ERP Application Paper

Submitted By dwolff12
Words: 3367
Pages: 14

Derek Wolff
BUS 771
ERP Final Application Paper

Enterprise Resource Planning (ERP) systems are rapidly becoming more and more common in today’s industries, in fact you would be hard bent to try and find any sizable company that is not using some form of ERP. Companies are implementing ERP systems to help them become more efficient in their everyday processes in turn making them more lean and profitable as well as being more reliable to their customers. These companies set these goals of the ERP system but they will be faced with many challenges along the way and will require a strong project manager or project management team to overcome these obstacles and continue to be successful. This paper will cover the business goals that most companies set when deciding to implement and ERP system and how they achieved these goals. It will also dive into the main management issues that may arise throughout the implementation and the optimal responses and solutions to these issues. What are the reasons that ERP systems have become so popular? With the advancements in today’s technologies companies have to upgrade their current processes to remain competitive in the markets they are in; finding ways to cut cost wherever possible as well as increasing productivity and reliability is becoming more of metric that is measured for today’s companies. Companies are looking to new ERP systems to help them achieve this. Although there is typically a large upfront cost in implementing and ERP system, when successful they can really have a nice payoff. One of the main goals is for the company to increase profitability. Companies are looking to ERP for this to help them in streamlining there process flow. By automating the process, the companies will see a reduction in the time and labor spent to achieve the same end result. Not only will automating the process help in streamlining the process flow, it will also reduce human error in a lot of factors that will in turn increase the reliability to the customer. Also a goal leading back to maximizing profitability, it is stated in an article listing the top goals and reasons companies implement ERP is to maximize their growth rate (Khan). The company may be limited by their legacy ERP system or lack of a system at all and the growth of the company can be limited by the amount of data they can accurately process and processes they can accurately manage without hindering the integrity of the business of the product. With an ERP system that has been properly selected this is no longer the bottleneck of the company’s growth and can actually grow with the company. Khan also stated that another leading reason companies are implementing an ERP system is strictly a metric measurement and data organization tool. The company most likely already has the goal of maximizing profitability but has had no way to really measure their strong suits and weaknesses. With an ERP system these metrics can be integrated and measured throughout the entire enterprise. Trying to reach all of the goals can be difficult and there are many challenges that are needed to overcome. These managerial issues can be the death of a successful ERP implementation. Below are a couple main issues that arise across a wide range of ERP Implementations. Difficulty in finding a compromise between the way the company would like to operate and the way the ERP system will allow the company to operate is an ongoing battle. The decision to configure your system vs customize your system is an ongoing controversy in the ERP world. This decision can be very difficult for the project management team to make correctly. An article from the Harvard Business Review stated that the customization of an ERP system is a dangerous game and should only be done if absolutely necessary. This is especially true if global enterprise resource planning is implemented. Due to the sensitive nature the company name was left out of the article,