Enterprise Resource System

The Enterprise Resource Planning systems were introduced for companies to try to solve organizational difficulties concerning its different departments. Caused by the development of corporate use of information technology in the 1990’s (Davenport, 1998), these systems promise to provide an integrated infrastructure that would minimized communication delays for transactions needing more than one department. By establishing an enterprise-wide database, it visions that the data storing and retrieving processes would be easier and better both for the companies employees and its costumers.

O’Leary's defination of ERP

As O’Leary (2005) had defined ERP, it should be a software package that enables business to integrate different kind of functionalities.

A trivial example is the integration of the software that conducts payroll to the software that conducts accounting and auditing. This example would give benefits both for the employees and the manager since it would half their work. As the company improves its output over time, the company manager may opt to reassign its affected employees to other tasks or to drop their number of working hours.

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But before a company manager should adopt this kind of system, he must first know why there are criticisms that contradict with it1. There exist reported problems of companies that had already started to implement ERP. Because ERP does involve large change within the enterprise3, a sufficiently large enough of time should be allotted with training employees that would use it. People who had been accustomed with their individual old systems would be unfamiliar with the new software that is able to do the payroll, the accounting and the auditing all at the same time.

Data from the old systems should also be properly migrated first which only the employees could only know how only after they are capable enough to use the new system. Another problem with the move to ERP is that its cost-effectiveness could not be realized fast. Developing such a customized system is commonly tasked to a separate company specializing in ERP. The new system cost, which usually amounts higher than the combined cost of the older systems, does not end with just a simple acquisition of a software package; it also includes periodic payment of its license together with its provided technical support.

Microsoft, one of the leaders in giving ERP Solutions

Microsoft, one of the leaders in giving ERP Solutions, had laid out their different off-the-shelf products that they said capable to integrate the functionalities of several existing business software in the market4. Together with the products is their individual expected revenue per annum which the highest amounts up to US$1 Billion. But the above given drawbacks does not hinders the company to why not try implementing ERP. A company should assess if he is ready to implement this new system.

After the company had been able to carefully select an ERP Solution provider that suites their need, training of experienced employees to the new system should comes next. After that, they could then plan how the real change is started to be implemented. Through time, they would be acquainted with the system and that is the time they would feel its promised benefits. A company may still choose to not adopt an ERP system. As for some company, they think that their internal work structure is now well established and introducing a new system would only ruin it.

Others may say that their system is more superior to ERP. The remaining may choose not to implement it because of resources restrictions such as time and qualified personnel that would handle the new system. As for now in my opinion, the decision of whether to adopt ERP still lies to every company manager. Their decision to follow or not to follow the trend would then decide the future of the company.

References

1. M. Themistocleus, Z. Irani, R. O’Keefe, R. Paul. (2001).ERP Problems and Application Integrated Issues: An Empirical Survey. Information Systems Evaluation Group, Department of Information Systems and Computing, Brunel University, Uxbridge, UK. Retrieved May 30, 2008 from http://www. hicss. hawaii. edu/HICSS_34/PDFs/ST2EA03. pdf 2 H. Tadinen. (2005).
2. Human resources management aspects of Enterprise Resource Planning (ERP) Systems Projects. Swedish School of Economics and Business Administration. Retrieved May 30, 2008 from http://www. pafis.shh. fi/graduates/heltad02. pdf
3. M. Andersson. (Feb 2008). Securing an ERP Implementation. School of Mathematics and Systems Engineering, Vaxjo University. Retrieved May 30, 2008 from http://www. cil. se/data/files//Examensarbeten/Examensarbete_MariLouiseAndersson_Securing_an_ERP_implementation. pdf
4. MBS ERP Product Overview (Chart). Microsoft Business Solutions Roadmap 2004. Retrieved May 30, 2008 from http://www. directionsonmicrosoft. com/sample/DOMIS/update/2004/03mar/0304bsr2_ch. htm