Business

Business environment has been changing over time, hence, creating a need for organizations to orient themselves with better tools in managing this change. The changes include, increased volumes of product output, larger number of employees, tracking thousands of customers among others. This is the time when organizations need to introduce Enterprise Resource Planning (ERP) to assist in making work easier (Kremzar and Wallace, 2001). The major function of an ERP system is to attempt to bring together all departments of the organization to look like one for the simple user (Shields, 2001).

There are back-end processes that are not visible to the users of this system. This system serves people in all departments. For example, people in accounting department are able to access modules that are relevant to them. This is the same across all other departments. In essence use of ERP implies there is a single database shared by all the departments. This is necessary to ensure that they share the information more easily.

System Functional Description and Application
ERP have different functionalities depending with who are the intended user of the system. Stephen Harwood (2003) intimates that, ERP has its roots in manufacturing, although it has evolved in a remarkably short time to address many other functions and sectors (p.1). The main functionality is to assist various business segments to see each other. There are however common functions that ERP can do.  Some of the major functionalities are

First, ERP plays a major role in integrating the organizations major functionalities. This means that the accounting, manufacturing, marketing, finance and others are easily integrated with one another. This allows them to easily exchange information and give unified outcome (Shields, 2001).

Second, with proper utilization of ERP, customer service is greatly improved. Today, there are a wide variety of tools and techniques that have been designed to help companies and their people produce products better and more efficiently (Kremzar  Wallace, 2001).This is because customer requests are received and processed on time. The processing of these requests is automated. Customers are able to get response in timely manner. Services and goods are also delivered to them promptly. With improved customer services, the companys image is greatly improved. This will further boost its sales. A word always goes round about companies with good reputation. This as a result will attract more customers who will definitely be satisfied. Good customer satisfaction is the best type of marketing because it costs less.

Third, there are times when communication within an organization may seem to be a problem. Information flow may not be consistent among the various organization departments. The output of one department may be an input of another. Without proper communication, this would lead to a myriad of problems for the organization. There would be delays in production, customer response and in the long run, customers would not be satisfied (Harwood, 2003). This communication gap is therefore reduced or eliminated by introducing ERP system into the organization.

Fourth, there are companies that have more than one branch in various locations. It is important that the operations of these organizations are streamlined. This various branches or companies should comfortably exchange information without a problem.  One organization should be in a position to get records from another organization. The best example for this is the supermarket store. They should have shared database of all their clients. If a customer wants to purchase goods from one branch, it should be easy without causing any problem. All they would need to have is the customer identification, which may be his name or certain number given to him by the supermarket.

Fifth, organisations run various projects most of the time. There is need that these projects are well managed so as to get the desired outcome. Failure to do so will lead to failed projects. There are special softwares that are made to track project implementation. At every time, it is possible for the organization to determine if they are on the right track or if they are off the track.  Project managers require tools like this to see if all they are doing is according to what was planned. This software is able to combine various matrices that are involved and give an output regarding the project state (Kremzar and Wallace, 2001).

Sixth, there are problems that always face organizations like shortage of stock, delays in delivery of goods and services among many others. These problems are easily eliminated. ERPs are automated in away such that if stock goes below certain allowed threshold, it would trigger a message indicating that stock is insufficient (Harwood, 2003). A message would then be sent to the procurement department who would then order for more goods. Seventh, ERP have many modules. Not all this modules would be utilized by the organization all the time. There would be those that would be pending. This offers opportunity for the business to expend its operations. If the current modules are properly utilized, it leads to high quality results. ERP have standards that have to be maintained. This standard would automatically lead to great quality output

Below is an example of an ERP used by a University.

Fig.1.0 ERP for university
Source Kremzar, M. H.,  Wallace, T. F. (2001). ERPMaking It Happen The Implementers Guide to Success with Enterprise Resource Planning (3 Ed.). New York, NY Wiley, p. 205

This software allows the university to properly interact with the private sector, industry, education community, user community and the government. Scott Hamilton (2003) says that, the benefits of an ERP (Enterprise resource planning) system justify significant investment by manufacturing firms (p.1). Over the last two decades, the there has been a paradigm shift that has occurred in the business environment. This is because the sizes of production have improved, markets have also expanded. This therefore calls for better mechanism that can be used to adapt to the ever changing environment.

Enterprise Resource Planning (ERP) has been the greatest inventions of the time. A lot of resources have been greatly put into it. This is owed to the great importance that ERP have. With time, there is an increased need to come up with goods and services that are of higher quality. High competition in the market place dictates that the quality of goods produced should be high. This is the only way the organization can brace competition. There are many costs that are involved before a company can fully implement a system. These costs determine if the investments are worth it or not. If the costs are higher than the benefits, it is not worth implementing the ERP. What are the returns gained from it
Before a company invests in the ERP, it is important that it is able to justify the costs that would be involved (Kremzar and Wallace, 2001). The management team must fully understand what the project is all about. It is not enough to get the funding the greatest hurdle is to ensure that the project is successfully implemented. Inability for the firms to justify huge investments may mean that wrong decisions may have been made. This would lead to financial losses because the system to be implemented may not function as required of it. These investments are normally in terms of millions of dollars.

There are so many ERP systems in the market today. The company should be in apposition to identify one that gives services close to what they offer. It is important to note that systems that require so much customization are not the best. A good system should capture more than 45 of what the company is offering and give room for future expansion (Shields, 2001). This selection can be done by engaging professionals and doing research in other companies that use the ERP systems.

There are so many factors that affect implementation of ERP that are worth considering  before an ERP is fully implemented. These factors include Cost of software- there are many factors that determine the cost of the shelf software (ready made software). These factors include the number of functionality the ERP will support, how many people will use it at a time, and who is selling the software. Some vendors would sale it at an exorbitantly high price depending on the costs incurred during the development stage.

Cost of hardware is also significant (Shields, 2001), before implementation of an ERP, it is important that the organization purchases hardware, software to run the machines, equipment to network various machines and put in place security measures to safeguard the implementation of the program. It is important to determine how big the ERP is intended to be.

Services to support the implementation, there are many factors that may be involved. When the ERP is bought, it is important to look at it and try to fit it with the organization needs (Harwood, 2003). It involves looking at what the organization needs are and what the ERP provides. The two are then brought together. This normally costs a lot of money. If it is done well, it would lead to success, but if not properly done it would miserably fail. Another cost that may be incurred is data conversion. Before the introduction of ERP and after, the data formats may not be the same. There is a need to make them the same.

This may prove expensive depending on the data formats. After the full implementation, it is necessary that the ERP is fully tested (Harwood, 2003). The reason for this to ensure that everything is in place and functioning as intended. Failure to do the testing may result to the system not delivering its goals. It is necessary that the users of this ERP are adequately trained to make them understand how it functions. Training is aimed at reducing failure rates. Everyone should effectively know what is expected of him when he is given the system. This to a great extend reduces system failures.

Conclusion
The great author Murrell G. Shields (2001), says that, No company can ignore the availability of new technology, that perhaps for the first time, truly support the redesign and implementation of new ways of doing business(p.3).    It is of great concern of all businesses to formulate ways that would aid them deliver services more efficiently and cost effectively. This would be one of the ways an enterprise can withstand stiff competition. Effective Enterprise Resource Planning systems lead to great results.