erp in retail

8/8/2019 Erp in Retail

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ERP in RETAIL

Group No-2Shubhangi Singh(61)

Prateek Chhabra(16)Kulvinder Pathania(27)Amit Rai(10)Ashish Sonewane(29)

Gaurav Chouhan(57)


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Flow of Presentationy What is ERP?y ERP in Retail

y Advantages of ERP in Retaily Challenges of using ERP in Retaily Core areas of ERP systemy ERP implementation stagesy Disadvantages of using ERP in Retaily SWOTy Example of Pantaloom


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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 operationaland financial processes

(Source: Gartners Research Note SPA-12-0420)

orAccording to Laudon and Laudon (2002) defines ERP as Firm wide informationsystem that integrates key business processes so that information can flowfreely between different parts of the firm


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ERP involves the following activitiesy Integrates various processes & provides consistency

throughout the value chain

y Integrates key business processes into singleapplication software

y Provides opportunity to implement processes that arebest practice in industry


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ERP in RETAIL


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Advantages of ERP Systemsy Uniform Organization Structure

y Unified single platform & information architecture

y Change agent

y Improved management reporting & decision making

y

Efficient operationsy Link with the outside world


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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y Outdated architecture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


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Core areas of ERP system Merchandise Purchase orders Request for quotations Vendor evaluation Goods receipt Product planning

PricingDistributionFinance

Data Analysis


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ERP Implementation StagesyImplementation life cycle divided into 4 section

of activities

Analysis

Design

ConstructionImplementation


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ANALYSISy Involves study, identification & documentation of business

requirement

y Evaluation of the existing technical infrastructure of thecompany

y Followed by Gap analysis


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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


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CONSTRUTION

yProgram development and testing are two importantaspects of construction phase

y

Functions created are tested logically


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IMPLEMENTATION

yInstallation of applications

yTraining to the end users


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ERP Implementation Life cycles


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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


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SWOTSTRENGTHS Helps in routine decision making

Allows streamlining of business processes Allows integration with systems ofassociates and business partners Provides an enterprise wide view of theworkflow

WEAKNESS

Expensive to procure

Security concerns Requires significant employee training Compatibility issues with other legacysystems

OPPORTUNITIES

High efficiencies beco ing critical in theretail sector due to the cut-throat

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

THREATS

Increasing co plexity of such syste s Opposition to globalization and

transnational ove ent of goods Security concerns regarding sharing ofdata over a net ork


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BUSINESS IMPLICATIONS

yGraphical User Interface (GUI) support

y

Allows optimum utilization of the resourcesyReduction in the overhead and Inventory

yTimely responsiveness

yEnterprise wide solutiony Integrated work environment


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Example of ERP in RETAIL


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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.


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Main Components of Retail ERP SystemyMerchandise management

y

Retail planningySupply chain planning and execution

yStore operations

yCorporate administration


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Aim : To deploy a robust transaction

management system and an

enterprise-wide platform to run its

operations.

Solution : SAP retail solution

Implemented by : SAP team with the help of Novasoft,

Singapore

Number of users : Around 1,200

Time taken : About six months

Cost of implementation : About $10 million

Nutshell


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IMPLEMENTATION

y Outsourced to third party Novasoft

yManagement also involved

y Project divided into three phases


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1st Phase The first phase involved blueprinting existingprocesses and mapping them to the desired state. In

this phase, the entire project team worked on currentprocesses within the structure of the organisation,analysed and drafted them. This blueprint was later

used in the formation of new states of the solution.Since the SAP would combine all the processes, eachand every one of these had to be evaluated.


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2nd Phase: Novasoft developed SAP platformThe SAP platform was developed with the help of Novasofts templatewhich was predefined by SAP after evaluation of Pantaloons needs and

expertise in retail solutions.

3rd Phase: Stores to switch to new system and data to be portedThe last phase in this project was for stores to switch over to the new

system and for current data to be ported. Before the SAPimplementation, all the data was unorganised. This data had to bemigrated to the new SAP application.


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BENEFITSyLong term benefits

y

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


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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.


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erp in retail

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