Erp in Retail (2)

8/8/2019 Erp in Retail (2)

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ERP in RETAIL

Group No-2

Shubhangi Singh(61)

Prateek Chhabra(16)Kulvinder Pathania(27)

Amit Rai(10)

Ashish Sonewane(29)

Gaurav Chouhan(57)



What is an ERP system?y ´A business strategy and set of industry-domain-

specific applications that build customer and

shareholder communities value network system by enabling andoptimizing enterprise and inter-enterprise collaborative operational

and financial processesµ

(Source: Gartner·s Research Note SPA-12-0420)



ERP involves the following activitiesy Integrates various processes & provides consistency

throughout the value chain-Billing system, purchase order , inventory system (scm), inventory

system, bill of material, production control (material requirementplanning) accounting assets management (finance management)

y Integrates key business processes into singleapplication software

-distribution module customer order processingDispatch billing and delivery critical business process

y Provides opportunity to implement processes that arebest practice in industry



ERP in RETAIL



Advantages of ERP Systemsy Uniform Organization Structure-

y help in creating and maintaining uniform organizing structure and procedure, system through

out geographic area. means every one uses similar information and process.y eg, samsung ² procedure and document of purchase.

y and coca cola for distribution

y Unified single platform & information architecture ²erp built and

operated on a single platform. Eg, mark and spenser use the same application of window in all

the stores. Erp system work around a single unified architecture , which helps organization to

form common and standardized definition and formats that is accepted by the whole

organization.



y Change agent ² organization want to get rid of old paper friendly system and introduce newerand more efficient system. Erp work as a catalyst to reengineer the process to bring more efficientsystem and operation.

y Improved management reporting & decision making ² not help only in sales,marketing and production but also improve the management report and decision making.

y Cross functional business process are organizational functions that are scattered more than onebusiness process.

y Supply chain involves purchase system on one hand and inventory and distribution on other. Systemalso generate periodic report for quick decision making.

y Efficient operations - help to create customer driven and vendor oriented work culture

y Modern management concept ² zero inventory ,jit make the organization efficient.

y Link with the outside world- designed to create an automatic purchase order on a vendor.The vendor receives order instantly as the stock goes below the reorder level.



Challenges of using ERP in retaily Daunting implementation

y Outdated architecture

y Limited scope

y Higher Upfront cost

y

High maintenance costsy No immediate benefits

y Resistance to change



Core areas of ERP system Merchandise Purchase orders

Request for quotations

Vendor evaluation Goods receipt

Product planning

PricingDistribution

Finance

Data Analysis



ERP Implementation StagesyImplementation life cycle divided into 4 section

of activities

Analysis

Design

ConstructionImplementation



ANALYSISy Involves study, identification & documentation of business

requirement

y Evaluation of the existing technical infrastructure of thecompany

y Followed by Gap analysis



DESIGNy Development of Tree structure

(business unit, offices, warehouses & retail outlets)

y Custom reports to meet client-specific requirements

y Interface to existing legacy system

y

Data conversion routines to load historic data



CONSTRUTION

yProgram development and testing are two important

aspects of construction phase

y

Functions created are tested logically



IMPLEMENTATION

yInstallation of applications

yTraining to the end users



ERP Implementation Life cycles



DISADVANTAGES OF USING ERP IN RETAILy Lack of price differentiation

y High installation costs

y Non-customized technical support

y Security concerns

y Low flexibility

y Limited scope for customization

y High switching costs



SWOTSTRENGTHS

Helps in routine decision making

Allows streamlining of business processes Allows integration with systems of

associates and business partners

Provides an enterprise wide view of the

workflow

WEAKNESS

Expensive to procure

Security concerns Requires significant employee training

Compatibility issues with other legacy

systems

OPPORTUNITIES

High efficiencies beco ing critical in the

retail sector due to the cut-throat

co petition and paper-thin arginsBoo ing retail sector in the e erging

global arkets

The retail sector is overlooked by the

ajor ERP solution providers

THREATS

Increasing co plexity of such syste s

Opposition to globalization and

transnational ove ent of goods Security concerns regarding sharing of

data over a net ork



BUSINESS IMPLICATIONS

yGraphical User Interface (GUI) support

y

Allows optimum utilization of the resourcesyReduction in the overhead and Inventory

yTimely responsiveness

yEnterprise wide solution

y Integrated work environment



Example of ERP in RETAIL



OVERVIEWy Opening stores in metros widely

y

Need reliable enterprise wide applicationy Looking for a solution that would bring all of its businesses

and processes together

y

After different evaluations management decided to go forSAP.



IMPLEMENTATION

y Outsourced to third party ² Novasoft

yManagement also involved

y Project divided into three phasesy 1st Phase ² Blueprint of existing process & mapping to

desired state.

y

2nd

Phase: Novasoft developed SAP platformy 3rd Phase: stores to switch to new system and data to be

ported.



BENEFITSyLong term benefits

y

Optimize inventory and cut it by two to four weeksyProper management of data



Conclusiony A retail ERP system makes management of a retail business a lot easier by

utilizing the computing power offered by the modern day InformationSystems (IS) in an integrated and consistent manner.

y The ERP Information Systems facilitates faster and better managementdecisions by providing crucial information in a timely manner.

y It also eliminates errors caused by multiple input of the same data required

in disparate legacy systems.

y When implemented properly, Retail ERP Systems have been found to deliverhigh ROI despite their high initial and maintenance costs.

Erp in Retail (2)

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