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CUSTOMISED ERP SOLUTIONS

WHY SHOULD WE USE ERP?

ERP provides an integrated and continuously updated view of core business processes using common databases maintained by a database management system. ERP systems track business resources cash, raw materials, production capacity and the status of business commitments: orders, purchase orders, and payroll. The applications share data across various departments (manufacturing, purchasing, sales, accounting, etc.).ERP facilitates information flow between all business functions and manages connections to outside stakeholders.

  FUNCTIONAL AREAS

An ERP system covers the following common functional areas. In many ERP systems, these are called and grouped together as ERP modules:

❖    Financial accounting: general ledger, fixed assets, payables including vouchering, matching and payment, receivables and collections, cash management, financial consolidation

❖    Management accounting: budgeting, costing, cost management, activity based costing

❖    Human resources: recruiting, training, rostering, payroll, benefits, retirement and pension plans, diversity management, retirement, separation.

❖    Manufacturing: engineering, bill of materials, work orders, scheduling, capacity, workflow management, quality control, manufacturing process, manufacturing projects, manufacturing flow, product life cycle management

❖    Order processing: order to cash, order entry, credit checking, pricing, available to promise, inventory, shipping, sales analysis and reporting, sales commissioning

❖    Supply chain management: supply chain planning, supplier scheduling, product configurator, order to cash, purchasing, inventory, claim processing, warehousing (receiving, putaway, picking and packing)

❖    Project management: project planning, resource planning, project costing, work breakdown structure, billing, time and expense, performance units, activity management

❖    Customer relationship management (CRM): sales and marketing, commissions, service, customer contact, call center support – CRM systems are not always considered part of ERP systems but rather business support systems (BSS)

❖    Data services: various "self–service" interfaces for customers, suppliers and/or employees

❖    Management of school and educational institutes.

    CUSTOMIZATION IN ERP

 ERP systems are theoretically based on industry best practices, and their makers intend that organizations deploy them "as is”. ERP vendors do offer customers configuration options that let organizations incorporate their own business rules, but gaps in features often remain even after configuration is complete.

ERP customers have several options to reconcile feature gaps, each with their own pros/cons. Technical solutions include rewriting part of the delivered software, writing a homegrown module to work within the ERP system, or interfacing to an external system. These three options constitute varying degrees of system customization—with the first being the most invasive and costly to maintain. Alternatively, there are non-technical options such as changing business practices or organizational policies to better match the delivered ERP feature set.

   Key differences between customization and configuration include:

●          Customization is always optional, whereas the software must always be configured before use (e.g., setting up cost/profit center structures, organizational trees, purchase approval rules, etc.).

●          The software is designed to handle various configurations and behaves predictably in any allowed configuration.

●          The effect of configuration changes on system behavior and performance is predictable and is the responsibility of the ERP vendor. The effect of customization is less predictable. It is the customer's responsibility, and increases testing activities.

●          Configuration changes survive upgrades to new software versions. Some customizations survive upgrades, though they require retesting. Other customizations (e.g., those

involving changes to fundamental data structures) are overwritten during upgrades and must be re-implemented.

Customization advantages include that it:

●          Improves user acceptance.

●          Offers the potential to obtain competitive advantage vis-à-vis companies using only standard features.

Customization disadvantages include that it may:

●          Increase time and resources required to implement and maintain.

●          Hinder seamless interfacing/integration between suppliers and customers due to the differences between systems.

●          Limit the company's ability to upgrade the ERP software in the future.

●          Create overreliance on customization, undermining the principles of ERP as a standardizing software platform.

  CONCLUSION

 There are a host of ERP solutions today that are built specifically for certain industries and focus on improving core functionalities and processes of, for example, manufacturing, distribution or engineering businesses. This means you can run each

part of your business effectively and have all your data in one place. As industries have become more specialised, industry-tailored systems have been developed based on industry best practices to fit your business needs and ensure your operation runs optimally.So choose a custom-made ERP solutions tailored for your line of industry.

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