Erp Systems

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Minicase 1. ERP helps productivity at Northern Digital Inc.

1. For a small company like NDI, why is an ERP better than SCM applications? ERP’s major objective is to integrate all departments and functional information flows across a company onto a single computer system that can serve all of the enterprise’s needs while SCM software focuses on planning, optimization and decision-making processes in segments of the supply chain. ERP is also a cost saving application as it can be leased (in our case NDI took it from Intuitive Manufacturing systems). The ease of ERP implementation and use is also very important in comparison with SCM.

2. Identify the supply chain segments that the ERP supports. ERP supports inventory management that helped to double inventory turns; order cycle, which has reduced since the implementation of ERP; production control, that had a direct impact on customer delivery; planning system, that improved significantly after using ERP and positively influenced labor and materials.

3. Relate this case to Porter’s value chain and to its competitive model. Show the ERP’s contribution. Activities in Porter’s value chain model can be divided into 2 parts: primary and support activities. Primary activities involve purchase of materials, the processing of materials into products, and delivery of products to customers. There are five primary activities: inbound logistics (inputs), operations, outbound logistics, marketing and sales, services. The suppliers provide inputs necessary to the firm and their value chains. As NDI is a supplier of 3D/6D measurement products, it stays at the first step of value chain. That’s why the ERP contribution is significant in this case as it helps the company to be successful at the first stage of supply chain, which is very important, and to influence positively other stages and to help company to keep its competitive position.

4. Enter and report on the capabilities of the company’s ERP...
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