- Enterprise software is based on a suite of integrated software modules and a common central database. The database collects data from and feeds the data into numerous applications that can support nearly all of an organization’s internal business activities. When new information is entered by one process, the information is made available immediately to other business processes. Enterprise systems support organizational centralization by enforcing uniform data standards and business processes throughout the company and a single unified technology platform. The firm-wide data generated by enterprise systems help managers evaluate organizational performance.
- Enterprise software consists of a set of interdependent software modules that support basic internal business processes. The software allows data to be used by multiple functions and business processes for precise organizational coordination and control. Organizations implementing this software would have to first select the functions of the system they wish to use and then map their business processes to the predefined business processes in the software. A particular firm would use configuration tables provided by the software to tailor a particular aspect of the system to the way it does business.
- Describe how enterprise systems provide value for a business. Enterprise systems provide value both by increasing operational efficiency and by providing firm wide information to help managers make better decisions. Large companies with many operating units in different locations have used enterprise systems to enforce standard practices and data so that everyone does business the same way. Enterprise systems helps firms respond rapidly to customer requests for information or products. Manufacturing is better informed about producing only what customers have ordered, procuring exactly the right amount of components or raw materials to fill actual orders, staging production, and minimizing the time that components or finished products are in inventory.
- Enterprise software includes analytical tools for using data captured by the system to evaluate overall organizational performance. Enterprise system data have common standardized definitions and formats that are accepted by the entire organization. Enterprise systems allow senior management to easily find out at any moment how a particular organizational unit is performing or to determine which products are most or least profitable.
What are the challenges posed by enterprise applications? List and describe the challenges posed by enterprise applications. Explain how these challenges can be addressed.
- Enterprise applications are difficult to implement. They require extensive organizational change, large new software investments, and careful assessment of how these systems will enhance organizational performance. Enterprise applications cannot provide value if they are implemented atop flawed processes, or if firms do not know how to use these systems to measure performance improvements. Employees require training to prepare for new procedures and roles. Attention to data management is essential.
- Highly expensive to purchase and implement enterprise applications
- Technology changes
- Business process changes
- Organizational learning, changes
- Switching costs, dependence on software vendors
- Data standardization, management, cleansing
If a company wants to implement an enterprise application, it had better do its homework. Discuss the implications of this statement.
- If a company is considering an enterprise application, it is essential they do their homework; i.e. a lot of research before implementing the enterprise application. It is critical to have a clear picture of what the company needs and wants from the enterprise application as a detailed analysis of enterprise applications will provide significant cost savings and hopefully prevent avoidable issues. Purchasing enterprise applications is also very expensive, so it is essential that the company allocate and budget enough funds to cover the total costs.
- There are two primary reasons as to why researching (doing their homework) is important. Firstly, enterprise applications are very expensive and very involved. The primary role of an enterprise application is to integrate various systems together to function as a unit. Enterprise applications are powerful software systems that aid in supply chain management but can also play an influential role in negatively affecting a business’s operations. The business should forecast into the future and calculate if the enterprise application they are seeking to implement will have be profitable and having a sufficiently high ROI.
- Secondly, the introduction of an enterprise application into a business requires a change to the way of doing things. Consequently, due to the natural resistance to change, it may be challenging for employees to become accustomed to a new and quite often difficult system and software to understand. This means that implementing an enterprise application would also require sound and effective change management structures within the business. As such, a company should calculate how much training the staff will need to become comfortable in properly running the software and systems which incurs significant costs; adding on the overall cost of the enterprise application. It is critical there is two-way communication between the company and its employees when considering an enterprise application as employees must be willing to be learn how to properly use the new enterprise application as well as potentially taking on new roles and expanding their job requirements.
- An enterprise application can be a great instrument for a business to increase their effectiveness and efficiency in any and all departments and areas of operation. On the other hand, a poor choice of an enterprise application may lead to disaster.
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