Evaluating a Business Performance in the context of Enterprise Resource Planning

Abstract

ERP (Enterprise Resource Planning) is a development of information technology. It is a management information system, which integrates into the departments and core functions of the organization to increase the coordination among the departments. It keeps all the information centrally and anyone can retrieve the information whenever required. Increase coordination results in effective decision making by the departments. ERP provides organizations a competitive edge over their competitors as it helps in reducing the costs, improving processes and increasing the efficiency of the company which leads to overall achievement of the objectives and increased profitability. All these factors account for the success of businesses which employs ERP.

Table of Contents

Introduction1

Problem Statement2

Aims & Objectives2

Literature Review3

ERP3

Reason for investment4

Technical reasons for investment in ERP4

Business Reasons4

ERP Failure4

Characteristics of ERP6

ERP & Standardization8

Proposed Research Method8

Anticipated Outcomes9

Evaluating a Business Performance in the context of Enterprise Resource Planning

Introduction

ERP (Enterprise Resource Planning) program put together all the important business applications. ERP is introduced in organizations which are suffering from major problems with respect to the processes they have implemented. ERP helps in efficient decision making across the departments. ERP is integrative in nature; as a result all the departments in the organization come on a single platform from where they share the required information among other departments. This helps in decision making as all the departments have full knowledge of other departments, thus decision making becomes mutual rather than independent. Mutual decision making helps in achievement of organizational goals because all the departments of the organization must work together to achieve the goals. Goal achievement becomes difficult when departments are working in separate direction and no coordination exists between them. When an organization lacks coordination it becomes inevitable that long term goals will not be met.

ERP development process is entirely different from the conventional processes. ERP development process has 6 stages; planning, requirement analysis, design implementation and maintenance. Planning assesses the need for implementation of ERP in the organization and requires organization to produce justification for the implementation. This is very important because clarity must be provided in all aspects. Requirement analysis is important because businesses need to indentify the segments which for which ERP will be implemented. ERP is a single system which supports major functions of the organization. ERP utilizes information finance, production, sales and human resources. ERP enables managers to look for obvious factors concerning other department of the organization when taking any particular decisions. Decisions affect the whole organization, thus decision making process becomes more streamlined and effective. The information obtained internally and externally by ERP systems enables organization to plan and design effective strategies and control operations in the most effective way (Tripathi, 2008).

Problem Statement

“Evaluating a business performance in the context of Enterprise Resource Planning”

Problem statement defines the scope for evaluation of business performance of those businesses which have implemented ERP. Several factors will be considered while measuring the success of organizations which include successful integration, cost effective decisions, increased coordination, and level of ...