Enterprise system’s contribution in improving organisational performance
Discuss About The Organisations Technology Conducting Operations.
In the era of technology, organisations are using technology for conducting operations. For bringing smoothness in the work, it is essential that organisations take use of various information technology systems. In this regards enterprise systems plays a very crucial role. In various types of available enterprise system, organisations select one for themselves on the basis of the requirements they have. These systems are capable of improve the organisation’s performance. In the implementation of these systems, organisational change management is highly required (Fui-Hoon, Lau and Kuang, 2001). There are several factors that stop the firm from implementing enterprise systems. This report exhibits the contribution of enterprise system on the performance of the firm. It also describes the ways in which contribution is measured. It also showcases the major drivers of supply chain management systems. In the last section of the report, various considerations for enterprise system adoption are measured.
In any organisation, enterprise system plays a very crucial role as it helps in improving the performance of their units. The first thing that enterprise system does is that it improves efficiency and smoothness of the work process. Apart from this there are several other ways in which enterprise system improves organisational performance and these are as follows:
- Automation of client’s service process: Enterprise system such as ERP supports in effective utilisation of resources. This will help the firm in aligning all the resources along with back and front end processes in one line (Shangand Seddon, 2002). This will not only improve the effectiveness of the organisation but also enhance the performance of the firm.
- Managing data: Today data has become one of the most crucial aspects of the business. These enterprise systems are highly efficient in the data management and producing results as per the requirement. It plays a crucial role at the time of decision making that too when specific decisions are need to be made as it is required in performance improvement of organisation.
- Resource Scaling: Enterprise systems help companies in their resource scaling in both upward and downward direction as per the need of the firm according to situations. This helps the organisation in using their resources for the longer period of time which is necessary for improved performance (Hendricks, Singhaland Stratman, 2007).
- Process standardisation: Enterprise systems supports in making of standard procedures as well as enforcing it in the processes. This is necessary for production of best quality product and services. It is crucial for obtaining higher satisfaction of employees at the same time it improves organisational performance. It also helps in improving the image of the company in the minds of the consumers.
- Strengthening supply chain management: Supply chain management is a crucial aspect of improving organisational performance. Strengthening of supply chain management helps in achieving better performance. With the help of data acquired by the enterprise system, supply chain management can be streamlined (Da, 2011). This can be done by evaluating how, where and when customer orders and supplier delivers. Delivery of products on the right time that too at lower cost can only be achieved using enterprise system.
By these methods contribution can be measured. This can be done with the help of performance metrics which varies according to the factors. Analysing next and previous values can help in measuring the contribution made by enterprise system. The changes in the values are easily noticeable (Bi, Xu and Wang, 2014). Number of errors in the process can also be checked and hence their numbers also diminishes. Return on Investment is one of the major metrics in this regards. These metrics are necessary for inconsistency removal. Few other measures are:
- Enhanced repeat sales
- Enhanced sales of products and services
- Improved customer retention rate
- On time completion of tasks
- Improved sales conversion rates
- Output production also gets increased
- Improved network performance
- Improved public image
In the modern day business maintaining demand and supply is very essential. In this regards Supply Chain management plays a crucial role. Supply chain management is crucial for maintaining the image of the firm in front of stakeholders especially the suppliers and clients (Sasidharan, et. al., 2012). Few of these drivers businesses adopting supply chain management are:
- Cost reduction: Supply chain management helps in improving the service quality but at the same time it reduces he overall cost of service delivery. It is because the best options are provided by the supply chain management system for delivering the services and products. Cost reduction can also be ensured in terms of the fact long term utilisation of resources can help in reducing the cost of investment on resource purchase. SCM enables company to take use of most cost effective resources so as to ensure highest of profits. In the competitive business environment saving cost has become highly essential.
- Demand measuring: By evaluating all the data, these systems are capable of measuring the demands. In other words it helps in predicting demand which is necessary for managing supply so that a balance can be made between the two (Saini, et. al., 2011). More the use of systems like SCM systems more is the chance to predict the demand accurately. In the modern day competitive environment, this is highly essential.
- Inventory buffer: SCM systems assist in bringing flexibility in the product’s storage. Since there is continues change in the spending of consumers hence firm need inventory management at lowest of cost. It is also crucial that demands are fulfilled at the required time (Wang, et. al., 2013). Such predictions can only be made when there is thorough analysis of data obtained through previous activities. In the longer run this helps in satisfying the needs of the company as well as the consumers.
- Low cost shipping: As there are two ways in which consumers can order products i.e. from the outlets or from the online stores. It is easier to predict path of shipping that costs least by the help of SCM systems. Readjustment in the system can be made as the consumer’s choice. At the same time they will also have to ensure that no quality issues arise in the overall process. Supply chain management system enables the company to streamline the whole delivery process that is of the cheapest of cost (Schubertand Williams, 2011).
- Emerging business risk: Due to several factors, risk in the business has gone very high. In this high risk environment, supply chain management helps in defining the critical risk factor within the firm and with their suppliers. Risks are measured according to product’s quality, compliances according to the laws that are applicable laws and safety measures (Trinon, et. al., 2011). Since supply chain management helps in prediction of the demand and supply hence it helps in the satisfying the consumers.
Adoption of Enterprise system is a long term process and as it affects the performance of the organisation hence certain changes are required in the process. All these changes needs change management so that there is successful adoption of enterprise system. Change management is also necessary because enterprise system may bring disruption in the business. Some of the considerations that are necessary for successful adoption of enterprise system are:
- Training: In any change management process training plays a highly crucial role. This is due to the fact that Enterprise system brings changes in the operational procedures hence training is required in the process. The training must also be provided for effective utilisation of enterprise systems. This is because there is transition from manual methods of managing operations to automatic methods and hence training becomes more essential (Panetto, et. al., 2016). Tanning must be given from top to bottom based on the requirements of the individuals. For this a training plan is required that brings smoothness in the process.
- Communication: In any change management, communication plays a very crucial role. Proper communicational mechanism is beneficial for removing the confusions from the minds of the stakeholders. In order to remove backdrops from the process, it is always crucial that wrong information is not portrayed in front of the stakeholders (Ningombam, et. al., 2014). Since consumers will also face challenges in case of change of procedures hence they must also be communicated to them.
- Employee engagement: In any change process, employee engagements play a very crucial role. The same goes with implementation of Enterprise system where employee’s engagement plays a decisive role. In all the units employees must be ensure that they have calculated the cost of implementation at the same time they have an understanding about system’s complexities (Mostaghel, et. al., 2012). This must also be done with the help of team work. As the team helps in proper understanding of the business process hence all the processes can be done smoothly.
- Cultural Concerns: In any organisation there are people from different cultural background which makes its essential for them to ensure that they have a change management plan which respects all the cultures. Every employee’s perspective about the change process is different especially in regards to involved risks, system benefits as well as implementation goals etc.
- Leadership approach: Since leadership approach differs from leader to leader. The approach of leadership plays a crucial role in the way a system can be implemented. It is calculated in terms of the fact that how much leadership is ready to apply changes or to face the consequences of the transformation. Huge investment is required in the whole process and leaders must be ready with required investments (Mostaghel, et. al., 2015). For making the adoption process simpler leaders are required to motivate the staffs. This can be done with the help rewards, benefits as well as clarifying about the goals that is set by the organisation for itself.
Conclusion
From the above based report it can be concluded that in the era of technology, Enterprise system is highly essential. This helps in ensuring that all the process are working smoothly at the same time it also helps in improving the process methodology. In the increasing competition, enterprise system becomes crucial as it improves the performance of the overall organisation. There are several metrics whose previous and later values are compared for measuring the effect of change within the organisation. Supply chain management systems can be helpful for predicting demands and hence maintaining the demand and supply chain. There are various drivers for adopting supply chain management systems. Since Enterprise system changes the overall operational procedures hence proper organisational change management is required within the organisation.
References
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Hendricks, Kevin B., Vinod R. Singhal, and Jeff K. Stratman. “The impact of enterprise systems on corporate performance: A study of ERP, SCM, and CRM system implementations.” Journal of operations management 25, no. 1 (2007): 65-82.
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Ningombam, Macks Singh, Nitin Jain, Sourav Mukherjee, Amit Bhalla, Anurag Singh, and Aawardhan Logandan. “Change analysis on enterprise systems prior to deployment.” U.S. Patent 8,893,106, issued November 18, 2014.
Panetto, Hervé, Milan Zdravkovic, Ricardo Jardim-Goncalves, David Romero, Joe Cecil, and István Mezgár. “New perspectives for the future interoperable enterprise systems.” Computers in Industry 79 (2016): 47-63.
Saini, S. L., Dinesh Kumar Saini, Jabar H. Yousif, and Sandhya V. Khandage. “Cloud computing and enterprise resource planning systems.” In Proceedings of the world Congress on Engineering, vol. 1, pp. 681-684. 2011.
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