What is an ERP system. Basic principles of ERP. Module

According to McKinsey (a leading consulting company), these figures are 4 times lower than in the United States of America.

The main purpose of ERP systems is automation. The technology includes different blocks:

planning the work of the organization;
budget control;
logistics;
accounting control;
management of activities and employees;
client management.

Reporting (management) allows management to view a complete picture of the company's production efficiency.

This makes modern ERP systems an indispensable element of the organization’s daily activities, the main tool for automation and strategic control.

The technology is a comprehensive storage and the ability to use data in all areas of the enterprise in different directions.

Implementation of ERP enterprise management is divided into the following stages:

planning;
definition of tasks;
verification and goals;
selection and preparation of the platform;
creation of information;
preparation of documentation and coordination of projects;
software development;
testing of created systems;
system implementation;
staff training;
work and support;
review of results.

Project management is based on the most effective practices and methods. The timing will depend on the desires and needs of the customer, the size of the idea (implementation of EPR can last from 3 to 24 months).

The cost of ERP implementation will include the price of purchasing licenses (the possibility of a rental contract is provided), services for setting up and putting the system into operation in an enterprise or industry.

The price tag also depends on the methodology for putting the software product into operation, the number of services of the consulting partner, and the needs and ambitions of the customer. Don't forget about paying for IT structure development, employee motivation, and ERP usage.

ERP "Enterprise Management" allows an enterprise to improve its performance thanks to:

sustainable relationships with old clients and attracting new consumers,
reduction in management and operational costs (by approximately 15%),
reduction of commercial expenses by 35%,
saving working elements,
reduction of the implementation program,
reducing the insurance factor of storage facilities,
reduction,
increase in turnover, various stocks,
optimizing the use of key funds.

The implementation of such a system will only be needed when the company has clearly set a goal. Top management must understand and be interested in automating the activities of the enterprise.

It will be necessary to find resources and motivation of employees to implement the system; the customer must choose the right platform and module developers.

ERP-class systems consist of a single information repository, which includes all corporate data of an enterprise.

They are able to provide easy access to programs for any number of employees in an organization with a certain level of authority.

Data correction is performed through the functions (function terminal) of the program.

Key functions of ERP systems:

taking into account the design and technological characteristics that determine the composition of manufactured parts, as well as the resources and mechanisms necessary for their production;
creating sales and production plans;
creating a plan for the need for raw materials and components, timing and size of supplies, which will be sufficient to comply with production standards;
control of inventories and supplies, accounting of contracts, sale of centralized purchases, supervision and optimization of inventories in workshops and warehouses;
distribution of production resources from full-scale to the use of individual elements and equipment;
optimization of the use of capital, including the creation of a financial plan and strict control over its implementation, accounting for material and management activities;
project control, including development and resource planning stages.

ERP "Enterprise Management" is built on a modular principle. This approach allows you to control all the economic and management mechanisms of the company. Each element is responsible for collecting information in its industry, and then sends the data to a single database.

The development of ERP systems is built on several levels. All basic elements are based on the main element, and additional, auxiliary elements are based on the second. By this definition, it is easiest to imagine the operating principle of systems.

Basic modules of the ERP system include production management functions:

development of a power consumption plan;
calculating the volume of required raw materials;
warehouse inventory management and purchasing mechanism.

Additional elements are a combination of several management modules:

SUPPLY – calculation of potential demand for a product, logistics of warehouses, production and household activities, control of counterparties;
PRODUCTION PROCESS – control of mechanisms from the moment to disposal;
EMPLOYEES – accounting and planning of wages, creation of a work schedule, development, implementation of motivation;
CONTRACTORS – sales support and other CRM activities;
SALES – determination of sales channels, costs, transportation, orders;
FINANCE - creating general documentation, sending information on accounts taking into account debtors and creditors, using accounting and providing reports.

ERP "Enterprise Management" introduces a structure that will depend on the developer. At the request of the customer, the program can only work partially.

The implementation of an ERP system in enterprises helps optimize processes.

The programs are divided into the following:

Purpose. In general, it is the same for all systems, however, different programs are oriented differently. There are industry-specific ERP (used for a very large company or a unique production) and general-purpose ERP (more popular, they focus not on the specifics of the industry, but on the features).
Type of organization. With the development of the enterprise, there are more opportunities for optimization. Now the classic division (into and internal) is missing. The introduction of public, private and hybrid classifications has become convenient.
Architecture. An uninteresting part for the finished consumer. However, program design has a strong influence on system implementation and development. Typically, modular ERPs are observed (characterized by error protection, but complex implementation and customization) and with a single design (characterized by quick installation and configuration).
License. Despite the fact that the cost of automation is only 15-20% dependent on the license, this can significantly affect the operation budget. They are divided into (1) basic, (2) proprietary and (3) open (OpenSource) systems.

In the Russian ERP segment there are a large number of both Russian and domestic ones.

According to analysts, the majority (more than 48%) was “occupied” by the German SAP AG system.

Microsoft Business Solution products follow closely behind with a 13% share, while Oracle is at the bottom of the top three, capturing about 11% of the ERP industry.

Such a large gap between the first place and the rest is explained by the fact that SAP was the first to appear on the Russian market, offering itself to customers back in 1992.

The situation around the world is somewhat different, where SAP and Oracle are fighting for dominance.

Video about CRM and ERP systems:

Four times lower than in the USA. The task of modernizing the economy has been set at the state level, and enterprises, especially those using high-tech technologies, need to look for internal optimization reserves.

ERP solutions are systems for managing key business processes of an enterprise. The ERP system includes modules: company activity planning, budgeting, logistics, accounting, personnel management, production management, customer management. Corporate, management, and accounting reporting allows senior management to obtain a comprehensive picture of the enterprise’s activities, which makes the ERP system an indispensable tool for automating operational activities and supporting current and strategic management decisions. In essence, an ERP system is a comprehensive storage and use of information, the ability to obtain data on the areas of an organization’s activities within the framework of work in one system.

The ERP system implementation project can be divided into the following stages: project planning, goal setting; diagnostics and requirements analysis; selection and justification of a platform, a ready-made solution; information system design; documentation and coordination of design solutions; software development; information system testing; system deployment; user training; operation and support, and evaluation of results. Project management is based on best practices and methodologies. Depending on the wishes, needs and scale of the customer’s project, the implementation of ERP systems can last from three months to 24 months.

The cost of a project to implement ERP systems includes the cost of purchasing licenses (there is also the possibility of renting licenses) and the cost of services for setting up and implementing a system or industry solution. The cost of the project, of course, depends on the implementation methodology, the scope of consulting services, and the desires and needs of the customer. You also need to consider the costs of IT infrastructure, team motivation and system operation.

The implementation of an ERP system allows companies to increase their income through the loyalty of old customers and attracting new ones; reduce management and operating costs by an average of 15%; reduce commercial costs by 35%; save on working capital; reduce the implementation cycle; reduce the insurance level of warehouse stocks; reduce accounts receivable; increase the turnover of funds in settlements; increase inventory turnover; improve the recycling of fixed assets.

It is necessary to implement an ERP system in cases where the purpose of implementation is clearly defined, there is an interest of top management in the clarity and automation of business processes in the organization, the company has resources for implementation and motivation, the customer has decided on the platform and the team of implementers - developers.

ERP concept

Historically, the ERP concept has become a development of the simpler concepts of MRP (Material Requirement Planning) and MRP II (Manufacturing Resource Planning). The software tools used in ERP systems allow for production planning, modeling the flow of orders and assessing the possibility of their implementation in the services and departments of the enterprise, linking it with sales.

One of the important questions is whether the system belongs to the ERP class or is an accounting system. To answer this question, we should not forget that an ERP system (as the name suggests) is first and foremost a resource planning system. It describes not only the situation “as it was” and “as it is,” but also “as it will be,” “as it should be.” ERP systems not only store data about what is happening at the enterprise, but also include modules for planning and optimization of all types of resources (financial, material, human, time, etc.), and most of the accounting functions implemented in the system are aimed to support the functioning of these modules.

To implement planning and optimization functions, it is necessary to have feedback in the system. Those. Based on management goals, a plan is drawn up, then, as the work progresses, real indicators are recorded, analyzed, and based on a comparison of the goals set and the results achieved, a corrective action is developed. The accounting system only allows you to record results. It, unlike the ERP system, does not include functions for automating planning and comparison between plan and fact. In other words, with the help of accounting systems it is possible to perform only some analytical part of management, but not a synthetic one. This is the fundamental difference between an ERP system and an accounting system.

Functions of ERP systems

ERP systems are based on the principle of creating a single data warehouse containing all corporate business information and providing simultaneous access to it by any required number of enterprise employees vested with appropriate authority. Data changes are made through the functions (functionality) of the system. Main functions of ERP systems:

maintaining design and technological specifications that determine the composition of manufactured products, as well as the material resources and operations necessary for their manufacture;
formation of sales and production plans;
planning the needs for materials and components, timing and volumes of supplies to fulfill the production plan;
inventory and procurement management: maintaining contracts, implementing centralized procurement, ensuring accounting and optimization of warehouse and workshop inventories;
production capacity planning from large-scale planning to the use of individual machines and equipment;
operational financial management, including drawing up a financial plan and monitoring its implementation, financial and management accounting;
project management, including planning stages and resources.

Features of implementation

Classic ERP systems, in contrast to the so-called “boxed” software, belong to the category of “heavy” software products that require quite a lot of setup in order to start using them. CIS selection, acquisition and implementation usually require careful planning within the framework of a long-term project with the participation of a partner company - a supplier or consultant. Since CIS are built on a modular basis, the customer often (at least at the early stage of such projects) does not purchase a full range of modules, but a limited set of them. During implementation, the project team usually spends several months configuring the supplied modules.

Any ERP system, as a rule, is designed for a specific market segment. Thus, SAP is more often used in large industrial enterprises, Microsoft Dynamics - in medium-sized companies of various profiles, 1C - in small companies, as well as in cases of limited budget.

The cost of ERP implementation, depending on the size of the company, complexity and the chosen system, can range from 20 thousand USD to several million USD. This amount includes software licenses, as well as services for implementation, training and support at the stage of putting the system into operation.

ERP concept coined by Gartner analyst Lee Wylie in a 1990 study on the development of MRP II. Wiley predicted the emergence of replicable multi-user systems that provide balanced management of all organizational resources, not only related to the core activities of a manufacturing enterprise, but also combining data on production, purchasing, sales, finance, and personnel through a common data model. In the early 1990s, the concept gained prominence through support from application software manufacturers.

Thus, ERP - Enterprise Resource Planning(English) - an information system created for processing business transactions (business processes), the use of which helps to increase the competitive advantages of the company. In a broader sense, an ERP system is understood as a methodology for effective planning and management of company resources.

If in the early 1990s ERP systems were implemented primarily in industry, and, as solutions implementing MRP II as a component, by engineering enterprises, then in the second half of the 1990s the use of ERP systems became widespread in the service sector , including telecommunications enterprises, energy supply companies, and even government bodies and non-profit organizations. At the same time, due to the rapid growth in the number of modules in ERP systems and their functionality, the idea of ERP systems as comprehensive software for organizations, fundamentally replacing all other application programs, was replaced by the beginning of the 2000s by highlighting such functions as CRM and PLM into separate software packages from ERP and outlining the ERP framework as universal systems for back-office processes and resource management.

As a characteristic feature of the ERP strategy a fundamental approach to the use of a single transactional system for the vast majority of operations and business processes of an organization is noted, regardless of the functional and territorial disunity of the places where they originate and pass, and the obligation to consolidate all operations into a single database for subsequent processing and obtaining balanced plans in real time.

Replication, that is, the ability to use the same software package for different organizations (possibly with different settings and extensions), appears as one of the mandatory conditions of an ERP system. One of the reasons for the widespread use of replicated ERP systems instead of custom development is the possibility of introducing best practices through business process reengineering in accordance with the solutions applied in the ERP system. However, there are also references to integrated systems developed for a separate organization to order as ERP systems.

The need for a comprehensive application of an ERP system in geographically distributed organizations requires support for multiple currencies and languages in a single system. Moreover, the need to support several organizational units (several legal entities, several enterprises), several different charts of accounts, accounting policies, various taxation schemes in a single copy of the system turns out to be a necessary condition for use in holdings, TNCs and other distribution enterprises.

Applicability in various industries imposes on ERP systems, on the one hand, requirements for universality, on the other hand, support for extensibility with industry specifics. The main large systems include ready-made specialized modules and extensions for various industries (specialized solutions within ERP systems are known for engineering and manufacturing industries, mining enterprises, retail trade, distribution, banks, financial organizations and insurance companies, telecommunications enterprises, energy, organizations public administration sector, education, medicine and other industries).

Capabilities and functions of ERP systems.

Enterprise resource planning processes are cross-functional, forcing the firm to move beyond traditional, functional and local boundaries. In addition, various business processes of an enterprise are often interconnected. Moreover, data that was previously located on various heterogeneous systems is now integrated into a single system.

ERP systems use “best practices.”

Enterprise resource planning systems have incorporated more than a thousand of the best ways to organize business processes. These best practices can be used to improve the performance of firms. The selection and implementation of ERP systems requires the implementation of such best practices.

ERP systems make organizational standardization possible.

Enterprise resource planning systems make it possible for organizational standardization among various geographically separated units. As a result, departments with non-standard processes can be made the same as other departments with effective processes. Moreover, the company can appear to the outside world as a single organization. Instead of receiving different documents when a company deals with different branches or enterprises of a given company, that company can be presented to the world as one common image, which leads to an improvement in its image.

ERP systems eliminate information asymmetries.

Enterprise resource planning systems put all information into the same master database, eliminating numerous information inconsistencies. This leads to several results. First, it provides increased control. If one user doesn't do their job, the other sees that something wasn't done. Secondly, it opens up access to information for those who need it; ideally, improved information is provided for decision making. Thirdly, information ceases to be the subject of mediation, since it becomes available to both management and employees of the company. Fourth, the organization can become “flat”: since information is widely available, there is no need for additional low-value workers whose main activity is preparing information for distribution to the company’s management and employees.

- ERP systems provide real-time information. In traditional systems, a large amount of information is recorded on paper and then transferred to another part of the organization, where it is either re-formatted (usually aggregated) or transferred to a computer format. With ERP systems, a lot of information is collected at the source and placed directly into the computer. As a result, the information immediately becomes available to others.
- ERP systems provide simultaneous access to the same data for planning and control.

Enterprise resource planning systems use a single database where most of the information is entered once and only once. Because data is available in real time, virtually all users in an organization have access to the same information for planning and control. This can lead to more consistent planning and management compared to traditional systems.

ERP systems promote communication and collaboration within an organization.

Enterprise resource planning systems also promote communication and collaboration within an organization (between different functional and geographically separated units). The presence of interconnected processes leads functional and geographically separated departments to interact and collaborate. Standardizing processes also promotes collaboration because there is less friction between processes. In addition, a single database promotes interoperability by providing each geographically separated and functional department with the information they need.

ERP systems facilitate communication and collaboration between organizations.

An ERP system provides an information highway for organizing interaction and collaboration with other organizations. Firms are increasingly opening up their databases to partners to facilitate procurement and other activities. For this system to work, a single archive is needed that partners can use; and ERP systems can be used to facilitate such exchanges.

Most modern ERP systems are built on a modular basis, which gives the customer the opportunity to select and implement only those modules that he really needs. Modules of different ERP systems may differ in both names and content. However, there is a certain set of functions that can be considered typical for ERP class software products. Such typical functions are:

· maintaining design and technological specifications. Such specifications define the composition of the final product, as well as the material resources and operations required to manufacture it (including routing);
· demand management and formation of sales and production plans. These functions are designed for demand forecasting and product planning;
· planning of material requirements. Allows you to determine the volumes of various types of material resources (raw materials, materials, components) necessary to fulfill the production plan, as well as delivery times, batch sizes, etc.;
· inventory management and purchasing activities>. Allows you to organize the management of contracts, implement a centralized procurement scheme, ensure accounting and optimization of warehouse stocks, etc.;
· production capacity planning. This function allows you to monitor the availability of available capacity and plan its load. Includes large-scale capacity planning (to assess the feasibility of production plans) and more detailed planning, down to individual work centers;
· financial functions. This group includes the functions of financial accounting, management accounting, as well as operational financial management;
· project management functions. Provide planning of project tasks and resources necessary for their implementation.

The structure and main functions of ERP systems are also clearly demonstrated in the figure. (Fig. 1)

Fig.1

The main capabilities of ERP systems can be represented in the form of four blocks: planning, accounting, analysis, management.

Planning. Planning the activities of an enterprise at various levels means:

· Create a sales program.
· Carry out production planning (a refined and approved sales program is the basis of the production plan; integration of data from these plans significantly facilitates the production planning process and ensures their inextricable connection).
· Create a master production schedule (a detailed operational production plan, on the basis of which planning and management of purchase and production orders is carried out). Form purchasing plans.
· Carry out a preliminary assessment of the feasibility of the formed plans at various planning levels in order to make the necessary adjustments or make a decision on attracting additional resources.

Accounting. If the plans have received their confirmation, they acquire the status of current plans, and their implementation begins. The previously simulated flow of dependent orders turns into a real one, generating requirements for materials, labor resources, capacity and money. Satisfying these needs gives rise to accounting actions that ensure prompt registration of direct costs related to manufactured products (material, labor, operating costs in relation to tasks, technological operations, design work, maintenance work), and indirect costs distributed among financial responsibility centers. All operations for registering direct costs are entered, as a rule, in physical terms of standard consumption (material - in the appropriate units of measurement, labor - temporary, etc.). To reflect the corresponding financial result, ERP systems offer powerful tools for setting up financial integration, allowing for automatic translation of consumed resources into their financial equivalent.

Analysis. Due to the prompt reflection of performance results, management personnel have the opportunity to carry out comparative characteristics of plans and results in real time, and the presence of additional modules for calculating key indicators and constructing mathematical models significantly simplifies the business planning process.

Control. The presence of operational information feedback about the state of the control object, as is known, is the basis of any control system. ERP systems provide this kind of feedback (reliable and prompt) information about the status of projects, production, inventories, availability and cash flow, etc., which as a result makes it possible to make informed management decisions.

Thus, we can talk about a broad range of functions and capabilities of ERP systems that allow modern companies to manage their activities efficiently, stably and reliably.

Recently, interest in integrated business process management systems has been growing in Russia. It is due to many factors, including active support from the government for the introduction of modern technologies into the Russian economy. In particular, there is an objective need to automate the functioning of an enterprise to optimize management and control processes. ERP systems can take on such problems within an enterprise.

ERP (Enterprise Resource Planning) is an integrated system based on a wide class of disciplines and areas of activity related to technologies for creating and processing data for managing internal and external resources of an enterprise. Simply put, ERP is an enterprise resource management system. This term was first used by the consulting company Gartner Group in the early 90s. Since then, the ERP concept has gone through many stages of development.

The main tasks solved by ERP systems are:

General and structured planning of enterprise activities;

Company financial management;

HR management;

Accounting for material resources;

Accounting and management of supply and sales;

Operational management of current activities and monitoring the implementation of plans;

Document flow of the enterprise;

Analysis of business results.

At a certain stage of development, a business is faced with the need to automate the processes and functions of the company, especially if we are talking about a large corporation or holding company. Then there is a need for specialized software that can organize the management process as efficiently as possible. ERP systems are based on the principle of creating a single repository of the enterprise’s information base accumulated in the process of doing business, in particular, financial information, data related to production, personnel, etc.

Modern business practice requires, as a rule, an individual approach. This fully applies to accounting and planning. Therefore, the most effective software is adapted directly to the complex tasks of a specific enterprise. The cost of such development is quite high due to the individual approach and implementation features, but, as a rule, the economic effect justifies the costs.

The process of implementing an ERP system at an enterprise is a technically complex undertaking that takes a long period of time. In addition to installing software and training staff, one should take into account the psychological factors of introducing a new system into the corporate culture, as well as the importance of the smooth functioning of each link.

ERP concept.

Functions of ERP systems.

Model of information flow management (IP) in an enterprise;

Hardware and technical base and means of communication;

DBMS, system and application software;

A set of software products that automate IP management;

Regulations for the use and development of software products;

IT department and supporting services;

Actually users of software products.

Main functions of ERP systems:

Maintaining design and technological specifications that determine the composition of manufactured products, as well as the material resources and operations necessary for their manufacture;

Formation of sales and production plans;

Planning the requirements for materials and components, timing and volumes of supplies to fulfill the production plan;

Inventory and procurement management: maintaining contracts, implementing centralized procurement, ensuring accounting and optimization of warehouse and workshop inventories;

Planning of production capacities from large-scale planning to the use of individual machines and equipment;

Operational financial management, including drawing up a financial plan and monitoring its implementation, financial and management accounting;

Project management, including milestone and resource planning

The difference between ERP systems and electronic document management systems(EDS) is that, as a rule, in ERP documents are machine-readable, and they are not “maintained”, but “posted” - after they have completed their life cycle, that is, they have been created, discussed, verified, agreed upon , approved, etc. And the EDMS supports such a life cycle of human-readable documents in the enterprise.

Advantages.

The use of an ERP system allows you to use one integrated program instead of several separate ones. A single system can manage processing, logistics, distribution, stocks, delivery, display invoices And accounting.

The information access control system implemented in ERP systems is designed (in combination with other enterprise information security measures) to counter both external threats (for example, industrial espionage), and internal (for example, theft). Implemented in conjunction with CRM-system and quality control system, ERP systems are aimed at maximizing the needs of companies for business management tools.

Flaws.

The main difficulties at the stage of implementation of ERP systems arise for the following reasons:

The distrust of company owners in high-tech solutions results in weak support for the project on their part, which makes the implementation of the project difficult to implement.

Departmental resistance to providing confidential information reduces the effectiveness of the system.

Many problems associated with the functioning of ERP arise due to insufficient investment in personnel training, as well as insufficient policies for entering and maintaining the relevance of data in ERP.

Restrictions.

Small companies cannot afford to invest enough money in ERP and adequately train all employees.

Implementation is quite expensive.

The system may suffer from a "weak link" problem - the effectiveness of the entire system may be undermined by one department or partner.

Compatibility issue with legacy systems.

There is a misconception that sometimes ERP is difficult or impossible to adapt to document flow company and its specific business processes. In fact, any implementation of an ERP system is preceded by the stage of describing the company’s business processes, most often associated with the subsequent stage business reengineering. In essence, the ERP system is a virtual projection of the company.