ERP market in Year 2009
Showing posts with label ERP. Show all posts
Showing posts with label ERP. Show all posts
Wednesday, March 4, 2009
Saturday, February 14, 2009
Saturday, January 12, 2008
The Road ahead...
New career opportunities are born every day especially in the technology and IT sector. You might come across a job offer and have absolutely no idea what it is exactly referring to and what it needs to be there. So is the case with ERP Jobs. Did you know more than 90% of ERP consultants come from non-IT background !
ERP is an information system that integrates all manufacturing and related applications for an entire enterprise into one computer system. ERP runs off a single database, enabling various departments to share information and communicate with each other. ERP systems comprise function-specific modules designed to interact with the other modules.
For more on ERP Basics, please check this -->
http://applearn.blogspot.com/2007/11/understanding-erp-right-from-very.html
If you are already working in industry with some domain experience or If you are fresh out of college and wish to pursue a career becoming an ERP consultant - its a great idea ! Besides being financially rewarding, it offers you with an opportunity to work on evolving technologies and work on best practices
What next?
1. Learn the basics of ERP
2. Discuss with an expert and select 4-5 modules to learn and focus on
3. Select the right trainer
4. Read, think of scenarios and options available
For more on ERP Job profiles, please check this -->
http://applearn.blogspot.com/2007/12/erp-jobs-opportunities-for-beginners.html
Questions? Doubts? Mail me on applearn@gmail.com
Sunday, December 9, 2007
ERP Jobs opportunities - for beginners
ERP is a skill, which was once mastered by reluctant learners, who now command premium price in the recruitment market. Today, recognising the potential of ERP training, professionals from as diverse streams as sales and marketing, human resources, manufacturing, production planning, supply chain management, quality, projects ...are ready to invest to get themselves trained for a much sought after global career.
The job opportunities are in the areas of Functional Consultant, Technical Consultant and in ERP Sales with well-defined growth path at different levels:
Associate - Technical Consultant / Functional Consultant
Technical Consultant / Functional Consultant
Associate Sr. Technical Consultant / Sr. Functional Consultant
Technical Consultant / Sr. Functional Consultant
Asst. Project Manager/Project Manager
Sr. Project Manager/ Chief Technical lead/ Chief Functional Lead
For Sales: Right from Sales Consultant, Business Development Manager to Head-Sales which all need a reasonable indepth knowledge on ERP product you sell to interact with the clients.
Obviously an extensive growth in new ERP installations creates tremendous employment opportunities. Companies that have used ERP achieved significant savings in payroll expenses by terminating large number of clerks, accountants and technicians. However, these firms require many "new breed" employees to support and run ERP - people who know business processes and have good technical programming skills. They need even more consultants to install, customize, and roll out new releases of ERP packages.
Any questions? Email me :)
The job opportunities are in the areas of Functional Consultant, Technical Consultant and in ERP Sales with well-defined growth path at different levels:
Associate - Technical Consultant / Functional Consultant
Technical Consultant / Functional Consultant
Associate Sr. Technical Consultant / Sr. Functional Consultant
Technical Consultant / Sr. Functional Consultant
Asst. Project Manager/Project Manager
Sr. Project Manager/ Chief Technical lead/ Chief Functional Lead
For Sales: Right from Sales Consultant, Business Development Manager to Head-Sales which all need a reasonable indepth knowledge on ERP product you sell to interact with the clients.
Obviously an extensive growth in new ERP installations creates tremendous employment opportunities. Companies that have used ERP achieved significant savings in payroll expenses by terminating large number of clerks, accountants and technicians. However, these firms require many "new breed" employees to support and run ERP - people who know business processes and have good technical programming skills. They need even more consultants to install, customize, and roll out new releases of ERP packages.
Any questions? Email me :)
Wednesday, November 21, 2007
Understanding ERP - Right from the very basics
Would be a good idea to understand with a simple example..
Suppose you are running a small grocery shop. So the typical operation as a shop owner is you basically buy groceries from some big seller and stock it in your shop. Now people come to your shop for day-to-day needs and buy stuff from your shop at a slightly higher price than what you originally bought and stocked it in your shop.
Ocassionally you may not be carrying items or run out of stock that people ask for so you make a note of it and promise the person to come back tomorrow and they will get their item. So far so good, now lets name some entities before we proceed and things get complicated. The big seller from whom you buy stock is called as Vendor, the people who come to your shop to buy things are known as customers, the stock in your shop is known as inventory.
So far we have identified few entities that play an active role in your day-to-day operations. As time goes by, your business expands and now you take orders over the phone and provide service to deliver the items to your customers, so you hire people to help you out in maintaining the inventory, do the delivery part and all the necessary stuff to keep the business running smoothly. The people you hire are known as employees.
So in this small shop, you typically manage the bookkeeping activities by hand using a notepad or something similar. Now imagine the same setup on a larger scale where you have more than 10,000 customers, have more than 1000 vendors, have more than 1000employees and have a huge warehouse to maintain your inventory. Do you think you can manage all that information using pen and paper? Absolutely not possible! Agree?
To facilitate big businesses, companies like Oracle Corporation have created huge software known in the category of ERP (Enterprise Resource Planning) as Oracle Applications. Now coming to think of it, Oracle Applications is not one huge software, instead it is a collection of software known as modules that are integrated and talk to each other.
Now what is meant by integrated? First let us identify the modules by entities. For e.g Purchasing and Account Payables deal with the vendors since you typically purchase from vendors and eventually have to pay the dues. Oracle Purchasing handles all the requisitions and purchase orders to the vendors whereas Oracle Accounts Payables handles all the payments to the vendors.
Similarly Oracle Inventory deals with the items you maintain in stock, warehouse etc. Dealing with customers is handled collectively with the help of Oracle Receivables and Oracle Order Management. Order Management helps you collect all the information that your customer is ordering over the phone or webstore etc whereas Receivables help you collect the money for the orders that are delivered to the customers.
Now who maintains the paychecks, benefits of the 1000 employees? It is managed by Oracle Human Resources. So by now you might have got an idea - for each logical function there is a separate module that helps to execute and maintain that function.
So all the individual functions are being taken care but how do I know if I am making profit or loss? That’s where integration comes into play. There is another module known as Oracle General Ledger. This module receives information from all the different transaction modules and summarizes them in order to help you create profit and loss statements, reports for paying Taxes etc.
To simplify, when you pay your employees that payment is reported back to General Ledgers as cost i.e money going out, when you purchase inventory items the information is transferred to GL as money going out, and so is the case when you pay your vendors. Similarly when you receive items in your inventory it is transferred to GL as money (i.e. a form of money) coming in, when your customer sends payment it is transfered to GL as money coming in. So all the different transaction modules report to GL (General Ledger) as either “money going in” or “money going out”, the net result will tell you if you are making a profit or loss.
All the equipment, shops, warehouses, computers can be termed as Assets and they are managed by Oracle Fixed Assets. Initially Oracle Applications started as bunch of modules and as time passed by they added new modules for different and new functions growing to meet the needs of today's global business corporations
(Source: http://www.appsbi.com/2006/05/26/what-is-oracle-apps-erp)
Suppose you are running a small grocery shop. So the typical operation as a shop owner is you basically buy groceries from some big seller and stock it in your shop. Now people come to your shop for day-to-day needs and buy stuff from your shop at a slightly higher price than what you originally bought and stocked it in your shop.
Ocassionally you may not be carrying items or run out of stock that people ask for so you make a note of it and promise the person to come back tomorrow and they will get their item. So far so good, now lets name some entities before we proceed and things get complicated. The big seller from whom you buy stock is called as Vendor, the people who come to your shop to buy things are known as customers, the stock in your shop is known as inventory.
So far we have identified few entities that play an active role in your day-to-day operations. As time goes by, your business expands and now you take orders over the phone and provide service to deliver the items to your customers, so you hire people to help you out in maintaining the inventory, do the delivery part and all the necessary stuff to keep the business running smoothly. The people you hire are known as employees.
So in this small shop, you typically manage the bookkeeping activities by hand using a notepad or something similar. Now imagine the same setup on a larger scale where you have more than 10,000 customers, have more than 1000 vendors, have more than 1000employees and have a huge warehouse to maintain your inventory. Do you think you can manage all that information using pen and paper? Absolutely not possible! Agree?
To facilitate big businesses, companies like Oracle Corporation have created huge software known in the category of ERP (Enterprise Resource Planning) as Oracle Applications. Now coming to think of it, Oracle Applications is not one huge software, instead it is a collection of software known as modules that are integrated and talk to each other.
Now what is meant by integrated? First let us identify the modules by entities. For e.g Purchasing and Account Payables deal with the vendors since you typically purchase from vendors and eventually have to pay the dues. Oracle Purchasing handles all the requisitions and purchase orders to the vendors whereas Oracle Accounts Payables handles all the payments to the vendors.
Similarly Oracle Inventory deals with the items you maintain in stock, warehouse etc. Dealing with customers is handled collectively with the help of Oracle Receivables and Oracle Order Management. Order Management helps you collect all the information that your customer is ordering over the phone or webstore etc whereas Receivables help you collect the money for the orders that are delivered to the customers.
Now who maintains the paychecks, benefits of the 1000 employees? It is managed by Oracle Human Resources. So by now you might have got an idea - for each logical function there is a separate module that helps to execute and maintain that function.
So all the individual functions are being taken care but how do I know if I am making profit or loss? That’s where integration comes into play. There is another module known as Oracle General Ledger. This module receives information from all the different transaction modules and summarizes them in order to help you create profit and loss statements, reports for paying Taxes etc.
To simplify, when you pay your employees that payment is reported back to General Ledgers as cost i.e money going out, when you purchase inventory items the information is transferred to GL as money going out, and so is the case when you pay your vendors. Similarly when you receive items in your inventory it is transferred to GL as money (i.e. a form of money) coming in, when your customer sends payment it is transfered to GL as money coming in. So all the different transaction modules report to GL (General Ledger) as either “money going in” or “money going out”, the net result will tell you if you are making a profit or loss.
All the equipment, shops, warehouses, computers can be termed as Assets and they are managed by Oracle Fixed Assets. Initially Oracle Applications started as bunch of modules and as time passed by they added new modules for different and new functions growing to meet the needs of today's global business corporations
(Source: http://www.appsbi.com/2006/05/26/what-is-oracle-apps-erp)
Friday, November 9, 2007
ERP - Success and failures for ERP implementations
Introduction
Enterprise Resource Planning attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments' particular needs.
Enterprise Resource Planning (ERP) predicts and balances, demand and supply. It is an
enterprise-wide set of forecasting, planning, and scheduling tools, which:
· links customers and suppliers into a complete supply chain,
· employs proven processes for decision-making, and
· co-ordinates sales, marketing, operations, logistics, purchasing, finance, product
development, and human resources
Benefits of ERP
ERP automates the tasks necessary to perform a business process—such as order fulfillment, which involves taking an order from a customer, shipping it and billing for it.
With ERP, when a customer service representative takes an order, he or she has all the necessary information—the customer's credit rating and order history, the company's inventory levels and the shipping dock's trucking schedule. Everyone else in the company can view the same information and has access to the single database that holds the order.
When one department finishes with the order, it is automatically routed via the ERP
system to the next department. To find out where the order is at any point, one need only log in to the system. The goals of ERP include high levels of customer service, productivity and cost reduction, and it provides the foundation for effective supply chain management and ecommerce.
It does it by developing plans and schedules so that the right resources -
manpower, materials, machinery, and money – are available in the right amount when
needed. ERP helps in co-ordinating the individual elements of the overall set of business processes. Many companies have experienced, as a direct result of ERP dramatic increases in responsiveness, productivity, on-time shipments and sales, along with substantial decreases in purchase costs, quality problems, and inventories.
ERP is the vehicle for getting valid plans and schedules, but not just of materials and production. It also means valid schedules of shipments to customers, of personnel and equipment requirements, of required product development resources, and of cash flow and profit.
Critical Success Factors:
The old saying 'the devil is in the details' is certainly a truism in ERP implementation. Building a solid implementation plan is critical for success. We need to plan our deployment in logical, manageable chunks to minimize risks and maximize acceptance of the new solution.
We might do so in a 'big bang' or use a ‘phased approach’. We need to decide which
business units will be implemented first and how will the application modules be
deployed. The IT infrastructure has to grow with our needs and we may need to integrate with legacy applications. We will need to keep the project focused on business results, and assess the results after the implementation.
An ERP system is not only the integration of various organisation processes. Any system has to possess few key characteristics to qualify for a true ERP solution. These features are:
1) Flexibility: An ERP system should be flexible to respond to the changing needs of an enterprise. The client server technology enables ERP to run across various data base back ends through Open Data Base Connectivity (ODBC).
2) Modular & Open: ERP system has to have an open system architecture. This means
that any module can be interfaced or detached whenever required without affecting
the other modules. It should support multiple hardware platforms for the companies
having heterogeneous collection of systems. It must support some third party add-ons
also.
3) Comprehensive: It should be able to support variety of organisational functions and must be suitable for a wide range of business organisations.
4) Beyond The Company: It should not be confined to the organisational boundaries,
rather support the on-line connectivity to the other business entities of the
organisation.
5) Best Business Practices: It must have a collection of the best business processes
applicable worldwide.
6) Simulation of Reality: Last but not the least, it must simulate the reality of business processes on the computers. In no way it should have the control beyond the business processes and it must be able to assign accountabilities to the users controlling the system.
Since, ERP gets the best out of the available resources, it is very important to reengineer the business processes before going for an ERP implementation.
Reasons for failures of ERP implementation
People don't like to change, and ERP asks them to change how they do their jobs. That is why the value of ERP is so hard to pin down. The software is less important than the changes companies make in the ways they do business.
If we use ERP to improve the ways people take orders, manufacture goods, ship them and bill for them, we will see value from the software; else the new software could slow us down by simply replacing the old software that everyone knew with new software that no one does. Common reasons for failure of ERP projects include:
1) Long period: ERP implementations usually run for a year or more. This long period
can be a pain for the company that is investing huge sums of money. But this should not be seen as a drawback as all the effort that is invested is for improving the business of the company itself.
2) Budget: A few oversights in the budgeting and planning stage can send ERP costs
spiraling out of control faster than oversights in planning almost any other information system undertaking.
3) Business Processes: The most common reason that companies walk away from
multimillion-dollar ERP projects is that they discover the software does not support one of their important business processes. At that point there are two things they can do:
i) They can change the business process to accommodate the software, which will mean
deep changes in long-established ways of doing business (that often provide competitive advantage) and shake up important people's roles and responsibilities.
Or
ii) They can modify the software to fit the process. This may 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.
What are the hidden costs of ERP?
1. Training
Training expenses are high because workers almost invariably have to learn a new set of processes, not just a new software interface.
2. Integration and testing
Testing is done by running a real purchase order through the system, from order entry
through shipping and receipt of payment with the participation of the employees who will eventually do those jobs. Add-ons add to the integration costs of ERP
3. Customization:Tailor-Made Business Fit
The customizations can affect every module of the ERP system because they are all so
tightly linked together. It is like playing with fire.
4. Post-ERP depression
ERP systems often wreak cause havoc in the companies that install them. In a recent
Deloitte Consulting survey of 64 Fortune 500 companies, one in four admitted that they suffered a drop in performance when their ERP system went live. The true percentage is undoubtedly much higher. The most common reason for the performance problems is that everything looks and works differently from the way it did before.
5. Waiting for ROI (Return On Investments)
The company expects to gain value from the application as soon as it is installed but it does take some time for the fruits to ripen.
How to make a successful ERP implementation?
· Choosing the right software vendor: If two vendors offer a function required in a
specific industry segment, and one specializes in deploying it in that segment while
the other does not, the difference can be dramatic. Here the benefits that are offered need to be considered along with cost and risk.
· Analyzing the Risks: Even the most simple effort probably has only a 90 percent
chance of success - i.e., the project is on-time, within budget, and attains all the
planned benefits. As projects increase in scope, the odds of achieving success
diminish rapidly. Implementation projects require companies to strike a balance
between the desire to satisfy everyone's functionality needs, and the need to keep
things simple enough to ensure success. A methodology will help ward off risk, but a
contingency plan still is absolutely necessary.
· Determine Company Intentions and Commitment: Examine why you wish to
undertake such a major project.
1. Is it to improve your already efficient and streamlined procedures?
2. Is it to speed workflow bottlenecks?
3. Is everything in disarray or do you just need to remove one or two bad apples?
4. Are you trying to get everything fixed at once?
· Be True to the Budget: The project should have a contingency budget. Most projects
should have a contingency of 10 percent on time - if all tasks go well, it will finish 10 percent early. Maintain pressure to control costs on all project tasks.
· Selecting proper technology: The tradeoff between stable, proven technology and
newer, state-of-the-art systems is one of the most critical decision points for the
project. While stable technology - one that has been around for several years - runs
the risk of being obsolete in the near future, newer technology may involve near-term
instability, which can lead to its own problems.
The key to successful implementation of an enterprise software solution is to apply
people, process, and product initiatives within a structured methodology framework.
When these elements are brought together and skillfully managed, companies can fully
expect to realize shorter time to production, measurable business benefits, and a rapid return on their technology investment.
Enterprise Resource Planning attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments' particular needs.
Enterprise Resource Planning (ERP) predicts and balances, demand and supply. It is an
enterprise-wide set of forecasting, planning, and scheduling tools, which:
· links customers and suppliers into a complete supply chain,
· employs proven processes for decision-making, and
· co-ordinates sales, marketing, operations, logistics, purchasing, finance, product
development, and human resources
Benefits of ERP
ERP automates the tasks necessary to perform a business process—such as order fulfillment, which involves taking an order from a customer, shipping it and billing for it.
With ERP, when a customer service representative takes an order, he or she has all the necessary information—the customer's credit rating and order history, the company's inventory levels and the shipping dock's trucking schedule. Everyone else in the company can view the same information and has access to the single database that holds the order.
When one department finishes with the order, it is automatically routed via the ERP
system to the next department. To find out where the order is at any point, one need only log in to the system. The goals of ERP include high levels of customer service, productivity and cost reduction, and it provides the foundation for effective supply chain management and ecommerce.
It does it by developing plans and schedules so that the right resources -
manpower, materials, machinery, and money – are available in the right amount when
needed. ERP helps in co-ordinating the individual elements of the overall set of business processes. Many companies have experienced, as a direct result of ERP dramatic increases in responsiveness, productivity, on-time shipments and sales, along with substantial decreases in purchase costs, quality problems, and inventories.
ERP is the vehicle for getting valid plans and schedules, but not just of materials and production. It also means valid schedules of shipments to customers, of personnel and equipment requirements, of required product development resources, and of cash flow and profit.
Critical Success Factors:
The old saying 'the devil is in the details' is certainly a truism in ERP implementation. Building a solid implementation plan is critical for success. We need to plan our deployment in logical, manageable chunks to minimize risks and maximize acceptance of the new solution.
We might do so in a 'big bang' or use a ‘phased approach’. We need to decide which
business units will be implemented first and how will the application modules be
deployed. The IT infrastructure has to grow with our needs and we may need to integrate with legacy applications. We will need to keep the project focused on business results, and assess the results after the implementation.
An ERP system is not only the integration of various organisation processes. Any system has to possess few key characteristics to qualify for a true ERP solution. These features are:
1) Flexibility: An ERP system should be flexible to respond to the changing needs of an enterprise. The client server technology enables ERP to run across various data base back ends through Open Data Base Connectivity (ODBC).
2) Modular & Open: ERP system has to have an open system architecture. This means
that any module can be interfaced or detached whenever required without affecting
the other modules. It should support multiple hardware platforms for the companies
having heterogeneous collection of systems. It must support some third party add-ons
also.
3) Comprehensive: It should be able to support variety of organisational functions and must be suitable for a wide range of business organisations.
4) Beyond The Company: It should not be confined to the organisational boundaries,
rather support the on-line connectivity to the other business entities of the
organisation.
5) Best Business Practices: It must have a collection of the best business processes
applicable worldwide.
6) Simulation of Reality: Last but not the least, it must simulate the reality of business processes on the computers. In no way it should have the control beyond the business processes and it must be able to assign accountabilities to the users controlling the system.
Since, ERP gets the best out of the available resources, it is very important to reengineer the business processes before going for an ERP implementation.
Reasons for failures of ERP implementation
People don't like to change, and ERP asks them to change how they do their jobs. That is why the value of ERP is so hard to pin down. The software is less important than the changes companies make in the ways they do business.
If we use ERP to improve the ways people take orders, manufacture goods, ship them and bill for them, we will see value from the software; else the new software could slow us down by simply replacing the old software that everyone knew with new software that no one does. Common reasons for failure of ERP projects include:
1) Long period: ERP implementations usually run for a year or more. This long period
can be a pain for the company that is investing huge sums of money. But this should not be seen as a drawback as all the effort that is invested is for improving the business of the company itself.
2) Budget: A few oversights in the budgeting and planning stage can send ERP costs
spiraling out of control faster than oversights in planning almost any other information system undertaking.
3) Business Processes: The most common reason that companies walk away from
multimillion-dollar ERP projects is that they discover the software does not support one of their important business processes. At that point there are two things they can do:
i) They can change the business process to accommodate the software, which will mean
deep changes in long-established ways of doing business (that often provide competitive advantage) and shake up important people's roles and responsibilities.
Or
ii) They can modify the software to fit the process. This may 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.
What are the hidden costs of ERP?
1. Training
Training expenses are high because workers almost invariably have to learn a new set of processes, not just a new software interface.
2. Integration and testing
Testing is done by running a real purchase order through the system, from order entry
through shipping and receipt of payment with the participation of the employees who will eventually do those jobs. Add-ons add to the integration costs of ERP
3. Customization:Tailor-Made Business Fit
The customizations can affect every module of the ERP system because they are all so
tightly linked together. It is like playing with fire.
4. Post-ERP depression
ERP systems often wreak cause havoc in the companies that install them. In a recent
Deloitte Consulting survey of 64 Fortune 500 companies, one in four admitted that they suffered a drop in performance when their ERP system went live. The true percentage is undoubtedly much higher. The most common reason for the performance problems is that everything looks and works differently from the way it did before.
5. Waiting for ROI (Return On Investments)
The company expects to gain value from the application as soon as it is installed but it does take some time for the fruits to ripen.
How to make a successful ERP implementation?
· Choosing the right software vendor: If two vendors offer a function required in a
specific industry segment, and one specializes in deploying it in that segment while
the other does not, the difference can be dramatic. Here the benefits that are offered need to be considered along with cost and risk.
· Analyzing the Risks: Even the most simple effort probably has only a 90 percent
chance of success - i.e., the project is on-time, within budget, and attains all the
planned benefits. As projects increase in scope, the odds of achieving success
diminish rapidly. Implementation projects require companies to strike a balance
between the desire to satisfy everyone's functionality needs, and the need to keep
things simple enough to ensure success. A methodology will help ward off risk, but a
contingency plan still is absolutely necessary.
· Determine Company Intentions and Commitment: Examine why you wish to
undertake such a major project.
1. Is it to improve your already efficient and streamlined procedures?
2. Is it to speed workflow bottlenecks?
3. Is everything in disarray or do you just need to remove one or two bad apples?
4. Are you trying to get everything fixed at once?
· Be True to the Budget: The project should have a contingency budget. Most projects
should have a contingency of 10 percent on time - if all tasks go well, it will finish 10 percent early. Maintain pressure to control costs on all project tasks.
· Selecting proper technology: The tradeoff between stable, proven technology and
newer, state-of-the-art systems is one of the most critical decision points for the
project. While stable technology - one that has been around for several years - runs
the risk of being obsolete in the near future, newer technology may involve near-term
instability, which can lead to its own problems.
The key to successful implementation of an enterprise software solution is to apply
people, process, and product initiatives within a structured methodology framework.
When these elements are brought together and skillfully managed, companies can fully
expect to realize shorter time to production, measurable business benefits, and a rapid return on their technology investment.
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