There are more ERP solutions than ever before today, and here we help you pick the right one by describing the major players.
Enterprise Resource Planning (ERP) is another one of those computer industry terms that seems to have different definitions, depending on who's talking. Wikipedia defines ERP as a system "intended to manage all the information and functions of a business or company from shared data sources." But as many would be quick to point out, how then do we differentiate ERP from such terms as business process management, management information systems, or even management reporting, which arguably all have that same goal?
Long Live Its Fame
ERP traces its roots back to the founding of SAP AG in 1972 by German engineers who were former IBMers. Some historians trace ERP back to early inventory management programs in the 1960s, although those beginnings could more properly be called the beginning of Material Requirements Planning (MRP) software. SAP remains a leader in ERP today after having formally introduced R/2 in 1979 and R/3 in 1992, both of them ERP systems that use DB2 databases. J.D. Edwards was the early innovator in ERP for the System i (the company's first product ran on the S/38). PeopleSoft, established in 1987, started competing directly with SAP for ERP customers by buying Red Pepper Software in 1996. Oracle Corporation became the first ERP vendor to offer client/server ERP on the Web in 1997 and in recent years consolidated its hold on the market by purchasing PeopleSoft shortly after PeopleSoft bought J.D. Edwards.
ERP has its origins in the manufacturing sector, where it originally was born from the interface between MRP and computer-integrated manufacturing (CIM); its function was to control manufacturing activities. In particular, this meant procuring raw materials or components, planning the most efficient ways to handle manufacturing process throughput, ensuring the finished product met quality standards, and moving the finished goods to the consumer. In the brave new world of global markets, in which even service companies are defined as "producing" something, ERP has grown in its conceptual application.
Large enterprises were among the early adopters of the ERP systems of a decade ago, because it would take a courageous CEO to deny that a unified system for controlling processes was necessary. But SMBs were largely able to make due with home-grown or component-based software systems that cobbled together an accounting package, an inventory program, and some supply chain software and call it good enough.
Long Live Its Glory
As the economic and technologic pictures have changed, particularly in the past few years, the definition of ERP has come to pivot not so much on the resource planning aspect but instead more on how an enterprise views itself and its potential markets. Those that aspire to being more than regional players in their respective markets may need to gear up. For example, a June 2009 study by the Aberdeen Group points to "best-in-class" mid-market enterprises now requiring ERP software to help them standardize, streamline, and automate their business processes.
Today's broader conceptualization of ERP encompasses financials (e.g., accounting functions such as accounts payable and receivable, fixed assets, general ledger, cash management), supply chain management, project management, customer relationship management, and human resources. It also implies Internet-based services that, for example, let the customer or business partner track the progress of their order from cradle to grave (or at least from the start of fabrication to delivery to the customer's doorstep). Also important can be features in such areas as business intelligence, business process management, and supplier relationship management. (For a more complete rundown on features to expect from an ERP package, see Steve Pitcher's recent article "ERP for Free?" in the February 8 edition of MC iTechnology Manager.)
While companies can either develop custom systems that are tailored to their internal processes or seek open-source ERP packages that can cut the initial cost of establishing an ERP system, neither path may be best. The former involves significant expense in developing expertise and software, and the latter puts processes critical to an enterprise at the mercy of potentially unsupported software of uncertain quality. Going with an established ERP vendor with some kind of a track record may be safest, although some measure of bold vision is required to adopt any ERP system because it will have numerous and often unforeseen effects on the way an enterprise does business.
And Long May Its Story Be Told
In the System i world at least, the concept of ERP is truer to its birth in the manufacturing sector. The vendors whose ERP products run strictly on the System i are focused much more narrowly on managing processes by which some kind of finished goods are built. Larger vendors that support multiple platforms—either with one product or assorted products—tend toward the broader definition that includes financial, human resources, and customer relationship management aspects.
It may be useful to define a few terms used in the product descriptions. Lean manufacturing refers to processes that provide a smooth manufacturing workflow and minimize waste by coordinating all elements of production to come together as they are needed rather than beforehand. Related is kanban ("just-in-time"), which attempts to precisely key the pace of production to the pace of observed demand. In practice, these two terms are interpreted as keeping inventories of raw materials or component parts low enough to just meet manufacturing needs for a specific time period, though they involve other techniques as well, such as constantly reviewing processes to eliminate inefficiencies.
If you are considering adopting an ERP application to streamline your enterprise processes, the product names, descriptions, and links to vendor Web sites below will help you focus your initial research. The key is to determine which aspects of your operations are most crucial to your success and then look for applications that are strongest in those areas.
Please note that the brief summaries used here in no way cover all the features each software product provides. You should consult the links provided for each product and contact the associated vendors for a more complete idea of what each ERP product has to offer.
And as always when looking for products or services, be sure to check the MC Press Online Buyer's Guide.
Significant ERP Applications for System i
ComMIT is a suite of four integrated products that collectively provide a planning, scheduling, and supply chain management system and help to synchronize production activities and optimize use of manufacturing resources. Users can deploy the modules standalone or together or integrate them with existing MRP II, ERP, or other information systems.
Service Information Access
Common Sense is based on IBM's WebSphere, Lotus, and DB2 middleware. It provides ERP functions in an application designed to integrate with custom and third-party software. It lets users build a data warehouse to support ERP functions such as back-office accounting, distribution, manufacturing, project services, transportation, and warehousing. The product includes extensions for integration with supply chain management, customer relationship management, and human resources apps.
Computer Software Solutions
Compsoft ERP provides an integrated suite for managing company resources in the wholesale distribution and retail sales industries. Its 14 modules include financials, inventory control and purchasing, cash reconciliation, fixed assets, order entry, point of sales, sales analysis, payroll, and human resources. The product offers a single database structure, customization options, and unified communications tools.
Realization defines Concerto as an execution management system for manufacturing companies and offers the software as part of an overall "execution culture" that helps enterprises prioritize tasks, improve throughput, and improve due-date performance. Concerto focuses on enabling and enforcing execution management rules, establishing project pipelining to maximize use of resources, highlighting process improvement opportunities, and providing execution priorities.
DS90 is an ERP for SMBs engaged in light manufacturing. The light manufacturing module helps enterprises move production, kit assembly, and component processing into a finished product. In addition, DS90 includes functions for financials, sales analysis, commission management, inventory control, and order management.
The eC-LINK ERP product is aimed at companies in the distribution or light manufacturing industries. In addition to normal ERP functions, eC-LINK ERP supports multimedia and multiple national languages. It also offers customization features and tools for converting legacy data. The product strives to achieve nearly paperless environments, provides automated stock replenishment reporting, and enables stock availability views across multiple locations.
First Level offers an Internet-capable parts-manufacturing solution keyed to the automotive industry or similar manufacturers. It fully supports electronic data interchange (EDI) and e-commerce activities and includes modules for production engineering, order entry, material planning and control, quality control, and financials.
GXD is Xdata's suite of graphical enterprise applications designed for companies of up to $500 million annual revenue engaging in manufacturing and distribution. The ERP app is a menu-driven system that handles master scheduling and material requirements planning, financials, inventory management, product configuration, returned-good authorization, order processing, purchasing and receiving, pricing, labor reporting, and routing processes.
HarrisData ERP Manufacturing provides a flexible ERP environment that helps users manage all facets of manufacturing, including integrated, Web-based customer and supplier self-service. HarrisData ERP supports lean manufacturing, activity-based costing, paperless shop floor, kanban replenishment, and variance analysis. HarrisData's ERP application also interfaces with the company's application offerings in distribution, accounting, and human resources.
IFS provides numerous ERP software applications for manufacturing companies. Manufacturing solutions include apps for companies specializing in engineer-to-order, lean manufacturing, make-to-stock, project-based delivery, repetitive manufacturing, and to-order manufacturing methods.
Infor offers a spectrum of ERP products, but LX is specifically designed for the System i and is modeled on the legacy BPCS application. The product is aimed at mixed-mode and process manufacturers and focuses on helping users improve core business processes such as manufacturing, logistics, channel management, customer relationships, supply relationships, and financial management.
JD Edwards EnterpriseOne is a suite of 70 integrated application modules that can support diverse business operations. Modules include manufacturing and engineering, supply chain execution, supply chain management, asset lifecycle management, financials, order processing, human resources, and customer relationship management. It supports a variety of operating systems, databases, and middleware, which makes it well-suited for larger, multiplatform enterprises.
JD Edwards World is an ERP application built expressly for System i SMBs and focuses on manufacturing management, distribution activities, financials, and human resources. It includes built-in interfaces to Oracle solutions for customer relationship management and demand management. World features customizable business-process templates that users can adapt to their existing practices.
Light Manufacturing Solution is aimed at companies in assemble-to-order, engineer-to-order, and make-to-order/work processing industries. Special features let users bundle fabrication processes into a master profile, generate a work order for fabricated materials, create predefined fabrication process templates, and modify fabricated items on the fly. Light Manufacturing also supports production of kits or combinations and helps users manage rollup and scrap materials.
M3 Manufacturing Operations helps enterprises centrally manage product definition for the Lawson M3 Enterprise System and manage configured and attribute-controlled products. It supports costing, planning, and execution activities. The product also supports lean manufacturing and manages discrete, process, and mixed-mode manufacturing environments.
Manufacturing PM is an MRP/ERP app tailored for SMB manufacturing companies. Functions include financials, product costing, manufacturing scheduling, capacity requirements planning, inventory management, shop floor control, purchasing, sales analysis, and product configuration. The app emphasizes UI simplicity, ease of implementation, and low cost.
Mosaic Data Solutions
Mosaic M21 integrates standard manufacturing functions with management tools for customer orders, inventory, purchasing, accounting financials, and payroll. Features include master production scheduling, material requirements planning, multiple-level bills of material, production schedule and order control, credit-card processing, and project accounting.
SAP's ERP application is part of the company's SAP Business Suite product line. In addition to standard ERP operations features, SAP ERP covers areas such as financials, human capital management, corporate services, end-user service delivery, and business performance management.
Solarsoft ERP focuses on the production management aspect of manufacturing and provides built-in modules for handling quotes and sales orders, requisitions and purchase orders, financials, warehouse and inventory management, and quality management. In addition, optional add-on modules can handle related enterprise activities such as EDI and e-commerce, warehouse automation, mobile sales and delivery, and Web sales.