Management Information Systems - Enterprise Resource Planning - Case Study Example

ERP Systems Management Report Name: Instructor: Course: Institution: Date: ERP Systems Management Report Introduction Today, Enterprise Resource Planning (ERP) systems have become the foundation for company-wide continuous improvement efforts. ERP refers to a broad group of activities supported by multimodule software programs that assists businesses to manage the essential business components, such as components buying, product planning, inventory maintenance, supplier relationships, provision of customer service, monitoring of purchase orders, and others. There are various ERP modules in the market today, with the most popular ones being SAP, Navision, Microsoft Dynamics, Scala, Epicor, and Oracle applications (Khan 2002). Among these, SAP modules (R/2 and R/3) find wide applications in organizations. For decades, SAP R/3 module has been the leading ERP application software, offering comprehensive functions that incorporate nearly all key business processes within the enterprise. In an attempt to help businesses apply ERP to understand and form sound relationships with their customers, SAP has steadily built up an all-inclusive customer relationship management (CRM) program that offers exceptional functionality for sales, marketing, and service. By offering support to customer-driven enterprise processes across various relationship channels, SAP’s CRM allows businesses to emphasize on plans for consumer-driven growth and to differentiate themselves in the industry by offering unparalleled customer experience (SAP Global n.d.). The current report explores CRM and the benefits it offers to companies, as well as description of SAP’s CRM solution and some of the companies that have implemented it. CRM Description Today, businesses view CRM as the most effective way towards pursuing customer focussed business operations. In this context, CRM describes an approach for businesses to create and preserve long-term business relationships with consumers. As Bagad (2009, p.12-1) argues, CRM also represents a means to integrate and automate most of the business processes and related analysis in an effort to maximize time resource. All these descriptions signify that CRM refers to a customer-driven approach that aims to assist businesses understand their consumers well enough to differentiate between those that needs to be retained and those that needs to be lost. A CRM solution integrates various components; all aimed at helping companies ensure efficiency, reliability, consistency, and effectiveness of their services to consumers. Some of the most popular components include sales, customer support and service, account and contact management, retention and loyalty plans, as well as promotion and performance (Kincaid 2003). Some of the providers of CRM solutions include Oracle, SAP, PeopleSoft, Siebel, and others. Benefits CRM solutions facilitate collaboration of various communication channels with the customers so that businesses can accommodate their consumers’ favourite interaction channels. Therefore, they provide the following three significant benefits to businesses: a) Enhanced customer service through individualized care – CRM enables businesses to identify best solutions beforehand through monitoring of consumer relationships with the business and adopting one-to-one customer care (Bell 2006). b) Decreased costs through consumer self-service – the large number of calls placed to customer care representatives present a concise and conventional set of questions. Profiles of users enable businesses to foresee the needs of consumer support and prepare required solutions automatically. Moreover, the solutions can also assist businesses to improve profitability as the customer service discourse intermittently offers opportunities for up- and cross-selling (Bagad 2009). c) Enhanced referrals through effective, long-term consumer interactions – CRM allow businesses to embrace sound marketing and promotion strategies that serve to attract new consumers. It also helps enterprises to preserve already existing consumers by providing them exceptional services, addressing every interaction individually, tracking sales cautiously, service and delivery performance, and other services (Bell 2006, p.223) SAP’s CRM Solution Description SAP CRM solution, offered as one of the components of SAP business suite, assists businesses to minimize their costs and maximize their ability to make decisions, as well as attain differentiated capacities essential for long-term competitive advantage. According to SAP Global (n.d.), the solution comprises of various functions and features, classified into eight business areas: marketing, sales, service, web channel, interaction centre, and others. Marketing The marketing function in SAP CRM supports the overall marketing cycle, from planning to analytics. It offers businesses a vital marketing framework for evaluating, planning, designing, and implementing marketing operations through consumer relationship contacts. Some of the business processes supported by the function include (SAP Global n.d.): Brand management and promotion resource – the function allows firms to strategically administer, maximize, and align all marketing activities and resources with marketing objectives. Promotion management – enables businesses to create individualized customer interactions and coincident promotional offers through internal and external channels of marketing, such as SMS, facsimile, e-mail, web, and phone. Managing brand loyalty – the function also enables businesses to design and execute brand loyalty strategies Analysis of market data – SAP CRM’s marketing function facilitates firms to analyse and transform market information into effective and segmented action plans to achieve customer satisfaction Sales This function is geared towards assisting sales professionals establish consistent processes throughout the sales cycle. As Deshmukh (2006) argues, SAP CRM function supports: Business sales – common features to support the process include integration of sales budgeting and planning, management of contact and account, pipeline and sales opportunity management, management of sales activities and tasks, management of sales quotations, orders, and contracts, among others. Online selling – The solution supports digital or web-based sales processes Channel enterprise – features here comprise of distributed quotations, inventory, and order management, hosted partner web addresses and order management, and virtual showrooms, all geared towards helping the business carry out joint sales tasks with their business partners. Service The service application software in SAP’s CRM software supports service processes that extend from planning to the actual execution of the services. According to SAP Global (n.d.), the most important processes supported by the service application include: Service promotion and sales – enables businesses to design and implement solution-driven marketing, as well as processing orders and quotations for services Managing service contracts Supporting customer care Computerising the overall process for deport and return refurbishment Managing the whole claim and warranty process, including tasks such as receipt and return merchandize authorization (RMA) Managing field service process Management of partner channels The CRM solution offers businesses internet-based application software to deal with partner interactions and assist them achieve exceptional sales volume. Individualized platforms assist producers to handle their interactions with associates effectively, coordinate with the brand partners, and maximize channel processes, including associate management, channel sales and promotion, analysis of channels and partners, as well as order administration (Deshmukh 2006). Management of web channel SAP’s CRM solution also incorporates web channel management software that gives businesses capabilities to conduct their business activities online. Some of the integrated online business processes include e-commerce (both business to business and business to consumer), e-business, e-service, and analytics (SAP Global n.d). Other functions In addition to the above features, SAP’s CRM application also includes other essential functions, such as interaction centre (acting a dedicated strategic delivery application), management of business communications (an application for businesses to exploit human capital for exceptional customer experience), trade marketing administration, and management of coincident trade offers. Examples of Companies Using SAP’s CRM Solution Some companies such as Cadbury, Dell computers, and Siemens Power Corporation among others have implemented the SAP’s CRM solution (Monk & Wagner 2008). Despite its benefits, the Dell computers lacked top management commitment, had a problem in reengineering the existing processes due to employees’ traditional conservatism, and faced high implementation costs that involved training of employees on the new system. The Cadbury faced a challenge in tracking the end-user duty suspension that came from the imported components to the finished products through the new multi-level bill material system. The company’s employees experienced problems in automatic refund calculation, a problem in linking EDI messaging, and in profitability analysis. On the other hand, Siemens Power Corporation had an issue with the big bang software implementation. It had to split implementation into three phases, as many resources were required. Moreover, the implementation team consultants left during the implementation phases, creating a major hurdle. This lost the implementation momentum, leaving management less enthusiastic about company’s efforts. Conclusion CRM refers to a customer-driven approach that aims to assist businesses understand their consumers well enough to differentiate between those that needs to be retained and those that needs to be lost. Some of the major benefits associated with CRM implementation include enhanced customer service through individualized care, decreased costs through consumer self-service, and enhanced referrals through effective, long-term consumer interactions. In an attempt to help businesses apply ERP to understand and form sound relationships with their customers, SAP has steadily built up an all-inclusive customer relationship management (CRM) program that offers exceptional functionality for sales, marketing, and service. SAP’s CRM solution assists businesses to minimize their costs and maximize their ability to make decisions, as well as attain differentiated capacities essential for long-term competitive advantage. It comes as an integration of various applications or functions, including marketing, sales, service, web channel, interaction centre, and others. Therefore, the solution allows businesses, such as Cadbury, to emphasize on plans for consumer-driven growth and to differentiate themselves in the industry by offering unparalleled customer experience. References Bagad, VS 2009, Management information systems, Technical Publications, Perth. Bell, S 2006, Lean enterprise systems: using IT for continuous improvement, John Wiley and Sons, New York, NY. Deshmukh, A 2006, Digital accounting: the effects of the internet and ERP on accounting, Idea Group Inc (IGI), Chicago, IL. Khan, A 2002, Implementing SAP with an ASAP methodology focus, iUniverse, Bloomington, IN. Kincaid, JW 2003, Customer relationship management: getting it right! Prentice Hall PTR, Upper Saddle River, NJ. Monk, EF & Wagner, BJ 2008, Concepts in enterprise resource planning, 3rd edn, Cengage Learning EMEA, London, UK. SAP customer relationship management: features and functions n.d., SAP Global, viewed 3 April 2011, Read More