Management Information Systems

In order to compete in this complex business world, companies need better information management of the company’s data, a management that will help in better analysis of the processes involved. Organizations are however having a difficult time integrating and correlating data from various software applications and are looking forward to a single application. This is where the organization can employ Enterprise Resource Planning (ERP) Software. The first article discusses the factors which should be considered while migrating to an ERP system.

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The second article outlines that purpose of ERP technology is to support the business processes that support the company’s strategic opportunities. No amount of advanced information technology can offset the problem of a flawed business strategy and poorly performing business processes. The article also emphasizes that successfully implementing ERP the first time requires a structured methodology that is strategy, people and process-focused. Doing it right the first time is the only cost-effective way to go. The third article outlines some of the causes of failure of ERP implementations and suggests ways to overcome such failures.

The fourth article emphasizes that since ASPs have proven technology, methodology, and ERP application expertise already in place, ASP customers by paying a predictable, flat-rate monthly fee, can move attention away from the day-to-day management of applications and technology and divert the same towards more value-added activities that turn the promise of ERP into profits. The fifth article suggests that implementing an ERP is only the first step and the real challenge lies in the successful execution of a quality assurance plan, otherwise known as a post-implementation optimization plan.

ERP outsourcing relieves the cost pressures from organizations by weeding out unnecessary recurrent costs. By negotiating with outsourcing service providers for fixed charges that are lower than the internal IT costs, organizations can not only efficiently reduce costs but also effectively create the time and money needed for the projects they really need or want to put in place. The sixth article enables us to look for ways to justify the huge investment made in ERP Solutions. Investments in ERP packages are considered as similar to buying a financial call options.

The cost of the projects is analogous to the cost of buying the option or the value of option. In other words an organization acquires an option by investing in an ERP. This method of valuing of investment projects results in a higher value than traditional financial techniques such as net present value (NPV). Also using option pricing methodology recognizes the investments can be more valuable when there is a high degree of uncertainty. Throughout this KIF the risks and advantages associated with the entire life cycle of ERP projects have been assessed.

The IT managers must be aware of all the risks before the organization proceeds for a consideration of a major ERP implementation. ERP generally refers to software that supports a wide set of activities which help the company manage its important functions like production, marketing, inventory, finance and human resource management. As such, ERP consists of a multi-module application, which allows data to flow from one module to the other. It therefore not only integrates the business processes, but also offers intelligent information by correlating data from various modules.

When deciding for an ERP solution, many factors come into play- the most important is that the solution should serve the company for a longer term. That is to say, the solution should be able to adapt itself to the changing technologies like operating systems and new hardware features. Most companies like Peoplesoft, SAP, Ramco, etc offer such upgrades; they have teams that cater to the changing needs in the software. All that is required is the application of a service pack. In this changing business world, companies are being bought and sold. It is likely that a company will be sold off or may merge with some other company.

It may so happen that these companies may be using different ERP packages. These ERP packages should now be able to work together. ERP solutions like SAP have offered technologies like web enabled services and exchanging technologies that help integrate these completely different ERP environments. A bulk of the IT budget in a company is spent not on new developments but on support. Having an ERP system minimizes support. At most, a two-member team is required for generating reports and solving minor problems that surfaces up when a lot of varied data is in the database.

This way a company could spend less on support and divert the money in purchasing new capabilities. The database should be meticulously chosen because a lot depends on it. It is the choice of the database that determines the performance of the ERP system. Server database that runs on a multi-user platform is required for an ERP application. Server databases contain mechanisms that ensure reliability and consistency of data. The primary factor that should be looked for is the concurrency model. The two most commonly used server databases are Microsoft SQL server and Oracle.

Both have their own advantages and disadvantages. They differ widely in terms of the concurrency model. Oracle provides a multi version read consistency with no read locks and no dirty reads. Readers do not block writers and writers do not block readers. In Microsoft SQL server, read consistency is not available. It requires shared read locks to avoid dirty reads, if locks are not shared, dirty reads are possible. Also readers block writers and writers’ block readers. Deadlocks can be a serious issue with Microsoft SQL server, which escalates row-level locks, to table-level locks depending on the transaction’s volume.

To the user, the application simply hangs. These unpleasant deadlock situations can result in aborting one or more of the concurrent users. Oracle, on the other hand, does not escalate row level locking. Microsoft SQL server is easier to use, easier to manage, less complex and requires lot less tuning than Oracle and is an excellent choice on windows platform. For cross platform support, Oracle is an excellent choice, which runs very well both on windows and Linux platforms. Most ERP solutions are built on both these platforms, and it is up to the customer to decide the database of their choice.