Implementing Best of Breed ERP Systems

Implementing Best of Breed ERP Systems

Joseph Bradley (University of Idaho, USA)
Copyright: © 2009 |Pages: 12
DOI: 10.4018/978-1-59904-859-8.ch017
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Abstract

ERP implementation projects normally involve a single vendor providing the packaged software for the entire system. Although most companies follow this practice, a significant number of firms employ an alternate strategy of “best of breed” ERP. This strategy involves selecting software that best matches the current or desired business practices of the company from a variety of vendors. This strategy reduces the need for the firm to customize the software or to significantly reengineer its business practices. Best of Breed offers firms the opportunity to maintain or create competitive advantage based on unique business processes. “Vanilla” ERP implementations may result in competitors all adopting the same business processes leaving no firm with an advantage.
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Background

ERP implementation projects can be distinguished from other IT projects by three characteristics (Somers, Ragowsky, Nelson, & Stern, 2001). First, ERP systems are “profoundly complex pieces of software, and installing them requires large investments in money, time and expertise (Davenport, 1998, p. 122).” Second, software packages may require the user to change business processes and procedures, may require customization, and leave the firm dependent on a vendor for support and updates (Lucas, Walton, & Ginsberg, 1988). Finally, adopting firms are usually required to reengineer their business processes. Implementation projects must be managed as broad programs of organizational change rather than a software implementation (Markus & Tanis, 2000; Somers et al, 2001)

ERP systems include functionality for basic business processes based on the vendor’s interpretation of best practices. However, the selected functionalities do not generally match the existing business processes of all organizations.

Key Terms in this Chapter

Integration: Integration is generally defined as “the bringing together of related components to form a unified whole…The primary concern of integration is ‘oneness’ and ‘harmony’ between user, technology, and the environment (Grant & Tu, 2005, p.8).” Grant & Tu propose a taxonomy of ERP integration ranging from the lowest level, system-specification integration, to global integration which deals with “issues of language, time difference, culture, politics, customs, management style.” Their proposed level-II deals with system-user integration at both the ergonomic and cognitive level. Level-III deals with integration of islands of technology throughout the firm.

Business Processes: “A business process is a set of business events that together enable the creation and delivery of an organization’s products or services to its customers (Gelinas et al, 2004).”

Legacy Systems: Transaction processing systems designed to perform specific tasks. Systems that have become outdated as business needs change and the hardware and software available in the market place have improved.

ERP II or Extended Enterprise Systems: ERP II opens ERP systems beyond the enterprise level to exchange information with supply chain partners and customers. ERP II extends beyond the four-walls of the business to trading partners. Typically, ERP II includes customer relationship management (CRM) packages, supply chain management (SCM) packages and e-business packages.

Material Requirements Planning Systems (MRP): Processes that use bills of materials inventory data and a master productions schedule to time phase material requirement, releasing inventory purchases in a manner that reduces inventory investment yet meets customer requirements.

Enterprise Resource Planning Systems (ERP): An off-the-shelf accounting-oriented information system that is designed to meet the information needs of most organizations. ERP systems enable organization to procure, process and deliver customer goods or services in a timely, predictable manner. These systems are complex and expensive information tools, which have proven difficult and time consuming to implement.

Customer Relationship Management (CRM): These are software packages that enable a business to develop knowledge of their customer’s needs and buying patterns. These systems “focus on the integration of externally based customer data for the organization to pursue more customer-oriented activities like targeted advertising, one-on-one marketing (Peppers et al., 1993), customer retention and building a real-time integrated view of the customer (Goodhue et al., 2002; Kos et al., 2001; Winer, 2001) ” (Pan, 2005, p. 66). Another definition is “a comprehensive strategy and process of acquiring, retaining and partnering with selective customers to create superior value for the company and customers” (Parvatiyar and Sheth, 2001, p. 5).

Supply Chain Management (SCM): These software packages exchange information with supply chain partners to order and track the procurement of goods and services. SCM can be viewed in four basic categories (Davenport & Brooks, 2004): supply planning tools, demand planning tools, plant scheduling tools, and logistics systems. A newer functionality in SCM is collaborative planning, forecasting, and replenishment (CPFR). In CPFR, “supply chain partners exchange not only orders and shipment notices, but sales plans and production forecasts with each other, so that they can synchronize their respective processes more fully (p. 12).”

Service-Oriented Architecture (SOA): Service Oriented Architecture (SOA) represents a collection of best practices principles and patterns related to service-aware, enterprise-level, distributed computing (OASIS, 2008).

Manufacturing Resources Planning (MRPII): MRPII extends MRP by addressing all resources in addition to inventory. MRPII links material requirements planning with capacity requirements planning avoiding the over and under shop loading typical with MRP. MRPII includes more business functionality than MRP, dealing with sales, production, inventory, schedules, and cash flows (Palaniswamy & Frank, 2000)

Best of Breed: Combination of ERP software provided by more than one vendor and legacy systems designed to meet the needs of an organization in a manner superior to the single vendor ERP approach.

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Editorial Advisory Board
Table of Contents
Preface
Jatinder N. D. Gupta, Sushil Sharma, Mohammad A. Rashid
Acknowledgment
Jatinder N. D. Gupta, Sushil Sharma, Mohammad A. Rashid
Chapter 1
Nancy Alexopoulou, Panagiotis Kanellis, Mara Nikolaidou, Drakoulis Martakos
Efficient response to change, both upon expected and unpredicted contingencies, is a critical characteristic for modern enterprises. This chapter... Sample PDF
A Holistic Approach for Enterprise Agility
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Chapter 2
Hossana H. Aberra
SAP Business Blueprint is a vital part of SAP implementation exercise. A well-defined business blueprint may set the foundation for successful... Sample PDF
What is SAP Business Blueprint?
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Chapter 3
Rogerio Atem de Carvalho
This chapter introduces the key aspects of Free/Open Source Enterprise Resources Planning systems (FOS-ERP). Starting by related work carried out by... Sample PDF
Free and Open Source Enterprise Resources Planning
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Chapter 4
Brian H. Cameron
Business process modeling (BPM) is a topic that is generating much interest in the information technology (IT) industry today. Business analysts... Sample PDF
The Changing Nature of Business Process Modeling: Implications for Enterprise Systems Integration
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Chapter 5
Alok Mishra
In the age of globalization, organizations all over the world are giving more significance to strategy and planning to get an edge in the... Sample PDF
Enterprise Resource Planning Systems: Effects and Strategic Perspectives in Organizations
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Chapter 6
Gary P. Moynihan
An executive information system (EIS) is a software system designed to support the informational needs of senior management. The EIS is... Sample PDF
An Overview of Executive Information Systems
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Chapter 7
Joseph Bradley
Enterprise Resource Planning systems have proven difficult and costly to implement. Organizations must consider the risks and rewards of embarking... Sample PDF
Enterprise Resource Planning System Risks and Rewards
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Chapter 8
Andrea Masini
After observing that the pervasiveness of IT may soon render it strategically irrelevant, management scholars have recently questioned the value of... Sample PDF
ERP-Driven Performance Changes and Process Isomorphism
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Chapter 9
Ronda R. Henning
The application software life cycle considers the functionality of a given collection of components within the context of a consumer’s requirements... Sample PDF
Application Integration within the Enterprise Context
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Chapter 10
Sanjay Mathrani, Mohammad A. Rashid, Dennis Viehland
A significant investment in resources is required for implementation of integrated enterprise systems as technology solutions while the... Sample PDF
The Impact of Enterprise Systems on Business Value
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Chapter 11
Charlotte H. Mason, Aleda V. Roth
Growing competitive pressures and escalating customer demands have led businesses to sophisticated information technology to manage costs and... Sample PDF
The Right Path to SCM-CRM Integration
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Chapter 12
Euripidis Loukis, Ioakim Sapounas, Konstantinos Aivalis
This chapter is dealing with the alignment of enterprise systems with business strategy and its impact on the business value that enterprise systems... Sample PDF
Enterprise Systems Strategic Alignment and Business Value
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Chapter 13
Sanjay Mathrani, Mohammad A. Rashid, Dennis Viehland
The market for enterprise systems (ES), continues to grow in the post millennium era as businesses become increasingly global, highly competitive... Sample PDF
Enterprise Systems in Small and Medium-Sized Enterprises
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Chapter 14
Kerstin Fink, Christian Ploder
Small and medium-sized enterprises (SMEs) are a vital and growing part of any national economy. Like most large businesses, SMEs have recognized the... Sample PDF
Integration Concept for Knowledge Processes, Methods, and Software for SMEs
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Chapter 15
Tobias Schoenherr, Ditmar Hilpert, Ashok K. Soni, M.A. Venkataramanan, Vincent A. Mabert
Although the research on integrated enterprise systems (ES) is proliferating, the knowledge base about ES implementations, usage and experiences... Sample PDF
Enterprise System in the German Manufacturing Mittelstand
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Chapter 16
Darshana Sedera
Organizations invest substantial resources in acquiring Enterprise Systems, presumably expecting positive impacts to the organization and its... Sample PDF
Size Matters! Enterprise System Success in Medium and Large Organizations
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Chapter 17
Joseph Bradley
ERP implementation projects normally involve a single vendor providing the packaged software for the entire system. Although most companies follow... Sample PDF
Implementing Best of Breed ERP Systems
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Chapter 18
Ganesh Vaidyanathan
Enterprise resource planning systems are complex yet single, integrated software programs that runs off a single database so that the various... Sample PDF
Enterprise Resource Systems Software Implementation
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Chapter 19
Calin Gurau
This chapter considers the importance of business modelling for implementing e-CRM systems. The introduction of e-business models requires the... Sample PDF
Restructuring the Marketing Information System for eCRM: An Application of the Eriksson-Penker Method
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Chapter 20
Albert Boonstra
At the present moment, many hospitals are going through a process of change directed at the integrated delivery of health care. Enterprise Systems... Sample PDF
Analyzing an ES Implementation in a Health Care Environment
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Chapter 21
S. Padmanaban
ERP systems have become key enablers of businesses today. While many organizations wish to adopt ERP for competitive advantage, they find choosing... Sample PDF
Designing to Deploying Customisable ERP Cost Effectively
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Chapter 22
Mateja Podlogar, Katalin Ternai
This chapter introduces the ERP systems, their complexity, and especially their integration in higher education as a significant challenge for many... Sample PDF
ERP Systems in Higher Education from Regional Perspective
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Chapter 23
Valentin Nicolescu, Holger Wittges, Helmut Krcmar
This chapter provides an overview of past and present development in technical platforms of ERP systems and its use in enterprises. Taking into... Sample PDF
From ERP to Enterprise Service-Oriented Architecture
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Chapter 24
ERP and Beyond  (pages 329-345)
Suresh Subramoniam, Mohamed Tounsi, Shehzad Khalid Ghani, K. V. Krishnankutty
Enterprise-wide automation has already transformed the relations among suppliers, purchasers, producers, and customers. Conventional ERP helps only... Sample PDF
ERP and Beyond
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Chapter 25
Gita A. Kumta
The chapter introduces the essence of ERP in government as a tool for integration of government functions which provides the basis for citizen... Sample PDF
E-Government and ERP: Challenges and Strategies
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Chapter 26
Manish Gupta, Raj Sharman
A paradigm shift is occurring in identity management philosophy. User-focused identity management is one the emerging and most promising paradigms.... Sample PDF
Emerging Frameworks in User-Focused Identity Management
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Chapter 27
Ramón Brena, Gabriel Valerio, Jose-Luis Aguirre
From the Knowledge Management perspective, Knowledge distribution is a critical process in organizations. As many of the other Knowledge-related... Sample PDF
Next-Generation IT for Knowledge Distribution in Enterprises
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