Information Systems in Management
Dr. Mamad Pourhosseini
Is Enterprise Resource Planning (ERP) Valuable System for The Companies Word Count: 3,311
21 June 2012
This paper critically analyses Enterprise Resource Planning (ERP) and the various tools and platforms it offers to the enterprises. This report looks at ERP as strategic management tool that ensures competitive advantage ones adopted. This paper will explore scholarly articles underling the implementations and procedures of the system. Together with that, it will evaluate the cost factors, ERP phases, describing ERP in legal and ethical terms, together with evaluation of the right needs for the right size of the business and the different types of ERP platforms. Then the paper will explain the theoretical background, defining ERP, competitive advantage, The Sarbanes-Oxley Act, strategic planning and connecting ERP to Moor’s law. A hypothesis will be formed to proof that ERP is a tool of strategic management which ensures competitive advantage. A discussion will then be developed, leading to a conclusion, which will state that ERP systems are beneficial for enterprises, continuing to develop and will have even greater value in the future.
The purpose of this paper is to critically analyse and evaluate the purpose of Enterprise Resource Planning (ERP) systems. The report is a summary and analyze of different researches and hypothesis of ERP system with the objectivity to make meaningful and pragmatic conclusions about ERP software initiatives. Nowadays, data is one of the most important assets that a company can possess. In order to protect these assets, different companies are trying to implement different information system technologies that support the information flow, while protecting information leek. Enterprise Resource Planning (ERP) systems help enterprises coordinate the information flow, which transforms the physical flow of goods from raw materials to finished goods. It is a structured approach that optimizes company’s internal value chain (Appendix, Figure 1). The system makes it possible for the companies to logically transmit and share data in an integrated framework. Although the system has some pitfalls, it is a reliable tool of strategic management, enabling organizations to gather competitive advantage. This paper will also represent different perspectives of ERP, examining successes as well as limitations of the process. This study is also showing the effect ERP has on some organizations. Concepts will be developed, explaining their meaning in ERP terms. SAP and ORACLE platforms will be also discussed evaluating their use, similarities and differences. Thus, this paper will give explanation why corporations should fully utilize ERP independently of the price of the package by using ERP as a strategic management tool gaining competitive advantage.
III. Literature Review
Implementation and Procedures
Enterprise Resource Planning (ERP) is important to be studied in terms of implementation and functionality. Panorama Consultancy Report on ERP analysis explains how the software works, as well as develops tested tools that worked in different direction for different companies and types of industries. Company’s research was made based on data from 246 participants from 64 countries in the communications, wholesale trade, finance, and insurance and real estate industries. (Appendix, Figure 2) A process of selecting the package that best fits the need of the business and its objective is essential part of the implementation of the software. Panorama’s research for 2012, shows that 81% are overally satisfied with the software selection. However, the level of satisfaction of specific ERP functions shows dramatic decrease. Low level is also recorded in all companies in terms of flexibility to change to software, the ease of reporting and user documentation provided by the...