ERP+Modules
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ERP Modules - By Catherine LaCroix, Contributor 29 Oct 2009 | SearchManufacturingERP.co ERP systems are used in all the daily operations of manufacturing. In order to pull data from across the enterprise, ERP systems are made up of many different software modules. Each of the modules in ERP module is specialized to handle specific business processes. In this guide to ERP modules and software, you'll find introductions to the various components of ERP and learn how each module can benefit your organization. Bro!"e a## of the "ection" of thi" gui$e, or %u & $irect#y to the "ection that intere"t" you o"t'
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ERP "u&&#y chain anage ent ERP cu"to er re#ation"hi& anage ent ERP &ro$uct #ifecyc#e ERP hu an ca&ita# ERP !arehou"e ERP a""et anage ent anage ent
anage ent
anage ent anage ent
ERP financia# ERP or$er ERP &ro%ect ERP in(entory
anage ent anage ent anage ent
Su&&#y chain anage ent )SCM* i" one of the o"t i &ortant "oft!are o$u#e" for anufacturer". SCM gi(e" &ro(i$e" (i"ibi#ity into the entire "u&&#y chain, fro "tart to fini"h. ERP SCM o$u#e" ty&ica##y inc#u$e co &onent" for foreca"ting, $e an$ anage ent, &rocure ent an$ &#anning+ $e#i(ery o$u#e" "uch a" #ogi"tic"+ an$ co &onent" for after, ar-et i""ue" #i-e return", in"ta##ation" an$ contract". Manufacturer" can u"e cu"to er re#ation"hi& anage ent )CRM* "oft!are to organi.e an$ (ie! $ata on in$i(i$ua# cu"to er tran"action" in one acce""ib#e &#ace. ERP CRM o$u#e" &ro(i$e cu"to er $ata integration, or a"ter $ata anage ent )M/M*, !hich -ee&" trac- of cu"to er" acro"" a## the "a#e" channe#" fro in,&er"on )fie#$ "a#e"* to &hone )inc#u$ing te#e ar-eting* to on#ine )te#e"er(ice an$ "u&&ort*. 0ith &ro$uct #ifecyc#e anage ent )PLM* "oft!are, anufacturer" can trac- the $e"ign an$ attribute" of a &ro$uct throughout it" #ifecyc#e, fro conce&t to en$,of,#ife. 1he co &onent" that a-e u& ERP PLM o$u#e" inc#u$e &ro$uct $ata anage ent )P/M*, &ro$uct $e"ign, &ortfo#io anage ent, $irect ateria#" "ourcing an$ cu"to er nee$" anage ent. 2u an ca&ita# anage ent i" another one of the co on ERP o$u#e". ERP 2CM o$u#e" function a" the core e &#oyee recor$, !hich $etai#" &er"onne# action", benefit" a$ ini"tration an$ &ayro##, &o"ition anage ent an$ co &#iance !ith go(ern ent regu#ation". ERP 2CM co(er" three area" of e &#oyee anage ent' tran"actiona#, ta#ent anage ent an$ exten$e$ anage ent. 0arehou"e anage ent "y"te " )0MS* "oft!are i" a u"t,ha(e for anufacturer". ERP 0MS o$u#e" fo##o! the $i"tribution &roce"" in(o#(e$ !ith fini"he$ goo$" or ateria#" fro $e#i(ery into the !arehou"e for "torage through re&#eni"h ent an$ &ic-ing for "hi& ent to fu#fi## or$er". 0MS o$u#e" a#"o he#& "ynchroni.e an$ contro# "toc- on the "ho& f#oor. Manufacturer" can trac- &hy"ica# anufacturing a""et" in(o#(e$ in &ro$uction ,, the &#ant it"e#f an$ e3ui& ent ,, u"ing ERP a""et anage ent o$u#e". So e of the $ai#y function" that ERP a""et anage ent han$#e" are aintenance "che$u#e", e3ui& ent u&ti e an$ $o!nti e, in(entory an$ !arranty anage ent an$ co &#iance !ith ha.ar$ou" ateria#" an$ !a"te trac-ing regu#ation".
4inancia# anage ent i" a critica# bu"ine"" function for anufacturer". ERP financia# anage ent o$u#e" inc#u$e functiona#ity for genera# #e$ger, !hich i" the core of ERP financia# anage ent. 1he"e o$u#e" a#"o han$#e function" for account" &ayab#e an$ recei(ab#e, fixe$ a""et", financia# re&orting an$ trea"ury anage ent. Or$er anage ent "y"te " ta-e in $ata fro or$er" on the front en$ ,, "uch a" cu"to er nu ber an$ &ro$uct &art nu ber ,, an$ a-e "ure that or$er" get fi##e$ on the bac- en$. Manufacturer" u"e ERP or$er anage ent o$u#e" to fi## &ro$uct or$er" at the #o!e"t &o""ib#e co"t. 1he"e o$u#e" are e3ui&&e$ to han$#e function" "uch a" auto ate$ or$er entry, (ie!ing an$ trac-ing+ or$er "tatu"+ cance#e$ tran"action"+ or$er an$ cre$it #i it (a#i$ation an$ chec-ing for $u&#icate or$er". 0ith &ro%ect anage ent "oft!are, anufacturer" can organi.e an$ re(ie! the $ata aroun$ &ro%ect ti e#ine" an$ co"t". 1he"e "oft!are "y"te " are geare$ to!ar$ organi.ation" that bi## c#ient" ba"e$ on the ti e their e &#oyee" "&en$ !or-ing on in$i(i$ua# &ro%ect". ERP &ro%ect anage ent o$u#e" han$#e" &ro%ect $efinition, &ro%ect co"ting an$ accounting, &ro%ect &ortfo#io anage ent, re"ource anage ent an$ &ro%ect bi##ing. ERP in(entory anage ent o$u#e" o(e fini"he$ goo$" through the &ro$uction cyc#e. 1hey are often tie$ into other function", inc#u$ing "hi&&ing, #ogi"tic", or$er", bi##ing an$, on a broa$er "ca#e, !arehou"e anage ent. ERP or$er anage ent "oft!are inc#u$e" functiona#ity for in(entory contro#, "eria# nu ber trac-ing, bar co$e &rinting, bui#$ ateria#" an$ -itting, in(entory (a#uation an$ S56 anage ent. Supply Chain Management ERP SCM "y"te " ty&ica##y "tart !ith creating an or$er an$ "hi& ent, &utting the tran"&ortation together, boo-ing the $e#i(ery an$ beginning the bi##ing cyc#e. 78t9" a (ery "traightfor!ar$ chain of #ogi"tic" in a "a#e" "cenario,7 "ai$ 2o#ger 5i"-er, an ana#y"t at 4orre"ter Re"earch. 71he functiona#ity ight inc#u$e "o e &#anning a"&ect" an$ $e an$ &#anning. 8t can trac- the cu"to er $e an$ an$ generate a foreca"t. Ba"e$ on that :$ata; you can "trea #ine the "u&&#y chain on the $e#i(ery "i$e.7 1y&ica# o$u#e" of an ERP "u&&#y chain anage ent "uite inc#u$e'
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/e an$ foreca"ting an$ &#anning Su&&#y chain net!or- &#anning to atch $e an$ !ith the "u&&#y "i$e Pro$uction &#anning that ref#ect" the $e an$ /etai#e$ "che$u#ing that $irect" &ro$uction for the $e an$ "i$e E(ent <#ert anage ent to co##ect an$ ana#y.e $i"tribute$ $ata "ource" onitor" for e(ent anage ent
Pricing o&ti i.ation acro"" the #ifecyc#e of a &ro$uct Su&&#y chain net!or- $e"ign an$ o&ti i.ation, to e(a#uate co &#ex "u&&#ier net!or-" an$ $eter ine the o"t &rofitab#e configuration"
0hen e(a#uating ERP SCM &ro$uct", "oft!are buyer" "hou#$ be a!are that $ifferent in$u"trie" ha(e $ifferent re3uire ent" for ERP an$ SCM. 7<#though there are "o e core o$u#e" an$ re3uire ent", the "&ecific" of !hich ) o$u#e" or* &ro$uct" to u"e can be (ery $ifferent fro in$u"try to in$u"try,7 5i"-er "ai$. 8n retai#, for exa &#e, $e an$ &#anning i" "trong#y #in-e$ to a""ort ent &#anning an$ foreca"t "y"te ". 8f you9re in charge of o(ing &etro#eu &ro$uct", you9## !ant your ERP SCM "y"te to ha(e ca&abi#itie" to ana#y.e "&ecific e#e ent" of the tan- "y"te or of the ty&e" of truc-" re3uire$.
One benefit that co &anie" gain fro an ERP SCM $e&#oy ent i" re$uce$ carrying co"t" for !arehou"e "toc-. SCM can a#"o re$uce tran"&ortation co"t" by o&ti i.ing the ba#ance bet!een "u&&#y an$ $e an$ an$ by re$ucing the ti e bet!een !hen the &ro$uct i" "hi&&e$ an$ &ay ent i" recei(e$. Warehouse Management ERP !arehou"e anage ent "y"te )0MS* o$u#e" fo##o! the $i"tribution &roce"" in(o#(e$ !ith fini"he$ goo$" or ateria#" fro $e#i(ery into the !arehou"e for "torage through re&#eni"h ent an$ &ic-ing for "hi& ent to fu#fi## or$er". 71hi" i" !here you recor$ actua# "hi& ent", -ee& trac- of in(entory !hen you "hi& to fi## or$er" an$ !hen you recei(e ne! fini"he$ goo$",7 "ai$ =reg <i i, a re"earch $irector at <MR Re"earch !ho ana#y.e" c#ient"9 $e an$,$ri(en "u&&#y net!or-". 6n#i-e in(entory anage ent, !hich focu"e" on o(ing goo$" or in(entory acro"" the co &#ete "u&&#y chain, ERP 0MS trac-" or$er" that co e into the !arehou"e through the or$er anage ent "y"te "o they are fi##e$ accurate#y an$ on ti e. 78t9" !here the anufacturing center ha" &u"he$ the fini"he$ goo$" out into the $i"tribution en(iron ent,7 <i i "ai$. 78n the !arehou"e you $o recei(ing, you ha(e $oc- $oor" on one "i$e !here you9re recei(ing an$ the goo$" are &ut on the "he#(e". 1hen a" or$er" co e in fro cu"to er", you ha(e echani" " by !hich you &ic-, &ac- an$ then "hi& out of the !arehou"e.7 <## the function" of the !arehou"e anage ent "y"te are geare$ to!ar$ &erfor ing or$er fu#fi## ent, on ti e, !ith the right &ro$uct, at the #o!e"t &o""ib#e co"t. 1he &rinci&a# focu" of the ERP 0MS o$u#e i" in(entory accuracy' 0ith a !arehou"e anage ent "y"te , co &anie" -no! ho! uch &ro$uct )of any gi(en S56* they ha(e at any gi(en ti e in that faci#ity. =i(en that in(entory accuracy, they can $eter ine ho! to anage or$er fu#fi## ent at the o"t &ro$ucti(e ean" &o""ib#e. ERP 0MS function" ty&ica##y inc#u$e'
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Pic-ing "trategie" )accor$ing to "toc-, !ith ru#e" of &riority by ex&iry, #ocation, etc.* Phy"ica# in(entory trac-ing 8n(entory anage ent an$ &#anning for re&#eni"h ent
Stoc- trac-ing )arri(a#">$e&arture", ex&iration $ate, in(entorie", #ocation"* Synchroni.ation an$ contro# of the "toc- in the "ho& f#oor
ERP !arehou"e anage ent &roce""e" &ro(i$e u&,to,$ate infor ation on in(entory "o it can be correct#y (a#ue$. ERP 0MS offer" return,on,in(e"t ent )RO8* through an&o!er "a(ing", "&ace uti#i.ation, &ro$uct turn" an$ cu"to er "a#e" ba"e$ on efficiency, re"&on"i(ene"" an$ accuracy. Inventory Management 0hi#e in(entory anage ent can be a "tan$a#one a&&#ication, ty&ica##y the "oft!are i" bun$#e$ into !arehou"e anage ent or "u&&#y chain anage ent "y"te ". 1hi" ERP in(entory anage ent o$u#e i" u"e$ by retai#, $i"tribution an$ anufacturing an$ tie$ into retai# erchan$i"ing "y"te " !here u"er" a#"o anage &ricing. 7?ou nee$ to -no! !hat9" on the "he#(e", !hat9" in the !arehou"e, an$ ho! you re,or$er goo$" to anage the f#o! of goo$" throughout the o&eration,7 "ay" Pau# 2a er an, (ice &re"i$ent of enter&ri"e a&&#ication" at 4orre"ter Re"earch. 1he goa# i" to get the in(entory to turn o(er,7 2a er an "ai$. 7?ou9re not a-ing any oney if it9" "itting in the !arehou"e.7 1he ain in(entory anage ent function" in(o#(e recei(ing, "toring an$ returning in(entory. 7?ou nee$ to account for )in(entory* !hen it9" arri(e$, !here you &ut it, ho! #ong it9" been there, ho! it9" been returne$ or ho! it9" been &ut into a &ro$uct,7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&.
Other -ey feature" in ERP in(entory
anage ent
o$u#e" are'
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8n(entory contro# Bui#$ ateria#" an$ -itting )&utting co &onent" together a" &art of a -it for "a#e* Seria# nu ber trac-ing Bar co$e &rinting @a#uation feature" to un$er"tan$ the $o##ar (a#ue of in(entory on han$ S56 anage ent
1he "oft!are &ro(i$e" a !ay to trac- thing" that are re#ate$ to each other. 74or a ce## &hone in a box, the o$u#e !ou#$ tie a## the in(entory to the ce## &hone, "tarting !ith -itting, !hich inc#u$e" bui#$ ateria#", "tatu" of -itting co &onent", "eria# nu ber" an$ #ot tracing, an$ exten$ing to un,bui#$ing the -it" an$ &utting thing" bac- if you get a reca## on a &art that nee$" to be re&#ace$ in the -it,7 "ai$ 0ang. <nother feature of ERP in(entory "&en$ #e(e#". anage ent i" the abi#ity to trac- an$ anage &urcha"e" in or$er to $eter ine
0hen co &anie" are carrying #ot" of in(entory, ca"h anage ent beco e" an i &ortant factor. 7?ou nee$ to "ure you9re not $e&#oying your ca&ita# ina&&ro&riate#y,7 "ai$ 0ang.
a-e
78f a## the batterie" you or$ere$ for a -it are i""ing, your &ro$uction i" $e#aye$, but you $on9t !ant too uch on han$, becau"e you ha(e to "tore it, !hich !i## a#"o co"t you,7 he "ai$. 7?ou nee$ to -no! ho! #ong thi" in(entory !i## be in the !arehou"e an$ !hen it !i## "hi&.7
Customer Relationship Management Si &#y &ut, ERP cu"to er re#ation"hi& anage ent )CRM* "oft!are &ro(i$e" c#ear $etai# on each in$i(i$ua# cu"to er tran"action in one acce""ib#e &#ace. But ERP CRM "y"te " can $o uch ore. 1hey a#"o &ro(i$e cu"to er $ata integration, or a"ter $ata anage ent )M/M*, !hich -ee&" trac- of cu"to er" acro"" a## the "a#e" channe#" fro in,&er"on )fie#$ "a#e"* to &hone )inc#u$ing te#e ar-eting* to on#ine )te#e"er(ice an$ "u&&ort*. 7<nyone !ho i" $ea#ing !ith the cu"to er ha" acce"" to a (ery $etai#e$ trac- recor$ of e(erything that ha" ha&&ene$ !ith the cu"to er,7 "ai$ 2o#ger 5i"-er, an ana#y"t at 4orre"ter Re"earch. 1hi" recor$ inc#u$e" $ata about current &ro$uct &urcha"e" or contract "tatu" ,, infor ation that can u#ti ate#y he#& increa"e "a#e". 1he $ata generate$ fro ERP CRM "oft!are auto atica##y &ro(i$e" infor ation that #et" you trac- #ea$" an$ figure out ho! any of tho"e #ea$" ha(e turne$ into $ea#". 76#ti ate#y, you9re #oo-ing at the effecti(ene"" of your ar-eting &rogra " to "ee !hat channe#" are ore "ucce""fu#, !hat ca &aign" are ore "ucce""fu#, !hich one" are o(ing the nee$#e in ter " of "a#e",7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&. <t the core of a## ERP CRM i" the cu"to er $ataba"e fro !hich ERP CRM o$u#e" generate auto ate$ re&ort" an$ con"o#i$ate$ infor ation. 78t9" i &ortant to be ab#e to "#ice an$ $ice the re&ort" in (ariou" $i en"ion", &er region, &er cu"to er "eg ent, &er &ro$uct, an$ &er "&ecific ti e of the year>"ea"on",7 5i"-er "ai$. 1he three -ey co &onent" of a CRM a&&#ication are "a#e", thi" !ay' ar-eting an$ "er(ice". Each of tho"e i" bro-en $o!n
Sales
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Cu"to er $e an$ in"ight" Cu"to er o&&ortunity anage ent Or$er anage ent )(ia ca## center, internet "a#e", anage ent obi#e "a#e"*
Sa#e" &erfor ance
Marketing
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Ca &aign an$ &ro otion Cu"to er "eg entation Lea$ anage ent
anage ent
Mar-eting ana#ytic"
Services
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Cu"to er "er(ice anage ent Co &#aint anage ent 4ie#$ "er(ice Ser(ice anage ent
anage ent ana#ytic"
8n a$$ition to in$i(i$ua# cu"to er infor ation, CRM "y"te " a#"o &ro(i$e a $etai#e$ (ie! of cu"to er "eg ent". One !ay ERP CRM "y"te " can increa"e "a#e" &ro$ucti(ity i" by getting the right &ro$uct to the right cu"to er at the right ti e, !hich $e#i(er" a higher return, !hich #ea$" to the -ey benefit" that anufacturer" an$ retai#" can achie(e' higher "a#e" argin". 7?ou can c#o"e the "a#e" cyc#e ore efficient#y,7 "ai$ 5i"-er. 75ey Perfor ance 8n$icator" )5P8"* can be i &ro(e$ !ith the right CRM "o#ution", the nu ber of ca##" that a ca## center agent can han$#e can be i &ro(e$, an$ the nu ber of c#o"ing" &er nu ber of a(erage ca##", can be i &ro(e$.7 Product Life-cycle Management 1he &ro$uct $e(e#o& ent chain or &ro$uct $efinition "tart" !ith &ro$uct conce&t, fo##o!e$ by $e"ign, te"ting, (a#i$ating an$ intro$uction into anufacturing an$ the "u&&#y chain. 7<" a &ro$uct get" o#$er, the $e(e#o& ent cyc#e exten$" to $eci"ion" about &ro$uct re$e"ign, co"t re$uction, or ta-ing it off the ar-et,7 "ai$ Mi-e Bur-ett, (ice &re"i$ent of <MR Re"earch9" 8n$u"try @a#ue Chain Strategie" tea . Core ERP &ro$uct #ifecyc#e anage ent inc#u$e" fi(e -ey co &onent"'
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Pro$uct $ata anage ent )P/M* i" the foun$ation of PLM. 8t enco &a""e" the "y"te of recor$" for a## $ocu ent" an$ infor ation about the &ro$uct. 1he ain function of P/M i" to aintain re(i"ion contro# an$ a-e "ure that e(eryone in(o#(e$ ,, fro $e"ign to ar-eting ,, ha" acce"" to that $ata. Co##aborati(e &ro$uct $e"ign #et" the tea "hare P/M $ata in a $e"ign re(ie! eeting !here in$i(i$ua#" can re(ie! the $e"ign an$ $i"cu"" !hat9" goo$ or !hat nee$" to change. 1hi" inc#u$e" (i"ua#i.ation too#" for #oo-ing at a A/ (er"ion of a &ro$uct or &art, an$ ar-ing it u& !ith co ent". Co##aborati(e $e"ign a#"o entai#" !or-ing !ith anufacturing to $e(e#o& the nece""ary too#" an$ &roce""e" for &ro$uction.
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Pro$uct &ortfo#io anage ent in(o#(e" &ro%ect anage ent acti(itie" "uch a" trac-ing for trac-ing !hat &ro%ect" in$i(i$ua#" are !or-ing on, ho! any &ro%ect" are in the &ortfo#io an$ the "tatu" of tho"e &ro%ect". <ccor$ing to Bur-ett, thi" feature he#&" the tea $eci$e !hich &ro%ect" in the &i&e#ine are the o"t i &ortant. /irect ateria#" "ourcing he#&" u"er" fin$ an$ organi.e the ateria#" that are u"e$ $irect#y in both $e(e#o& ent an$ &ro$uction &roce""e". 1hi" inc#u$e" a&&ro(e$ (en$or #i"t", (en$or cata#og" an$ !or-f#o! to "u&&ort the re3ue"t,for,3uote &roce"" for a&&ro(e$ (en$or". Cu"to er nee$" anage ent $i"&#ay" !hat cu"to er" !ant an$ bring that into the $e(e#o& ent &roce"". 1hi" a(oi$" $e"igner"9 ten$encie" 7to inno(ate on thing" that the cu"to er" ha(en9t a"-e$ for,7 "ai$ Bur-ett. Cu"to er nee$" infor ation a#"o co e" fro fee$bac- fro the cu"to er ba"e about in"ta##e$ &ro$uct".
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One benefit of ERP PLM i" fa"ter ti e to ar-et. 78f you un$er"tan$ the &roce"" better, you can re$uce the ti e it ta-e" to bring a &ro$uct to ar-et becau"e you can auto ate the &roce"" an$ offer )greater* acce"" to the "a e,7 Bur-ett "ai$. Human Capital Management ERP !" software functions as the core employee record, which details personnel actions, benefits administration and payroll, position management and compliance with government regulations. #$ company needs to %now on a cost level how many employees they have and what it's costing them, along with turnover rates and analytics to help them ma%e decisions and understand the essential talent that ma%es the organization successful,# said Paul amerman, vice president of enterprise applications at &orrester Research. !ore components of ERP human capital management include modules for three employment management processes' ransactional!
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(or%force management, including time capture, forecasting and absence management uman capital management, including employee records, benefits administration, payroll, position management and R compliance
alent management!
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Performance and compensation, including succession planning and career development )earning management, including training administration and content management *taffing and recruiting, including wor%force planning, re+uisitions, applicant trac%ing and new hires
E"tended management!
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Employee and manager processes "anagement reporting and analysis
#ey ERP HCM functions #Personnel management around the employee lifecycle, from hiring to promotions, transfers, and terminations, is the basic employee transaction that any system should be able to manage,# amerman said. ,ther %ey functional areas include compensation, bonuses and long-term e.ecutive compensation functions li%e stoc% plans, organizational and position structures, and compliance to government regulations around diversity.
*ome ERP !" modules will also handle nonemployees, such as contractors, as part of a personnel management component. /eyond standard compensation structures, including salary grades and benefits programs, ERP !" applications can also be set up to manage eligibility determinations for fle.ible spending accounts and time off programs. #It's important to develop people in a way that is aligned with the ob0ectives of the business,# said amerman. #1hat's the strategic aspect of it, which is of critical importance. !ompanies that get that tend to be more successful.# $sset Management 7)Enter&ri"e a""et anage ent* goe" han$ in han$ !ith in(entory anage ent, but the $ifference i" that in(entory anage ent i" about the &hy"ica# goo$" that are in the !arehou"e. <""et anage ent i" about the e3ui& ent,7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&. So e (en$or" offer a""et anage ent "oft!are a" a "e&arate a&&#ication+ other" a-e it &art of a "uite of a&&#ication". So e " a##er (en$or" offer "tan$a#one a&&#ication" for ca&abi#itie" "uch a" a""et", in(entory an$ !arehou"e anage ent. 4or the &ur&o"e" of thi" gui$e, the ter refer" to ERP a""et anage ent o$u#e" that tie into the bac-bone of an ERP "y"te . 5ey function" inc#u$e trac-ing for'
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Maintenance "che$u#e" E3ui& ent u&ti e an$ $o!nti e 8n(entory an$ !arranty anage ent ateria#" an$ !a"te trac-ing regu#ation"
Co &#iance !ith ha.ar$ou"
By integrating enter&ri"e a""et anage ent o$u#e" !ith ERP "y"te ", co &anie" can increa"e the a(ai#abi#ity of their &ro$uction e3ui& ent an$ re$uce o(era## &#ant co"t" through better "er(ice an$ aintenance &rogra ". <""et anage ent "oft!are can a#"o he#& a co &any i &ro(e it" ca"h f#o! by increa"ing in(entory turno(er an$ o&ti i.ing anufacturing &ro$uction. 7?ou nee$ to -no! if your achinery an$ e3ui& ent are in goo$ !or-ing or$er an$ if tho"e achine" are running at axi u ca&acity !ith an u&ti e of 99.9 &ercent,7 0ang "ai$. 78f you9re co##ecting re(enue throughout the tran"action, you nee$ to acti(e#y a-e "ure that you fix tho"e achine" or -ee& the in goo$ !or-ing or$er in ter " of re&air an$ !arrantie". 8t9" rea##y critica#, e"&ecia##y if you9re in the !or#$ of &ro$uction or $e#i(ery.7 ERP a""et anage ent can he#& a co &any i &ro(e it" ca"h f#o! in other !ay". 4or exa &#e, if a co &any ha" ten &iece" of achinery an$ can $eter ine ho! to u"e eight ore effecti(e#y, 7you9(e %u"t "a(e$ !hate(er the co"t of ca&ita# i" for t!o &iece" of hea(y e3ui& ent,7 "ai$ 0ang. 78f you can fin$ !ay" to create ore efficient &roce""e" in your &#ant", then you $on9t ha(e to !orry about too uch re$un$ancy !ith aintenance "che$u#e", ini i.ing $o!nti e an$ o&ti i.ing &ro$uction "che$u#e".7 0ang "ai$. 1hat9" !here a""et anage ent $e#i(er".7 %inancial Management =enera# #e$ger i" at the core of any ERP financia# anage ent "y"te , !hich enco &a""e" the function" that are re3uire$ to aintain one or ore "et" of boo-", generate financia# re&ort", anage ca"h an$ fixe$ a""et" an$ execute &ay ent an$ recei(ab#e tran"action". 7E(erything "tart" by ha(ing a genera# #e$ger an$ then it !or-" it" !ay out to account" &ayab#e" )ho! you &ay (en$or"* an$ account" recei(ab#e" )ho! you co##ect fro cu"to er"*,7 "ai$ Ray 0ang, "enior ana#y"t, <#ti eter =rou&. 1he ba"ic co &onent" of a financia# anage ent "y"te inc#u$e'
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=enera# #e$ger, !hich re&re"ent" the core "et of boo-" for a bu"ine"" entity <ccount" &ayab#e, !hich $i"bur"e" oney to (en$or" <ccount" recei(ab#e, !hich &roce""e" inco ing ca"h 4ixe$ a""et", !hich in(entorie" ca&ita#i.e$ &ro&erty 4inancia# re&orting, !hich "u $etai#" ari.e" the re"u#t" in "tan$ar$ re&ort" "uch a" tria# ba#ance" an$ account
Many ERP financia# anage ent "y"te " a#"o inc#u$e o$u#e" "uch a" trea"ury anage ent, !hich can inc#u$e #oc- box, re(enue f#o!, ca"h f#o!, account ba#ance", fun$ tran"fer" an$ tax a""e"" ent". < ca"h anage ent o$u#e a##o!" you to create an o&ti a# &ay ent>co##ection "che$u#e. 1here9" a#"o bu"ine"" inte##igence )B8* functiona#ity an$ contro#" for go(ernance, ri"- anage ent an$ co &#iance )=RC*. Pro%ect accounting offer" a re&ort "tructure ba"e$ on hour" con"u e$. <ccor$ing to 4orre"ter Re"earch ana#y"t 2o#ger 5i"-er, ERP financia# anage ent "oft!are "hou#$ inc#u$e feature" that "u&&ort creation of a$ hoc re&orting a" !e## a" onth,en$ c#o"ing, 3uarter c#o"ing" an$ year,en$ re&orting. 7Since it9" trac-ing e(ery o(e ent in an$ out of the !arehou"e, it can $e#i(er at any ti e c#ear (a#ue of !hat9" in "toc-,7 "ai$ 5i"-er. 71he financia# o$u#e )"hou#$* fo##o! e(ery in$i(i$ua# "te&, inc#u$ing bu$get &#anning for &ro$uction an$ bi##ing.7 ERP finance o$u#e" can a#"o he#& you eet 4inancia# <ccounting Stan$ar$" Boar$ )4<SB* "tan$ar$". <nother benefit i" "y"te atic auto ation of $ata on tran"action" "uch a" !arehou"e in(entory or the nu ber of $ay" account" recei(ab#e" ha(e been aging. 7E""entia##y, it9" gi(ing you a## the financia# $ata that you nee$ to run a bu"ine"",7 "ai$ 0ang. &rder Management On the front en$, the "y"te ca&ture" $ata "uch a" cu"to er nu ber, &ro$uct &art nu ber an$ $ue $ate for routing an$ in$exing !hen an or$er arri(e", no atter !hether the or$er i" in the for of a fax, &hone ca##, e ai#, or !hether it i" &a&er,ba"e$ or e#ectronic. Ca&ture$ $ata i" then tran"ferre$ to an or$er anage ent a&&#ication. 8n the bac- office, the anufacturing or$er anage ent a-e" "ure that the or$er get" fu#fi##e$ ,, an$ at the #o!e"t co"t, "ai$ =reg <i i, a re"earch $irector at <MR Re"earch !ho ana#y.e" c#ient"9 $e an$,$ri(en "u&&#y net!or-". 5ey ERP or$er anage ent function" inc#u$e'
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<uto ate$ or$er entry, (ie!ing an$ trac-ing Rea#,ti e a(ai#abi#ity of or$er "tatu" an$ tran"action $ata Contro##e$ han$#ing for cance#e$ tran"action" @a#i$ating or$er" an$ cre$it #i it chec-ing Chec-ing for $u&#icate or$er" 8nfor ation on a## cu"to er or$er anage ent &roce""e"
Re&ort" on &roce"" ti e an$ (o#u e, 3ueue$ or$er", exce&tion" an$ $e#i(ery $ate"
8n an ERP or$er anage ent "y"te , a## the $ata i" integrate$ bet!een or$er", in(entory an$ an organi.ation9" !arehou"e to a-e the fu#fi## ent an$ "hi&&ing of or$er" run " ooth#y.
7Mo"t "y"te " interact !ith infor ation &roce""e" #i-e cu"to er "er(ice )&rioriti.ing "hi& ent* or anufacturing )&ro$uct a(ai#abi#ity*,7 <i i "ai$. 7<## of the"e are out"i$e of the execution of the"e "y"te ", but it9" goo$ infor ation to ha(e for a ho#i"tic a&&roach.7 1he -ey benefit of an ERP anufacturing or$er anage ent "y"te i" fa"ter or$er fu#fi## ent an$ ore effecti(e "a#e" a$ ini"tration. 8t can he#& increa"e $ata entry accuracy an$ i &ro(e ca"h f#o!, re$uce or$er error" an$ fu#fi## ent $e#ay", an$ i &ro(e cu"to er "ati"faction. Re&orting an$ ana#y"i" feature" ba#ance !or-#oa$" an$ i$entify &roce"" bott#enec-". Many ERP or$er anage ent "y"te " offer auto atic confir ation "ent $irect#y to the cu"to er once the entry i" create$ in the ERP "y"te . 1hi" a$$itiona# trac-ing of a## inco ing $ocu ent" fro creation in the ERP to fu#fi## ent a$$" another #ayer of &roce"" onitoring an$ contro#. ERP &ro%ect anage ent "y"te " are geare$ to!ar$ organi.ation", "uch a" engineering fir ", con"truction fir ", con"u#tant" an$ architect", that bi## c#ient" ba"e$ on the ti e their e &#oyee" "&en$ !or-ing on in$i(i$ua# &ro%ect". Pro%ect anage ent o$u#e" $e#i(er &roce"" auto ation an$ &roce"" i &ro(e ent that tran"cen$" the tra$itiona# boun$arie" of cu"to er re"ource anage ent )CRM* an$ "u&&#y chain anage ent )SCM* "oft!are to inc#u$e &ro%ect accounting, change anage ent, ti e an$ ex&en"e re&orting an$ ana#ytic" about acco &#i"he$ !or-. 1he core co &onent" of ERP &ro%ect anage ent "oft!are inc#u$e'
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Pro%ect $efinition, !hich inc#u$e" ta"-" an$ $e#i(ery $ate" an$ fin$ing re"ource" to fu#fi## the &ro%ect Pro%ect co"ting an$ accounting, !hich #oo-" at $irect co"t", ateria#", #abor, tra(e# an$ other co"t" a""ociate$ !ith the &ro%ect Pro%ect &ortfo#io anage ent, !hich &ro(i$e" (i"ibi#ity o(er ti e an$ on bu$get u#ti&#e &ro%ect" to "ee if &ro%ect" are running on
Re"ource anage ent, !hich i" the hu an re"ource" )2R* co &onent an$ &ro(i$e" (i"ibi#ity into re"ource" a(ai#ab#e for u#ti&#e &ro%ect" Bi##ing for &ro%ect" &er hour, inc#u$ing &rofitabi#ity trac-ing
ERP &ro%ect anage ent "oft!are gi(e" anager" in"ight into a &ro%ect acro"" the entire &ro%ect #ifecyc#e, fro $e(e#o&ing an$ "e##ing the bu"ine"" or "er(ice, $e#i(ering that "er(ice, anaging an$ o&erating the bu"ine"" to bi##ing an$ co##ecting &ay ent once the &ro%ect i" co &#ete. 1he "oft!are gi(e" the"e anager" the $ata they nee$ to a""e"" an$ ana#y.e &ro%ect &erfor ance an$ &rofitabi#ity. 7Bi##ab#e hour" are the in(entory of a &ro%ect,ba"e$ fir , "o higher re"ource uti#i.ation an$ )better* anage ent of &ro%ect co"t" are -ey to re aining &rofitab#e,7 "ai$ Pau# 2a er an, (ice &re"i$ent of enter&ri"e a&&#ication" at 4orre"ter Re"earch. 2a er an "ai$ that ERP &ro%ect anage ent o$u#e" he#& co &anie" o&ti i.e the re"ource" they ha(e an$ a""ign tho"e re"ource" to &ro%ect" that !i## axi i.e the uti#i.ation of tho"e re"ource". ERP &ro%ect anage ent o$u#e" are a#"o u"e$ to &re(ent &ro%ect" fro going o(er bu$get or running o(er "che$u#e.
0hat other re"ource" !ou#$ you #i-e to "ee on ERP "u&&#y chain e$itorC"earch anufacturinger&.co .
anage entB E ai# u" at
About the author: !atherine )a!roi. is a freelance writer based in Portland, ,re. *he covers technology used in business, education and healthcare.
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ERP "u&&#y chain anage ent ERP cu"to er re#ation"hi& anage ent ERP &ro$uct #ifecyc#e ERP hu an ca&ita# ERP !arehou"e ERP a""et anage ent anage ent
anage ent
anage ent anage ent
ERP financia# ERP or$er ERP &ro%ect ERP in(entory
anage ent anage ent anage ent
Su&&#y chain anage ent )SCM* i" one of the o"t i &ortant "oft!are o$u#e" for anufacturer". SCM gi(e" &ro(i$e" (i"ibi#ity into the entire "u&&#y chain, fro "tart to fini"h. ERP SCM o$u#e" ty&ica##y inc#u$e co &onent" for foreca"ting, $e an$ anage ent, &rocure ent an$ &#anning+ $e#i(ery o$u#e" "uch a" #ogi"tic"+ an$ co &onent" for after, ar-et i""ue" #i-e return", in"ta##ation" an$ contract". Manufacturer" can u"e cu"to er re#ation"hi& anage ent )CRM* "oft!are to organi.e an$ (ie! $ata on in$i(i$ua# cu"to er tran"action" in one acce""ib#e &#ace. ERP CRM o$u#e" &ro(i$e cu"to er $ata integration, or a"ter $ata anage ent )M/M*, !hich -ee&" trac- of cu"to er" acro"" a## the "a#e" channe#" fro in,&er"on )fie#$ "a#e"* to &hone )inc#u$ing te#e ar-eting* to on#ine )te#e"er(ice an$ "u&&ort*. 0ith &ro$uct #ifecyc#e anage ent )PLM* "oft!are, anufacturer" can trac- the $e"ign an$ attribute" of a &ro$uct throughout it" #ifecyc#e, fro conce&t to en$,of,#ife. 1he co &onent" that a-e u& ERP PLM o$u#e" inc#u$e &ro$uct $ata anage ent )P/M*, &ro$uct $e"ign, &ortfo#io anage ent, $irect ateria#" "ourcing an$ cu"to er nee$" anage ent. 2u an ca&ita# anage ent i" another one of the co on ERP o$u#e". ERP 2CM o$u#e" function a" the core e &#oyee recor$, !hich $etai#" &er"onne# action", benefit" a$ ini"tration an$ &ayro##, &o"ition anage ent an$ co &#iance !ith go(ern ent regu#ation". ERP 2CM co(er" three area" of e &#oyee anage ent' tran"actiona#, ta#ent anage ent an$ exten$e$ anage ent. 0arehou"e anage ent "y"te " )0MS* "oft!are i" a u"t,ha(e for anufacturer". ERP 0MS o$u#e" fo##o! the $i"tribution &roce"" in(o#(e$ !ith fini"he$ goo$" or ateria#" fro $e#i(ery into the !arehou"e for "torage through re&#eni"h ent an$ &ic-ing for "hi& ent to fu#fi## or$er". 0MS o$u#e" a#"o he#& "ynchroni.e an$ contro# "toc- on the "ho& f#oor. Manufacturer" can trac- &hy"ica# anufacturing a""et" in(o#(e$ in &ro$uction ,, the &#ant it"e#f an$ e3ui& ent ,, u"ing ERP a""et anage ent o$u#e". So e of the $ai#y function" that ERP a""et anage ent han$#e" are aintenance "che$u#e", e3ui& ent u&ti e an$ $o!nti e, in(entory an$ !arranty anage ent an$ co &#iance !ith ha.ar$ou" ateria#" an$ !a"te trac-ing regu#ation".
4inancia# anage ent i" a critica# bu"ine"" function for anufacturer". ERP financia# anage ent o$u#e" inc#u$e functiona#ity for genera# #e$ger, !hich i" the core of ERP financia# anage ent. 1he"e o$u#e" a#"o han$#e function" for account" &ayab#e an$ recei(ab#e, fixe$ a""et", financia# re&orting an$ trea"ury anage ent. Or$er anage ent "y"te " ta-e in $ata fro or$er" on the front en$ ,, "uch a" cu"to er nu ber an$ &ro$uct &art nu ber ,, an$ a-e "ure that or$er" get fi##e$ on the bac- en$. Manufacturer" u"e ERP or$er anage ent o$u#e" to fi## &ro$uct or$er" at the #o!e"t &o""ib#e co"t. 1he"e o$u#e" are e3ui&&e$ to han$#e function" "uch a" auto ate$ or$er entry, (ie!ing an$ trac-ing+ or$er "tatu"+ cance#e$ tran"action"+ or$er an$ cre$it #i it (a#i$ation an$ chec-ing for $u&#icate or$er". 0ith &ro%ect anage ent "oft!are, anufacturer" can organi.e an$ re(ie! the $ata aroun$ &ro%ect ti e#ine" an$ co"t". 1he"e "oft!are "y"te " are geare$ to!ar$ organi.ation" that bi## c#ient" ba"e$ on the ti e their e &#oyee" "&en$ !or-ing on in$i(i$ua# &ro%ect". ERP &ro%ect anage ent o$u#e" han$#e" &ro%ect $efinition, &ro%ect co"ting an$ accounting, &ro%ect &ortfo#io anage ent, re"ource anage ent an$ &ro%ect bi##ing. ERP in(entory anage ent o$u#e" o(e fini"he$ goo$" through the &ro$uction cyc#e. 1hey are often tie$ into other function", inc#u$ing "hi&&ing, #ogi"tic", or$er", bi##ing an$, on a broa$er "ca#e, !arehou"e anage ent. ERP or$er anage ent "oft!are inc#u$e" functiona#ity for in(entory contro#, "eria# nu ber trac-ing, bar co$e &rinting, bui#$ ateria#" an$ -itting, in(entory (a#uation an$ S56 anage ent. Supply Chain Management ERP SCM "y"te " ty&ica##y "tart !ith creating an or$er an$ "hi& ent, &utting the tran"&ortation together, boo-ing the $e#i(ery an$ beginning the bi##ing cyc#e. 78t9" a (ery "traightfor!ar$ chain of #ogi"tic" in a "a#e" "cenario,7 "ai$ 2o#ger 5i"-er, an ana#y"t at 4orre"ter Re"earch. 71he functiona#ity ight inc#u$e "o e &#anning a"&ect" an$ $e an$ &#anning. 8t can trac- the cu"to er $e an$ an$ generate a foreca"t. Ba"e$ on that :$ata; you can "trea #ine the "u&&#y chain on the $e#i(ery "i$e.7 1y&ica# o$u#e" of an ERP "u&&#y chain anage ent "uite inc#u$e'
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/e an$ foreca"ting an$ &#anning Su&&#y chain net!or- &#anning to atch $e an$ !ith the "u&&#y "i$e Pro$uction &#anning that ref#ect" the $e an$ /etai#e$ "che$u#ing that $irect" &ro$uction for the $e an$ "i$e E(ent <#ert anage ent to co##ect an$ ana#y.e $i"tribute$ $ata "ource" onitor" for e(ent anage ent
Pricing o&ti i.ation acro"" the #ifecyc#e of a &ro$uct Su&&#y chain net!or- $e"ign an$ o&ti i.ation, to e(a#uate co &#ex "u&&#ier net!or-" an$ $eter ine the o"t &rofitab#e configuration"
0hen e(a#uating ERP SCM &ro$uct", "oft!are buyer" "hou#$ be a!are that $ifferent in$u"trie" ha(e $ifferent re3uire ent" for ERP an$ SCM. 7<#though there are "o e core o$u#e" an$ re3uire ent", the "&ecific" of !hich ) o$u#e" or* &ro$uct" to u"e can be (ery $ifferent fro in$u"try to in$u"try,7 5i"-er "ai$. 8n retai#, for exa &#e, $e an$ &#anning i" "trong#y #in-e$ to a""ort ent &#anning an$ foreca"t "y"te ". 8f you9re in charge of o(ing &etro#eu &ro$uct", you9## !ant your ERP SCM "y"te to ha(e ca&abi#itie" to ana#y.e "&ecific e#e ent" of the tan- "y"te or of the ty&e" of truc-" re3uire$.
One benefit that co &anie" gain fro an ERP SCM $e&#oy ent i" re$uce$ carrying co"t" for !arehou"e "toc-. SCM can a#"o re$uce tran"&ortation co"t" by o&ti i.ing the ba#ance bet!een "u&&#y an$ $e an$ an$ by re$ucing the ti e bet!een !hen the &ro$uct i" "hi&&e$ an$ &ay ent i" recei(e$. Warehouse Management ERP !arehou"e anage ent "y"te )0MS* o$u#e" fo##o! the $i"tribution &roce"" in(o#(e$ !ith fini"he$ goo$" or ateria#" fro $e#i(ery into the !arehou"e for "torage through re&#eni"h ent an$ &ic-ing for "hi& ent to fu#fi## or$er". 71hi" i" !here you recor$ actua# "hi& ent", -ee& trac- of in(entory !hen you "hi& to fi## or$er" an$ !hen you recei(e ne! fini"he$ goo$",7 "ai$ =reg <i i, a re"earch $irector at <MR Re"earch !ho ana#y.e" c#ient"9 $e an$,$ri(en "u&&#y net!or-". 6n#i-e in(entory anage ent, !hich focu"e" on o(ing goo$" or in(entory acro"" the co &#ete "u&&#y chain, ERP 0MS trac-" or$er" that co e into the !arehou"e through the or$er anage ent "y"te "o they are fi##e$ accurate#y an$ on ti e. 78t9" !here the anufacturing center ha" &u"he$ the fini"he$ goo$" out into the $i"tribution en(iron ent,7 <i i "ai$. 78n the !arehou"e you $o recei(ing, you ha(e $oc- $oor" on one "i$e !here you9re recei(ing an$ the goo$" are &ut on the "he#(e". 1hen a" or$er" co e in fro cu"to er", you ha(e echani" " by !hich you &ic-, &ac- an$ then "hi& out of the !arehou"e.7 <## the function" of the !arehou"e anage ent "y"te are geare$ to!ar$ &erfor ing or$er fu#fi## ent, on ti e, !ith the right &ro$uct, at the #o!e"t &o""ib#e co"t. 1he &rinci&a# focu" of the ERP 0MS o$u#e i" in(entory accuracy' 0ith a !arehou"e anage ent "y"te , co &anie" -no! ho! uch &ro$uct )of any gi(en S56* they ha(e at any gi(en ti e in that faci#ity. =i(en that in(entory accuracy, they can $eter ine ho! to anage or$er fu#fi## ent at the o"t &ro$ucti(e ean" &o""ib#e. ERP 0MS function" ty&ica##y inc#u$e'
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Pic-ing "trategie" )accor$ing to "toc-, !ith ru#e" of &riority by ex&iry, #ocation, etc.* Phy"ica# in(entory trac-ing 8n(entory anage ent an$ &#anning for re&#eni"h ent
Stoc- trac-ing )arri(a#">$e&arture", ex&iration $ate, in(entorie", #ocation"* Synchroni.ation an$ contro# of the "toc- in the "ho& f#oor
ERP !arehou"e anage ent &roce""e" &ro(i$e u&,to,$ate infor ation on in(entory "o it can be correct#y (a#ue$. ERP 0MS offer" return,on,in(e"t ent )RO8* through an&o!er "a(ing", "&ace uti#i.ation, &ro$uct turn" an$ cu"to er "a#e" ba"e$ on efficiency, re"&on"i(ene"" an$ accuracy. Inventory Management 0hi#e in(entory anage ent can be a "tan$a#one a&&#ication, ty&ica##y the "oft!are i" bun$#e$ into !arehou"e anage ent or "u&&#y chain anage ent "y"te ". 1hi" ERP in(entory anage ent o$u#e i" u"e$ by retai#, $i"tribution an$ anufacturing an$ tie$ into retai# erchan$i"ing "y"te " !here u"er" a#"o anage &ricing. 7?ou nee$ to -no! !hat9" on the "he#(e", !hat9" in the !arehou"e, an$ ho! you re,or$er goo$" to anage the f#o! of goo$" throughout the o&eration,7 "ay" Pau# 2a er an, (ice &re"i$ent of enter&ri"e a&&#ication" at 4orre"ter Re"earch. 1he goa# i" to get the in(entory to turn o(er,7 2a er an "ai$. 7?ou9re not a-ing any oney if it9" "itting in the !arehou"e.7 1he ain in(entory anage ent function" in(o#(e recei(ing, "toring an$ returning in(entory. 7?ou nee$ to account for )in(entory* !hen it9" arri(e$, !here you &ut it, ho! #ong it9" been there, ho! it9" been returne$ or ho! it9" been &ut into a &ro$uct,7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&.
Other -ey feature" in ERP in(entory
anage ent
o$u#e" are'
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8n(entory contro# Bui#$ ateria#" an$ -itting )&utting co &onent" together a" &art of a -it for "a#e* Seria# nu ber trac-ing Bar co$e &rinting @a#uation feature" to un$er"tan$ the $o##ar (a#ue of in(entory on han$ S56 anage ent
1he "oft!are &ro(i$e" a !ay to trac- thing" that are re#ate$ to each other. 74or a ce## &hone in a box, the o$u#e !ou#$ tie a## the in(entory to the ce## &hone, "tarting !ith -itting, !hich inc#u$e" bui#$ ateria#", "tatu" of -itting co &onent", "eria# nu ber" an$ #ot tracing, an$ exten$ing to un,bui#$ing the -it" an$ &utting thing" bac- if you get a reca## on a &art that nee$" to be re&#ace$ in the -it,7 "ai$ 0ang. <nother feature of ERP in(entory "&en$ #e(e#". anage ent i" the abi#ity to trac- an$ anage &urcha"e" in or$er to $eter ine
0hen co &anie" are carrying #ot" of in(entory, ca"h anage ent beco e" an i &ortant factor. 7?ou nee$ to "ure you9re not $e&#oying your ca&ita# ina&&ro&riate#y,7 "ai$ 0ang.
a-e
78f a## the batterie" you or$ere$ for a -it are i""ing, your &ro$uction i" $e#aye$, but you $on9t !ant too uch on han$, becau"e you ha(e to "tore it, !hich !i## a#"o co"t you,7 he "ai$. 7?ou nee$ to -no! ho! #ong thi" in(entory !i## be in the !arehou"e an$ !hen it !i## "hi&.7
Customer Relationship Management Si &#y &ut, ERP cu"to er re#ation"hi& anage ent )CRM* "oft!are &ro(i$e" c#ear $etai# on each in$i(i$ua# cu"to er tran"action in one acce""ib#e &#ace. But ERP CRM "y"te " can $o uch ore. 1hey a#"o &ro(i$e cu"to er $ata integration, or a"ter $ata anage ent )M/M*, !hich -ee&" trac- of cu"to er" acro"" a## the "a#e" channe#" fro in,&er"on )fie#$ "a#e"* to &hone )inc#u$ing te#e ar-eting* to on#ine )te#e"er(ice an$ "u&&ort*. 7<nyone !ho i" $ea#ing !ith the cu"to er ha" acce"" to a (ery $etai#e$ trac- recor$ of e(erything that ha" ha&&ene$ !ith the cu"to er,7 "ai$ 2o#ger 5i"-er, an ana#y"t at 4orre"ter Re"earch. 1hi" recor$ inc#u$e" $ata about current &ro$uct &urcha"e" or contract "tatu" ,, infor ation that can u#ti ate#y he#& increa"e "a#e". 1he $ata generate$ fro ERP CRM "oft!are auto atica##y &ro(i$e" infor ation that #et" you trac- #ea$" an$ figure out ho! any of tho"e #ea$" ha(e turne$ into $ea#". 76#ti ate#y, you9re #oo-ing at the effecti(ene"" of your ar-eting &rogra " to "ee !hat channe#" are ore "ucce""fu#, !hat ca &aign" are ore "ucce""fu#, !hich one" are o(ing the nee$#e in ter " of "a#e",7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&. <t the core of a## ERP CRM i" the cu"to er $ataba"e fro !hich ERP CRM o$u#e" generate auto ate$ re&ort" an$ con"o#i$ate$ infor ation. 78t9" i &ortant to be ab#e to "#ice an$ $ice the re&ort" in (ariou" $i en"ion", &er region, &er cu"to er "eg ent, &er &ro$uct, an$ &er "&ecific ti e of the year>"ea"on",7 5i"-er "ai$. 1he three -ey co &onent" of a CRM a&&#ication are "a#e", thi" !ay' ar-eting an$ "er(ice". Each of tho"e i" bro-en $o!n
Sales
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Cu"to er $e an$ in"ight" Cu"to er o&&ortunity anage ent Or$er anage ent )(ia ca## center, internet "a#e", anage ent obi#e "a#e"*
Sa#e" &erfor ance
Marketing
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Ca &aign an$ &ro otion Cu"to er "eg entation Lea$ anage ent
anage ent
Mar-eting ana#ytic"
Services
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Cu"to er "er(ice anage ent Co &#aint anage ent 4ie#$ "er(ice Ser(ice anage ent
anage ent ana#ytic"
8n a$$ition to in$i(i$ua# cu"to er infor ation, CRM "y"te " a#"o &ro(i$e a $etai#e$ (ie! of cu"to er "eg ent". One !ay ERP CRM "y"te " can increa"e "a#e" &ro$ucti(ity i" by getting the right &ro$uct to the right cu"to er at the right ti e, !hich $e#i(er" a higher return, !hich #ea$" to the -ey benefit" that anufacturer" an$ retai#" can achie(e' higher "a#e" argin". 7?ou can c#o"e the "a#e" cyc#e ore efficient#y,7 "ai$ 5i"-er. 75ey Perfor ance 8n$icator" )5P8"* can be i &ro(e$ !ith the right CRM "o#ution", the nu ber of ca##" that a ca## center agent can han$#e can be i &ro(e$, an$ the nu ber of c#o"ing" &er nu ber of a(erage ca##", can be i &ro(e$.7 Product Life-cycle Management 1he &ro$uct $e(e#o& ent chain or &ro$uct $efinition "tart" !ith &ro$uct conce&t, fo##o!e$ by $e"ign, te"ting, (a#i$ating an$ intro$uction into anufacturing an$ the "u&&#y chain. 7<" a &ro$uct get" o#$er, the $e(e#o& ent cyc#e exten$" to $eci"ion" about &ro$uct re$e"ign, co"t re$uction, or ta-ing it off the ar-et,7 "ai$ Mi-e Bur-ett, (ice &re"i$ent of <MR Re"earch9" 8n$u"try @a#ue Chain Strategie" tea . Core ERP &ro$uct #ifecyc#e anage ent inc#u$e" fi(e -ey co &onent"'
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Pro$uct $ata anage ent )P/M* i" the foun$ation of PLM. 8t enco &a""e" the "y"te of recor$" for a## $ocu ent" an$ infor ation about the &ro$uct. 1he ain function of P/M i" to aintain re(i"ion contro# an$ a-e "ure that e(eryone in(o#(e$ ,, fro $e"ign to ar-eting ,, ha" acce"" to that $ata. Co##aborati(e &ro$uct $e"ign #et" the tea "hare P/M $ata in a $e"ign re(ie! eeting !here in$i(i$ua#" can re(ie! the $e"ign an$ $i"cu"" !hat9" goo$ or !hat nee$" to change. 1hi" inc#u$e" (i"ua#i.ation too#" for #oo-ing at a A/ (er"ion of a &ro$uct or &art, an$ ar-ing it u& !ith co ent". Co##aborati(e $e"ign a#"o entai#" !or-ing !ith anufacturing to $e(e#o& the nece""ary too#" an$ &roce""e" for &ro$uction.
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Pro$uct &ortfo#io anage ent in(o#(e" &ro%ect anage ent acti(itie" "uch a" trac-ing for trac-ing !hat &ro%ect" in$i(i$ua#" are !or-ing on, ho! any &ro%ect" are in the &ortfo#io an$ the "tatu" of tho"e &ro%ect". <ccor$ing to Bur-ett, thi" feature he#&" the tea $eci$e !hich &ro%ect" in the &i&e#ine are the o"t i &ortant. /irect ateria#" "ourcing he#&" u"er" fin$ an$ organi.e the ateria#" that are u"e$ $irect#y in both $e(e#o& ent an$ &ro$uction &roce""e". 1hi" inc#u$e" a&&ro(e$ (en$or #i"t", (en$or cata#og" an$ !or-f#o! to "u&&ort the re3ue"t,for,3uote &roce"" for a&&ro(e$ (en$or". Cu"to er nee$" anage ent $i"&#ay" !hat cu"to er" !ant an$ bring that into the $e(e#o& ent &roce"". 1hi" a(oi$" $e"igner"9 ten$encie" 7to inno(ate on thing" that the cu"to er" ha(en9t a"-e$ for,7 "ai$ Bur-ett. Cu"to er nee$" infor ation a#"o co e" fro fee$bac- fro the cu"to er ba"e about in"ta##e$ &ro$uct".
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One benefit of ERP PLM i" fa"ter ti e to ar-et. 78f you un$er"tan$ the &roce"" better, you can re$uce the ti e it ta-e" to bring a &ro$uct to ar-et becau"e you can auto ate the &roce"" an$ offer )greater* acce"" to the "a e,7 Bur-ett "ai$. Human Capital Management ERP !" software functions as the core employee record, which details personnel actions, benefits administration and payroll, position management and compliance with government regulations. #$ company needs to %now on a cost level how many employees they have and what it's costing them, along with turnover rates and analytics to help them ma%e decisions and understand the essential talent that ma%es the organization successful,# said Paul amerman, vice president of enterprise applications at &orrester Research. !ore components of ERP human capital management include modules for three employment management processes' ransactional!
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(or%force management, including time capture, forecasting and absence management uman capital management, including employee records, benefits administration, payroll, position management and R compliance
alent management!
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Performance and compensation, including succession planning and career development )earning management, including training administration and content management *taffing and recruiting, including wor%force planning, re+uisitions, applicant trac%ing and new hires
E"tended management!
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Employee and manager processes "anagement reporting and analysis
#ey ERP HCM functions #Personnel management around the employee lifecycle, from hiring to promotions, transfers, and terminations, is the basic employee transaction that any system should be able to manage,# amerman said. ,ther %ey functional areas include compensation, bonuses and long-term e.ecutive compensation functions li%e stoc% plans, organizational and position structures, and compliance to government regulations around diversity.
*ome ERP !" modules will also handle nonemployees, such as contractors, as part of a personnel management component. /eyond standard compensation structures, including salary grades and benefits programs, ERP !" applications can also be set up to manage eligibility determinations for fle.ible spending accounts and time off programs. #It's important to develop people in a way that is aligned with the ob0ectives of the business,# said amerman. #1hat's the strategic aspect of it, which is of critical importance. !ompanies that get that tend to be more successful.# $sset Management 7)Enter&ri"e a""et anage ent* goe" han$ in han$ !ith in(entory anage ent, but the $ifference i" that in(entory anage ent i" about the &hy"ica# goo$" that are in the !arehou"e. <""et anage ent i" about the e3ui& ent,7 "ai$ Ray 0ang, "enior ana#y"t at <#ti eter =rou&. So e (en$or" offer a""et anage ent "oft!are a" a "e&arate a&&#ication+ other" a-e it &art of a "uite of a&&#ication". So e " a##er (en$or" offer "tan$a#one a&&#ication" for ca&abi#itie" "uch a" a""et", in(entory an$ !arehou"e anage ent. 4or the &ur&o"e" of thi" gui$e, the ter refer" to ERP a""et anage ent o$u#e" that tie into the bac-bone of an ERP "y"te . 5ey function" inc#u$e trac-ing for'
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Maintenance "che$u#e" E3ui& ent u&ti e an$ $o!nti e 8n(entory an$ !arranty anage ent ateria#" an$ !a"te trac-ing regu#ation"
Co &#iance !ith ha.ar$ou"
By integrating enter&ri"e a""et anage ent o$u#e" !ith ERP "y"te ", co &anie" can increa"e the a(ai#abi#ity of their &ro$uction e3ui& ent an$ re$uce o(era## &#ant co"t" through better "er(ice an$ aintenance &rogra ". <""et anage ent "oft!are can a#"o he#& a co &any i &ro(e it" ca"h f#o! by increa"ing in(entory turno(er an$ o&ti i.ing anufacturing &ro$uction. 7?ou nee$ to -no! if your achinery an$ e3ui& ent are in goo$ !or-ing or$er an$ if tho"e achine" are running at axi u ca&acity !ith an u&ti e of 99.9 &ercent,7 0ang "ai$. 78f you9re co##ecting re(enue throughout the tran"action, you nee$ to acti(e#y a-e "ure that you fix tho"e achine" or -ee& the in goo$ !or-ing or$er in ter " of re&air an$ !arrantie". 8t9" rea##y critica#, e"&ecia##y if you9re in the !or#$ of &ro$uction or $e#i(ery.7 ERP a""et anage ent can he#& a co &any i &ro(e it" ca"h f#o! in other !ay". 4or exa &#e, if a co &any ha" ten &iece" of achinery an$ can $eter ine ho! to u"e eight ore effecti(e#y, 7you9(e %u"t "a(e$ !hate(er the co"t of ca&ita# i" for t!o &iece" of hea(y e3ui& ent,7 "ai$ 0ang. 78f you can fin$ !ay" to create ore efficient &roce""e" in your &#ant", then you $on9t ha(e to !orry about too uch re$un$ancy !ith aintenance "che$u#e", ini i.ing $o!nti e an$ o&ti i.ing &ro$uction "che$u#e".7 0ang "ai$. 1hat9" !here a""et anage ent $e#i(er".7 %inancial Management =enera# #e$ger i" at the core of any ERP financia# anage ent "y"te , !hich enco &a""e" the function" that are re3uire$ to aintain one or ore "et" of boo-", generate financia# re&ort", anage ca"h an$ fixe$ a""et" an$ execute &ay ent an$ recei(ab#e tran"action". 7E(erything "tart" by ha(ing a genera# #e$ger an$ then it !or-" it" !ay out to account" &ayab#e" )ho! you &ay (en$or"* an$ account" recei(ab#e" )ho! you co##ect fro cu"to er"*,7 "ai$ Ray 0ang, "enior ana#y"t, <#ti eter =rou&. 1he ba"ic co &onent" of a financia# anage ent "y"te inc#u$e'
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=enera# #e$ger, !hich re&re"ent" the core "et of boo-" for a bu"ine"" entity <ccount" &ayab#e, !hich $i"bur"e" oney to (en$or" <ccount" recei(ab#e, !hich &roce""e" inco ing ca"h 4ixe$ a""et", !hich in(entorie" ca&ita#i.e$ &ro&erty 4inancia# re&orting, !hich "u $etai#" ari.e" the re"u#t" in "tan$ar$ re&ort" "uch a" tria# ba#ance" an$ account
Many ERP financia# anage ent "y"te " a#"o inc#u$e o$u#e" "uch a" trea"ury anage ent, !hich can inc#u$e #oc- box, re(enue f#o!, ca"h f#o!, account ba#ance", fun$ tran"fer" an$ tax a""e"" ent". < ca"h anage ent o$u#e a##o!" you to create an o&ti a# &ay ent>co##ection "che$u#e. 1here9" a#"o bu"ine"" inte##igence )B8* functiona#ity an$ contro#" for go(ernance, ri"- anage ent an$ co &#iance )=RC*. Pro%ect accounting offer" a re&ort "tructure ba"e$ on hour" con"u e$. <ccor$ing to 4orre"ter Re"earch ana#y"t 2o#ger 5i"-er, ERP financia# anage ent "oft!are "hou#$ inc#u$e feature" that "u&&ort creation of a$ hoc re&orting a" !e## a" onth,en$ c#o"ing, 3uarter c#o"ing" an$ year,en$ re&orting. 7Since it9" trac-ing e(ery o(e ent in an$ out of the !arehou"e, it can $e#i(er at any ti e c#ear (a#ue of !hat9" in "toc-,7 "ai$ 5i"-er. 71he financia# o$u#e )"hou#$* fo##o! e(ery in$i(i$ua# "te&, inc#u$ing bu$get &#anning for &ro$uction an$ bi##ing.7 ERP finance o$u#e" can a#"o he#& you eet 4inancia# <ccounting Stan$ar$" Boar$ )4<SB* "tan$ar$". <nother benefit i" "y"te atic auto ation of $ata on tran"action" "uch a" !arehou"e in(entory or the nu ber of $ay" account" recei(ab#e" ha(e been aging. 7E""entia##y, it9" gi(ing you a## the financia# $ata that you nee$ to run a bu"ine"",7 "ai$ 0ang. &rder Management On the front en$, the "y"te ca&ture" $ata "uch a" cu"to er nu ber, &ro$uct &art nu ber an$ $ue $ate for routing an$ in$exing !hen an or$er arri(e", no atter !hether the or$er i" in the for of a fax, &hone ca##, e ai#, or !hether it i" &a&er,ba"e$ or e#ectronic. Ca&ture$ $ata i" then tran"ferre$ to an or$er anage ent a&&#ication. 8n the bac- office, the anufacturing or$er anage ent a-e" "ure that the or$er get" fu#fi##e$ ,, an$ at the #o!e"t co"t, "ai$ =reg <i i, a re"earch $irector at <MR Re"earch !ho ana#y.e" c#ient"9 $e an$,$ri(en "u&&#y net!or-". 5ey ERP or$er anage ent function" inc#u$e'
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<uto ate$ or$er entry, (ie!ing an$ trac-ing Rea#,ti e a(ai#abi#ity of or$er "tatu" an$ tran"action $ata Contro##e$ han$#ing for cance#e$ tran"action" @a#i$ating or$er" an$ cre$it #i it chec-ing Chec-ing for $u&#icate or$er" 8nfor ation on a## cu"to er or$er anage ent &roce""e"
Re&ort" on &roce"" ti e an$ (o#u e, 3ueue$ or$er", exce&tion" an$ $e#i(ery $ate"
8n an ERP or$er anage ent "y"te , a## the $ata i" integrate$ bet!een or$er", in(entory an$ an organi.ation9" !arehou"e to a-e the fu#fi## ent an$ "hi&&ing of or$er" run " ooth#y.
7Mo"t "y"te " interact !ith infor ation &roce""e" #i-e cu"to er "er(ice )&rioriti.ing "hi& ent* or anufacturing )&ro$uct a(ai#abi#ity*,7 <i i "ai$. 7<## of the"e are out"i$e of the execution of the"e "y"te ", but it9" goo$ infor ation to ha(e for a ho#i"tic a&&roach.7 1he -ey benefit of an ERP anufacturing or$er anage ent "y"te i" fa"ter or$er fu#fi## ent an$ ore effecti(e "a#e" a$ ini"tration. 8t can he#& increa"e $ata entry accuracy an$ i &ro(e ca"h f#o!, re$uce or$er error" an$ fu#fi## ent $e#ay", an$ i &ro(e cu"to er "ati"faction. Re&orting an$ ana#y"i" feature" ba#ance !or-#oa$" an$ i$entify &roce"" bott#enec-". Many ERP or$er anage ent "y"te " offer auto atic confir ation "ent $irect#y to the cu"to er once the entry i" create$ in the ERP "y"te . 1hi" a$$itiona# trac-ing of a## inco ing $ocu ent" fro creation in the ERP to fu#fi## ent a$$" another #ayer of &roce"" onitoring an$ contro#. ERP &ro%ect anage ent "y"te " are geare$ to!ar$ organi.ation", "uch a" engineering fir ", con"truction fir ", con"u#tant" an$ architect", that bi## c#ient" ba"e$ on the ti e their e &#oyee" "&en$ !or-ing on in$i(i$ua# &ro%ect". Pro%ect anage ent o$u#e" $e#i(er &roce"" auto ation an$ &roce"" i &ro(e ent that tran"cen$" the tra$itiona# boun$arie" of cu"to er re"ource anage ent )CRM* an$ "u&&#y chain anage ent )SCM* "oft!are to inc#u$e &ro%ect accounting, change anage ent, ti e an$ ex&en"e re&orting an$ ana#ytic" about acco &#i"he$ !or-. 1he core co &onent" of ERP &ro%ect anage ent "oft!are inc#u$e'
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Pro%ect $efinition, !hich inc#u$e" ta"-" an$ $e#i(ery $ate" an$ fin$ing re"ource" to fu#fi## the &ro%ect Pro%ect co"ting an$ accounting, !hich #oo-" at $irect co"t", ateria#", #abor, tra(e# an$ other co"t" a""ociate$ !ith the &ro%ect Pro%ect &ortfo#io anage ent, !hich &ro(i$e" (i"ibi#ity o(er ti e an$ on bu$get u#ti&#e &ro%ect" to "ee if &ro%ect" are running on
Re"ource anage ent, !hich i" the hu an re"ource" )2R* co &onent an$ &ro(i$e" (i"ibi#ity into re"ource" a(ai#ab#e for u#ti&#e &ro%ect" Bi##ing for &ro%ect" &er hour, inc#u$ing &rofitabi#ity trac-ing
ERP &ro%ect anage ent "oft!are gi(e" anager" in"ight into a &ro%ect acro"" the entire &ro%ect #ifecyc#e, fro $e(e#o&ing an$ "e##ing the bu"ine"" or "er(ice, $e#i(ering that "er(ice, anaging an$ o&erating the bu"ine"" to bi##ing an$ co##ecting &ay ent once the &ro%ect i" co &#ete. 1he "oft!are gi(e" the"e anager" the $ata they nee$ to a""e"" an$ ana#y.e &ro%ect &erfor ance an$ &rofitabi#ity. 7Bi##ab#e hour" are the in(entory of a &ro%ect,ba"e$ fir , "o higher re"ource uti#i.ation an$ )better* anage ent of &ro%ect co"t" are -ey to re aining &rofitab#e,7 "ai$ Pau# 2a er an, (ice &re"i$ent of enter&ri"e a&&#ication" at 4orre"ter Re"earch. 2a er an "ai$ that ERP &ro%ect anage ent o$u#e" he#& co &anie" o&ti i.e the re"ource" they ha(e an$ a""ign tho"e re"ource" to &ro%ect" that !i## axi i.e the uti#i.ation of tho"e re"ource". ERP &ro%ect anage ent o$u#e" are a#"o u"e$ to &re(ent &ro%ect" fro going o(er bu$get or running o(er "che$u#e.
0hat other re"ource" !ou#$ you #i-e to "ee on ERP "u&&#y chain e$itorC"earch anufacturinger&.co .
anage entB E ai# u" at
About the author: !atherine )a!roi. is a freelance writer based in Portland, ,re. *he covers technology used in business, education and healthcare.
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