Enterprise Systems Enterprise Systems CollaborationCollaboration

EGN 5621 Enterprise Systems CollaborationSummer B, 2012

Course ObjectivesCourse Objectives To learn how the ERP system supports

business strategies. To develop technical skills of making

decisions using an enterprise software To acquire a hands-on understanding of

the concepts underlying enterprise systems operation

To appreciate first hand, the tangible benefits of enterprise systems integration

The Operations ScenarioThe Operations ScenarioYou (your team) will operate a company in

a simulated business environment to compete with several other competitors (i.e., other teams).

You (each team) will decide on business strategies and make business decisions toward maximum operation profit for your company, using an enterprise information system.

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Corporate Roles DesignationCorporate Roles Designation CEO (Team Leader)

◦ Watch financial statement◦ Review price market report◦ Check summary sales report◦ Check inventory Report

Marketing Manager◦ Marketing Expense Planning◦ Review Price market report◦ Review summary sales report

Sales Manager◦ Change product prices◦ Check sales order report◦ Check summary sales report

MM Manager◦ Forecast – create planned indep. Req.◦ MRP run◦ Automatic generation of POs◦ Purchase Order Tracking◦ Check inventory Report

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The Virtual Business EnvironmentThe Virtual Business Environment

Simulation of a market

Automation of administrative tasks

Simulation of the passing of time

Automated Business ProcessesAutomated Business ProcessesThe Integrated ERP EnvironmentThe Integrated ERP Environment

Sales

Automated

AutomatedPlanning

Automated

Procurement

Automated

The Simulated ERP The Simulated ERP EnvironmentEnvironment

Watch this video clip for more information about ERPsim: http://www.youtube.com/watch?v=qzqiRsuY4gg

Three Case StudiesThree Case Studies

The Distribution CaseThe Distribution Case

Covers the following processes and operations: Planning and Purchasing Sales and Marketing

The Logistics CaseThe Logistics Case

The focus is set on data analysis Overstock, out of stocks

and wrong allocations of products can be costly to the team

Students must analyse data to understand the market and make better decisions

Covers the following processes and operations: Planning and Purchasing Transfers and logistics

(Pull or push mode) Sales

The Manufacturing CaseThe Manufacturing Case

Covers the following processes and operations: Planning and Purchasing Production Sales and Marketing Master Data (BOM)

Allows for the reversal of the business cycle

The Manufacturing Case ExtendedThe Manufacturing Case Extended

Covers the following processes and operations: Planning and Purchasing Production Sales and Marketing Master Data (BOM)

Advanced Options Warehousing Costs Production improvement Automatic asset

depreciation posting Interest, Bank Loans, and

Credit Rating Management

Operate a Distribution Operate a Distribution CompanyCompany

(Pilot & Operation-Run)(Pilot & Operation-Run)

EGN 5621 Enterprise Systems CollaborationSummer B, 2012

TeamsTeamsEach time should have

4 participants at most.Each team operates a

bottle distribution company.

Participants make business decisions to ensure the profitability of their operation, using standard reports.

The (German) MarketThe (German) Market

North45 retailers

South38 retailers

West40 retailers

• 6 products (boxes of 12x1L and 24x500mL)• 3 areas with distinct marketing accounts• One distribution channel: 14• Market size of about € 6,000 per company per step

The 6 Products The 6 Products Product Code Product Description Units in box Cost of boxes

$$-F01 1L ClearPure 12 bottles 11.99 $$-F02 1L Spritz 12 bottles 14.99 $$-F03 1L Lemon Spritz 12 bottles 16.99 $$-F04 500mL ClearPure 24 bottles 16.99 $$-F05 500mL Spritz 24 bottles 19.99 $$-F06 500mL Lemon Spritz 24 bottles 22.99

The Game Layout DesignThe Game Layout Design20 steps

25 min20 steps

25 min20 steps

25 min

Rules of the gameRules of the gameEach round will be of 20 steps (a bit more

than 1 min per step)End-of-round inventory is carried over to

the next roundYou can sell a product only if you have it

in stockYou compete against the other teams and

importersYour objective is to maximize profit

ABC of the Enterprise systemABC of the Enterprise systemAn enterprise system is built around an

integrated databaseA system such as SAP contains tens of

thousands of data tablesWhen a user creates, changes or views data in

the system, he or she performs a transactionData changed or created by one user can be

exploited by all other users (ex. reporting, tracking, execution of orders, etc.)

All transactions are traceable, transactions with financial impacts can be reversed, never erased

User interfaceUser interfaceUsers interact with the enterprise system

through transactions. A large number of pre-programmed

transactions exist in SAPEach transaction has a transaction code –

one can call a transaction if one knows the transaction code

The SAP menu allows to browse and find the desired transaction

One can create a user menu or a list of favorites with the commonly used transactions

SAP Menu & NavigationSAP Menu & NavigationExtras / Settings / Display Technical Names

Reports and queriesReports and queriesReports and queries are transactions that

allow users to view existing dataA typical query is performed as follows:

In the first page of the transaction, you must enter the selection criteria for the query (ex. Company code, product code, etc.)

Then, click on to execute the queryA table containing the requested data will

appearThe display and layout can sometimes be

modified

Entering new dataEntering new dataSome transactions are designed to

change or create new data (change forecast, release purchasing orders, change sale price, etc.)

The interface varies according to data required by the system

The system will not allow you to save information if all the compulsory fields have not been filled

You must save/release/confirm before exiting the transaction

Other useful buttonsOther useful buttonsUse the navigation buttons to go back or

get out of a transactionYou can open up to 6 sessions. Click on

to open a new sessionDelete , search , select all , view

, enter .

Participant’s job aidParticipant’s job aid

Getting Started:Getting Started:Set up teams:

◦Max 4 persons: User 1 to User 4◦Up to 26 companies : A to Z

Log in using user name and password given by the instructor.

Login informationLogin informationClient: 610

Login: intro_$ #Where

$ = Team, # = User 1 to

User 4

For example: intro_A1

Password: ERPSIMYou will have to change your password the first time you enter

25 min

20 steps20 steps

Distribution Game: Distribution Game: Round 1Round 1

Cost, inventory & initial Cost, inventory & initial pricingpricing

Material $$-F01 $$-F02 $$-F03 $$-F04 $$-F05 $$-F06

Name 1L ClearPure 1L Spritz 1L Lemon Spritz

500mL ClearPure 500mL Spritz 500mL Lemon

Spritz

Size 1L 1L 1L 500mL 500mL 500mL

Number of bottles in package 12 12 12 24 24 24

Cost €11.99 €14.99 €16.99 €16.99 €19.99 €22.99

Initial price €14.99 €17.99 €19.99 €19.99 €22.99 €25.99

Initial stock 1,000 1,000 1,000 1,000 1,000 1,000

The Distribution Game:The Distribution Game:Quarter 1 (20 virtual steps)Quarter 1 (20 virtual steps)

Initial Financial Status:◦11000 Fix Assets 250,000◦70000 Common Stock (500,000)◦113300 Bank Cash Account 146,060◦792000 Finished Goods 103,940

The Distribution Case: Round 1 The Distribution Case: Round 1 (20 steps)(20 steps)You need to maintain the price of your 6 products

and invest in marketing.Need to know the following in order to make

decisions:◦ Maintain price list◦ See available stock◦ Monitor sales orders◦ Monitor competitors

Participant’s job aid & MenuParticipant’s job aid & Menu

Maintain Prices for DC 14Maintain Prices for DC 14

Marketing expensesMarketing expenses

On marketingOn marketing

Enter your daily marketing budget for each product and for each region

The impact of marketing in one region depends on your share of all marketing expenses in this region

Marketing induces customers to find your product “more desirable”

The daily marketing budget can be changed at any time

Stock in material overviewStock in material overview

Check sales summary reportCheck sales summary report

Check market reportCheck market report

Check sales order reportCheck sales order report

The Distribution Game:The Distribution Game:Round 1 Round 1 (20 steps)(20 steps)

Now start the simulator for 20 steps

25 min

20 steps20 steps

Distribution Game: Distribution Game: Round 2Round 2

It’s time to replenish !It’s time to replenish !

You need to replenish. Replenishment will allow you to purchase the same quantity that you have sold.

Material $$-F01 $$-F02 $$-F03 $$-F04 $$-F05 $$-F06

Name 1L ClearPure 1L Spritz 1L Lemon Spritz 500mL ClearPure 500mL Spritz 500mL Lemon

Spritz

Initial forecast 1,000 1,000 1,000 1,000 1,000 1,000

Replenishment lead time Up to 3 steps Up to 3 steps Up to 3 steps Up to 3 steps Up to 3 steps Up to 3 steps

Participant’s job aid & MenuParticipant’s job aid & Menu

Execute MRPExecute MRP

After the MRP runAfter the MRP run

Convert purchase requisitions into Convert purchase requisitions into purchase orderspurchase orders

Track purchase ordersTrack purchase orders

The Distribution Game:The Distribution Game:Round 2Round 2 (20 steps) (20 steps)

Now start the simulator for 20 steps

25 min

20 steps20 steps

Distribution Game: Distribution Game: Round 3Round 3

It’s time to replenish !It’s time to replenish !

You need to replenish. Change your forecast to adapt the replenishment levels to your needs

What do you need to know in order to make that decision ?

Material $$-F01 $$-F02 $$-F03 $$-F04 $$-F05 $$-F06

Name 1L ClearPure 1L Spritz 1L Lemon Spritz

500mL ClearPure 500mL Spritz 500mL Lemon

Spritz

Initial forecast 1,000 1,000 1,000 1,000 1,000 1,000

Replenishment lead time 3 steps 3 steps 3 steps 3 steps 3 steps 3 steps

Participant’s job aid & MenuParticipant’s job aid & Menu

ForecastingForecasting

The Distribution Game:The Distribution Game:Round 3Round 3 (20 steps) (20 steps)

Now start the simulator for the last

20 steps

Cash managementCash managementYou started with $146,060 in cashYou can reimburse your bank loan at

anytime and save on interest paymentYou can use all your cash to stock products,

but …If you run out of cash, your bank loan will be

extended but you credit rating will go down and your interest payments will go up

Holding to much stock reduce your ability to response to customers’ preferences

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Premium on credit ratingsPremium on credit ratingsCre dit ra tings Risk PremiumAAA 0.00% AA+ AA- A BBB+ BBB BBB- BB+ BB CC 10.00%

Check financial dataCheck financial data

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Financialstatements

Productcosting

Analysis of Your Distribution Analysis of Your Distribution OperationOperation