FUSION-University of Chittagong - Department of Management ...

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FUSION
-
University of Chittagong








MGT409
-

Management Information Systems

Project Title

ERP System Application in Supply Chain Management Practices in Industry

An Empirical Study of S.A. Group of Industries, Bangladesh


Submitted by: Team “FUSION”

Name

Subarna

Nilufar

Mahmuda

Ku
mrul

Raihan

Comments
(Percentage of
work completed
and
description)

25%

Revise,
Compose,
Material
Collection,
Compilation of
documentation,
Lessons
Learned,
Challenges
faced.

20%

Revise,

Material
Collection,
Compilation of
documentation,
Lessons
Learned.

20%

Material
Collection,
Compilation of
documentation,
Lessons
Learned
.

20%

Material
Collection,

Edit, Compose.

15%

Material
Collection,
Lessons
Learned.


Group Contact Information

Suabarna Bisaws
-


subarno07@gmail.
com
, Class Roll: 4919, Exam Roll: 2006/86.

Nilufar Sharmin

-

nilufarsharmin4931@gmail.com
, Class Roll: 4931, Exam Roll: 2006/70.

Mahmuda Fatema
-

tonni_cu@yahoo.com
,
Class Roll: 5033, Exam Roll: 2006/81.

Md. Kumrul Hasan Mazumder
-

mamun.mgtcu@gmail.com
, Class Roll: 4933, Exam Roll: 2006/36

Raihan Bulbul Hasnahena
-

sumimgtcu@gmail.com
, C
lass Roll:
4980, Exam Roll: 2006/88.

Date Submitted: 06/02/2011






FUSION
-
University of Chittagong


P

R

E

F

A

C

E

“In the beginning God cr
eated the heavens and the ERP”
--
ORACLE 1:1.

Enterprise Resource Planning (ERP) applications might not have had divine origins, but there is little d
oubt that
somewhere, right now, a business or technology

professional
is praying for a successful ER
P deployment. Only a
few projects

have been con
ducted on
ERP practices in Bangladesh especially on manufacturing organizations. This
report is an attempt in

this direction. The overall objective of
this study is to
analyze

the ERP system adaptation
process & its impact on the organization.

This report
documents the results of a team project

that was undertaken by
the students of the group “FUSION”, 4
th
year,
Department of Management Studies
, University of Chittagong under
the supervision of Mr. Mohammed A Jahed, Associate Professor of the respective department. The predetermined
subject of the team project is “ERP system application in Supply Chain Management
Practices in the particular
industry of Bangladesh”. The
project documented in this report was completed by conducting the
practicalities of
introducing and implementing
Enterprise

Resource Planning (ERP) system in Samannaz Condensed Milk Ltd.

(SCML), memb
er of
S.A. Group of Industries, Bangladesh
. The enterprise was provided with a sample
questionnaire about the ERP system.

This report consists of an Executive Summary & Literature Review that present the project’s findings. The project
documented in this r
eport was completed and provided on February 6, 2011. The views expressed in this report are
the members of the project team.

ACKNOWLEDGEMENT

Placing a finished report into a reader’s hand requires the work of many people. Team members of “FUSION” do
their

part by efficiently developing an outline, thoroughly researching topics. “FUSION” would like to recognize
just a few of the people who contributed to this report. “FUSION” would like to express the gratitude to all those
who gave the possibility to compl
ete this report. “FUSION” would like to thank honorable chairman Prof. Dr.
Shelina Akhter, Department of Management Studies, University of Chittagong for giving the permission by
providing a forwarding letter to do the necessary project work. “FUSION” is d
eeply indebted to honorable teacher,
MR. Mohammed A Jahed, Associate Professor from the Department of Management Studies, University of
Chittagong, who gave the permission, opportunity and immense support by stimulating suggestions and
encouragement that h
elped in all the time of the project work and writing of this report. “FUSION” also want to
thank
-



Mr. Md. Shamsuj Jaman Mulla , Manager IT Department, S.A. Group of Industries, Agrabad, Chittagong.



Mr.
Syed Khalid Hossain, Asst. Manager (VAT & Tax)
, S.A. G
roup of Industries, Agrabad, Chittagong.

“FUSION” conveys thankfulness to them for all their help, support, interest and valuable time.

EXECUTIVE SUMMARY

E
RP systems are now ubiquitous in the
sense that such

an Enterprise
-
Wide information system is needed
to fully
coordinate the information requirements for
purchasing
, planning, scheduling and distribution of an organization
operating in a complex global
environment. Today

s enterprises especially the manufacturing industries, irrespective
of their size and

nature, are therefore adopting ERP systems. Although many theoretical and empirical projects on
ERP system were made in the western countries, very little is known on the topic in the Bangladesh context.

This
report has made a modest attempt to provide a
small block of knowledge in the field. Basing

on project work
, the
procedure, implementation and adaptation of ERP system have been identified. Adopted ERP syst
em of S.A. Group
of Industries
has been studied and view of the concerned authority in this rega
rd examined. It has been found that
the ERP system is expected to improve both backbone and front
-
end functions simultaneously as a mid
-
size
business today faces unprecedented challenges.
Difficulty in getting accurate data, timely information and improper

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University of Chittagong


interface of the complex natured business functions have been identified as the hurdles in the growth of any
business.
In the light of the
identified
li
mitations and challenges, some
recommendations have been suggested
towards the competent adoption , and

effective application of ERP system.

INTRODUCTION

The unprecedented growth of Information and Communication technologies (ICT) driven by computer hardware and
software systems has influenced all facets of computing applications across organizations. Simul
taneously the
business
environment

is becoming

increasingly complex with functional units requiring more and more inter
-
functional data flow for decision making, timely and efficient procurement of product parts, management of
inventory, accounting, human
resources and
distribution

of

goods and services.
Most organizations across the world
have realized that in a rapidly changing environment, it is impossible to create and maintain a custom designed
software
package

which

will cater to all their requirement
s and also be completely up
-
to
-
date. Realizing the
requirement of user
organizations

some of the leading software companies have designed Enterprise Resource
Planning Software which offers an integrated software
solution

to all the functions of an organiza
tion.
In this context
Enterprise Resource
Planning (
ERP) is the latest high end solution that Information Technology has lent to business
application.
Organizations increasingly find that

they must rely on effective supply
chains
, or networks, to compete
i
n the global market and networked economy.
Supply Chain is a set of organizations directly linked by one or more
of the upstream and downstream flows of products, services, finances and information from a source to a customer.
Successful Supply Chain
Manag
ement

requires a change from managing individual functions to integrating
activities

into key supply chain processes. The organization covered by the study, give preference to all elements of
supply chain. Regarding the ERP system used by the enterprise th
e study revealed that it implements
General
Ledger (GL), Purchase Order (PO), Inventory Management (IM),
Order Processing (OP), Bill of M
aterials(BOM),
Manufacturing Order (MO) modules.

This report is based on the
empirical study of Sama
nnaz Condensed Mil
k Ltd. (SMCL). It is mainly private and
manufacturing organization. It’s manufactured product is GOALINI BRAND CONDENSED. It is located at Finlay
House (3
rd

floor), Agrabad, Chittagong.

OBJECTIVES OF THE PROJECT

The main objective of the project is to stud
y the ERP system application in supply chain management practice of
Samannaz Condensed Milk Ltd.
This is a private and manufacturing organization. Other important objectives are
stated as follows:


To identify the leading competent software house in the con
text of Bangladesh.


To identify the modules offered by the ERP system and their operations.


To identify the major players (vendors) in the marketplace.


To know the adaptation of the ERP software.


To know the evaluation, selection and implementation of ERP
system.


To identify the challenges and limitations faced by the organization during the implementation of ERP.


To know whether the adopted ERP system is consistent and matched with the organizational structure,
strategy and goal.

METHODOLOGY

The present st
udy is an empirical one. Available publications including relevant journals and paper works have been
consulted to prepare the theoretical framework of the study. The study was limited to Samannaz Condensed milk
Ltd. The study was limited to the ERP system

application of the sample enterprise up to 2011. The data for the
study, a detailed questionnaire was
administered

by the Manager of IT Department, who was trained for this purpose
and was always kept under the strict supervision of the team. And this int
erview stationed at the Head
-
Office. The
FUSION
-
University of Chittagong


study used both the primary and secondary data. Most of the data required for the study were collected from primary
source through interview schedule. The team itself collected the required data. The collected data
and information
have been processed manually.
All the collected data were edited, coded and classified by the team itself. Finally,
the paper has been prepared in the appropriate form to make the study informative.

S.A. GROUP of INDUSTRIES At
A Glance
:

S.A
. Group is one of the leading group of companies in Bangladesh with a diverse portfolio of investment ranging
from the telecom sector to edible oil refinery with its establishment in the early 1986s. S.A. Group has been able to
provide employment to over 1
500 staff. They believe in providing quality along with affordability.

Members of S.A. Group:

S.A. Oil Refinery Ltd.

S.A. Pulp & Paper Products Ltd.

Samannaz Super Oil Ltd.

S.A. Salt Industries Ltd.

Kamal Vegetable Oils Ltd.

S.A. Telecom System Ltd.

Lai
la Vanashpati Products Ltd.

South Eastern Tank Terminal Ltd.

Sharija Oil Refinery Ltd.

South Eastern Paper Mills Ltd.

Samannaz Condensed Milk Ltd.

S.A. Power Generation Ltd.

Samannaz Dairy & Food Products Ltd.

S.A. Properties Ltd.

S.A. Beverage Ltd.



Products/Services:


Goalini Condensed Milk,


Muskan Soyabean Oil,



SA Pulp & Paper,


Sharija Mineral Water,


Sharija Soyabean Oil,


Laila Vanaspati


SA Tel.

Supply Chain Practice
of Samannaz Condensed Milk Ltd.

Supply Chain Management (SCM) is the cros
s
-
function approach including managing the movement of raw
materials into an organization, certain aspects of the internal processing of materials into finished goods and the
movement of finished goods out of the organization and toward the end
-
consumer
. S
amannaz Condensed Milk Ltd.
Emphasizes on all the elements of Supply Chain and these are purchasing, operation, distribution and integration. In
case of selecting supplier they prefer some factors such as quality, cost and reliability. They include multipl
e
numbers

of suppliers in their supply chain. Suppliers don’t link into its POS (Point of Sale) system for deciding
resupply inventory.

They don’t use Supplier Relationship Management (SRM) software. They don’t face any
problem in Sales Order Processing.
They use Sales Management software. They also use various means for this
purpose like:


Customer Order


Sales Return


Receivable


Sales Invoice


Delivery Order


Realization

They use it because it is easy to maintain sales, realization and distribution related

works. The Transportation Mode
in this regard is Motor and Water carrier. The Mode of Transportation is chosen on the basis of both the Time utility
and Place utility.

ERP Software adopted
by Samannaz Condensed Milk Ltd.

The selected ERP system of Samanna
z Condensed Milk Ltd.
i
s DREAM Apps (Dynamic Resource Extended
Application Management).
The software provider is Advance ERP, which does posses the vision to evolve into a
globally competent software house offering quality ERP software solution and service
s to customers around the
FUSION
-
University of Chittagong


world

with DREAM technology. They adopted closed source ERP system. DREAM Apps ERP modules take care of
all the back
-
end operations relating to the following modules:


General Ledger

i.

Accounts Payable

ii.

Accounts
Receivable


Purchase Or
der

i.

Local purchase

ii.

Import Purchase


Inventory Management


Order Processing


Bill of Materials


Manufacturing Orders

General Ledger(GL)


Multi
-
currency balances for each period for each currency as well as consolidated base
-
currency balances


Independent balances

and transactions for each accounting year allowing for concurrent transactions and
reporting for multiple accounting years


User defined accounting periods allowing for fiscal periods different from calendar periods


Prior period adjustment transactions wit
h automatic adjustments to balances carried forward to subsequent
accounting periods


No limit in the max number of periods allowed for prior period or future period posting


No limit in the maximum number of years allowed for prior year adjustments


Supervis
or enforced controls for forcing posting to a pre
-
defined accounting period.


Flexible coding structure with user
-
definable codes

7


Separate definition for grouping of accounts and cost centers


Multiple levels for departmental or cost center structures


Hier
archical grouping
-

may be changed anytime without affecting the account codes or ledgers


Arbitrary non
-
hierarchical groupings by user
-
defined Analysis Codes
-

may be changed anytime without
affecting the account codes or ledgers.

Accounts Payable (AP)


Dat
a entry in both batch mode and on
-
line mode (with immediate update to supplier ledgers)


Allow partial and on account payment, advances to suppliers


Create multiple General Ledger control accounts for cash payments and creditors/payable


Make both prior and
future period entry for supplier invoices, credit notes, debit notes and payments


Know which suppliers are due to being paid


Make sure you take advantage of suppliers’ discounts

Account Receivable (AR)
:


Data entry in both batch mode and on
-
line mode (with

immediate update to customer ledgers)


Allow partial and on account payment by customers


Allocate payments by individual invoices; range of accounts and by exception


Post multiple General Ledger control accounts for debtors, cash receipts and debtors/recei
vables


Make both prior and future period postings for invoices, credit notes, debit notes and payments


Know which customers owe you money and it is due


Know the aging status of each receivable type, customer, and invoice

8


Evaluate efficiently each custome
r’s payment performance

Bill of Materials (BOM):


Bill of Material in a detailed or summarized fashion


All product structures are maintained as a single level bill of material; however, the system generates the
exploded multiple level bill of material whene
ver necessary


Multiple Options for a single Bill of Material for customized finished product by customer


Each component on a bill has its own effective date and inactive date; the system derives the required
structure based on these effective dates


Enginee
ring change orders can also be maintained; if desired engineering change orders can be linked to
one or many bills of material

Manufacturing Order (MO):

FUSION
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University of Chittagong



Details for each transaction include reference, date, analysis details (planner code etc.), item code,
quantity
to be produced, due date, job priority and status


Types of transactions are planned manufacturing order entry, order release, kitting material, direct material
issues, order completion, de
-
kitting


Integration with inventory provides for stock upda
ting and inquiry


Facility to amend (and print) documents such as kit list


Multiple warehouses options for issues and receipts


Comprehensive production analysis based on both quantity and cost


Allocation of manufacturing costs by divisions for project costi
ng

Samannaz Condensed Milk Ltd. operated the ERP system for 25 months
-
4years on an average and they use it in
their company all the time.

CURRENT PRACTICE

Major players of marketplace

The major vendor
s of ERP in the marketplace are:


SAP

R/3


ORACLE


PEOPLE
SOFT

SAP R/3


Former name of the main Enterprise Resource Planning software produced by SAP AG. It is an enterprise wide
information system designed
to coordinate all the resources, information and activities needed to complete business
processes such as o
rder fulfillment or billing.

Offerings:


my
SAP ERP


my
SAP Business Suite

R/3 4.6 and


SAP R/3 Enterprise 4.7

Modules used by SAP R/3:


Financials and Controlling (FICO)


Human Resources (HR)


Materials Management (MM)


Sales & Distribution (SD)


Production


Qual
ity Management


Product Life Cycle


Workflow


Business Warehouse


Customer Relationship Management


Advanced Planner and Optimizer


ABAP Programming Language


Strategic Enterprise Management

ORACLE

Oracle provides business applications that utilize relational dat
abases for storing information. Offerings of
ORACLE: Five comprehensive product lines:


Oracle
9i
Database


Oracle
9i

e
-
Business Suite 11.5.9


Oracle
9i

Application Server


Oracle
9i
Collaboration Suite


Oracle
9i

Developer Suite

The Oracle e
-
Business Suite offers s
olutions in:


Product Life Cycle Management


Supply Chain Planning


Procurement


Manufacturing Resource Management


Order Fulfillment

PEOPLESOFT

PeopleSoft, Inc. provided Human Resource Management Systems(HRMS) and Customer Relationship Management
(CRM) softwar
e, as well as software solutions for

FUSION
-
University of Chittagong



Manufacturing


Financials



E
nt
erprise performance management


S
tudent administration to large corporations, governments and organizations.

Offerings:


PeopleSoft Enterprise 8.8 and 8.9 and


Enterprise

One 8.11

The People
Soft name and product line are now marketed by Oracle.

PROS &

CONS of EACH PRODUCT

Key Areas

SAP

Oracle

PeopleSoft

Advanced ERP

Pricing

The complexity of
SAP applications
results high
implementation
costs.

Oracle can lower
implementation
costs by avoiding

unnecessary costs

PeopleSoft has
rethought its
entire set of
applications to
ensure that they
are built from
the ground up to
minimize
deployment and
maintenance
costs.

Unparalleled
Pricing.

Implementation


Application
Installation
Wizard


Advanced
configu
ration


Process modeler


Advanced data
loading and
moving


Process
-
oriented
integration


Pre
-
packaged
integration
between vendor
applications


Built
-
in web
services
integrations

SAP slightly
addresses all seven
criteria

Oracle shows
strength in
advanced
configu
ration, the
process modeler,
advanced data
loading and
moving, and built

in web services
integration, but not
in pre
-
packaged
integration
between vendor
applications.

PeopleSoft
excels in the
areas of
application
installation
wizard,
advanced
configuration
,
advanced data
loading and
moving, pre
-
packaged
integration
between vendor
applications, and
built
-
in web
services
integration.

Optimum
successful
Implementation.

Usability


Task
-
oriented
navigation


Navigation
configurability


Task
-
oriented
dashboards


Web
client


Integrated office
productivity.

SAP provides no
task
-
oriented
dashboards

Oracle offers only
limited
functionality with
task
-
oriented
dashboards.
Oracle's web
architecture is not
consistent across
all Oracle
modules.

PeopleSoft
provide the
fullest fe
ature set
for usability.

Unlimited User
-
License and ready
to use.

Maintenance, support &
upgrades


Diagnostic and
technical support


Remote and online
SAP offers full
performance
diagnostics and
tuning.

Oracle offers full
performance
diagnostics and
tuning.

PeopleSoft
offers the fullest
feature sets.

Easy
-
to
-
handle
customization
,
maintain and
upgrade.

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University of Chittagong


support


Performance
diagnostics and
tuning


Patch
management


Automated
upgrade process
and toolsets


User
-
ce
ntric
performance
testing


Data archiving.

Applicatio
n Module
Specialty

Logistics

Financials

Human Resource
Management

Manufacturing


ERP SELECTION &

IMPLEME
NTATION

K
EY FACTORS AFFECTING THE ADAPTATION OF ERP SOFTWARE

Technological adaptation is referred to as the adjustments and changes following the insta
llation of a new
technology in a given setting.
Adaptation is t
he extent efforts and time spending in ERP adjustment and changes to
align with organizational process needs
.


DREAM Apps is a web
-
delivered customizable business operating system that implemen
ts a totally integrated IT
infrastructure for businesses enabling Customer Relationship Management (CRM) and Enterprise Resource
Planning or Management (ERP/ERM) functionalities.

Adaptation Stages of ERP Projects start with the standard
processes in the co
mpany. These are Sales, Purchasing, Planning & Production, Inventory, Quality
, Finance &
Accounting.

In support of these processes, secondary processes are put into practice such as CRM, Maintenance &
Service.

The factors affecting the adaptation are:


Scal
ability:

Scalability refers to the permanent state to effectively and efficiently operate at many different
scales.
DreamApps is described as scalable as
it

remain
s

effective when there is a significant
increase/decrease in the number of resources as for i
nstance data in parts lists.


Modularity:
A module consists of a module

trunk and a module
-
interface.
T
he modularity presents a
possibility for efficient combination, recycling and fast change of informational applications. As for
DreamApps,
modularity is c
losely linked with component
-
based architectures. Modules are implemented
so as to hide all the information about them except what is available through its interfaces.


Mobility:

Mobility raises the question on spatial and temporal unlimited access applicat
ions of the
information system architecture and therefore to its functions and data by different technologies
-

for
example via web
-
browser, terminal server or a virtual private network, by means of these applications data
can be accessed.

DreamApps is acc
essible from anywhere, anytime.


Interoperability:

Interoperability describes the ability of applications to work together. Independence of
the used hardware, the operating system, the network
-
technology and the realized application, cooperation
between the
se applications can easily be established. Interoperability allows the uncomplicated access to
different (also spatial) data
-

and processing resources within a workflow or rather the easy combination of
different information systems.


Self
-
Organization
:

The

approach represents a major evolution in how systems connect and interact with
each other.

DreamApps can be deployed for a specific purpose.


Self
-
Similarity:

DreamApps is an interface that describes a collection of operations that are network
-
accessible t
hrough standardized XML.


Based on XML, DreamApps allows the integration of heterogeneous applications within and across
organizations. With DreamApps, business processes can span across departments, divisions and enterprise
boundaries, allowing the company

to integrate the services of multiple applications without concerning
about the underlying technologies and implementation characteristics.

ERP
SELECTION CRITERIA

FUSION
-
University of Chittagong


I
n selecting the DREAMApps software more than one hundred fifty users were actively involved
. Buying decision
of the software, time of implementation and the payment for the software package are quite confidential.

It took a lot
of management time and effort to compare and decide the appropriate software. They checked:


Whether all functional aspe
cts of the company were duly covered.


Whether all the business functions and processes were fully integrated.


Whether all the latest IT trends were covered.


Whether the vendor had customizing and implementing capabilities.


Whether the company could absorb
the cost.


Whether the ROI is optimum.

T
ECHNICAL REQUIREMENTS

The technological factors considered in selecting DREAM Apps are:


Cost


Installation


User Interfaces


Upgradability


Computing Environment


DREAM Apps is built on Sunâ€


Java and XML which are truly multi
-
platform and fast growing technologies that
free businesses from the tyrannies of proprietary platforms. Its common application platform uses low overhead
multi
-
threaded servlets that communi
cate with clients, databases and value
-
added services
through industry
standard, platform independent protocols, thereby making it highly scalable while remaining fully platform
independent.
It can be run on Windows, Mac, Linux. It has option to select RDB
MS like SQL Server, oracle,
PostgreSQL, DB2.
DREAM (Dynamic Resource Extended Application Management) allows automatic generation
of applications from specifications, at runtime. This makes it possible to customize applications at every level
without affec
ting the core code
-
base.

Dream Apps Virtual Sc
h
ema separates the physical database structure from the
application database view, thereby allowing use of third party products to access data in a secure way.


Dream Apps generic Page creates appropriate user

interfaces for several devices like HTML browsers, Java
browsers, Palm devices or WAP compliant phones. DreamApps Event Flow allows users to set predefined automatic
responses to business events. DreamApps Smart Tree facilitates secured object transfer th
rough firewalls using
standard protocols.

IMPLEMENTATION PHASES

Step by step method of implementing ERP package yields a better result than big
-
bang introduction.

The ERP
Implementation of Samannaz Condensed Milk can be grouped into four major phases namel
y:


Detailed Discussions


Design and Customization


Implementation and


Production

Phase 01
-
Detailed
Discussion
:

Task: Project initialization, Evaluation of current
processes
, business practices, Set
-
up project organization.

Deliverables: Accepted norms and c
onditions, Project organization chart, Identify work teams

Phase 02
-

Design and Customization
:

Task: Map organization, Map business process, Define functions and processes, ERP software configuration and
Build ERP system modifications.

FUSION
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University of Chittagong


Deliverables: Organi
zation structure, Design specification, Process Flow Diagrams, Function Model,
Configuration

recording and system modifications.

Phase 03
-
Implementation
:

Task: Create go
-
live
plan

and documentation, Integrate applications, Test the ERP customization, Train

users

Deliverables: Testing environment report, Customization test report and Implementation report.

Phase 04
-
Production:

Task: Run Trial Production, Maintain Systems.

Deliverables: Reconciliation reports, Conversion Plan Execution.


C
HALLENGES FACED DURI
NG IMPLEMENTATION

When implementing ERP system, Samannaz Condensed Milk Ltd. faced some challenges.


The selection problem
: The very first question that managers faced was what type, size, and scope of the
future system they actually required and how to ch
oose the most suitable solution among the hundreds
offered on the market. ERP system choice predefines a company’s strategy for at least the following 6 to 10
years and, no doubt, has a telling impact on the future success of the entire business.


Technical

issues
:

The technical part of the project covered the servers and workstations to be revised
and


probably

the new and modern ones to be ordered, purchased, and replaced. The internal network
was to be analyzed and modernized; the speed and bandwidth of t
he existing Internet access was to be
taken into consideration, along with possible technical concerns about the mobile devices being used.


Data quality issues:

This issue was particularly symptomatic of the company

that
was implementing

ERP
for the first
time and transferring the legacy data into the new system from Excel spreadsheets, manual
records, or old disparate applications. Basically, the question is that old data that have been used and stored
for years can for many reasons appear approximate or e
ven incorrect in the new ERP reality.


Business philosophy changes
:

ERP implementation brought

significant changes into the
company’s
conventional business model and the day
-
to day practices it has been using for years.


Business process knowledge
:

As every
ERP project requires some level of customization due to type of
industry and different business process, there was a need for consultants or group of people in organization
who could understand both the information technology and business process.


Project
(Implementation)
:

Implementation process is a very critical phase of ERP projects. Timelines and
milestones were followed very carefully.


People
:

ERP consulting team and company's key users were the main factor to make the project successful.


ERP Software
:

ERP package must bring minimum customization for projects. Standard in ERP project
implementation was to be quick and cheap. It met almost 80% of busniess process requirements.

OTHER IMPLEMENTATION ISSUES

The ERP architecture of Samannaz Condensed Milk Lt
d is Two
-
Tier Implementation. The server handled both
application and database duties. The clients were responsible for presenting the data and passing user input back to
the server.







In case of ERP implementation the strategic decision was centralized. They employed a consulting team for the
implementation of ERP. The company didn’t seek the help of a third party consulting company in this case. In
other words,
its

ERP
environment was not supplemented with third

party programs. They used suitable tools
for data migration.

IMPACT ON ORGANIZATION & FUTURE OUTLOOK

ASSEMENT OF PERFORMANCE

As DREAM Apps is a top of the line web based ERP/CRM suite of application software it
was easy to handle
automation and customization. Data Mart is not applicable but Data Mining to get data about customer products and
competitors. It took a few time to import data into the ERP system and to be confident for the system to go live. It
was ea
sy to install and not compatible with existing hardware but with existing operation software. The software
FUSION
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University of Chittagong


interface was intuitive and quite easy for non
-
computer literature people to use. Training facility was provided.
There were no bugs in the software.

The system is easy to maintain and upgrade. The software is consistent with
Interface and user
-
friendly operations.

The company is satisfied with the software. It has improved their
manufacturing efficiency.

I
MPACT ON SUPPLY CHAIN EFFICIENCY

Order Proces
sing
:


Get the whole procedure of receiving orders, delivering goods and invoicing done very smoothly


Far
-

reaching pricing, commission and discount options to do by all types of special situations


Special discounts, margin and commissions on item quantity,

other than usual entered options, and also for
both items level and on the whole.


Instantly access to past sales orders for a customer


Know exactly how and when the customer wants delivery of his order


Be sure a customer's credit status gets checked befor
e and after placing an order


Provide order acknowledgment forms to your customers to make sure the order is accurate


Can alter delivery order quantities, if any customer wants it partially


Special handling options, so you can have special order, back order

or sale from future available stock


Sales quotations and order acknowledgments for obvious communication with your customers


Prioritization of orders by customer

Inventory:


Automatic conversion between ordering, stocking and consumption units of measures


Categorize of items for analysis purpose; reorder level for exception report


Stock status for each item and each warehouse showing quantities on customer orders, allocates to
customer orders, in picking, on manufacturing orders, kited to manufacturing orde
rs, kited to transfer
orders, goods
-
in, stock in hand etc.


Know the value of your current inventory.


Move quantities between inventory locations as needed


Stock status by batch numbers


Inventory costing and facilitate generation of stock ledger by three ty
pes of costing method


Weighted
Average Costing, FIFO Costing and Batch Costing

Purchase Order:


Multiple depot address and projects for a supplier


Facilities to amend (and print) documents such as purchase orders and GRN


Automatic integration with invento
ry for stock upgrade and inquiry


Categorize of purchase information for comprehensive purchase analysis


Comprehensive supplier analysis based on both quantity and price variance


Provision for updating of requisition and receipt quantities


Keep track of LC
in a detail way


Detail information of C & F, banks, shipment information


Details of costs those already incurred to mature the L/C


Provisional costs which have to be paid later on


L/C costing for generating landed cost of items


MAJOR RISK/COST OF THE PRAC
TICE

Samannaz Condensed
Milk

Ltd. remained confidential in
this

regard.

CURRENT LIMITATIONS

Samannaz Condensed Milk Ltd. has faced the following limitations:


Its ERP system does not link and enable manufacturers, suppliers, distributors, customers, partner
s and
employers to work together.


The software provider is not responsive to problems occurred.


There is a poor level of technical support from the vendor.


There was great resistance by employees to the new software.


There is lacking of an effective proje
ct management while implementing the software

P
ROJECTED FUTURE IMPACTS

FUSION
-
University of Chittagong


Samannaz Condensed Milk Ltd. with DreamApps technology is willing to move towards a totally integrated and
customizable enterprise business.
It envi
sions to


Configure applications at ev
ery level without affecting the core
-
code base.


Requirement Analysis


Consultation on hardware and infrastructure requirements.


Development and customization of the software.


Security Management and extended utilities and facilities.


Improved quality with a
ffordability and customer satisfaction.

RECOMMENDATION


It is recommended that people and
the technical system
should be prepared
through
close relationship

with
vendor.


M
aintenance
should be improved
by vendor
-
supported long
-
term contract as part of the sy
stem
procurement.


Extend
application modules such as POS, FAM, VMS etc.


P
ersonnel
should be aware
about
the viability of the system and
International Business Practice.


M
anagement involvement, commitment and continuous support
should be enhanced
.


Cooperati
on and collaboration among manufacturers, suppliers, distributors, customers, partners and
employers should be ensured.

CONCLUSION

In conclusion we can say that, though the trend of ERP systems adoption is comparatively new in Bangladesh, the
growth rate o
f implementation is significant. The adopted ERP system of Samannaz Condensed Milk Ltd. is a totally
integrated and c
ustomizable Enterprise Business Operating System which is completely browser based and
developed in pure JAVA to enable the system to be ha
rdware and software independent. The ERP software’s
modules take care of all the back
-
end operations relating to procurement, distribution, manufacturing, human
resource, logistics and accounts. DreamApps ERP solution for Garments (Knit, Woven, Sweater), F
reight
Forwarders, Airlines GSA, Schools, Steel Manufacturers, Aluminium I
ndustries
, Pharmaceuticals, Beverage
Industries, Vehicle Workshop, Recruiting Agencies, Developers, Hospital and Diagnostics, Retail Sales, Courier
Services, Transport Business, Hote
l Management
-

are in operation, amongst a range of satisfied clientele. So it is
undoubtedly a unique and ubiquitous business operating system for S.A. Group of Industries as well as other
growing industries of Bangladesh.

To get a more accurate understand
ing of the ERP system success and failure in
the context of Bangladesh there remains a greater need for more case study type of research to accentuate the critical
factors important to its successful adoption. It will provide a better guidance to the vendo
rs and companies to avoid
the ERP pitfalls and achieve competitive advantage in a rapidly changing business environment both in local and
international arena.

REFERENCES

Books:

1.
Wisner, J. D.; Tan, K.C.; Leong, G.K.(2009), Principles of Supply Chain Manag
ement
-
A Balanced Approach,2
nd

Edition, South
-
Western Cengage Learning, Mason, OH 49040, USA , 37
-

103, 188
-
255, 346
-
459.

1.

Sumner, M. (2005), Enterprise Resource Planning, Pearson Prentice Hall, New Delhi, India,
1
-
147.

Journals:

1.

Hossain, M.M.; Jahed, M.A.(2
010),
Factors Influencing On The Adjustment Of ERP System During
Implementation
, Global Management Review, Vol.4, Issue 3,58
-
70.

Web Source:

1.

Vuskic, V.B.,; Spermic, M. (2005), ERP System Implementation and Business Process Change: Case Study
of a Pharmaceu
tical Company, Journal of Computing and Information Technology,

V
ol. 13, Issue 1, 11
-
24.

Available at
www.acrobatplanet.com
. Accessed December 16, 2010.

2.

Rashid, M.A.; Hossain, L.; Patrick, J.V. (2002), The Evoluti
on of ERP Systems: A Historical
Perspective,
Idea Group Publishing, Chapter I,1
-
16

Available at
www
.
jobfunctions.bnet.com
.
Accessed
January 16, 2011.

FUSION
-
University of Chittagong


3.

Hawking, P. (2007), Implementing ERP Systems Globally:Chall
enges and Lessons Learned for Asian
Countries, Journal of Business Systems, Governance and Ethics, Vol. 2, No. 1, 21
-
32. Available at
www.jbsge.vu.edu.au
.
Accessed January 16, 2011.

4.

Billah, A.B.M.M.; Puttee, C.; Ali
, Y. (2008
, July
-
August
), Consideration of Critical Success Factors for
Enterprise Resource Planning Systems Implementation in the Context of Bangladesh, The Cost and
Management Journal, Institute of Cost and Management Accountants of Bangladesh, Vol. 36,4
,
17
-
22.
Available at
www.icmab.org.bd
.
Accessed
December 26, 2010
.

5.

Bento, A., Bento, R. (2006, November 2), Factors Affecting the Outcomes of Performance Management
Systems, Journal of Information Technology Managemen
t, Vol. XVII, Article
-
3, 23
-
31. Available at
www.
jitm.ubalt.edu
.
Accessed January 4, 2011.

6.

Hedman, J. (2010, January 8), ERP Systems: Critical Factors in Theory and Practice, Centre for Applied
ICT(CAICT)
, Copenhagen

Business School,

ISBN 978
-
87
-
92524
-
08
-
9,
Available at
www
.
openarchive.cbs.dk
.
Accessed
January 4, 2011.

7.

Lau, L.K. (2003), Developing A Successful Implementation Plan for ERP: Issues and Challenges,
Longwood Univ
ersity, Chapter VII, 223
-
229. Available at
www.iacis.org
.
Accessed January 14, 2011.

8.

Hong, K.K.; Kim, Y.G. (2002), The Critical success Factors for ERP Implementation: an
organizational fit
perspective,
Information and Ma
nagement,
VOL. 40, 25
-
40. Available at
www.elsvier.com/locate/dsw
.

Accessed January 26, 2011.

9.

Infosys® website. Available at
www.infosys,com
. Accessed January 2, 2011.

10.

Res
earch. Com examples website. Available at
www.reasearch.com
.
Accessed January 28, 2011.

11.

Advanced ERP


website. Available at
www.advancederpbd.com
.
Accessed January 16,2011.

12.

S
.A.Group website. Available at
www.sagroupbd.com
.

Accessed December 14, 2010

13.

Wikipedia
Free Encyclopedia
website. Available at
www.en.wikipedia.org
.
Accessed December 14, 2010
.

14.

Supply Chain Practice Website. Available at
www.supplychainpractice.com
.
Accessed
January 15, 2011.

15.

ERPWire website. Available at
www.erpwire.com
.
Accessed December 18,
2010.

16.

Knowledge Sharing Communities™ website. Available at
www.toolbox.com
.
Accessed January 12, 2011.

17.

ITtestpapers website. Available at
www.ittestpapers.com
.

Accessed January
4, 2011.

18.

ERP5 website. Available at
www.erp5.com
.

Accessed January 6, 2011.

19.

Go Frugal Technologies Werbsite. Available at
www.gofrugal.com
.
Accessed January 10, 2011.

20.

World Website Dir
ectory Home
. Available at
www.directory.classifieds1000.
com
. Accessed January 25,
2011.

21.

PRLog Free Press Release website. Available at
www.prlog.org
.

Accessed January

5, 2011.

22.

Professional RFP Letters Website. Available at
www.rfptemplates.technologyevaluation.com
.
Accessed
January 17, 2011.

AGENDA

Serial
No.

Date

Time

Discussions & Decisions

01.

06.12.10

10.15a.m.

First meeting on what will be done on the proposed project.

02.

09.12.10

11.30
-
1.00

Data Collection

03.

12.12.10

10.40
-
11.10

Library Work

04.

13.12.10

10.15
-
11.30

Group Study on ERP

05.

15.12.10

10.30
-
11.15

Study on Supply Chain Management &

question making

06.

18.12.10

2.50
-
3.50

ERP question making

07.

21.12.10

9.50
-
10.15

Library work

08.

23.12.10

11.30
-
12.10

Data Collection

09.

27.12.10

11.00
-
1.00

ERP question making

10.

28.12.10

10.30
-
1.30

ERP question making

11.

01.01.11

1.00

Mutual

discussion

12.

02.01.11

11.00
-
12.30

CRM study, book searching

13.

05.01.11

10.50
-
11.30

Questionnaire revise

14.

11.01.11

11.10
-
11.30

Questionnaire print, thorough discussion

15.

14.01.11

10.30
-
11.15

Study for report

16.

16.01.11

10.40
-
11.15

Schedule fixed for company visit

FUSION
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University of Chittagong


17.

17.01.11

11.30
-
1.45

Company visit & fill up questionnaire

18.

18.01.11

11.00
-
12.15

Thorough study of the filled up questionnaire

19.

26.01.11

10.35
-
11.50

Compilation of the documents & materials

20.

01
.02.11

11.20
-
1
.00

Report discussion.