Topics: Enterprise resource planning, Enterprise application integration, Data management Pages: 54 (8664 words) Published: September 23, 2014

Meeting 2
ERP: a brief history – Jacobs & Weston
ERP = framework for organizing, defining, and standardizing business processes to effectively plan and control and org. so that the org. can use internal knowledge for external advantage ERP development (beyond MRP = manufacturing resource planning) driven by need for stronger integration between functional enterprise silos (1970s-1980s) 1960s: early computers, reorder point (ROP) systems and early material requirements planning (MRP) Competitive focus = costs

Product-focused manufacturing
High-volume production
Magnetic tape = only storage medium
One-dimensional, but manufacturing = two-dimensional
Availability of random access memory made MRP possible
1970s: MRP and computer hardware and software developments
Competitive focus = (target-) marketing, production integration and planning Ever faster and higher capacity disk (random access) storage Integration between forecasting, master scheduling, procurement and shop floor control MRP II = manufacturing resource planning

Mid 70s: birth of major software vendors (later key ERP vendors) SAP

1975: IBM’s manufacturing management and account systems (MMAS) = precursor to ERP Synchronization of new software applications with release of new hardware systems 1980s: MRP II
Competitive focus = quality  need for process control
Idea of integrated software packages to replace several stand-alone systems UNIX operating system offered possibility of real-time capture of transactions  better decision support Oracle: SQL database system  software could be run on computers from different vendors (flexibility) Integration of information in a consistent, effective manner across the enterprise  ERP foundation 1990s: MRP II and early ERP systems

Dramatic growth of ERP software and systems due to anticipated year 2000 (Y2K) problem  ERP as one way to address needed fixes to legacy system software that was not Y2K compliant Trend: Industry consolidation

2000s: software vendor consolidation
2000-2002: pressure to downsize on software companies
One business growth option = acquisitions and mergers
E.g. PeopleSoft/J.D. Edwards merger
Complementary software products
Little overlap in software offerings
More complete software portfolio
Left industry with two majors players (Oracle and SAP), but with software capabilities of original 5 players The future of ERP
ERP systems = mature
Focus: easy configuration
Short implementation cycles
Medium and large projects: still project management issues
Tailored ERP software packages
Niche markets, niche products & vendors
“push” information based on user-defined interest areas
Intelligent systems

Building Enterprise Integration Through ERP Systems – Kien & Lian Enterprise integration = the process of achieving unity of effort among the various subsystems in the accomplishment of org. tasks Tight coordination and cooperation

Dynamic concept  continuous management
ERP systems = the tool to enable integration
Packaged software solutions that integrate all business processes and functions Single IT architecture
High Differentiation and High Integration
Business growth  organizations get more complex business strategy: differentiation of groups of employees / departments along functional, product & geographic lines Disparate work flows
Organizational boundaries
Regulatory differences
Synergies, but also mutual vulnerability in place
Need for an integrated management approach over these units to capitalize on deepening competences Optimal = high level of differentiation & dynamic integration (first makes the latter more difficult) Understanding Enterprise Integration

Conceptualized integration beyond functional units
E.g. Social, knowledge & emotional integration + standardized IT infrastructure Synthesizing and decomposing processes into more manageable forms Enterprise integration at the strategic level
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