The Current State of Enterprise Resource Planning

To analyze the future trends of Enterprise Resource Planning, it is first important to look at the current state of this industry. While this tool was originally used for manufacturing and human resources, it is now being used in areas such as customer services, sales automation, and supply chain maintenance. At the moment, it seems that ERP vendors are expanding the capability of their ERP products, and many of them are catering to smaller businesses instead of just Fortune 500 companies.

The advent of the Internet has played an important role in the evolution of Enterprise Resource Planning.
A number of companies are combining their supply chain maintenance functions with the internet so that suppliers can also have easy access to the information. When the supplier is given access to this crucial information, they will be able to understand the needs of their clients. They will have a good understanding of how much they should produce, and they will also become familiar with manufacturing issues. In addition to integrating the processes within a company, ERP vendors are working to merge the collaboration of suppliers, customers, and the companies that work with them. In addition to doing this on a domestic level, these vendors are working on an international level as well.

A number of experts have said that they feel the future of ERP may be in danger. There are a number of reasons why they voice these concerns. First, many ERP vendors have already catered to the needs of large companies. Most, if not all large companies are now using some type of Enterprise Resource Planning system. What this means is that the market for ERP is decreasing with Fortune 500 and 1000 companies. Even though a vendor can expect to make millions off the sale of a system, they will not make any more money beyond this, and once a company has implemented a ERP system, there is little they need from the vendor.

To solve these problems, a number of vendors are focusing on small to medium sized businesses. They are tailoring their products to these companies by reducing the size, cost, and complexity of implementing them. If an ERP vendor wants to survive in this ever changing market, there are a number of things they will need to do. They will first want to pay attention to processes that are not connected to a generic system. They will want to look at things such as customer support and the ability of their clients to make decisions. The last thing they will need to do is target their products towards smaller companies. If an ERP vendor wants to succeed, they must understand the needs of their customers. Their customer service must be superior in quality, and the prices must be decent, especially for small to medium sized businesses.

If a vendor does these things successfully, they can compete in the global market. The business world continues to change, and ERP vendors must be able to adapt to these changes if they wish to remain competitive. As we move further into the 21st century, it will become more important for organizations to integrate both their processes and information. It is critically important for manufacturers and customers to work at a higher level of understanding and coordination. In addition to this, the company must be able to effectively work with suppliers. Overall, ERP is a strategic resource that will allow companies to synchronize processes that would otherwise be disconnected.

Source: www.exforsys.com

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Oracle E-Business Suite – Is It Really Possible To Support It Remotely?

Well, let’s begin from philosophical introduction. It is probably moving into this direction, all the recent talks about offshore development, remote support, customization project outsourcing, BPO (business processes outsourcing). And the final result will be so-called radical compromise, meaning it is not a regular compromise, but rather something we do not know about. In order to predict the future form of Oracle Applications/Fusion support we have to look at the trends.

• Market Trends. When we see that traditional manufacturing is now outsourced to China, India, Brazil, Latin America, Mexico, South East Asia – we should question if traditional ERP support will stay in the local framework and model, when consultants go onsite, sit the day with corporate IT, CEO, Controller and key AR/AP people to design the MRP model. In fact – communication channel advances allow you to be present in the conference virtually and do not feel strong disadvantages of not being able to shake opponent hands. If you are in USA, Europe, Australia, New Zealand – do you really care if get phone/skype/websession support, not peer-to-peer?

• Step-by-Step. Well, we have to be conservative in order to be profitable and mutually beneficial. Let’s start from small - assume that remote support and outsourcing are for Oracle E-Business Suite Extensions & Customizations, Oracle Report Builder design & development, plus typical customer support cases, when you as a client are OK to call 800 number

• International Challenge. This is when Oracle Applications has to be supported in their localized (multicurrency, local and regional taxation and language: Portuguese, Spanish, French, German, Russian). This is definitely the obstacle, however we see more examples when company has employees from Argentina, Brazil, Haiti, Montreal, China sitting in the same office…

• Conclusion. Probably the most likely scenario will be the one when you will have to accept the conception of virtual reality.

Author: Andrew Karasev

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ERP/Accounting Selection: Microsoft Dynamics, Oracle, SAP – Expansion To Europe

This article is targeted at US-based mid-size and large companies, planning the expansion and opening branches in Europe. It is for IT director, who is nowadays responsible for ERP/MRP platform selection and following implementation. The format of the article doesn’t allow us to come up with detail specs comparison, we will be rather giving you highlights for further research and checklist of things that you should not miss at the consideration. We will begin with the specific of the market and then point out to the solutions available.

• Multiple Languages. Continental Europe doesn’t speak on English language natively – documentation is in German, French, Italian or whichever country you consider. It is not just a question of finding English speaking and writing accounting personnel – as you will see, reading further

• Taxation. Now it is becoming more standardized, however you should now that in Europe you have to deal with VAT (Value Added Tax), in comparison to Sales Tax in the US. VAT should be paid not only by end consumer, but also by resellers, distributors, etc. Also it is common practice when Services are taxable in European countries.

• Government Reporting. In the USA you report on the federal and state levels and usually IRS and the states don’t care about the accounting system you use. In Europe, again depending on the country and probably this tendency is more applicable when you move Eastward, the government might have more involvement in the ERP brands selection, recommending several systems as approved, certified, localized, etc.

• Accounting Procedures. In some countries (France, Russia) you may encounter with the situation, when government wants you to use recommended chart of accounts, usually generalized and geared toward manufacturing accounting, which might be a nightmare in the case if you are service-oriented business. Considering innovative nature of US businesses in expansion mode – this issue should be addressed

Now we will give you solutions highlights:

• Local ERP. The specific legislation and conditions of the country you chose for your European penetration probably produced several locally originated ERPs. As a tendency – these systems typically deal with government reporting and available in local language only. If you decide to implement such a solution, please understand the trade-ins – you can not find US/international managers who could efficiently take the control over when needed.

• Microsoft Dynamics. Microsoft Business Solutions these systems for continental Europe: Navision, Axapta – Microsoft Dynamics NAV and Microsoft Dynamics AX (Microsoft Great Plains/Microsoft Dynamics GP will be pulled out from France, Germany and Holland, where it currently has some market presence). Navision & Axapta are both localized and “approved”

• SAP Business One. Assuming that you represent mid-size business – this system has all-in-one and the named user license includes all the modules (you can have CRM-only client for your sales people at ½ of the price). SAP Business One was designed with the ideas of the Multilanguage, flexible reporting and object-oriented tax engine. Plus SAP Business One has transaction integration to mySAP.

• Oracle Financials/E-Business Suite. This solution, coming from Oracle, also referred as Oracle Applications should be considered as very efficient and reliable. It is also localized and has very long market presence history in Europe. Oracle comes with J2EE/EJB/Java customization & development

• IBM Lotus Notes/Domino. It is not an ERP – it is rather the platform, Lotus is very popular in Europe and you should consider and respect it if you purchase existing company, using Lotus for document workflow

• Integration, Customization & Reporting. You should consider European branch ERP integration ability to your corporate ERP in the USA and management reporting compliance.

Author: Andrew Karasev

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