Enterprise Resource
Planning Summary
Course Disclaimer: The course ERP is not about SAP. The goal is for the students to
understand various business processes and the complexity of an organization; this can
be achieved better using an ERP application. This will enable the student to grasp
abstract concepts by executing hands-on the daily activities of a business and simulate
real world business situations using an ERP system.
Rania El Ghalbzouri 1
IBT 3 2024-2025
,Chapter 1: Introduction to SAP
What is ERP?
Enterprise Resource Planning (ERP) is a system designed to integrate and manage
essential business processes within an organization. It serves as both software and a
framework that helps businesses handle resources and daily operations such as
supply chain management, manufacturing, services, financials, and more.
Key Functions of ERP Systems:
➢ Automation of Business Processes: ERP systems streamline activities such as
accounting, procurement, project management, customer relationship management
(CRM), and supply chain operations. By automating these tasks, ERP reduces manual
input and simplifies workflow.
➢ Cross-Departmental Integration: The main benefit of ERP is its ability to integrate
various functions across a business. For example, financial data from accounting is
easily accessible for procurement or project management, creating a unified system
where information flows freely between departments.
➢ Simplification of Operations: An ERP system simplifies complex operations by
centralizing data and automating tasks, improving overall business efficiency and
decision-making.
Extra Reading:
Gartners Definition: ERP delivers an integrated suite of business applications that
automate and streamline processes like finance, HR, manufacturing, supply chain, and
services. It supports both administrative and operational functions across various
industries.
Key Benefits of ERP:
➢ Business Innovation: Helps companies rethink workflows and management
strategies.
➢ Efficiency: Standardizes processes, reducing errors and improving daily operations.
➢ Process Standardization: Ensures consistency across departments.
➢ IT Cost Savings: Consolidates systems, cutting IT expenses.
Market Growth:
The global ERP market, valued at $49.28 billion in 2022, is projected to reach $90.63
billion by 2029. ERP demand surged during the COVID-19 pandemic as businesses
sought more effective resource management tools.
Rania El Ghalbzouri 2
IBT 3 2024-2025
,Discussion Questions: An ERP system ties multiple business processes together
ERP is the vehicle for integrating people, processes, and technologies across a modern
enterprise. ~ Oracle
➢ What is a business Process?
A business process is nothing more than the activities that companies do in a daily
business.
A business process refers to the daily activities that companies perform in order to
achieve their goals. It includes all the tasks and workflows that occur regularly within
a business.
➢ Give an example of a business process?
An example of a business process is the procure-to-pay process, which involves
requisitioning, purchasing, and paying for goods and services.
➢ Give an example in a business context.
In an automotive manufacturing company, the process of procuring parts from
suppliers is a business process. For instance, tracking the purchase of “front brake
pads” from requisition to payment is managed through the company’s ERP system.
The system ensures that data like part name, cost, and supplier information is
consistent and properly tracked across all departments.
ERP Fundamentals
ERP systems are built around a unified data structure and common database,
ensuring consistent information across an organization. They integrate people,
processes, and technologies by connecting workflows across departments like
finance and HR. A key feature of ERP is centralizing data, replacing disconnected
spreadsheets with a secure, shared repository. This ensures that all users, from the
CEO to clerks, access the same accurate, up-to-date data. ERP improves data
integrity and reliability across all business tasks, from financial statements to reports,
minimizing errors.
Example: In a car manufacturing company, an ERP system tracks the purchase of
parts from suppliers, ensuring all data (like part name, cost, and specifications) is
consistent throughout the process. For example, "front brake pads" are uniformly
labelled and tracked, making it easier to manage and analyse data. This avoids
confusion from different naming conventions and helps the company accurately
monitor costs, negotiate better prices, and make informed decisions across
departments.
Rania El Ghalbzouri 3
IBT 3 2024-2025
, B2B Case Study: Vanden Borre & Apple
In anticipation of Black Friday sale, Vanden Borre’s forecast is that there will be more
demand for iPhones, the territory sales manager from Vanden Borre contacts an Account
Manager (Sales) at Apple to order some iPhones.
The conversation might go somewhere like this: "We need 5,000 iPhones at ten of our
biggest stores in Belgium hopefully by November 1st and if you could cut me a good
deal."
Let’s say you are this Account Manager at Apple. How would you proceed?
Apple's Decision-Making Process for a Large iPhone Order
Before fulfilling a large iPhone order from a retailer like Vanden Borre, Apple must
carefully consider several factors. These include:
➢ Inventory Availability: Does Apple have sufficient iPhones in stock to meet the order?
➢ Shipping Capacity: Can Apple ship the iPhones to Vanden Borre's stores on time?
➢ Customer Relationship: Is Vanden Borre a reliable customer with a good payment
history?
➢ Discount Consideration: Should Apple offer a discount to Vanden Borre based on
their relationship and order size?
If the answers to these questions are positive, Apple can proceed with fulfilling the order.
The first process in this scenario, as outlined in the revised text, is evaluating the order
request. This involves assessing the factors mentioned above to determine if Apple can
fulfill the order.
Rania El Ghalbzouri 4
IBT 3 2024-2025
Planning Summary
Course Disclaimer: The course ERP is not about SAP. The goal is for the students to
understand various business processes and the complexity of an organization; this can
be achieved better using an ERP application. This will enable the student to grasp
abstract concepts by executing hands-on the daily activities of a business and simulate
real world business situations using an ERP system.
Rania El Ghalbzouri 1
IBT 3 2024-2025
,Chapter 1: Introduction to SAP
What is ERP?
Enterprise Resource Planning (ERP) is a system designed to integrate and manage
essential business processes within an organization. It serves as both software and a
framework that helps businesses handle resources and daily operations such as
supply chain management, manufacturing, services, financials, and more.
Key Functions of ERP Systems:
➢ Automation of Business Processes: ERP systems streamline activities such as
accounting, procurement, project management, customer relationship management
(CRM), and supply chain operations. By automating these tasks, ERP reduces manual
input and simplifies workflow.
➢ Cross-Departmental Integration: The main benefit of ERP is its ability to integrate
various functions across a business. For example, financial data from accounting is
easily accessible for procurement or project management, creating a unified system
where information flows freely between departments.
➢ Simplification of Operations: An ERP system simplifies complex operations by
centralizing data and automating tasks, improving overall business efficiency and
decision-making.
Extra Reading:
Gartners Definition: ERP delivers an integrated suite of business applications that
automate and streamline processes like finance, HR, manufacturing, supply chain, and
services. It supports both administrative and operational functions across various
industries.
Key Benefits of ERP:
➢ Business Innovation: Helps companies rethink workflows and management
strategies.
➢ Efficiency: Standardizes processes, reducing errors and improving daily operations.
➢ Process Standardization: Ensures consistency across departments.
➢ IT Cost Savings: Consolidates systems, cutting IT expenses.
Market Growth:
The global ERP market, valued at $49.28 billion in 2022, is projected to reach $90.63
billion by 2029. ERP demand surged during the COVID-19 pandemic as businesses
sought more effective resource management tools.
Rania El Ghalbzouri 2
IBT 3 2024-2025
,Discussion Questions: An ERP system ties multiple business processes together
ERP is the vehicle for integrating people, processes, and technologies across a modern
enterprise. ~ Oracle
➢ What is a business Process?
A business process is nothing more than the activities that companies do in a daily
business.
A business process refers to the daily activities that companies perform in order to
achieve their goals. It includes all the tasks and workflows that occur regularly within
a business.
➢ Give an example of a business process?
An example of a business process is the procure-to-pay process, which involves
requisitioning, purchasing, and paying for goods and services.
➢ Give an example in a business context.
In an automotive manufacturing company, the process of procuring parts from
suppliers is a business process. For instance, tracking the purchase of “front brake
pads” from requisition to payment is managed through the company’s ERP system.
The system ensures that data like part name, cost, and supplier information is
consistent and properly tracked across all departments.
ERP Fundamentals
ERP systems are built around a unified data structure and common database,
ensuring consistent information across an organization. They integrate people,
processes, and technologies by connecting workflows across departments like
finance and HR. A key feature of ERP is centralizing data, replacing disconnected
spreadsheets with a secure, shared repository. This ensures that all users, from the
CEO to clerks, access the same accurate, up-to-date data. ERP improves data
integrity and reliability across all business tasks, from financial statements to reports,
minimizing errors.
Example: In a car manufacturing company, an ERP system tracks the purchase of
parts from suppliers, ensuring all data (like part name, cost, and specifications) is
consistent throughout the process. For example, "front brake pads" are uniformly
labelled and tracked, making it easier to manage and analyse data. This avoids
confusion from different naming conventions and helps the company accurately
monitor costs, negotiate better prices, and make informed decisions across
departments.
Rania El Ghalbzouri 3
IBT 3 2024-2025
, B2B Case Study: Vanden Borre & Apple
In anticipation of Black Friday sale, Vanden Borre’s forecast is that there will be more
demand for iPhones, the territory sales manager from Vanden Borre contacts an Account
Manager (Sales) at Apple to order some iPhones.
The conversation might go somewhere like this: "We need 5,000 iPhones at ten of our
biggest stores in Belgium hopefully by November 1st and if you could cut me a good
deal."
Let’s say you are this Account Manager at Apple. How would you proceed?
Apple's Decision-Making Process for a Large iPhone Order
Before fulfilling a large iPhone order from a retailer like Vanden Borre, Apple must
carefully consider several factors. These include:
➢ Inventory Availability: Does Apple have sufficient iPhones in stock to meet the order?
➢ Shipping Capacity: Can Apple ship the iPhones to Vanden Borre's stores on time?
➢ Customer Relationship: Is Vanden Borre a reliable customer with a good payment
history?
➢ Discount Consideration: Should Apple offer a discount to Vanden Borre based on
their relationship and order size?
If the answers to these questions are positive, Apple can proceed with fulfilling the order.
The first process in this scenario, as outlined in the revised text, is evaluating the order
request. This involves assessing the factors mentioned above to determine if Apple can
fulfill the order.
Rania El Ghalbzouri 4
IBT 3 2024-2025
