Examination Paper of Enterprise Resource Planning Examination Paper of Enterprise Resource PlanningIIBM Institute of Business ManagementExamination PaperMM.100Enterprise Resource PlanningSubject Code-C102Section A: Objective Type & Short Questions (30 marks)This section consists of Multiple Choice questions & Short Answer type questions. Answer all the questions. Part one questions carry 1 mark each & Part Two questions carry 5 marks each. Part One:Multiple Choices:Enterprise Resource Planning is: Computer System Manufacturing organization Method of effective planning of all the resources in an organization None of the above b. Manufacturing organization Enterprise Resource Planning vendors are those people: Who are experts in administration and management of projects Who have developed the ERP packages Who uses the ERP system None of the above b. Who have developed the ERP packages Interviewing and cost justification is tool and technique of: Design step of ERP Implementation step of ERP Requirement analysis of ERP Planning step of ERP b. Implementation step of ERP Support re-engineering processes to fit the software systems best practice is approach of: Re-engineering approach Customizing approach Rational approach None of the above a. Re-engineering approach Process of tracking customer contacts and providing the customer with a price quote is: Inventory sourcing Sales order processing Pre-sales None of the above Sales order processing 1IIBM Institute of Business ManagementExamination Paper of Enterprise Resource PlanningThe difficulty in creating an audit trial of transactions when multiple transactions use multiple database is associated with: Product profitability sub-system Finished goods inventory sub-system Management reporting sub-system Creating an audit trial sub-system d. Creating an audit trial sub-system Differences occur between standard costs and actual costs is problem associated with: Accounting Production Purchasing / Materials Management None of the above a. Accounting MRP in Enterprise resource planning stands for: Maximum retail price Material requirement planning Management requirement planning None of the above b. Material requirement planning Process of providing status of purchase order comes in a category of: Purchase order follow-up Source determination Determine requirement Invoice verification c. Determine requirement Resource failure occurs when: People clashes Inability to communicate with the system user Poor specification of requirements Conflicts of people, time and project scope due to insufficient personnel Poor specification of requirements Part Two:What are the advantages of the re-engineering method of implementing ERP? AnswerChoosing to implement an ERP system and re-engineer business processes to match best practices supported by the vendors software has a number of advantagesfor businessesAdvantages:Taking advantage of best practices within an industry may improve business processesTimeliness software is readily available to implementCost effective as there is no need to make changes to the systemMinimal change to the businessWhat are the benefits reported from implementing ERP? AnswerIt automates and integrates many of the business processes, allows companies to share a common database and business practices throughout the enterprise and it produces information in real time.Write a short note on Credit Management. AnswerThere is no clear definition of what credit management is. It is usually regarded as assuring that buyers pay on time, credit costs are kept low, and poor debts are managed in such a manner that payment is received without damaging the relationship with that buyer. A trade credit insurance company does all that. Either directly or in conjunction with a companys credit department. An approved credit management policy can offer assurances to a financing bank, which may facilitate financing.Credit management is the process for controlling and collecting payments from your customers. A good credit management system will help you reduce the amount of capital tied up with debtors (people who owe you money) and minimize your exposure to bad debts.Good credit management is vital to your cash flow. It is possible to be profitable on paper and but lack the cash to continue operating your business.Define Material Requirements Planning. AnswerMaterial requirements planning (MRP)is a production planning andinventory control system used to managemanufacturingprocesses. Most MRP systems are software-based, while it is possible to conduct MRP by hand as well.An MRP system is intended to simultaneously meet three objectives:Ensurematerialsare available forproductionandproductsare available for deliveryto customers.Maintain the lowest possible level of inventory.Plan manufacturing activities, delivery schedules and purchasing activities.END OF SECTION A2IIBM Institute of Business ManagementExamination Paper of Enterprise Resource PlanningSection B: Caselets (40 marks)This section consists of Caselets. Answer all the questions. Each Caselet carries 20 marks. Detailed information should form the part of your answer (Word limit 150 to 200 words). Caselet 1Tech Knowledge is a start-up founded in 1997 by Robert Thyer. The company is a distributer of presentation technologies, including computer based projection systems, video equipment, and display technologies. The firm has 25 employees and does $5 million in sales. It is growing rapidly. The owner, Robert Thyer, would like to net source the back-office functions of the firm because the company does not have an internal IT capability. The applications to be net sourced would include sales and distribution, financial accounting, and inventory management.Tech Knowledge would like to source SAP or another ERP vendor via a hosting arrangement. It does not expect to do much customization, and it does not have any legacy systems.Questions:What factors should it use to evaluate each of these potential hosts? AnswerInformation sources and on-line library databases (e.g. ABI Inform, ProQuest, First Search). These articles will describe the features of net-based software systems and services, and this information will provide the background needed to develop a list of criteria for evaluation.What controls should be in place to monitor the hosting arrangement? AnswerSome of the controls which should govern a successful net sourcing arrangement include: development of a service agreement which details the roles and responsibilities of the host and of the user organization and development of service performance measures on the part of the host. The arrangement needs to be continuously monitored using these performance measures. In addition, it is important to maintain internal technical expertise, to provide end-user training, and to establish overall project leadership.Caselet 2ITM is a company specializing in network implementation and management. It provides networking services to mid-sized companies, which do not have an internal networking analyst or IT, manager. These organizations include real estate companies, law offices, medical practices, architectural / engineering firms, construction companies, business services providers, country clubs, community organizations, and churches.ITM uses a legacy accounting system to handle its financial accounting and financial management functions. It has added on a billing package for client services. The next step is to obtain a CRM capability to manage information about current and prospective customers more effectively.You have been assigned to identify potential sources for a net-sourcing arrangement with an ERP vendor, which provides CRM capabilities.Questions:Identify potential sources of software. AnswerThe term CRM describes methodologies, software, and often, Internet capabilities designed help businesses manage customer relationships in an organized fashion. While CRMs have traditionally been seen as an automated way to track and maintain client contact data, today's CRMs are smarter, faster, and highlight the most up-to-date computing technologies available. From there the CRM can be the tool you use to set and measure sales goals, devise, deliver and track e-mail marketing campaigns up through and including interfacing with your social media accounts. CRMs' importance in the marketplace has also grown. By having everyone sales, marketing, and customer service on the same page the company becomes more efficient (and hopefully more profitable) by matching customer needs with company offerings.According to Michael Krigsman, CEO of business consulting firm, Asuret in Brookline, Massachusetts, choosing the right CRM means, "You need to get a package that's tailored to your company's size. At the most basic level you have simple contact management. Then you have contact management with a shared database. You can have sales tracking or opportunity tracking or customer service functionality. Match the capabilities of the software with what your business goals are."James Wong, CEO of CRM software provider, Avidian in Redmond, Washington, agreed with focusing on business goals. "If you're new to CRM, it might make sense to say what is my one end goal and then try to build the CRM around that goal," said Wong.The first thing to decide is how much software, if any at all, do you want stored on your local server, said Krigsman. For example, Avidian's Prophet contact and sales management software integrates directly with Microsoft Outlook. There are two small business versions: one that allows you to log on, download software and start enhancing customer relationships immediately (Internet-based). The other, Prophet 5 Personal Edition is a software package installed on the individual computer. "Not every small business is ready to put everything online," notes Wong, adding that many small businesses worry about security breaches.Determine five criteria you will recommend be used to evaluate each of alternative providers. AnswerThe ones who have stayed behind are those who have more realistic expectations of what an Internet business can be. Sure, there are still people making a mint online, but you can bet that they have not only worked very hard to achieve that goal - but they have also been very smart about the choices they have made. Sometimes, being smart means getting help from expert strategic consultants - or getting access to the right online tools.Yes, as many have learned the hard way, when the going gets tough online, the tough seek out strategic Internet marketing service providers. If you are looking for strategic Internet marketing services, here are 5 criteria to evaluate potential service providers:1. Length of experience:How long has the person or company been working in this field? Ask for references and other evidence that they are not just someone who is new to the game after having read a few books and building their own website over a couple of long weekends. Experience definitely counts in this arena.2. Amount of hands-on attention they will give you:Figure out just how much personal, hands-on attention you will get from a senior level consultant. How can you do this? Before signing a contract or going forward with a project, call the office a few times and see how easy it is to actually talk to the head person in charge. Your experience here likely forebodes how the rest of the relationship will play out. Trust your first impressions.3. Degree to which they know your particular industry:The important of this one is debatable. Much of online know-how is agnostic to any particular industry. Still, if their company has experience with what you do, all the better.4. Degree to which they outsource vs. use in-house talent:Outsourcing certain online marketing tasks is no crime, and in many ways you may benefit from their doing this (such as in paying lower prices). However, make sure that all key strategic decisions on your behalf are being made in-house - and NOT by some outside person who really has little connection to you or your business goals.5. Quality of tools they use:All strategic Internet marketers have access to a host of interactive tools, such as website analysis, keyword analysis, and competitor analysis tools. Find out what they use and how well they use them.An alternative to your hiring a strategic Internet marketing solutions provider is to gain access to professional grade online tools you can use yourself. After a bit of training, you may know 90% of what these consultants could tell you - for a lot less cash.END OF SECTION B3IIBM Institute of Business ManagementExamination Paper of Enterprise Resource PlanningSection C: Applied Theory (30 marks)This section consists of Applied Theory Questions. Answer all the questions. Each question carries 15 marks. Detailed information should form the part of your answer (Word limit 200 to 250 words). Explain in brief Sales and Marketing Modules in ERP System. AnswerAny company would want to have a good and fighting sales and marketing force to compete in the market. A comprehensive sales and marketing ERP module will help a company stay competitive and streamline their sales and marketing activities.A sales and marketing ERP software allows activities which begin from contacting customers which are referred to as pre sales activities to be recorded. It also allows tracking of each customer orders right from placing an order to dispatch of material for that particular order and customer. Automating the sales force activities such as visits to customers, expenses, competitor assessment is possible with the ERP sales and marketing module.Many a times payments have to be received from customers after dispatches are made. An ERP sales and marketing module allows executives to contact customers and follow-up each and every sales invoice and receive payments for such invoices.Target setting for marketing personnel allows managements to monitor target achievement by individual marketing personnel. This feature in the ERP software enhances the working of the marketing department and ensures personnel are not working aimlessly.A good sales and marketing module also has features to track lost orders and identify the reasons for loosing those orders. Business partners and franchises are a common phenomenon in today's world. Latest ERP software will associate marketing personnel to their business partners and franchises and allow them to track and monitor their performance.ERP sales and marketing module will allow the preparation of reports to track sales trends over different periods, drill down for the consolidated data, allow for sales forecast and give a birds eye view of the sales and marketing activities of the company.A good sales and marketing ERP module is an essential feature of an ERP software.What are the different development process in ERP systems and write a detailed note on it?AnswerAn Enterprise Resource Planning System is a fully integrated business system covering functional areas of an enterprise like Logistics, Production, Finance, Accounting, and Human Resource1) Organizes and Integrates Operation processes and information flows to make optimumuse of resources such as Men, Material, Money and Machine (M4).2) ERP is a global tightly integrated closed loop business solution package and ismultifaceted.3) The ERP solutions seek to streamline and integrate operation processes and informationflows in the company to synergize the resources of an organization namely M4 (men,material, money and machine) through information.4) ERP Promises One Database, One Application, and one user interface for the entireenterprise rather than use of disparate (distinct) systems ruled manufacturing, distribution,finance and sales.5) ERP provides an integrated information storehouse where information needs to be storedonly once and can be further processed and reported to anyone in the value chain.Benefits:-1. Assists employees and managers plan, monitor and control the entire business.2. Assists Modern ERP System enhances a manufacturers ability to accurately scheduleProduction, fully utilizes capacity, reduce inventory and meet promised shipping datesIn the ever-growing business environment, following Demands are placed:-1. Aggressive cost control initiatives2. Need to analyse cost/revenue on a product/ customer basis3. Flexibility to respond to changing business requirementsApplications and Planning Systems that have been introduced into the business world for crossingthese hurdles are:a. Material Resource Planning (MRP)b. Manufacturing Resource Planning (MRP II)c. Money Resource Planning (MRP III)1. ERP has evolved from the MRP II system with the integration of information between vendor,Customer and Manufacturer using networks such as LAN, WAN and Internet2. MRP II system again evolved from MRP system.MRP is a system which has the following salientfeatures:3. MRP: -Objective: Obtain end product demand schedule from Master Production Schedule (MPS) for thegiven product which is taken from Bill of Material (BOM) into a schedule of planned ordersconsidering the inventory in hand.Reports that are prepared by MRP System: Planned Order Releases (POR) for Purchase Orders Work Orders4.MRP II: Method of planning of all the resources of manufacturing company. Involves alloperational and financial planning and has simulation capabilities to WHAT IF?questions.END OF SECTION C4IIBM Institute of Business Management