTERPRISE APPLICATIONS 13 Running head: ENTERPRISE APPLICATIONS | 1

IS Management: Enterprise Applications Applied Research Project Khath Ourng Jerry Gonzales

Keller Graduate School of Management December 05, 2010

Prepared for: Professor Rabey IS535

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IS Managements: Enterprise Applications I. Introduction

II. Definition: Enterprise Applications Today businesses have become more complex and competitive. As the businesses grow, having many departments and branches as well as having suppliers around the globe, the cost of transaction processing has become a big issue; it is sky high. Furthermore, the competition from businesses worldwide is hard to challenge. To stay on top of the business game, businesses need to find solutions to reduce the cost of business transaction processing but still have the capability to satisfy customers and increase profits. To achieve the goal, businesses need to change their way of conducting or performing their business transaction processing. Businesses need to become digital and global in relation to performing well in management, marketing, selling, and building good relationship among suppliers and customers globally. Management, managers need real knowledge of their business transaction processing, such as employees monitoring and payroll, supply chain, customers orders or background relating to consumptions records, to help made wise decision. Marketers need real knowledge of the products and services they are promoting and need to know their customers well; so that they can promote and target their products to the right consumers anywhere and anytime. They need to know of the environment where their companies make sell and provide services. With the right knowledge they can apply the right approach whether using or adapting the customers language, culture, or belief.

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Sellers need customers credit record in order to make sales and provide the services that the customers deserve. Sellers are similarly applying the same approach as the marketers when performing the sales, else they might be losing customers interests, and therefore lose sales and no profit. Companies need to establish a way to bring current information of their productions and services to customers. Ultimately, companies need to build a network where customers can interact with them for any questions, feedback, training, workshop, and building good friendship. Without the smooth flowing between the companies and suppliers, the business transaction processing is costly, for companies do not have the products to sell to customers at the right time. Without the smooth interaction between companies to customers, company would lose sales, and not too long, lose customers permanently. Therefore, to reverse the business transactions dilemma, companies around the world are now seeking for new technologies assistant to help them run their businesses with the competitive advantage. Enterprise Resource Planning Systems have the capabilities to help solve the transaction problem. The Enterprise Resource Planning Systems have the ability to integrate all fragmented system of the company to a central database management. It can integrate the internal systems; so that staffs at all departments of the companies can access information via the dash board in their specific fields. For example, accountants can access data of employees payroll status to help them issue the check and keep records current. The managers can access knowledge information to help them made wise decision and monitor employees. Human resources can access information about employees working status; so that they can promote certain employees or fire the unfitted, and

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then hire another one to substitute. On the other hand, the database can reduce repetition and increase accuracy of data to be used by all staffs. Example, if the sales have sold and enter into the system, the staffs at the shipping, the accountant, and the management departments will know and have the same data. So, what is really the ERP you may wonder? The ability to integrate all segregated key business processes in manufacturing and production, finance and accounting, sales and marketing, human resources, and storing the data in a single central database repository.

III. Brief Background of Wayne Enterprises Wayne Enterprises is a subsidiary of a Fortune 500 company and leader in the installation of building products. The companys mission is to deliver value to their customers, and profits to the company, through innovative building product solutions. The building products include cabinets, garage doors, shelving, closets, rain gutters, fireplaces, insulation, windows, and more. The company has over 400 branches located in every major metropolitan area in the United States while the corporate office is located in Daytona Beach, Florida. The company employs over 16,000 employees nationwide and had sales at $7.8 billion in 2009. Wayne Enterprises has established national accounts with several of the countrys largest home builders such as Pulte Homes and with some of the best product manufacturers such as Rubbermaid and Owens Corning. They are able to provide their customers value by negotiating discounted pricing and by installing products manufactured by their parent company. Also, they offer their customers convenience by stocking many of their products in one warehouse, offering timely installations, and a single invoice for multiple installations.

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To accomplish their mission, become more efficient, and become more profitable, Wayne Enterprises decided to implement an enterprise resource planning system. They have chosen Oracles E-Business suite to automate many of their business processes including payroll, billing, and production. Initially, they hired a consultant group to help design and implement the new ERP system and spent millions of dollars before the first branch went live.

IV. Discussion of Current Business Issues In 2009, Wayne Enterprises had sales of $7.8 billion and operating expenses at $7.5 billion, leaving only $0.3 billion for taxes and retained earnings. Because of a lack of Enterprise Applications, Wayne Enterprises operating expenses are a large percentage of their sales. Just a 10% increase in productivity and efficiency can reduce overhead expenses and increase sales at the same time.

Sales and Marketing Sales representatives are given pricing on an Excel Spreadsheet and generate quotes manually using the pricing on this list. When the sales rep meets with the customer, they gather the necessary information on a takeoff. The next time that they are in their office, they generate a quote and either mail, fax, or email to the customer. At the same time, the sales rep or customer will schedule the installation with the production department. However, before production can proceed with the installation, they must have a copy of the quote signed by the customer. The sales representative, production manager, and customer have no way of tracking whether the sales process has been completed before the scheduled installation date. Usually, the administrative

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assistants will notify the production department that some of the necessary documents are missing and a work order cannot be generated until the necessary documents are received.

Production The production department routinely receives phone calls from customers requesting a date for installation. However, the customers do not have reference numbers for quotes, cannot provide enough information for the scheduler to determine the actual resources needed, and do not have the capability to track the sales process (meeting with the customer, generating quote, receiving a signed quote and a list of necessary resources). In addition, the production department does not have access to general customer information such as contact lists, past installations, sales information, customer preferences, etc. Scheduling installations is usually a guessing game. The production department does not know that required paperwork is missing until days prior to installation. To ensure that there are necessary resources, the production department must review the quotes/takeoffs, if they receive them. Usually, the production department will stock the warehouse with high levels of inventory instead of reviewing every quote.

Finance and Accounting With many institutional customers, payment terms vary greatly. Some customers want to pay only after all phases of the installation are complete. Others want to pay according to a strict schedule. Some customers do not want an invoice but want to mail or transfer money on a monthly basis. This causes problems because the accounting department generates invoices as soon as an

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installation is complete. This causes many customer accounts to appear on the aging list (late payments) when the company has already agreed to payment terms.

Human Resources The company currently keeps employee records in filing cabinets. All human resource requests are completed manually (form is completed and changes made by admin personnel).

V. Discussion of Proposed Solution Analyzing and Implementing When competition from other business environments are so high, the demands from consumers are so challenging, and the new competitive technologies are the main driving force of business transaction and the source of gaining the business competitive advantages, every business, firm, and industry is searching for the best suitable technology to survive and stay on top of the business curve. But, then this becomes the biggest issue such as, for who will know, which is the suitable new technology that will match or fit for the existing business regarding to its organizational structure, management style, and business transaction processing method? Due to the above elemental issues, many companies and firms are searching for consultants from Consultant Enterprise, who are expert in business analyzing and software implementing. Wayne Enterprise, after many years performing well among its businesses competitors (Jerry, please give me some business competitors names to be inserted here) in the Metropolitan areas, has now faced with the challenge of its unprepared growth that unmatched with the current management style, organizational structure and business transaction processing. Furthermore, its

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surrounding competitors are so hard to compete with the existing operational format. Wayne Enterprise has then reliable that it is time to search for Business Consultants to assist in analyzing for the best way to run its business with the competitive advantages. This company, after having searched many Consultant Enterprises, then it comes to contact and sign the contract with the J and K Enterprise as its best representative to analyze and implement new technology for the company. Two consultants from J and K Enterprise meet with Wayne Enterprise conducting an analyst of the company business transaction. They request for one representative from each department of the company to participate analyzing the business transaction processing and implementing the new system. After careful analyzing, viewing over business transaction of the four departments, the consultants and the representatives have found the following issues from each department and listed these issues below: (Summary from the current Business Issues paragraphs) Sales and Marketing:

Use sale price from Excel Spreadsheet, but quote sales manually Gather necessary information on a takeoff. Generate a quote either via mail, fax, or email to customers while scheduling installation w/ the production department

Production cant proceed w/ installation before customer signed the quote Sales rep, product manager, and customer have no way tracking whether sales process has been completed before the scheduled installation date

Documents are missing reported by administrative assistant

Production:

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Call from customers requesting for date installation, but the rep doesnt have the reference numbers for quotes and date

Cant track sales process Dont have access to generate customer information: contact lists, past installation, sales information, customer preference, etc.

Scheduling installations is a guessing game

Finance and Accounting Customer payment preferences:

Some customers want to pay only after all phases of the installation Others want to pay accounting to a stick schedule Some want an invoice, but want to mail or transfer money on a monthly basis The problem is that the accounting department generates invoices as soon as an installation is complete, because of this it has cause many customer accounting to appear on the aging list as late payment.

Human Resources

Employee records in filing cabinets Requests are complete manually

After discovering the above issues, the consultants and the representatives have come out with some solutions, and they present to the director and top executives of the Wayne Enterprise. Below are their presentations:

Solutions: Implement New Technologies, select options

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A.

Diamond Option (Enterprise Applications System): The Enterprise Applications System is, a commercial software application, consisted of

four components: Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), Supply Chain Management (SCM), and Knowledge Management System (KMS). The system has the capabilities to internally integrate all Wayne Enterprises fragmented systems into one central repository and externally has the power to communicate and build good relationship with outside sources such as building good relationship with customers, suppliers, and/or business partners. This new technology system is very complex and expensively to implement, but it can reserve or reduce the cost of the business transaction processing in Sales and Marketing, Production, Finance and Accounting, and Human Resources (please see more detail from Business Current State or list under business issue points) while reaping huge revenue, building good relationship with suppliers, and satisfying customers. (Jerry, please supply me with some number, to insert here, as reference in comparison: past failure amount less than the current state or amount of the present. If possible give me in both number and percentage.) Below are some advantages and disadvantages to consider: Advantages: Competitive Advantage 1. 2. 3. 4. 5.

One system can serve or connect all the TPS Save time, money, and confusion (long-term) Convenience and user friendly Allows multiple entries Accurate, consistent, and fast

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6. 7.

Compatible updating systems as well as database management central repository Free on site consulting and training from Oracle Consultant Firm for 5 years

Disadvantages:
8. 9.

It costs 6 millions to implement the full commercial version of Enterprise Applications It takes 9 months to implement and 3 to 5 months to train the end users to get full benefits from the new systems.

10.

It may take 5 years to generate profits.

B.

Golden Option (Intranet, Extranet, and E-commerce): Intranet has only the internal capability as the Enterprise Resource Planning System, for it can

integrate the companys fragmented systems into a single repository database management. But, it lacks the power to connect with the outside sources. We can solve this problem via employing the Extranet and E-commerce. Extranet enables management and production staffs to connect to suppliers. Ecommerce allows the interaction between company such as sales and marketing, management and production. This is a system less complex and with reasonable cost to implement. Below are some points of advantages and disadvantages to consider: Advantages: Competitive Advantage 11. 12. 13.

Intranet (Internal connecting all systems of the company) Extranet (External connecting to SCM, CRM, and B2B) E-commerce (External connecting to customers for marketing, selling, and educating, and information updating)

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14. 15.

Accurate, Consistent, and Fast Reasonable cost: less than $2 millions

C.

Silver Option (Networking, Internet, and E-commerce): Networking

Competitive Advantage
16. 17. 18.

Networking (Connects all IT components systems of the company) Internet (connect to the external sources - suppliers and customers) E-commerce (connect to customers regarding market, selling, training and daily supporting service)

19. 20. 21. 22.

Low cost - under $1 million to implement Fast, Accurate, Consistent, and compatible with the external systems Take one and half month to implement User friendly (it is routine procedures; just follow simple 1-2-3 steps instruction once.

Disadvantages:
23. 24. 25. 26.

No onsite consulting after implementing complete More structure based, and less flexible Perfect only for routine entries, but changes can be a big challenge No CRM regarding to marketing and selling displayed as on the E-commerce

VI. Recommendation CUSTOMER RELATIONSHIP MANAGEMENT: ORACLE CRM

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The Customer Relationship Management (CRM) through Oracles E-Business Suite allows Wayne Enterprises to automate their business processes in their sales and marketing, production, and finance and accounting departments. ORACLE SALES Through Oracle Sales, all business processes, from storing customer information, preferences, quotes, proposals, and tracking orders, can be automated. Sales Representatives can use a handheld device to access customer information. ORACLE MARKETING Management can use Oracle Marketing to facilitate and keep track of marketing campaigns. ORACLE ORDER MANAGEMENT Wayne Enterprises can use Oracle Order Management to generate accurate work orders. The order management is integrated with Oracle Sales and Oracle Service. ORACLE SERVICE Oracle Service integrates the sales units, order management, and customer information with the production department. It automates the process of dispatching installations within the branchs designated territory. It aids in the automation of inventory control and the billing cycle. SUPPLY CHAIN MANAGEMENT: ORACLE INVENTORY OPTIMIZATION Oracles Inventory Optimization service will aid Wayne Enterprises manage inventory levels, mitigate risk, balance inventory budgets, and maintain customer service. ORACLE VALUE CHAIN PLANNING Oracle value chain planning will aid improve management forecasts through analytics and improved consensus forecasting. Aids management in providing real-time planning of sales and production KNOWLEDGE MANAGEMENT SYSTEM: Oracle Business Intelligence offers knowledge management analytics for multiple functional units within a company. Financial, sales, service, marketing, human resources, supply chain, and many more analytics. HUMAN RESOURCE MANAGEMENT: ORACLE HUMAN CAPITAL MANAGEMENT

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Integrates payroll, HR management, talent management, benefits management, time and labor, and integrates with production and enterprise applications. VII. Conclusion

VIII. Attachments ORACLE ERP APPLICATIONS Enterprise Applications Customer Relationship Management Sales Marketing Order Management Service Inventory Optimization Value Chain Planning Business Intelligence Human Capital Management IS Management CRM CRM CRM CRM CRM SCM SCM KMS HRM Advantages

IX. References There are no sources in the current document.

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X. Exhibits