Enterprise Resource Planning

(ERP)
 This presentation is dedicated to discuss

enterprise resource planning, its emergence,

implementation, importance of using it within

organizations and the different challenges related

to its implementation.
 The complexity of the business and work

environment nowadays and the changing nature

of market requirements have led to looking for

systems that could improve organizations

competitiveness, achieve cost effectiveness and

cope with the logistic needs.

 The Enterprise Resource Planning (ERP) has

emerged as a technique to balance between

demand and supply, reinforce business

productivity and promote the quality of processes.

 ERP is a software that is dedicated to

manage all business processes through using an

integrated and comprehensive applications to

manage different tasks and operations in different

fields such as planning, manufacturing, sales,

marketing, human resources, purchasing, etc and

unified them in a single platform that lead to

effective real changes on the organizational level

and increase in the level of revenues.

 The emergence of ERP software as a way to

integrate the processes and functions of the

organization in a unified and advanced technique by

sharing a common database in such a way that

supports the effective and efficient implementation

of different operations within the organization.

 There are many factors that prompt the use

of ERP in different business organizations among

them are the inability of existing system to fulfill

organizational needs and provide extensive

resources for maintenance and support, the

incompatibility of several information systems

with the current business systems and the

inability of employees to respond easily and

quickly to customers or suppliers' inquiries and

concerns.
 ERP systems contain several configuration

options for each business process based on best

practices which sometimes force the firm to

reengineer its business processes to be

compatible with the software package options.

 The retrofit of technical infrastructure has

succeeded in transforming the way ERP systems

work; at first, installing and maintaining an ERP

system were expensive and took a relatively long

time to get the revenue, after that the

implementation and maintenance cost of ERP

system was greatly decreased due to technical

infrastructure modernization.
 ERP systems are able to minimize data

replication, control data records, and reduce

registration errors.
 The interdependence and interconnectivity

among all processes of ERP systems reduce the

time needed to perform the different operational

tasks, so the process efficiency can be increased

and the speed of performing operations can be

doubled.
 The strengths that distinguish ERP systems

from non-integrated traditional systems; first it

provides a unified enterprise view of the business

and a scheme of how functions should be

performed in different departments.

 Second, it introduces an enterprise database

where all business transactions are saved,

processed, evaluated and disclosed. In other

words, it provides an accurate methodology which

helps managers and employers to quickly access

database and find what they are searching for.

Emergence of ERP
 ERP system can be dated back to standard

inventory control packages designed to handle

traditional inventory processes without addressing

the finance and accounting area.

 The late eighties and early nineties has

witnessed the emergence of new software

systems known as ERP targeting mainly large

complex business organizations.

 This complex, expensive and powerful

systems become available for most organizations,

it requires nothing but consultants who can install

and implement them based on the company’s

requirements and real needs.

 ERP systems have begun to emerge in the

field of resource management in the late 1980s

and the beginning of 1990s mainly targeted to

large business organizations.

 To run these complex and powerful systems;

they require professional consultants to implement

them within organizations that have different

requirements and needs and as a result, these

systems require organizations to reengineer all their

business processes to accommodate the software

modules.
 These systems have options to add "add-on"

when organizational processes required these

options to ensure effective and comprehensive

application.
 The need for information systems in general

and ERP systems in particular emerged from the

assumptions that these systems are considered as

being pillars for the survival of organizations as

they can provide many options facilitating the

flow of processes and operations across the

organization such as speedy access of information

anytime and anywhere and accurate processing of

data that can be used in different operations and

by different levels from senior management to

ordinary employees.
 Speedy access of data is very helpful

especially for the processes of preparing different

reports and minimizing errors that used to occur

while depending on manual strategies for

collecting information.
Importance of ERP
 ERP systems are of great importance for

work and business environments today; while

looking at different organizations and processes

associated with them, we can say that

organizations aren't separated entities in which

each department works independently of other

departments but rather they are integrative

processes where all departments work in harmony

with each other to achieve the objectives and

goals of the whole organizations.

 Among the most important advantages of

using ERP in organizations are the integration of

different tasks and functionalities and help senior

management in decision making processes through

providing different alternatives and showing the

negative and positive effects linked to them.

Implementation of ERP
 It is worthy here to mention that the

effective implementation of ERP systems depends

on many internal and external factors.

 For example organizational culture,

leadership support, clear implementation plan,

continuous overview of the budget and available

financial resources and employees' internal

motivation and openness to change, desire to

update the traditional methods of doing work are

among the common internal factors that may

affect the implementation of ERP systems in

organizations while the policies and obligations

that govern the work environment and be

supported by higher authorities are considered

among the external ones.

 The different factors that may affect the

implementation of ERP systems are economic

growth, government policies, the type of ICT

infrastructure and organizational factors especially

the computer culture, management commitment,

business process re-engineering and IT maturity

level.
 It is also obvious that ERP implementation

depends on four distinct phases such as

preparation and training, transition, performance

and usefulness, and maintenance.

 The different factors that may affect the

implementation of ERP systems are economic

growth, government policies, the type of ICT

infrastructure and organizational factors especially

the computer culture, management commitment,

business process re-engineering and IT maturity

level.
Challenges of ERP System’s

Implementation
 It is also not uncommon that there are many

challenges linked to the use of ERP systems in

organizations revolved around the financial and

technical issues.
 Grabski et al. identified five major challenges

which influences the effective implementation of

ERP systems within the organization such as the

lack of consistency or harmony between the

requirements of ERP system and the real needs of

the business processes.

 The possible loss of control over employees

or over processes, the risks related the level of

complexity in managing the system, lack of in

house skills.
 Sometimes users and/or employees may feel

resistance of this type of systems due to their

inability to go in harmony with the requirements

of these systems or their desire to adhere to the

stereotyped models of performing the roles.

 Rajapakse & Seddon marked some

challenges that hinder the effective

implementation of ERP in organizations in

developing countries.
 They found that high cost of installing and

maintenance and the lack of knowledge regarding

how these systems operate are among the most

common challenges that impede the

implementation of these software systems.