Enterprise Resource Planning

A1: How ERP works and map them against the system hierarchy?

Enterprise Resource Planning System is a computer program that provides an end to end data administration under concentrated systems for an organization (Hussain, 2008). Several different business territories are covered, such as production frame, assembling operation. In simple words, ERP is the focal database where each division uploads their data. In this focal database, every division inside the organization can access others department's data and share data of their own. Monitored by a computer system, it is much more efficient and effective than by manpower.

As seen from the chart below, the management information system illustrates how organizations manage information to making decision effectively (O'Brien, 1999). Each level of management utilizes distinctive information systems. The executive level is utilizing the executive information system for key planning; the front-line level is using transactions processing systems.

A2: What is the flow of information through the use of ERP?

ERP serves as an operation that handles transactions in everyday manufacturing. It helps every division to communicate effectively and avoids data duplication. The flow of information can be described as following: when approached by a client and received the order, sales department access the ERP database which contains data about inventories. They check for the availability of the desired items, as well as the storage location. After the whole or part of the payment is confirmed, the items are delivered to the client and the revenues are uploaded to the database for finance division.

However, if there is a shortage of the products, a report is filed and sent through the ERP network to planning operation. The product planning division will then access the ERP network and look for data regarding the availability of required raw materials. Then, they send the order to manufacturing operation where the items are produced. The finished products are transferred to sales and delivered to the client. The revenues then are updated to the database, manufacturing operation send production report to planning department and production planning updates the inventory data in the database.

In the situation where the quantity of raw materials is low, inventory division will update the production planning division, who sends a report to purchasing department to order more supplies.

A3: What kind of system an Enterprise Resource Planning is?

Enterprise Resource Planning is an incorporated framework that binds together every computer systems in an organization. Each department in an organization usually has its own customized system for its specific