A Brief Note On Enterprise Resource Planning

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Enterprise Resource Planning as ERP is a system with all the business related functions and designed to serve the needs of each different department within an enterprise. A well-implemented and appropriate ERP system can create significant efficiencies across the business, resulting in timely business information, better customer relationships, a more cost effective supply chain, improved internal process and increased profitability. To Analyze ERP system in an enterprise, the architecture of enterprise systems should be determined in the first place. Therefore, two architectures have been suggested, Three-tier Client-Server architecture and Service-Oriented architecture. (Magal S and Word J, 2012) As three-tier Client-Server architecture, it costs too much on hardware and software to support a great number of users within an enterprise. In 2000s, Service-Oriented architecture concept has been introduced to integrate many different Client- Server systems in new and valuable ways. Because this new architecture is based on web browser, more and more small and medium companies merge their business to ERP systems and taste benefit by using it. Nowadays, ERP systems become the major business systems in global wide.

In the meantime, issues pop up as well. According to a study conducted by Deloitte Consulting, It shows the biggest challenge before and after ERP implementation is not the technology, but “People”. (Alexis L, 2008) And “People” means employees, management, implementation team, consultant and vendors. At every stage, the companies must work harder to manage change, secure purchase, communicate with and educate their employees. Only if all users of an ERP system are trained properly, they will understand what is going to be achieved in the new systems. Otherwise, they will not accept to use it or use it incorrectly. Then, the benefits of using an ERP system will not be fully co-operative, which can result in the failure of an ERP system. In this paper, we focus on the main people related issues, which are change management, internal staff adequacy, training, employee relocation and retraining, consultants, management support and analyze the potential solutions for implement better ERP systems. Also, the real scenarios will be the best evidence to prove the solutions.

First of all, it is important to introduce Change Management to ERP systems, because the ERP system will definitely change the way companies do business and the way people work. The job profile of employees will change, some jobs will no longer be required while new jobs will be created, the way in which the organization functions will change, the planning, forecasting and decision-making capabilities will improve, information integration will occur, manage processes will be automated, and so on. But, when implementing an ERP system, top management commonly faces an unwanted attitude from potential users for one reason or another, they resist the implementation process. According to Hawking (2004), many companies struggle during the implementation phase due to the underestimation of the change process. Nah (2001) referred that the employees are able to make a success, or a failure, or neutralize complex systems such as ERPs.AL Mashari and Zairi (2000) report on failure which occurs due to the employees’ resistance to change. Therefore, the core issue is the managing people.

Generally, the company management people take the responsibility to design and distribute job types and positions to employees. Once the ERP software implemented, the whole process will change and some long term positions will not exist anymore, that means employees may have to work in other departments or be treated as redundant. This is what the primary change occurs due to the ERP implementation. Also, this dramatic change always runs through all the departments in a company. Therefore, employees’ attitude has to be positive as well. To fulfill new positions requirement in
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