ERP and Business Processes

1. ERP and Business Processes Illustrated with Microsoft Dynamics NAV 2009 Author: Hans van der Hoeven msc 1st edition

2. Chapter 1 Getting to know business functions, business processes,ERP and Business Management ERP and Business Processes

3. Business Functions, Departments, Business Processes • Business Function: organizational unit • Also known as “department” • Hierarchical structure • Line-staff organizational chart ERP and Business Processes

4. U-turn to Business Processes • In the 1990’s • Michael Porter’s Value Chain • Business process is not a business function • Trigger, ‘customer’ demand, inputs  outputs ERP and Business Processes

5. What is a Business Process? • A business process is a collection of coherent activities that starts with a trigger and ends with the delivery of one or several products. • The products represent a value for the customer of these products. The customer could be an external customer, as well as an internal customer (a department). • Services are also considered as products. ERP and Business Processes

6. BPR • Business Process Redesign (Reengineering) • Michael Hammer in the nineties of previous century • Event driven Process Chains (EPC’s) • Events drive logistic, finance, HR, etc. • Processes consist of a collection of events which match with each other (activities). • Cycle-approach • O2C: Order to Cash • P2P: Purchase to Pay • H2R: Hire to Retire ERP and Business Processes

7. Example of a Process Chart ERP and Business Processes

8. ERP and Business Management • ERP: Enterprise Resource Planning • ERP-package • Before island automation • One integrated information system • One central database • Business Management (‘the management side of ERP’) • Business Control ERP and Business Processes

9. Chapter 2 Focus on erp ERP and Business Processes

10. ERP in Historical Perspective • MRP • MRP II • ERP • ERP II (or x-ERP) ERP and Business Processes

11. MRP (I) • Materials Requirement Planning • Deciding about material requirement for a production process • Using a BOM and the quantity of neede finished products • Material requirement leads to purchase proposals and eventually to purchase orders • Bike example ERP and Business Processes

12. MRP II • Manufacturing Resource Planning • Not only raw materials • Also resources like machines and people (capacities) • Resources • MRP II aims at manufacturing control ERP and Business Processes

13. ERP • Enterprise Resource Planning • Enterprise wide • One integrated system instead of different seperated systems • One central database • A way of thinking about dealing with processes, so process orientation • EPC’s: Event Driven Process ChainsChain of activities ERP and Business Processes

14. ERP • ERP as a package • standard software package with a very integrated functionality, which stretches out over all business processes in an organization. • ERP as a phenomenon • enterprise wide integrated planning and steering concept • Organizational structure and management; • Products, services and business processes; • Information technology (computers, communication infrastructure, systems, internet, e-mail); • People, competences and culture. ERP and Business Processes

15. ERP II • Extended ERP (x-ERP) • Collaboration between companies to reach a better position in the Supply Chain • Intra-enterprise collaboration = ERPInter-enterprise collaboration = ERP II • Possibilities of Internet, EDI ERP and Business Processes

16. CRM • Customer Relationship Management • “Know your customer” • Registering customer data, purchase behavior, data from external sources • Analyzing and combining data • See chapter 4 ERP and Business Processes

17. SCM • Supply Chain Management • Chain of companies that form a chain from natural resources to a product that is sold to a final consumer • Copmpanies want to defend or extend their position in the Supply Chain  Supply Chain Management • See chapters 5 and6 ERP and Business Processes

18. Best-of-Breed and ERP • Best-of-Breed (BOB) • No integrated approach • Functional approach • Interfaces and middleware • Specific needs, very different from ERP ERP and Business Processes

19. Pros and Cons of ERP pros cons • Integration • Process orientation • Simple user interface • Openness • One vendor • State-of-the-art • International aspects • Long implementation periods • Complexity • No made to measure solution ERP and Business Processes

20. The vendors of ERP systems • SAPSAP Business Suite, All-in-One, Business One • OracleOracle Financials, Peoplesoft, JD Edwards, Fusion • InforMapics, Baan, SSA Global • Microsoft DynamicsDynamics NAV, Dynamics AX, Dynamics CRM • Industry Solutions ERP and Business Processes

21. Chapter 3 Microsoft dynamics nav 2009 ERP and Business Processes

22. Microsoft Dynamics • Dynamics NAV • Dynamics AX • Dynamics GP • Dynamics CRM ERP and Business Processes

23. Dynamics NAV 2009 ERP and Business Processes

24. Role Tailored Client (RTC) • Personas • Role centers, list places, departments page ERP and Business Processes

25. Modules / Departments • Financial Management • Sales & Marketing • Purchase • Warehouse • Manufacturing • Jobs • Resource Planning • Service • Human Resources • Administration ERP and Business Processes

26. Departments in the RTC ERP and Business Processes

27. Classic Client (CC) ERP and Business Processes

28. Some Principles • Adapting business processes to the ERP systemAdapting ERP system to the processes • Customizing • Selection and implementation process • Architecture of Dynamics NAV • Client tier (presentation layer) • Service tier or Middle tier (business logic layer) • Database tier (data layer) ERP and Business Processes

29. Add-ons and Industry Solutions • Dynamics NAV consists of: • Add-on: piece of standard software which can communicate and interact with a standard ERP system • Product configurator • Foodbranche • HRM ERP and Business Processes

30. Customer Model ERP and Business Processes

31. Customer Model ERP and Business Processes

32. Training and Education • Conceptual level (this book) • Details of how the software operates • Functional training • The buttons • Manners • Through training partner • Through e-training (Customer Source) ERP and Business Processes

33. Chapter 4 Marketing & sales process: o2c cycle ERP and Business Processes

34. Customer • Master data • Contact data • Transaction data • Customer Card • Customer postinggroups ERP and Business Processes

35. Payment Terms and Delivery Terms • Creditability • Creditability as an amount • Creditability as a period of time • Payment terms: • Cash on delivery • 7 days • 1 month (8 days) • Delivery/shipment terms ERP and Business Processes

36. Customer • Customer (discount) groups • Characteristics in common • Discounts • Per customer • Per item • Per order • E-commerce • Web shop • Electronic payment • B2B and B2C ERP and Business Processes

37. The Sales Process (O2C) • More: • Blanket orders • Return orders and credit memos ERP and Business Processes

38. Contacting the Customer • Customer seeks contact • Company seeks contact • Sales promotion • CRM ERP and Business Processes

39. Issuing Sales Quotation • Request for Quotation (RFQ) • Not always necessary • Register customer data and quotation data • Fast tabs • Item lines • Creating Quotation • Send to customer • Obligation to deliver • Reaction period • Management information ERP and Business Processes

40. Sales Order Processing • Does the customer agree? Quotation is converted into a sales order. Or a direct sales order (without quotation) • Creditability check • Availability check (AtP, CtP) • Integration with Office • Release order for delivery ERP and Business Processes

41. Delivery and Shipping • Warehouse gets assignments (sales orders with today’s delivery date) • Picking and packing, then shipping • Create shipping documents • Postings in the ERP system • Logistic • Financial ERP and Business Processes

42. Billing • Creating and sending Sales Invoice • Invoice is usually made from data sales order • Separation of goods and money streams • Prepayment ERP and Business Processes

43. Billing (2) • Event driven action: • Logistical • Financial • Matching principle • Actions • Update obligations administration • Update customer open debt-claim • Update general ledger (financial mutation) • Update stock (logstic mutation) • Update VAT registration • Update analyses en reports ERP and Business Processes

44. Collecting money ERP and Business Processes

45. Blanket Orders • Long term relationship with customer • Usually special price or discount (or afterwards: revenue bonus) • Sell a large quantity, deliver/ship (and bill) in parts ERP and Business Processes

46. Return Orders • Items are damages on arrival at customer site • Shipping wrong items • Customer has ordered too much • RMA procedure • Destination of returned items • Credit memo (sales) ERP and Business Processes

47. Discounts and Credit Memos • Discounts because of RMA, revenue bonus, correction of mistakes • Sales decides upon contents credit memo • Credit memo lowers the debt-claim on the customer • Detailed checks are necessary ERP and Business Processes

48. Marketing • "Marketing is an organizational function and a set of processes for creating, communicating and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders." (source: American Marketing Association (AMA) ) • Macroeconomic functions: • Information exchange between manufacturers, wholesalers and consumers; • Stabilization function/distribution function. • Product development, strategies • Segmentation of the market • Marketing mix ERP and Business Processes

49. CRM • Customer Relationship Management • Relation a company maintains with its customers • Register and analyze customer behaviour • Enlarge profitability and customer satisfaction • Customer pyramid • Pros CRM • Lower costs by operational efficiency • Higher revenue by better segmented market • Improved strategy and better measure effects on actions ERP and Business Processes

50. CRM (II) ERP and Business Processes