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ERP & Related Technologies

Limitation of ERP

Managers cannot generate custom reports or queries without help from a programmer.

This restricts them from obtaining information quickly and act on it in this competitive market.

ERP system provide current status only such as open orders. The data in ERP is not integrated with other enterprise or division system and does not include external intelligence.

Overcoming the Limitations

There are many technologies that help to overcome these limitations. These technologies when used in conjunction with ERP system help for better decision making and also help in overcoming limitations of ERP. Organizations are constantly innovating methods to improve organizational efficiency, reduce cost, provide high quality, personalized customer service, customer satisfaction , increased profit margin.

Companies use these technologies to integrate it into core of their business planning and are ready to face the challenges of conducting business in this


Some of these technologies when integrated with ERP system , enable companies to do business at internet speed. These technologies are :

Business Process Re-engineering (BPR).

Management Information System (MIS). Decision Support System (DSS).

Executive Information Systems (EIS). Data Warehousing. Data Mining. On-line Analytical Processing (OLAP).

Business Process Re-engineering (BPR).

Dr. Michael Hammer defines BPR as the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance such as cost, quality, services and speed. One of the main tools for making this change is the Information Technology(IT). Any BPR effort that fails to understand the importance of IT, and goes through the pre-BPR analysis and planning phases without considering the various IT options available, is bound to crash during take off.

Management Information System (MIS).

MIS is a computer based system that optimizes the collection, collation, transfer and presentation of information throughout an organization, through an integrated structure of databases and information flow. MIS supports data processing functions of transaction handling and record keeping. MIS uses an integrated database Integrates the information flow between functional areas. MIS provides operational, tactical and strategic

Decision Support System (DSS).

Managers spend a lot of time and effort in gathering and analyzing information before making decisions. Decision support systems are interactive information systems that rely on an integrated set of user-friendly software and hardware tools, to produce and present information targeted to support management in the decision making process. DSS allow manager to improve the quality of their decision.

DSS facilitates decision making process, choose between alternatives; automatically rank the alternatives.


designed to address semi-structured and unstructured problems. supports decision-making at the top management level. interactive, user-friendly.

Difference between MIS & DSS.

Executive Information System (EIS)

EIS is better and sophisticated DSS. EIS is a DSS especially made for senior level executives.

concerned with how decisions affect the entire organization.

An EIS takes the following into considerations:

vision and mission & the company goals. Strategic planning and objectives. Organizational structure. Crisis management/ contingency planning.

Data Warehousing

Operational data in the database increases as time passes Affects the performance of the ERP system. Better to archive data once its use is over. E.g. Once the financial year is over, the daily transaction data can be archive. As volume of data in the database increases , the performance of database and related application decreases. Solution :- separate operational data from non operational data (not archive data).

A data warehouse is designed to support decision making in organization. Data warehouse is a combination of different database across the organization. the data stored for the business analysis can be accessed most effectively by separating it from the data in operational systems. High performance and quick response time.

A data mart is a collection of database enabling managers for better decision making.

Usually smaller and focus on particular dept.

Data Mining

Data mining is the process of identifying valid, novel, potentially useful and ultimately comprehensible information from databases that is used to make crucial business decisions. Need for data mining :

enormous volume of existing and newly appearing data that require processing. The amount of data accumulated each day by various businesses, scientific and governmental organizations around the world is daunting. Research organizations, academic institutions and commercial organizations create and store huge amounts

Data mining is sorting through data to identify certain patterns and establish relationships among data. E.g . Data mining s/w can help retail companies to find customers with common interest. Data mining parameters include :

Sequence Classification Clustering Forecasting (predictive analysis)

On-Line Analytical Processing (OLAP)

OLAP is a decision support s/w that allows users to quickly analyze information that has been summarized into multidimensional views.

OLAP is a s/w tool that provides analysis of data stored in the database.
Used to perform trend analysis on sales and financial information, marketing analysis, financial reporting and consolidation, budgeting and planning. Used in Data Mining. OLAP can be defined in five words Fast Analysis of Shared Multi-dimensional Information.



deliver most responses to users within about 5 seconds.


system can cope with any business logic and statistical analysis relevant for the application and the user.


system implements all the security requirements for confidentiality. provide concurrent update locking at an appropriate level.


OLAP is used in applications such as :

Product profitability

Pricing analysis
Activity based costing Manpower planning Quality analysis

Supply Chain Management (SCM)

A supply chain is a network of facilities and distribution options that performs the function of procurement of materials, transformation of these materials into intermediate and finished products and the distribution of these finished products to the customers. SCM plans all movement and storage of raw materials, work in progress, inventory and finished goods from point of origin to point of consumption. Need for SCM :

All the depts in organization along with supply chain operated independently.



Refer Alexis Leon PPTs