ERP FINAL EXAM LATEST UPDATE
1) Describe the functional organizational structure. Why do you think
this structure is so widely used? - ANSWER - Most common
organizational structure
- Functional structure divided into functions or departments
- Functions perform specialized tasks or activities
- Processes cut across functions
2) What is the Silo effect? - ANSWER - Focusing on functional
objectives without regard to process objectives
- Optimizing functional goals vs. process goals
o Local Optimization
o Competing goals
o Conflicting performance measures
- Performance data is collected and managed within functions
o Often duplicated
o Difficult to update across functions
- Process execution requires communication and coordination
among functions
o This communication and coordination is even more difficult within a
global enterprise
Why does the Silo Effect Exist? - ANSWER CONFLICT: Most
organizations are structured FUNCTIONALLY while the processes
are designed CROSS-FUNCTIONALLY.
Managers do this - ERP systems DO NOT: - ANSWER • Define the
,organization mission or vision
• Set goals for organizations and groups
• Define competitive business strategies
How can Silo Effect be eliminated? - ANSWER ERP Systems can
minimize the silo effect
Enterprise Systems (ERP) support cross-functional processes
(often globally)
• Centralize and coordinate information in a central database
• Process are streamlined by consolidating duplicate data
• Processes are standardized using best practices
• Diverse business processes are connected
• Scalability is possible (relatively simple to grow in size)
3) What is a business process? - ANSWER - Business Process: The
set of activities designed to convert inputs into value-added Output
- Has a specific goal
- Initiated by some sort of trigger (inputs)
- Involves multiple steps (tasks)
- Are executed and influenced by multiple functions within the
organization
- Utilizes and creates data (resources)
- Results in a product or document outcome (value-added output)
4) Briefly describe the key business process included in this chapter
in terms of their key steps - ANSWER - Procurement, Materials
Management - Buy
- Production Planning - Make
, - Fulfillment, Sales and Distribution- Sell
- Material Planning - Plan
- Inventory and Warehouse Management - Store
- Lifecycle Data Management - Design
- Asset Management and Customer Service - Service
- Human Capital Management - People
- Project Management - Projects
- Financial Accounting - Tracking for External Reporting
- Management Accounting - Tracking for Internal Reporting
1) Discuss the three types of data in an enterprise system and how
they are related: - ANSWER organizational data, master data and
transaction data.
o Organizational data - ANSWER are used to represent the structure
of an enterprise. Examples of an organizational structure are
companies, subsidiaries, factories, warehouses, storage areas, and
sales regions.
• Examples of organizational structure are client, company code, and
plant.
o Master data - ANSWER represent entities associated with various
processes such as selling a product a customer.
• Examples of master data are customer, vendors and materials.
Transaction data reflect the consequences of executing process
steps, or transactions.
1) Describe the functional organizational structure. Why do you think
this structure is so widely used? - ANSWER - Most common
organizational structure
- Functional structure divided into functions or departments
- Functions perform specialized tasks or activities
- Processes cut across functions
2) What is the Silo effect? - ANSWER - Focusing on functional
objectives without regard to process objectives
- Optimizing functional goals vs. process goals
o Local Optimization
o Competing goals
o Conflicting performance measures
- Performance data is collected and managed within functions
o Often duplicated
o Difficult to update across functions
- Process execution requires communication and coordination
among functions
o This communication and coordination is even more difficult within a
global enterprise
Why does the Silo Effect Exist? - ANSWER CONFLICT: Most
organizations are structured FUNCTIONALLY while the processes
are designed CROSS-FUNCTIONALLY.
Managers do this - ERP systems DO NOT: - ANSWER • Define the
,organization mission or vision
• Set goals for organizations and groups
• Define competitive business strategies
How can Silo Effect be eliminated? - ANSWER ERP Systems can
minimize the silo effect
Enterprise Systems (ERP) support cross-functional processes
(often globally)
• Centralize and coordinate information in a central database
• Process are streamlined by consolidating duplicate data
• Processes are standardized using best practices
• Diverse business processes are connected
• Scalability is possible (relatively simple to grow in size)
3) What is a business process? - ANSWER - Business Process: The
set of activities designed to convert inputs into value-added Output
- Has a specific goal
- Initiated by some sort of trigger (inputs)
- Involves multiple steps (tasks)
- Are executed and influenced by multiple functions within the
organization
- Utilizes and creates data (resources)
- Results in a product or document outcome (value-added output)
4) Briefly describe the key business process included in this chapter
in terms of their key steps - ANSWER - Procurement, Materials
Management - Buy
- Production Planning - Make
, - Fulfillment, Sales and Distribution- Sell
- Material Planning - Plan
- Inventory and Warehouse Management - Store
- Lifecycle Data Management - Design
- Asset Management and Customer Service - Service
- Human Capital Management - People
- Project Management - Projects
- Financial Accounting - Tracking for External Reporting
- Management Accounting - Tracking for Internal Reporting
1) Discuss the three types of data in an enterprise system and how
they are related: - ANSWER organizational data, master data and
transaction data.
o Organizational data - ANSWER are used to represent the structure
of an enterprise. Examples of an organizational structure are
companies, subsidiaries, factories, warehouses, storage areas, and
sales regions.
• Examples of organizational structure are client, company code, and
plant.
o Master data - ANSWER represent entities associated with various
processes such as selling a product a customer.
• Examples of master data are customer, vendors and materials.
Transaction data reflect the consequences of executing process
steps, or transactions.
