Enterprise Resource Planning (EPR) System
Table of Contents
1.0 Executive Summary
With the society develops, the demand of the company’s economic growth is rising rapidly. Improving efficiency is no longer only for production, but also the company’s data processing. Companies with various sizes are seeking ways to increase their profits. Yet they end up finding out that it is hard to process plenty of information during their business. Enterprise resource planning (ERP) system upstarted overnight, seizing up the opportunity to show off itself. It can “merge a firm’s data, information flows and business processed into a single package” (Lengnick- Hall, Cynthia A., Lengnick Halla, Mark L. and Abdinour, Sue, 2004). It is capable of gaining the bargaining power of both suppliers and customers. Moreover, it has its own special capability to promote the company to win rivalry among existing competitors. However, in order to implement the ERP system correctly, some recommendations need to be taken by the company.
ERP system was first introduced by Gartner Group Inc., one of the most famous world’s leading information technology research and advisory company in US, as an application software in 1990. Later on, ERP system was surprisingly accepted by enterprises from all over the world overnight. Nowadays, it is developed and considered as one of the most important enterprise management theories, which is established on the advanced information technology, providing a decision-making platform for management and staff by using a systematic management idea. “ERP system integrates both internal and external information flows used by the organization within a single, comprehensive solution” (Green Beacon). It involves the practical system to come up a six core ideas, such as Engineering Data Management, Production Management, Project Management, Customer Service Management, Materials Management and Financial Management.
Making full use of ERP system will be able to settle the problems of the Porter Five Forces Analysis, which is a frame work for industry analysis and business strategy development put forwarded by Michael E. Porter of Harvard Business School in 1979. In the Five Force Analysis, Michael Porter indicated the following five forces, “Threat of new entrants, Threat of substitute products or services, Bargaining power of customers (buyers), Bargaining power of suppliers and Intensity of competitive rivalry” (Michael E. Porter, 1979). However, the ERP system is capable of providing good ways for increasing the bargaining power of customers (buyers) and suppliers by using its competitive advantages and gain victory of rivalry among existing competitors. Later on three examples will be presented to show how ERP system gets the upper hand of the three forces raised by Michael Porter.
Last but not least, recommendations for operating system are necessary since they would allow the company to utilize the ERP system perfectly by rational analysis before implementing ERP system to set a practical target, training for staff in the very first place once ERP system is confirmed to be used and keep testing in the final stage before make it go-live....
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Ann Zimmerman (2010)
Fishman, C. (2006). The Wal-Mart effect: how the world 's most powerful company really works-- and how it 's transforming the American economy. New York: Penguin Press.
Green Beacon Solutions (2013)
John Teresko (2004). E-Business – E-Collaboration. http://www.industryweek.com/information-technology/e-business-e-collaboration [Accessed 11/12/2013]
Reed Smith, Jeffrey Yost (2008). Electronic Data Interchange and Enterprise Resource Planning Technology in Supply Chain Contracts. http://home.kelley.iupui.edu/jrsmith2/res/supplychain1108.pdf [Accessed 11/12/2013]
Retail Enterprise Resource Planning
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