Chapter 1 SYNOPSIS 1. SYNO

Chapter 1


There is no longer any distinction between an IT project and a business initiative. IT is a key component of the products and services provided by different companies. So even top executives and managers must learn how to apply information system and technologies to their unique business situations. The field of information systems encompasses many complex technologies, abstract behavioral concepts and specializes applications in countless business and nonbusiness areas. Business professionals rely on many types of information systems that use a variety of technologies. For example some information systems use simple manual hardware devices and informal communications channels but some are complex. The business applications of information systems have expanded significantly over years. Until the 1960s,the role of most information system was simple. Then another role was added, ie a trial to develop an integrated management of business as a whole, from the view point of the effective use of management resources, to improve the efficiency of an enterprise. There came ERP as a solution.
Originally, ERP packages were targeted at the manufacturing industry and consisted mainly of functions for planning and managing core business such as sales management, production management, accounting and financial affairs. However, in recent years , adaptation not only to manufacturing industry, but also to diverse type of industry has become possible and the expansion of implementation and use has been progressing on a global level. ERP software is designed to model and automate many of the basic processes of a company, from finance to shop floor, with the goal of integrating information across the company and eliminating complex, expensive links between computer system that were never meant to talk each other.

1.1 Objective
Enterprise Resource Planning is the latest high end solution, information technology has lent to business application. The ERP solutions seek to streamline and integrate operation processes and information flows in the company to synergise the resources of an organisation namely men, material, money and machine through information. Initially implementation of an ERP package was possible only for very large Multi National Companies and Infrastructure Companies due to high cost involved. Today many companies in India have gone in for implementation of ERP and it is expected in the near future that 60% of the companies will be implementing one or the other ERP packages since this will become a must for gaining competitive advantage.

In the present business environment, role of a Chartered Accountant is considered to be very important and inevitable. Chartered Accountants as managers, consultants, advisors or auditors play an important role in controlling, managing, and supporting the business.

As the business needs are very complex in nature, the implementation of an ERP package needs Chartered Accountants with functional skills for evaluation, Business Process Reengineering (BPR), Mapping of Business requirements, Report designing, ensuring Business controls, customization of the package for the specific requirements, Documentation etc.,

Sooner or later a Chartered Accountant without the knowledge of ERP may feel as if he is a fish out of the bowl. By this article it is attempted to highlight various aspects of ERP and specific areas of ERP that are relevant for Chartered Accountants.

1.2 Evolution of ERP
In the ever growing business environment the following demands are placed on the industry :

• Aggressive Cost control initiatives

• Need to analyze costs / revenues on a product or customer basis

• Flexibility to respond to changing business requirements

• More informed management decision making

• Changes in ways of doing business
Difficulty in getting accurate data, timely information and improper interface of the complex natured business functions have been identified as the hurdles in the growth of any business. Time and again depending upon the velocity of the growing business needs, one or the other applications and planning systems have been introduced into the business world for crossing these hurdles and for achieving the required growth. They are:
• Management Information Systems (MIS)

• Integrated Information Systems (IIS)

• Executive Information Systems (EIS)

• Corporate Information Systems (CIS)

• Enterprise Wide Systems (EWS)

• Material Resource Planning (MRP)

• Manufacturing Resource Planning (MRP II)

• Money Resource Planning (MRP III)
The latest planning tool added to the above list is Enterprise Resource

1.3 Need for ERP
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 requirements 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 will offer an integrated software solution to all the functions of an organisation.
Features of ERP
Some of the major features of ERP and what ERP can do for the business system are as below:

• ERP facilitates company-wide Integrated Information System covering all functional areas like Manufacturing, Selling and distribution, Payables, Receivables, Inventory, Accounts, Human resources, Purchases etc.,
• ERP performs core Corporate activities and increases customer service and thereby augmenting the Corporate Image.
• ERP bridges the information gap across the organisation.

• ERP provides for complete integration of Systems not only across the departments in a company but also across the companies under the same management.
• ERP is the only solution for better Project Management.

• ERP allows automatic introduction of latest technologies like Electronic Fund Transfer(EFT), Electronic Data Interchange(EDI), Internet, Intranet, Video conferencing, E-Commerce etc.

• ERP eliminates the most of the business problems like Material shortages, Productivity enhancements, Customer service, Cash Management, Inventory problems, Quality problems, Prompt delivery etc.,
• ERP not only addresses the current requirements of the company but also provides the opportunity of continually improving and refining business processes.
• ERP provides business intelligence tools like Decision Support Systems (DSS), Executive Information System (EIS), Reporting, Data Mining and Early Warning Systems (Robots) for enabling people to make better decisions and thus improve their business processes

Components of ERP
To enable the easy handling of the system the ERP has been divided into the following Core subsystems:

• Sales and Marketing

• Master Scheduling

• Material Requirement Planning

• Capacity Requirement Planning

• Bill of Materials

• Purchasing

• Shop floor control

• Accounts Payable/Receivable

• Logistics

• Asset Management

• Financial Accounting

Suppliers of ERP
There are many numbers of ERP suppliers who are very active in the market. Some of the companies offering renowned international ERP products include:
• Baan


• D&B


• JD Edwards

• Marcarn

• Oracle

• Peoplesoft

• Platinum

• Ramco



• Software 2000
1.4 BPR and ERP
Business Process Reengineering is a pre-requisite for going ahead with a powerful planning tool, ERP. An in depth BPR study has to be done before taking up ERP. Business Process Reengineering brings out deficiencies of the existing system and attempts to maximize productivity through restructuring and re-organizing the human resources as well as divisions and departments in the organisation

Business Process Engineering evolves the following Steps:
• Study the current system

• Design and develop new systems

• Define Process, organisation structure and procedure

• Develop customize the software

• Train people

• Implement new system
The principle followed for BRP may be defined as USA

principle(Understand, Simplify Automate)
i.e., Understanding the existing practices, Simplifying the Processes and Automate the Process. Various tools used for this principle are charted below:
• Understand Simplify Automate

• Diagramming Eliminating EDI

• Story-boarding Combining ERP

• Brain storming Rearranging
1.5 Selection of ERP
Once the BPR is completed the next task is to evaluate and select a suitable package for implementation. Evaluation of the right ERP package is considered as more crucial step. Evaluation and selection involves:

• checking whether all functional aspects of the Business are duly covered
• checking whether all the business functions and processes are fully integrated
• checking whether all the latest IT trends are covered

• checking whether the vendor has customizing and implementing capabilities
• checking whether the business can absorb the cost

• checking whether the ROI is optimum
1.6 Implementation of ERP
Implementing an ERP package has to be done on a phased manner. Step by step method of implementing will yield a better result than big-bang introduction. The total time required for successfully implementing an ERP package will be anything between 18 and 24 months. The normal steps involved in implementation of an ERP are as below:

• Project Planning

• Business & Operational analysis including Gap analysis

• Business Process Reengineering

• Installation and configuration

• Project team training

• Business Requirement mapping

• Module configuration

• System interfaces

• Data conversion

• Custom Documentation

• End user training

• Acceptance testing

• Post implementation/Audit support
The above steps are grouped and sub-divided into four major phases namely 1)detailed discussions, 2) Design & Customisation, 3)
Implementation and 4) Production. The phases of implementation vis-a-vis their tasks and respective deliverables are as below:

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

Deliverables:- Accepted norms and Conditions, Project Organisation chart, Identity work teams

Design and customisation Phase:
Task :- Map organisation, Map business process, Define functions and processes, ERP software configuration and Build ERP system modifications.
Deliverables :- Organisation structure, Design specification, Process Flow Diagrams, Function Model, Configuration recording and system modification.

Implementation Phase: Task :- Create go-live plan and documentation, Integrate applications, Test the ERP customisation, Train users Deliverables :- Testing environment report, Customisation Test Report and Implementation report

Production Phase:
Task:- Run Trial Production, Maintain Systems
Deliverables:- Reconciliation reports, Conversion Plan Execution

1.7 Benefits of ERP
The benefits accruing to any business enterprise on account of implementing are unlimited. According to the companies like NIKE, DHL, Tektronix, Fujitsu, Millipore, Sun Microsystems, following are some of the benefits they achieved by implementing ERP packages:

• Gives Accounts Payable personnel increased control of invoicing and payment processing and thereby boosting their productivity and eliminating their reliance on computer personnel for these operations.
• Reduce paper documents by providing on-line formats for quickly entering and retrieving information.
• Improves timeliness of information by permitting, posting daily instead of monthly.
• Greater accuracy of information with detailed content, better presentation, fully satisfactory for the Auditors.
• Improved Cost Control

• Faster response and follow up on customers

• More efficient cash collection, say, material reduction in delay in payments by customers.
• Better monitoring and quicker resolution of queries.

• Enables quick response to change in business operations and market conditions.
• Helps to achieve competitive advantage by improving its business process.
• Improves supply-demand linkage with remote locations and branches in different countries.
• Provides a unified customer database usable by all applications.

• Improves International operations by supporting a variety of tax structures, invoicing schemes, multiple currencies, multiple period accounting and languages.
• Improves information access and management throughout the enterprise.
Chapter 2



Research is a systematic and logical study of an issue or a problem to arrive at accurate results, research the job of collecting, recording and analyzing relevant data to arrive at decisions. The present study is systematic, objective and exhaustive search for studies of the facts Relevant to a problem in the field of Human resource management.
Review of Literature

My reference material comes from the existing system information that the company has. There is no such general information regarding this aspect because it relates to the internal affairs of the company.My present research deals with finding the flaws and trying to come to a conclusion whether an enhanced variant of the present system would be advantageous or not.
Population size

The study encompasses all the employees of the software enterprises.

2.1 Sampling method and sample size

Sampling plan:-An integral component of a research design is the sampling plan, specifically it addresses three questions.

• Whom to survey? (Sampling unit)

• How many to survey? (Sample size)

• How to select them? (Sampling procedure)

Since the number of employees in the concerned organization are thirty, we have taken all the thirty as sample.
2.2 Data collection design

Data was collected with the help of using questionnaires. A questionnaire, which is also known familiarly as an interview schedule with a format containing a list of questions sequentially ordered to obtain information relevant to the objectives of the study, was developed. Structure and undisguised questionnaire was chosen as the questions could be presented with exactly the same order to all the respondents. The reason for standardization was to ensure that all respondents were replying to the same question.

The questionnaire for research included a combination of the following kinds of question
? Close-ended

? Direct question

The questionnaire proved out to be very helpful in conducting the survey.

Primary data will be collected through questionnaire survey. In this method questionnaire was prepared and given to the sample population to fill.
Field work

The fieldwork was the data collection by contacting the respondents personally at their respective work desks. And few of the information gathered were through E-mailed questionnaires.

2.3 Method of Analysis

The data collected through questionnaire and the records available was examined in detail. It was further tabulated with various statistical tests.
2.4 Statement of the problem:

The existing software of the concerned company is not efficient. The expected productivity is not obtained from the system. The employees are finding it difficult to use.
2.5 Scope of the study

This is a attempt to design an ERP system which involves an integrated automation of entire processes done in the concerned company
.In this present day when companies, irrespective of their market size and market share, are selling in various areas of the world. ERP is a best available solution for them. ERP packages are targeted at everything from small business to largest organizations, and that can be composed of a highly flexible decentralized database and an information system cluster linked by a network. An ERP package can not only handle individual business functions such as accounts, HR and material management, but also the entire range of business functions necessary for the company’s operations.

2.6 Objectives of the study:

Primary objective:

> To analyze the enhancements required for the current manual system and to design an automated system.
Secondary objective:

> To make it more user friendly

> To include a search engine

> To include a scrape management system

2.7 Hypothesis:

H0 :The functions performed by the existing system of the concerned company are inefficient.
H1 :The functions performed by the existing system of the concerned company are efficient.
Primary source:

The researcher will collect the data directly from sample respondents through direct interview method and with the help of structured questionnaire.
Secondary source:

The secondary data for the study will be collected from various journals, survey reports, books and magazines.
Sampling technique:

The employees of the concerned company are taken as a sample and will carry out the study.
Duration: 1 month


> Time and cost matters the survey to some extend.
Chapter 3

What is ERP?
ERP stands for Enterprise Resource Planning. ERP software integrates all of your major business processes, which helps ensure consistent data across all your functional departments. ERP applications typically consist of modules such as Marketing and Sales, Field Service, Production, Inventory Control, Procurement, Distribution, Human Resources, Finance, and Accounting.

ERP business process model fully integrates ERP and CRM capabilities to help you effectively manage a wide range of functions across your enterprise. It offers an effective blend of enterprise resource planning, customer relationship management, partner relationship management, supply chain management, and online analysis processing. This gives you the ability to make qualified business decisions based on a seamless,
360-degree view of your business, customers and vendors.
3.1 What makes ERP better?
Fast and Flexible Implementation
All of the information provided during implementation can be adapted or modified at any time to meet the changing needs and demands of your company. By choosing ERP, you can reduce hidden organizational, on- going-integration, operational and maintenance costs.

Designed for the Global Economy
Traditional ERP applications weren’t developed for the complexities of the global market. Gaps in functionality arise when these features are simply layered on top of existing code. But now it is designed with global markets

in mind, featuring multi-currency, smulti-tax, multi-costing, multi- accounting and multi-organizational functionalities. The accounting solutions cater to the needs of enterprise, no matter what currency or schema you use. ERP even provides the flexibility to account in one or more Accounting Schema in parallel. It also features language packs and the ability to customize both the Web Store and the application itself to suit your language requirements.

Can ERP software improve the company’s business performance?

ERP solutions give you the ability to save time and money across your entire enterprise. With ERP software you need only input customer, vendor, and order data once and then share it across your functional departments. You can automate inventory and warehouse procedures as well as billing and accounting procedures. You can use ERP applications to create reports and analyze enterprise trends quickly and easily, allowing you to respond quickly to shifts in the market. It also helps make e-commerce easy. The information in Web Store is shared with the standard application, so no synchronization or extra integration work is required.

Will an ERP application fit the way I do business?
With traditional ERP solutions, this question was vital. ERP applications normally come with a built-in system of “Best Practices” whose restrictive rules limit your business processes. ERP system are built to adapt to your business structure because we know that every company has unique needs.

Can ERP software help with integration problems?
One of the reasons businesses look into an ERP installation is that their enterprise is experiencing difficulty in integrating the information they have stored in widely diverse applications that can’t “talk” to one another. Organizations within a company may even use different programs to perform the same functions. When you install an ERP application you solve many of your information integration problems. With an ERP system you have better data quality, since information need only be entered once to be available to the entire company. You are also able to easily run reports using enterprise-wide data, allowing you to quickly see trends developing within specific organizations or across your entire company.

Nano-tech Controls was set up in 2007 with an aim to establish itself among leading Global IT Solutions Providers. On road to the vision, the company has already emerged among India’s fastest growing organizations that provide quality IT and IT enabled services to its clients.

Nano-tech Controls provides IT solutions to meet the business needs of small and medium enterprises. We provide comprehensive technology and web branding solutions spanning varied business domains and entrepreneurial ventures. Our solutions involve research, business process analysis and use of relevant technology.

Nano-tech Controls is focused on leveraging information technology to help small and medium enterprises achieve their business goals. We do this by combining our technology strengths with our business analysis skills so that the application serves the needs of the target audience and is technologically robust.
Nano-tech Controls is an organization with four distinct skill sets:

We are a consulting company that generates ideas, evaluates business processes and helps our clients in formalizing an idea, application, or a process.

We craft a unique information technology solution that will deliver value and addresses all your business needs.

We package the solution in a visual medium so that we deliver a unique and interesting user experience

IT Consulting and Business Solutions

With over 20 successful projects Nano-tech Controls provides the necessary solutions for the small and medium enterprises to enable them to leverage the strength of IT by automating business processes. We ensure that value is added to your company by adding value to your business processes, define new processes and automate them to comprehensively address current and future business needs.

Technology Solutions

Our technology services include offshore software development, application & data migration, remote database management, embedded system solutions and other services which help enterprises enhance value of their existing IT infrastructure. We ensure that our technology solutions help you increase the effectiveness of your current IT infrastructure.

Human computer interaction has become an important parameter in developing all business applications which have multiple sets of users. Our integrated visual design teams along with our business analysts ensure that all your applications have an aesthetic and intuitive visual interface and navigation. Our visual design team produces highly creative new media and print media solutions including web branding, promotion and corporate collaterals.

Mission: To become the best in the world in providing our clients with world-class products and services that help select, develop, and retain business status.

Values: We are committed to:

> Being customer driven and quality focused.

> Adding value to our clients and improving business results by providing products and services that are valid, easy to use, fast, and cost effective.

> Continuously improving our offerings to ensure both the content and the technologies are innovative and leading edge.

> Empowering our clients to use Nano-tech Controls products and services in a flexible manner to meet their needs

> Being governed by high standards of integrity and professional ethics.
Chapter 4


4. Project Overview

4.1 Choosing ERP Software

ERP failure cannot be tolerated by organizations as it involves great money. On the contrary ERP success makes great money. The causes of ERP failure can be a result of any of the following elements acting in combination or individually:

Meeting and consultations in the organizations to decide ERP

Selecting ERP software does not happen all on a sudden or as a result of an overnight’s discussion. There is lot of groundwork that needs to be done in this regard. There are many reasons for the ambiguity, with the foremost being advent of Internet. This has expanded the scope of computers and redefined the technological implications in the business. As a result there is more expectations and demand. These were not foreseen earlier. Advancement in computing indirectly implies the advancement in enterprise resource planning. Needless to say the constant updating, upgrading and innovating have become the benchmark of ERP packages. The indecisive mind of companies in choosing ERP soft ware solutions needs no explanation.

Hire or Buy ERP
There are two alternatives in choosing ERP software for the company. The first one is purchasing the software while the second one is obtaining one on hiring basis. There aren’t any differences in terms of costs or benefits irrespective of the option that the company goes for. It all lies in how best the company makes use of ERP. However the company has to stick on to any one option as soon as it finalizes.

ERP should Suit company preferences
Companies that choose ERP on grounds of their own preferences succeed in the long run than other companies. Other companies who sail by some decision that does not justify their preferences are most unlikely to succeed.

Choosing the ERP vendor
The quality of the services offered by the vendor is equally detrimental in choosing ERP software. Buyers generally tend to purchase from sellers who have got adequate experience in ERP Products and services. This is

the usual practice for any commodity. This has to be strongly followed in the case of ERP as there are several dimensions involved with regards to decision making. Nevertheless Choosing to buy from the right person is alone not enough. How the organization makes the best use of it in response to the specific needs, to avail the best services is more important in deciding to buy ERP Systems.

ERP implementation will be successful if certain guidelines are followed in choosing ERP software. There is a dual purpose in ERP. It is neither meant exclusively to benefit the trade procedures in the organization nor help the technological contents. It has to make both ends meet. This Key function holds ERP in a special manner when compared with any other system. Therefore the company must be prudent enough to choose an application that caters to this advantage to the maximum extent. Therefore if a company chooses an enterprise process to assist the business or technology alone the decision will not yield the required results.

Essential Elements of an ERP System
If a company is able to obtain all the related products of ERP from one seller /vendor then it can be termed as a profitable Venture. The company will be able to avail their services in all matters relating to ERP solutions. This is highly recommended and regarded as a wonderful combination. When they choose to buy an ERP application of a particular module it must be ensured that they enable connectivity and facilitate data transfer which should easily be made available to the stakeholders. The advantage in buying a modular application is that the company can choose to select them on the basis of the function for which it is purchased. These are the essential element of ERP systems.

Time constraints in respect to the organizations function
The ERP system should be purchased based on the long term needs of the organization. In that sense the firm should visualize its prospects, position and requirements in the long term also. Therefore it has to be made sure that ERP is not restricted to meeting the current needs. This will also help in implementation of ERP.

Suppose if a company is engaged in one particular domain of banking it also needs to understand that it may have to cater to the entire banking sector if the need arises. Hence it must purchase ERP that can serve related banking applications or if not be capable of modification for the said purpose in the future. This will also stand out to be true in the case of organizations that aim at diversifying the business. A choice is to be made

from ERP implementation models. This will also help in implementation of

Employees to express their opinion on ERP
The core members in the decision making body (for ERP) should hear and heed to the views of all the employees in the company as long as they are valid. This will make sure that everyone is given an opportunity of being heard so that they don’t lament that they were not allowed to express their opinions on ERP. This discussions will facilitate the decision making body to know how well ERP is received in the company and what are the setbacks that are to be removed. This will also help in implementation of ERP

There is another important objective in these meetings. They help to bring out the various modifications and technological changes that the company has to undergo to become ERP friendly. Gap meeting and business process requirements do help in bringing out them. But these processes will witness the employees difficulties and requirements directly. The impact is also bound to be more when it is voiced out in person and in detail.

Customizable and predefined Modules
A large majority of ERP sellers sell customized application in addition to predefined applications to ERP customers. They assist the customers in making all decisions right from implementation to use. Both have their own advantages and disadvantages. In the case of customizable applications the buyers will be instructed about the various options available for modifying. The users have to make a decision of choosing the appropriate combinations on the basis of their business requirements.

Resorting to an External Body for ERP Services
Some organization finds it tedious to undertake the above mentioned steps. Their workload would be too large to concentrate on this. In that case they can be outsourced to a third party who can take care by keeping the needs of the organizations in mind. There are many competitive advantages in availing the services of such person. Firstly they have the professional expertise and the required experience. The third party will also face the difficulties of the firm but there wont be any mindset or favoritism as far as he is concerned .these are all inevitable when the company is doing the service. Their services will be suited even for bigger

operations that have numerous complexity and ambiguity in operations. This will also help in implementation of ERP.

Verifying the credibility of Vendor’s services
The company has to check if the Vendor has already installed a similar configuration elsewhere as it would not be advisable to be subjected to first time testing given the huge investment in the name of ERP. If possible the company can try to get information from the ERP customers of the vendors but it is not practically possible to elicit the necessary information whether they are competitors or not, as business ethics and professional code of conduct would not permit the same. They will also help in analyzing ERP Systems.

Application Service Provider
Application service provider is an emerging concept in ERP packages. These are built in packages that have their own setups for hardware and business process. The usual manner of choosing ERP viz Deciding, buying and installing has even been given a go by in some occasions. This will also help in ERP integration

The edge enjoyed by S.M.E.’s
ASP was discussed as a profitable option. The actual fact is that it is a boon to small and medium enterprises (S.M.E.’S).They would not have been able to think about ERP but for ASP and outsourcing. They would choose these due to efficient services and affordable costs.

Choosing an outsource service provider
These companies may also choose to select the systems on a rental basis so that they are not burdened with the tasks like administration, handling network as these are too big when compared with the size of their firms. As per ASP arrangement the infrastructure part will be taken care of by the service provider. The company can access everything online, while the customers access to ASP at an agreed Service charge for the stipulated periods.

In the case of business process outsourcing the organization can avail the services of a consultant for its business that will perform the required functions on behalf of the company. The company can also choose to outsource inhouse operation to the outsourcer to get maximum benefits be made from ERP implementation models.
Choosing ERP vendors for ASP
Companies must exercise caution in choosing Asp service provider. Many ERP sellers offer ASP services in response to the rising market demand. Their expertise is unquestionable but the trouble lies in terms of costs as the ERP vendor would price them at high rates. In addition the choices are not plenty interms of choosing players. Therefore it is advised to refrain from vendors offering ASP services and approach ASP service providers alone. This will also help in implementation of ERP.

Resorting to an External Body for ERP Services
Some organization finds it tedious to undertake the above mentioned steps. Their workload would be too large to concentrate on this. In that case they can be outsourced to a third party who can take care by keeping the needs of the organizations in mind. There are many competitive advantages in availing the services of such person. Firstly they have the professional expertise and the required experience. The third party will also face the difficulties of the firm but there wont be any mindset or favoritism as far as he is concerned .these are all inevitable when the company is doing the service. Their services will be suited even for bigger operations that have numerous complexity and ambiguity in operations. There are different software solutions available for both purposes.

Verifying the credibility of Vendor’s services
The company has to check if the Vendor has already installed a similar configuration elsewhere as it would not be advisable to be subjected to first time testing given the huge investment in the name of ERP. If possible the company can try to get information from the ERP customers of the vendors but it is not practically possible to elicit the necessary information whether they are competitors or not, as business ethics and professional code of conduct would not permit the same.

The Nuances in choosing ERP Software
Pre ERP implementation includes analysis, constructive criticism; homework’s has a significant place in the whole process of ERP. Lot of research and background work needs to be completed prior to the implementation of ERP or even before thinking about bringing Erp into the organization. The plans of the organization must be clearly charted out and how it intends to benefit from Erp operations have to be looked from a broader context.

Important Points in the discussion
This discussion should include important element namely financial issues. Besides it should also account for the potential threats, strengths and weakness. How much profit will be incurred have to be discussed and substantiated? Other non monetary benefits should also find a place. These studies should involve the contribution of the entire group in the organization right from the person in the highest hierarchy to the one in the lowest level. The contribution should be validated and sharpened by means of presentations which will help everybody to get insight of the different perspectives, and views. All of them will be helpful in implementation of ERP.

The cost factor and compensation
ERP will definitely yield the required monetary benefits to organizations whether they have the practice of built in systems or individual practices. If we are to calculate the costs involved in preserving and building them over a period of time it will be evident that the ERP costs incurred to support and facilitate the said functions will be comparatively less.

This calculation will prove to be equally true even if we take the case of individual department for that matter. Another important point in this issue is that it has to align with the target goals of the organization (the purpose for which it is sought and justified) as organizations generally tend to go far ERP with a view to improve or increase the efficiency of a particular section /dept and the whole process in general. Similarly the costs incurred to facilitate that particular function must not be monetarily pinching on the organization and even if they are the benefits and profits from that particular department or the whole organization preferably should exceed the exorbitant costs. Everything has to be calculated on the basis of the chosen ERP software systems

Committee to look after ERP process
Analysis and criticism will go a long way in deciding the fate of the ERP product. They are alone not enough. The next process would be the services of the team who can decide everything concrete with regards to ERP. The required powers are to be delegated to them. They will do the screening of the potential vendor based on the organizational needs that have been classified and discussed earlier. This will be helpful in implementation of ERP.
4.2 ERP Gap Analysis
What is the Necessity for ERP Gap Analysis and how is it done? Why Gap Analysis?
Gap analysis is an important step in ERP implementation. ERP is meant to integrate the data of all the departments in a company under one common platform. This calls for a radical change in the system of the company’s functioning.
The organization can either drop the idea of implementing ERP or choose to go by it. Such a decision can be arrived only by comparing with parameters like the reaction of their customers. The organization can go ahead with ERP by modifying the software to suit their needs but as earlier discussed it leads to other complications and dilutes the working of erp.If the company decides not to go about in searching for another alternative arrangement. On the other hand if the company wants to go for ERP it will stick on to ways and means for implementing ERP. In order to help the company arrive at a proper decision in such unwary circumstances GAP analysis is advocated and followed. Gap analysis basically identifies analyses and as well suggests a sequence of steps to be followed after taking into account “What ought to be “and “what actually exists”. It provides to overcome /bridge the gap. Above all it is aimed at improving the commercial viability. The process is aimed at facilitating ERP function so that the benefit of ERP is received in full.

Steps in a Gap Analysis

• The primary step will be to make a note of the existing business system and list out the flaws and positive aspects. This is an attempt to have an idea of what is currently happening given the scenario in question so as to help in ERP implementation.

• Evaluate and decide the additions that need to be made to the business in view of ERP implementation. The aim is to make sure that there is not even a thin line of difference between ERP and the organizations commercial activities. It will be oriented to ERP function.

• Rating the existing level of performance to set a benchmark or standards for the business as on date. This will help in finding out the benefit of ERP.

• Having an in-depth study of the regulations and statements in the organizations and suggesting modifications. This also will decide ERP implementation.

• Clearly defining the roles of individuals in the organization so that the priorities are met and the structure remains undisturbed. This is to make things clear for ERP function.

• Checking if the objective in discharging duties are met because it is the ultimate solution to any issue. If they are not met the gaps should be made known and corrected. Only then the organization can achieve the benefit of ERP.

• Ensuring that functions are executed properly and if need be personnel can be rewarded to boost up and encourage performance.

• Similarly comparisons are to be made for every other factor that draws relation in one way or other. These results are to be complied for ERP gap analysis.

• The gap analysis takes into account all the factors of study and gives the results. It either recommends the implementation of an ERP system or rejects the idea in totality.

This whole process takes about 90-120 days depending on the complexities and technicalities involved. Gap analysis requires the proper understanding of the firm and the ERP product in question. The analysis should fully focus on how the business process and software can be mutually beneficial to one another. GAP analysis becomes instrumental in deciding ERP implementation, so as Business Process Reengineering
4.3 Factors influencing ERP price

ERP cost is an important issue that companies look forward while deciding on ERP. ERP calls for a voluminous investment. By and large this step is not a cakewalk for any company.
It is not possible to give a comprehensive price structure for all companies implementing ERP.ERP pricing varies even among companies based on requirement, facilities, size and nature of the business and so on. Above
all it is dependent on that particular factor which the company banks on or
in other words the root cause for the company to decide on ERP. ERP
implementation cost is not the only cost to the company.

Some of the well known factors which influence the cost of ERP
software product are as follows: Execution of ERP

This term will include all the exercises from business process engineering to gap analysis to actual restructuring and training. Above all this the

process of modifying and transferring data and systems from the old form to new form is another costly affair. The manpower and time spent may also be taken into account to know the non-monetary costs precisely.

The company needs to calculate this though not for accounting purposes as it will help be estimate the Regular work that was not carried during the regular course of business (due to ERP intervention (some even call it as interruption?!).Again these costs are solely dependent on the company’s workings.

If the company engages the services of an ERP consultant then the costs will be quite different, if it goes ahead with the process with the help of In- house IT staff (which is not encouraged during the initial stages).These alone don’t constitute ERP implementation cost. A host of other charges will be included in ERP implementing cost.

Consultation by ERP Expert
These factors also influence ERP cost to a considerable extent. The professional charges payable to the outsider also depends on the extent of the services availed by the company.

If the company is restricts his service merely to training and implementation the fees will be different from seeking his expertise for the entire process which includes staying with the company to rectify practical difficulties after implementation, conducting refresher programs and so on. This is important component of ERP implementation cost. However this is not the only issue in ERP implementing cost.

This is also a crucial determinant of ERP costs. There are two modes of training offered in companies. Companies hire trainers to update their IT staff on the nitty gritty of ERP. They in turn train the user to get acclimatized to ERP’s functioning. This method has lot of drawbacks but still many companies go for it not only because of the comparative low costs but doing away with the need to train everyone in the company. In spite of the drawbacks this method has claimed relative success in some companies.

The other methods is training the users and the IT staff as well .In this method the IT staff will be trained on technical parameters while the users

will be trained on usage. But for the exorbitant costs this method is highly successful. ERP implementing cost is very important. Similarly if the company wants to seek the trainers service only for particular facets if it believes that the pool of In-house It staff are competent to handle other areas, then ERP costs will be different.

4.4 Return on investments for ERP

This article can form the basis for a research namely “ERP Industry paper”. The intervention of ERP has resulted in lot of discussions among IT professionals, employees, and market and so on.

Some of the instructions that have to be followed to ensure adequate
Return on Investments are given below:

Working out the Myths of ERP in the Initial stage
The question of Erg’s ROI remains a puzzle to companies who are experiencing difficulties even in implementing it. There is a simple and straight answer to the question of ROI on ERP. Companies can definitely be assured of ROI from ERP if they properly follow the procedures and implement the right practices.

This is often well said than done. One common blunder committed by the company is following the age old methodologies and thereby the ERP process will not add any value to the company and business process. The difficulty in implementation process makes them think it ids difficult to embrace ERP and the returns will not be guaranteed. This mindset is not true and hence companies have to work more as the process deepens and not vice versa, in order to achieve optimum benefits from ERP. Otherwise the operations done by ERPROI calculator will not be true. Even using ERPROI tools will serve no purpose.

Proper Implementation and Finance
There implementation process should take place in a smooth manner and in accordance with the set standards .There should be no compromise or controversy in the funds allocated. One mistake which is normally done by companies is that they tend to cut down the expenditures on some areas in order to be monetarily benefited.

However the fact is that it will affect the company in the long run unless the step is meant to change the decision like partial implementation (provided it is supported by some logical reasons. While talking about the

implementation process it is important to ensure that it confirms with the standards and as per the instruction of the vendor/ERP consultant.

Strict Adherence to Changes
Many of ERP’s welfare measures are visible to the naked eye. However there are some elements that are unseen but still impact the organization in a large manner. These elements make the company to assume that ERP is not worth the money and hence they even go to the extent of violating/discarding it halfway and not following the changes that were arrived after a long suggestion and deliberate planning. They will defeat the very objective of ERP ROI .There will be no use even in disgruntling on ERPROI tools.

4.5 Challenges faced by ERP
Organizations face lot of challenges right from choosing ERP vendor. It was really a hilarious task to convince them on regarding implementing ERP. ERP failures that arose in an organization were never analyzed or studied.

Lot of excuses were given on the failure of ERP like the organization was not yet well equipped to accept ERP, there was deficiency in service on the part of vendor and so on. All this only led to skirmishes within the organization and outside. The services of an ERP consultant was not suffice to overcome these drawbacks of Enterprise resource planning action.

Full fledged and Partial ERP
One basic problem with companies is that they go for ERP at a stretch. This might be one potential reason in the case of backfiring. The requirements of each organizations are entirely different .It is not advisable to go for fullfledged ERP unless it is required by the organization. Since ERP requires large investment in terms of Money and time the resources spent will not be justifiable unless they are optimally utilized. Partial ERP does not denote partial implementation of ERP but it indicates the implementation of ERP to perform the required function and role exclusively. Again size is not the deciding factor. It totally depends on the nature of business, scope of operations and similar details. ERP is definitely a flexible application however it is difficult to infuse this element of partial and need based functions and it still remains a major challenge. The company can even avail the services of an ERP consultant to decide on Enterprise resource planning action

Surplus commodities in production
When ERP is used in the manufacturing one common problem that strikes any user is the question of how to properly manage surplus commodities? Infact ERP can regulate and monitor all resources and production factors. The whole organization should work on this aspect failing which ERP will not yield the necessary results. This poses to be another challenge to ERP since each member/department have their own interest and plan of action while working with ERP .This common objective of managing the surplus will not work out without proper coordination no matter how best the product is supplied by the ERP vendor.

Problem of sudden transformation
Unlike MRP which manages the surplus goods slowly and steadily ERP operates very swiftly on them. This transformation is unlikely to be received by the organization positively .Even persons in the managerial cadre will not be receptive. The reason is that it demands tremendous work load at the beginning though the fact remains that it will be much lesser than MRP after further progress .At this stage the challenge lies in bringing about an attitudinal change in the entire organization to match with ERP’s Speed. An ERP consultant will help to guide the company properly in these areas along with enterprise resource planning action.

Equipping as a result of the transformation
It is not enough if one brings about an attitudinal change. certain changes in the organization structure is also desired .The greatest challenge now lies in restructuring the midway of ERP operations without affecting Erg’s functioning.

Meeting future needs
Organizations have started to prefer an ERP system that meets the future needs. This can be a challenge to ERP as well because the visualization and expectations in companies may not always turn to be true. The quotation made to the ERP vendor has to be prepared only after keeping all these details in mind.
Steps to be taken into account for the performance ERP
Enterprise Resource planning ERP definition is not a technical aspect. Enterprise resource planning is a huge investment on the part of

company. Therefore it is necessary to ensure the accountability of the
ERP vendor.

An understanding of ERP and language is must to follow ERP best practices. The ERP vendor cannot be blamed if the company does not follow the procedures correctly. On the contrary when his services are not up to the industry standards he has to be held responsible. But how to compute the services is another big question.

Some of the steps that can be taken to compute are as underneath: Preparations

The company should have a scale for evaluation right from the beginning stage. This will help them to progress further in due course of time .This is the primary step in the process .It includes everything is checking if the vendor has given the necessary supporting services to the company in the process of implementation installation training and relevant areas. This is very important because it forms the foundation for the ERP process in the company. One needs to be clear about ERP best practices for this.

Evaluating the work
This step concentrates on the core function. The company must periodically make a note of the work done. Any discrepancies will be brought to the vendor’s notice immediately. The vendor should extend his full fledged cooperation in making sure that the work gets done as promised. Then only it is possible to scale ERP best practices.

Incase there are some inherent errors or technical flaws in the company the ERP vendor can advise or suggest the company on how things are to be done. This step by and large helps the company to find out if the vendor stands up to the promise in terms of delivery. Understanding of ERP and language is a must.

Calculating ROI

ROI helps to directly account the performance of ERP software programs. In simple terms ROI calculates the returns from ERP software programs. When the returns are high or at least meets the expected and industry standards the performance of ERP software can be rated as “promising”. The ROI on ERP will not be merely achieved by ERP implementation. The returns will be achieved only if the procedures are followed properly. But if

the software fails to deliver the required results even after following the correct practices it shows lacuna on the part of ERP software. This will affect the rate of ROI as well.

Following contracts terms
The performance of ERP software can be gauged on the basis of its working in relation to the terms of contract. ERP software that accords to contractual terms in relation to working definitely indicates better performance than vice versa.

Customizing ERP Software
Customizing is an integral part of ERP solutions. This is a crucial decision which needs to be taken by the organization as it is detrimental in ERP’S success. The rate of customization is directly proportional to ERP success.

Customization tends to pose a challenge to time and the funds allocated. The challenge of a successful management lies in balancing them and making both ends meet. It is a difficult task but the success speaks for the process.

Burning Issues
The major issues that require attention in the process of customizing ERP are strong knowledge about the current system and the likelihood of innovations in ERP. These two issues have their own say in the process of ERP customization. The process of customization will not take place properly unless or otherwise there is a strong working knowledge about ERP systems. Even if it does the rate of success won’t be to that of the desired or atleast required extent. The chances of innovation in ERP will have a say on the customization of ERP because whatever modifications are done now would not have any relevance if they are already covered in the new systems. If the management addresses these two issues properly then the chances of ERP’s customization are pretty high which also speaks for ERP’S success. A proper ERP solution can be provided by the Right ERP company.

Features of ERP innovations
The innovations of new ERP applications help users to include all the specific details in ERP system itself. This means they don’t have to input these details into the ERP systems every time they login. This also implies

that the operators need not recompile ERP softwares as and when there is a change in the attributes or methodology of data fed. Customization has also helped the users to act independently rather than depending on the vendors whenever a modification is required. The innovations in New ERP systems have made it so userfriendly that the customers go to the extent of modifying the systems to perform functions exclusive to the organization. ERP solutions are now handier to customize than ever. ERP company offers numerous and flexible ERP solution.

Sound knowledge about ERP System
The features be it old or new or modern or traditional will not be of any use unless the users are aware of the ERP Systems features and modalities. This knowledge has to be imparted to the end users apart from IT personnel. They should have a clear knowledge about the entire system in finger tips. If questioned or demanded they must be capable of bringing that particular function into effect. The services of an expert ERP consultant will come in handy for an organization to supply this information to the user. The consultant will make a decision on the basis of the organizational needs and system configuration. He will be a part of the organization for quiet some time. This will also help him in know the organization and people better. He will therefore be able to work easily. Customization is an important part in implementation of ERP.ERP Company can decide the proper ERP solution for the organization.

BPR is one of the fundamental steps undertaken prior to ERP implementation. Business process reengineering analyses and suggests the structural changes. This is regarded to be very important because it helps in knowing how the organization should be customized inorder to become ERPfriendly.

Change and BPR
BPR is inevitable not only for ERP but as far as any business process is concerned. BPR becomes the first step in the process of ERP implementation. Business process reengineering is taken to conduct feasibility study and other restructuring exercises. Nothing can be done to prevent change. The best way to manage change is to adopt it.

Time and again it has been proved that imposing change of any magnitude all on a sudden is not the proper way. There needs to be a proper method to bring about it. Business process reengineering is one

scientific study that helps organizations largely to analyse the viability of not only ERP but any other dynamic change. BPR ERP is interrelated.

4.6 BPR and ERP
BPR does not necessarily stop with the process of identifying the possibility. It also suggests a series of steps that needs to be executed, for ERP to find a place in the organization. BPR is the first step that comes prior to ERP implementation.

The reason is simple. Many parameters are taken while preparing ERP. This includes the assumption of Predefined functions. Hence ERP software will be preconceived to perform those set of functions. On the other hand companies expect ERP to function in such a way that it coincides with the regular business process. BPR ERP can be the biggest challenge for the vendor and the company as such. BPR ERP forms an important part of ERP study.

Solving BPR ERP Clash
There are two alternatives that will help the companies to combat this menace. The company can either restructure the business process itself or customize the ERP system so that it suits the business process. Deciding this is paramount to ERP implementation. BPRERP has lot of conflicts. The pros and cons of each of them are explained in the following paragraphs:

Implementing ERP Software to Suit Business Needs
When the company demands a particular ERPsoftware they have to make compromises on the budget because reworking modules and supplying an ERP Software would definitely be a costly affair. This is because of the complications involved in doing the same.

Apart from finance this also calls for persons with greater working knowledge to design the systems. This means the process is not going to be unambiguous.he process will also require frequent updations. This is going to be difficult taking into account the several changes that has already been inflicted on the system to make it business friendly.

Restructuring the business process to be ERP Friendly:
This method also requires lots of monetary outlay because of the major change in business process.
The customers will not be receptive to changes in business process. It is possible to train the employees but whereas in the case of customers they cannot be expected to stay in tune in tune with the whims and fancies of the organization.

It is possible to train the employees. The likelihood of them to adapting to the change at the immediate outset is very much limited. This will cast a spell on the revenue of the business and unless ERP does not make it good in the later days the voluminous investment cannot be justified.

Chapter 5



4.1 Test for randomness

H0 :Data is random. ie ,The functions performed by the existing system of the concerned company are efficient.
H1 : Data is not random ie, The functions performed by the existing system of the concerned company are inefficient.

Take each question, each option in the four alternatives carries marks according to the question given.
Result 1——————-2——————–3—————————4


Depending on the answers given by each respondents we calculate the marks for each questionnaire and conducting a test for randomness.

The survey done on the 30 respondents are shown below. Marks given by each of them for each questions are shown in the table Figure 1.













U=no of runs


V(u)=[n/4*((n-2)/(n-1))] Z=[(u-E(u))/Sq V(u)]
The values are calculated as follows

The middle most value is taken as for calculating U,we have to consider the bench mark as 26 .Those values which comes under 26 are given – sign and which comes above 26 are given + sign .Since there are
30 respondents we have to take 30 numbers.

























































So U=5

E(u)= (n+2)/2

n=28 since two values are 26 in the case of the respondents we cannot consider those two.

V(u)=[n/4*((n-2)/(n-1))] V(u)=[(28/4)*((28-2)/(28-1))]=6.74
Z=[(u-E(u))/Sq V(u)]

Z=[(5-15)/Sq 6.74]=(-10)/2.6=-3.85

Mode Z=3.85

For level of significance 5% , the table value is 1.96

Since mode Z value is more than 1.96 data is not random. ie The functions performed by the existing system of the concerned company are inefficient.
Since the hypothesis has to be rejected there is a need for an enhanced system which can perform the operations more effectively. The following are the recommendations.
> The system should be more user friendly

> The taken for each operation by the existing system is more and so it should be reduced
> There is a need for a scrape management and a search engine in the system.
> It is necessary to produce reports and print outs, so there should be a system for that.
Hence my next step in research involves ,coming out with an efficient variant that would fulfill the current requirements of the organization.


The proposed ERP is supposed to solve the entire drawback with the Existing System. Right from the problems faced by the company for purchasing the material from vendors to the sale of the finished products. By implementing this the entire organization is considered as a system

and all the departments are its subsystems. The information about all the aspects of the organization is stored centrally and is available to all departments. This transparency and information access ensures that the departments no longer work in isolation pursuing their own independent goals. Each subsystem knows what the others are doing, why they are doing it and what should be done to move the company towards the common goal.

For the development of this system, one has to break the process into different phases like system analysis, database design, system implement, system testing and validation etc.

A system can be defined as the interrelated procedures that are joined together to perform an activity or to accomplish a specific objective. It is in effect all the ingredients that make up the whole. A procedure is a precise series of step-by-step instruction that explain.

• What is to be done?

• Who will be doing it?

• When it will be done?

• How it will be done?

The system analysis is the process of analyzing a system with the potential goal of improving or modifying it. In the system analysis we have to study what are problems incurred during transactions, what are the difficulties of the existing system, what is to be done to improve it, and
how it will be done. In other words system analysis involves study and design or a system in order to modify it, hopefully for the better system.
The system analysis approach, all the major influences and constraints are identified and evaluated in terms of their impact on various decisions points in the system. A decision point in a system at which some people are automobile mechanism must react to input data and make a decision.


This project work can be taken as an attempt to treat the organization as a single entity and caters to the information needs of the whole organization. The project work reduces the manual planning, time scheduling and increases the efficiency.

The need for the project work aroused due to the expansion plans of the company in meeting the large contracts of the industry. The existing being a manual one, have lot of limitations and disadvantages. Hence the following objectives are laid for the proposed system, which tends to avoid the disadvantages and improve effectiveness efficiency.


In order to make the data entry more easily as well as accurate, the data is to be validated in the early stages such as entering the identification number of the vendor and material. This maintains that the data entry operator need not follow complicated procedures to fill in the data.
Report Generation

Preparation of reports is very fast and ready when they are needed. Moreover the report generation depends on various criteria.

Secondary Storage

The data entry has to be made only once, which can be copied to secondary storage devices such as floppy diskettes. The data once entered can update the master database. This will eliminate the tedious job of reentering the data and errors and emissions will be eliminated.

Less Storage

The storage area required for the data would be very less compared, to that in the manual system and the loss of data is reduced in the proposed system.

Man Power System

The software aims at reducing the manpower since the high level management maintains all the reports and comparative statements. The transfer of request also does not need any manual communication process since every communication process is done through web application.
The main reasons for carrying out the proposed system is

• Reduce production delays arising out of shortage of supply of materials.
• To avoid unnecessary lying of the capital investment in the stock and to have a scrape management facility.
• To include a search engine in the system.

• To generate reports as and when needed for the management in the decision making process.
It increases the efficiency of production handling and end-user satisfaction. It also makes the system more user friendly, thus saving the time.These are to be found for designing a complete computerized system for the management.

In the existing system they work on FOXPRO,which is an outdated one. It takes a long time for them to processes each request .If they want to retrieve certain information they are finding it very difficult. Multiple user facility is also not there in the system. They even find it very difficult to produce the required reports for the processes of decision making. The transactions regarding the requirement and the purchase of the material are recorded manually which resulted in lot of time lag, mishaps of the inventory and inappropriate records. Whenever materials are needed the company bought from the vendors with out going for quotation. This resulted in delays in production. In case of large contracts the company invested a lot of capital in inventory alone.
The existing system is maintaining all the operations manually. This is time consuming causing a lot of mishaps.


The existing system has many drawbacks like maintaining record for all inventory and vendor details as well as some manpower is required for maintaining information. Also the final reports, which are going to be submitted, have to be secure and also generation of every report is a manual work and it requires a lot of manpower.

The following are the major drawbacks of the existing system.

• The data entry at various stages is a time consuming and tedious sometimes.
• Delay in preparing the reports and comparison studies.

• No scrape management facility available in the current system, which is a must in this case.
• No proper supplier and customer information, which is a must to get business on right time.
Even though some modules are automated, most of the existing system carries out all the transactional activities manually, which may result in lot of error onerous data in the records.


The proposed ERP is supposed to solve the entire drawback with the Existing System. Right from the problems faced by the company for
purchasing the material from vendors to the sale of the finished products. By implementing this the entire organization is considered as a system and all the departments are its subsystems. The information about all the aspects of the organization is stored centrally and is available to all departments. This transparency and information access ensures that the departments no longer work in isolation pursuing their own independent goals. Each subsystem knows what the others are doing, why they are doing it and what should be done to move the company towards the common goal.

The following modules are needed for the ERP

> Registration

> Login

> Company Details.

• Customer Details

• Supplier Details

> Item

> Product

> Bill Of Material

> Purchase And Planning

> Supplier Purchase Order(Purchase Order Out)

> Security

> Goods Receipt Note(GRN)

> Goods Acceptance Note(GAN)

> Rejection Return Note(RRN)

> Delivery Challan(DC)

> Enquiry /Quotation Details.

> Customer Purchase Order (Purchase Order In)

> Order acceptance

> Material request note

> Material issue note


In the package of ERP every attempt has been made to satisfy the requirements of the organization. With the necessary study of the requirements of system, the software has been developed in such a way that it provides for user-friendliness as well as an ease of use. The major advancements, which the systems offer are.
• Fast Accessing of data.

• Easy Communication Process.

• Reduced Man Power.

• Details regarding Vendor’s detail information’s are maintained.
• The reports are useful in decision making for the management.
• It is easy to modify any record and to change any particular data.
• The system makes the transaction fast and accurate.

• All the modules are integrated.

• Restricted Access to Application by role & privileges.

• Data Protection by Backup and Restore utilities.

• User defined structure for Transaction Numbers.

• Application level Security with user-id and password.


After the analysis of the requirement from the proposed system and outlining broad specification of the proposed system a feasibility study of the projected system is conducted. Since the hardware and software cost of developing and implementing a major information system can mount to a small fortune, preliminary study for the feasibility of the project is extremely important.
The feasibility study includes the investigation of the information needs of the end user and objectives, constraints, basic resource requirement and cost and benefits. Based on this the feasibility of the proposed system can be evaluated in terms of four major categories.

Organizational Feasibility

This analysis aims at determining whether the proposed system will support the organization’s strategic plans.
Economic Feasibility

The computerization of the system will certainly result in economic gains for the organization as compared to the cost incurred in the computerization system, no extra expertise need to be hired. Thus the cost incurred in the development and implementation of the proposed system would be returned within a short period of time.

Technical Feasibility

The computerized system has minimum hardware requirements. The system is to be in a single user Window’s environment and can easily operate on a high end PC with minimum of peripherals that include a
mouse and printer beside the other primary I/O devices. These hardware and software already exists with the organization.

Operational Feasibility

The management of the system intends to keep in step with the advantages of information technologies and is aware of the advantages of the new computerized system and is willing to change over to the new system.
From the data collected in the feasibility analysis it was concluded that the development of the proposed system would be very advisable and implementation of the new computerized system would be in the best interest of the organization.

Requirement specification is a software engineering tasks that bridges the gap between level software allocation and software design. Requirement analysis enables the software engineer to specify software function and performance and establish design constraints that the software must meet.

Requirement analysis allows the software engineer to refine the software allocation and build models of the process, data and behavioral domains that will be treated by the software. Requirement analysis provides the software engineer with a representation of information and function that can be translated to data, architectural and procedural designs. Finally, the requirement analysis provides the developer and the customer with the means to access the quality once the software is bui

Processor : Intel Pentium IV 1.7 GHZ Mother Board : 845glly -Intel
RAM : 256 MB Disk Drive : 1.44 MB
CD-ROM Drive : 52x Creative Drive

Hard Disk : 40 GB Monitor : 15″ LG
Keyboard : Samsung 104 keys
Mouse : Mercury

Printer : Cannon Inkjet


Operating System : Window ‘2000 Server
Front End : J2EE
Back End : MS-SQL Server
Documentation : MS Word’ 2000

Introduction to JAVA
Java Overview

Java is powerful but lean object oriented language. Java builds on the strength of C++. It has taken the best features of C++ and discarded the problematic error prone parts. To this lean core it has added garbage collection (automatic memory management), multithreading (capacity of one program to do more than one thing at a time) and security capabilities. The result is that Java is a simple, elegant, powerful and easy to use.

Java is Extensible

A big plus for Java is the fact that it can be extended. The JDBC API, the Java.sql package is one of the foundations upon which extensions are being added or worked on in area such as multimedia, conferencing and telephony.

Java is Secure

It is important that a programmer not be able to write subversions code for applications or applets. This is especially true with Internet being used more and more extensively for services such as electronic commerce and electronic distribution of software and multithreading

Java is Multithreaded

Multithreading is the ability of a program to do more, than one thing at a time. For example, an application can fax a document and at the same time print another document.

Java is Portable

With different systems connected to the internet, one need to have some means of generating portable executable code for programs to be

dynamically loaded to all the various types of platforms connected to the internet. Java’s solution to there problems is both elegant and efficient

Java Packages and Classes used
Packages package package provides system input and output through data streams, serialization and the file system. Data is retrieved from input stream and results of the program are sent to output stream.

Java. math package

Java.math package provides classes for performing arbitrary-precision integer arithmetic (BigInteger) and arbitrary-precision decimal arithmetic (BigDecimal).

Java.util package

Java.util package contains the collections framework, legacy collection classes, event model, date and time facilities, internationalization, and miscellaneous utility tokenizer, a random-number generator, and a bit array).



The Vector class implements a growable array of objects. Like an array, it contains components that can be accessed using an integer index. However, the size of a Vector can grow or shrink as needed to accommodate adding and removing items after the Vector has been created.

Each vector tries to optimize storage management by maintaining a capacity and a capacityIncrement. The capacity is always at least as large as the vector size; it is usually larger because as components are added to the vector, the vector’s storage increases in chunks the size of capacityIncrement. An application can increase the capacity of a vector before inserting a large number of components; this reduces the amount of incremental reallocation.
Linked list implementation of the List interface. It implements all optional list operations, and permits all elements (including null). In addition to implementing the List interface, the LinkedList class provides uniformly
named methods to get, remove and insert
an element at the beginning
and end of the list. These operations allow linked lists to be used as a stack, queue, or double-ended queue (deque).
All of the stack/queue/deque operations could be easily recast in terms of the standard list operations. They’re included here primarily for convenience, though they may run slightly faster than the equivalent List

The StringTokenizer class allows an application to break a string into tokens. The tokenization method is much simpler than the one used by the StreamTokenizer class. The StringTokenizer methods do not distinguish among identifiers, numbers, and quoted strings, nor do they recognize and skip comments.

The set of delimiters (the characters that separate tokens) may be specified either at creation time or on a per-token basis. Constructor used is StringTokenizer(string);
File Output Stream
A file output stream is an output stream for writing data to a File or to a FileDescriptor. What files are available or may be created depends on the host environment. Constructor used is FileOutputStream(filename);
File Input Stream

A FileInputStream obtains input bytes from a file in a file system. What files are available depends on the host environment. Constructor used is FileInputStream(filename)
5.8 SYSTEM DESIGN Design Techniques
Designing the systems involves for different aspects

• Input Design

• Output Design

• Screen Design

• File Design

• Database Design

• Architecture design

An important processing system must be functional in design, it must supply information quickly, eliminate duplication of effort and takes and must make effective user of people, technology and procedures.
The logical design of an information system shows the major features and also how they are related to one another. The reports and the outputs of the analyst are like engineers design components. In designing an output file for the system, for example the system specification includes reports and output screens, definitions describing menu and the various options available in the system.

The input design is the link between the information system and the user. It steps are necessary to put transaction data into a usable form for processing data entry. The activity of putting data into the computer for processing can be archived by inspecting the computer to read data from a written or printed document or it can occur by having people keying the data directly into the system. The design of input focuses on controlling the amount of input required, controlling errors, avoiding delay, avoiding extra steps and keeping the process simple.
The system needs the data regarding the purchase, sales, supplier and vendors for various validation, checking, calculation and report generation. The supplier and vendor details such as their code, name are selected from combo box provided by the front-end tool. This facility allows the operator to have a direct selection from the combo box and can avoid errors while entering them. The error raising method is also included in the software, which helps to raise error message while wrong
entry of input is done. So in input design the following thing are considered.

• What type of data to be given as input?

• How the data should be arranged or coded?

• Which medium to use.

• The dialogue to guide the operating personnel in providing input.

• Method for preparing input validations and steps to follow when error occur.
• Data item and transaction needing validation to detect errors.
Computer output is the most important hand direct information source to the user. Output design is a process that involves designing necessary outputs in the form of reports that should be given to the users according to the requirements. Efficient in decision-making. Since the reports are directing referred by the management for taking decisions and to draw conclusions they must be designed with almost care and the details in the reports must simple, description and clear to the user. So while designing output the following things are to be considered.

• Determine what information to present.

• Arrange the presentation of information in an acceptable format.

• Describe how to distribute the output to intended receipts.

• Desired whether to display, print,”speak”, the information and select the output medium.
• Arrange the present of information acceptable format.

Depending on the nature and future use of output required, they can be displayed on the monitor for immediate need and for obtaining the hardcopy.


Screen design begins with recognition that the screen is composed of different areas. Layout tools assist the analyst in specifying the content of the single and multiple. Design formats. All screens have been provided with menu’s pushbuttons icon’s and control buttons such as add/delete/ edit/find/clear/ exit etc. the main screen consists of main menu from which we can move o another forms or screens. In designing output screens we need area for

• Heading and titles

• The content of display

• Message and instruction

• Some times explanations for information’s in the reports.


The design of files includes decision abut the nature and content of the file itself such as whether it is to be used for storing transaction details, historical data, or reference information. Among the decision made during file designed are the following

• Which data items include in a record format within the file.

• Length of each record, based on characteristics of the data item on which it is

• The sequence or management of each record within the file.

Not all the new information system application requires the design of all files used by the application. For example, some master file may already exist because they are used in other existing application. a new application may need to reference only the existing master file. In this instance, the details of the files are included in the application design specification, but the file itself is not designed.


Database files are the key source of information into the system. it is the process of designing database files, which are the key source of information to the system the files should be properly designed and planned for collection, accumulation, editing the required information. The objectives of the files design are to provide effective auxiliary storage and to contribute to the over all efficiency of the computer program component of the system.
It is the centralized store of information. Database should provide rapid retrieval of accurate and relevant information. A database is a collection of interrelated data stored with controlled redundancy, to serve one or ore applications. The most basic piece of data that cannot be broken into more detailed unit is called data item or data element, or field. The primary activity during the data design is to select logical
representations of data objects identified during the requirements definition and specification phase.
Database design is the process of developing database structure to hold data to cater to user requirements. The final design must satisfy user needs in terms of completeness, integrity, performance and other factors.

Terms used in Database


A table is a logical structure used to group a set of relevant information. The proposed system contains several tables such as IPADMISSION.


A field is an attribute of a record. For each field there is one and only one entry.


A record is a grouping of a set if attributes describing each person, place or item in database. For example, in the IPMASTER table for each entry there is one and only one record.

Primary key

Primary key is a key that uniquely identifies a record. This is accomplished by assigning a unique id or number to each record, which is called the primary key. Records are stored based on the primary key.

Foreign key

Foreign keys are fields in common between tables.


Access to a database record is often made faster through the use of an index assigned to fields other than the primary key field.


Queries are questions asked of database. In Visual Basic, an English like language named Structured Query Language (SQL) is used to retrieve data from a database.


Normalization is an important stage of any system design. Before system is designed details about the existing computerized system and the manual system are collected. The database is designed in such a way that data are stored without unnecessary redundancy to allow the retrieval of information easily.

Normalization is a technique of separating redundant fields and breaking up a large table in tot a smaller one. All the tables have been normalized up to the third normal form. In short the rules for each of three normal forms are as below.

A relation is said to be in 1 NF if all the underlying domain of attributes contain simple indivisible values.
> In the first stage of normalization the table must have a primary key (not null and the value must be unique.)

> The table must not contain any repeating group

(duplication must strictly be avoided)


A relation is said to be in 2NF if and only if it is in 1NF and every non-key attribute is fully functionally dependent on candidate key of the table.
The 2NF are based on the concept of full functional dependency.

? The table must be in first normal form.

? All non -key attributes must be functionally dependent on the primary.

The 3 NF is based on the concept of transitive dependency. A relation in 2NF is said to be in 3NF if every non-key attribute is nontrnsitively dependent on the primary key.
The table should follow the details of first and second normal form. The table must be of first and second normal form. All non-key attributes are non-transitively dependent on the primary key (all non-key attribute must be solely dependant on the primary key).
Selecting Software and Hardware

Many times when information system is under development, the computer system, workstations, and communication apparatus on which it will run are already in place the organization. in these constants, the entire
focus of the development effort is on fitting the application to the characteristics of the computer system.

However when new computer equipment is needed, the selection and acquisition becomes an additional dimension of the new system activity. Specification for the system must be formulated, proposals from vendors received and reviewed, and selection made. The decision will focus on acquisition, operating and maintain cost, speed and capacity, and processing communication features.
Similar concerns are raised when the pre return computer software must be acquired. Selecting computer software involves evaluating the features of each package and choosing between purchasing and leasing the software.

The architecture we are using here is MVC architecture.

What is MVC?

MVC is an acronym for Model View Controller.It represents a software design pattern developed at Xerox PARC in 1978.It explains a method of separating the visual, interaction and data components.It is Very popular, used extensively in Java and other languages.
Why we use MVC?

• Makes it very easy to have multiple different displays of the same information.
• For example: a graph and a table could both display and edit the same data.

• Essentially provides greater control over the UI and it’s behaviour.

Participants & Responsibilities

The MVC architecture has its roots in Smalltalk, where it was originally applied to map the traditional input, processing, and output tasks to the graphical user interaction model. However, it is straightforward to map these concepts into the domain of multi-tier enterprise applications.

• Model – The model represents enterprise data and the business rules that govern access to and updates of this data. Often the model serves as a software approximation to a real-world process, so simple real-world modeling techniques apply when defining the model.
• View -The view renders the contents of a model. It accesses enterprise data through the model and specifies how that data should be presented. It is the view’s responsibility to maintain consistency in its presentation when the model changes. This can be achieved by using a push model, where the view registers itself with the model for change notifications, or a pull model, where the view is responsible for calling the model when it needs to retrieve the most current data.
• Controller – The controller translates interactions with the view into actions to be performed by the model. In a stand-alone GUI client, user interactions could be button clicks or menu selections, whereas in a Web application, they appear as GET and POST HTTP requests. The actions performed by the model include activating business processes or changing the state of the model.

Based on the user interactions and the outcome of the model actions, the controller responds by selecting an appropriate view.

The following diagram represents the Model-View-Controller pattern:


A DFD is a logical model of the system. The model does not depend on hardware, software and data structures of file organization. It tens to be easy for even non-technical users to understood and thus servers as an excellent communication tool. DFD can be use to suggest automatic boundaries for proposed system.
At a very high level, the entire system is shown as a single logical process clearly identifying the sources and destination of data. This is often referred to as zero level one DFD. Then the process is exploded into major process and the same is depicted as level one DFD. This way further explosion of processes into sub processes is carried it following top down approach. Its corresponding level of DFD debits each level of explosion. The lower level of DFD’s is more detailed. The DFD’s pertaining to proposed system are presented in the next session.

Implementation includes all activities that take place to convert from the old system to the new. The old system consists of manual operations, which are operated in a very different manner. The proposed system’s proper implementation is essential to provide a reliable system to meet the requirements of the organizations. An improper installation may affect the success of the computerized order processing computerized system.
Implementation Methods

There are several methods for handling the implementation and consists for changing from the old to the new computerized system. We will discuss the methods for conversion and procedures used to ensure that it is performed properly.

The most secure method for conversion from the old system to the new system is to run the old and new system in parallel. In this approach, a person may operate in the manual older processing system as well as
start operating the new computerized system. This method offers high security.

Another commonly method is a direct cut over from the existing manual system to the computerized system. The change may be with in a week or a day. There are no parallel activities.however; there is no remedy in case of a problem. This strategy requires careful planning.

A working version of the system can also be implemented in one part of the organization and the personnel will be plotting the system and changes can be made as and when required, but this method is less preferable due to the loss of entirety of the system.

The implementation plan includes a description of all the activities that must occur to implement the new system and to put it into operation. It identifies the personnel responsible for the activities and prepares a time chart for implementing the system; the implementation plan consists of the following steps.

> List all files required for implementation.

> Identify all data required to build new files during the implementation.
> List all new documents and procedures that go into the new system.

The implementation plan should anticipate possible problems and must be able to deal with them. The usual problems may be missing documents; mixed data formats between current and new files, errors in data transalation, missing data etc.


The implementation of the proposed system includes the training of system operators. Training the system operators includes not only instructions in how to use the equipment, but also in how to diagnose malfunctions and in what steps to take when they occur. So proper training should be provided to the system operations in the order processing system. No training is complete without familiarizing users with simple system maintenance activities. Since the proposed system is developed in a GUI, training will be comparatively easy than system is developed in a non-GUI. There are different types of training. We can select off-site training to give depth knowledge to system operators.

The success of the order processing system depends on the way in which it is operated and used. There fore the quality of the training given for the operating personnel affects the successful implementation of the system. The training must ensure that the personnel can hand all the possible operations.trainig must include data entry personnel. They must also be given training for the installation of new hardware, terminals, how to power the system, how to power it down, how to detect the malfunctions, how to solve problems etc. the operators must also be provided with the knowledge of trouble shooting which involves the determination of the cause of the problem.
The proposed system requires trained personnel for operating the system. The data entry jobs must be done utmost carefully in order to avoid errors. This will reduce the data entry errors considerably. It is preferable to provide the personnel with the some kind of operating manuals that will explain all the details of the sales order processing.


After the system is implemented, a review should be conducted to determine whether the system is meeting expectations and where improvements are needed. System quality, user confidence and operating systems statistics are accessed through such technique event logging, impact evaluation and attitude surveys. The review not only assesses how well the proposed system is designed and implemented, but also is a valuable source of information that can be applied to a critical evaluation of the system.

The reviews are conducted by the operating personals as well as the software developers in order to determine how well the system is working, how it has been accepted and whether adjustments are needed
.the review of the system is highly essential to determine the future enhancements required by the system. The system can be considered successful only if information system has met it objectives. The review analyses the opinion of the employees and identifies their attitudes towards the new computerized system. Only when the merits and demerits of the implemented system are known, we can determine what are all additional features it requires.


Testing is a critical aspect that is done to ensure that the software works according to the requirements or the expectations. Testing is process that is done with an intent to find error, which is yet undiscovered. The basic goal of the software development process is to produce software that has no errors soon after they are introduced. In an effort to detect errors soon after they are introduced, each phase ends with a verification activity such as review.
However most of these verification activities in the early phase of software development are based on human evaluation and cannot detect all the errors. This unreliability of the quality assurance activities in the early part of the development cycle places a high responsibility on testing. In other words, as testing is the last phase before the final software is delivered, it has the enormous responsibility of detecting any type of error that may be in the software.
All these factors mean that testing cannot be done on the fly, as is often done by programmers. It has to be carefully planned and the plan has to be properly executed. The testing process focuses on how testing should proceed for a particular project.

Unit testing is a dynamic method for verification, where the program is actually compiled and executed. It is one of the most widely used methods, and the coding phase is sometimes called the “coding and unit
testing phase”. As in other forms of testing, unit testing involves executing the code with some test cases and then evaluating the results.
The goal of unit testing is to test modules or “units” not the entire software system. Other levels of testing are used to test the system. The programmer most often does unit testing. The programmer, after finishing the coding of a module, tests it with some test data. The tested module is then delivered for system integration and further testing.
The entire project is not tested here; the module is tested with the sample inputs. The sample inputs must resemble the original data. So that the reliability of the project can be verified. Since the sample data resembles the original data, the efficiency of the project can be checked out.

Black box testing is also known as behavioral testing and this focuses on functional requirements of the software. The black box testing enables the software engineer to derive sets of input condition that will fully exercise all functional requirements for a program. Black box testing is not an alternative to white box techniques. Rather, it is a complementary approach that is likely to uncover a different class of errors than white box methods.
In this project, the sample inputs like the patients details, the test reports are given and it is tested to verify whether the coding performs well and to find the errors in their internal structures, database etc.,
This testing attempts to find errors in the following categories

? Incorrect or missing functions.

? Interface errors.

? Errors in data structures or external database access.

? Behavior or performance errors.

? Initialization and termination errors.

Black box testing concludes that the system takes input correctly as specified and gives the required output.


White box testing is the test case design method that uses the control structure of the procedural design to derive test cases. Using white box testing methods, the software engineer can derive test cases that guarantee all independent paths within a module have been exercised at least once, exercise all logical decisions on their true and false sides, exercise internal data structures to ensure their validity, exercise all loops at their boundaries and within their operational bounds. This White box testing is called as Glass box testing.
In this project, after the module is completed all the loops and the validity are verified. All logical conditions are verified for both the true and false conditions for validity.

Software validation is achieved through a series of black box tests that demonstrate conformity with requirements. A test plan outlines the
classes of tests to be conducted and a test procedure defines specific test cases that will be used to demonstrate conformity with requirements. Both the plan and procedure are designed to ensure that all functional requirements are satisfied, all behavioral characteristics are achieved, all performance requirements are attained, documentation is correct, and human-engineered and other requirements are met.

After each validation test case has been conducted, one of two possible conditions exists.

The function or performance characteristics conform to specification and are accepted.
? A deviation from specification is uncovered and a deficiency list is created.
? This validation testing is performed in the project to confirm the execution of the module and to confirm whether all the testing, the functions and the procedures are successfully executed and the accurate result is got.
Chapter 6

On the basis of the analysis of the questionnaire

The following are the major drawbacks of the existing system.

• The system should be more user friendly

• The taken for each operation by the existing system is more and so it should be reduced
• There is a need for a scrape management and a search engine in the system.
• It is necessary to produce reports and print outs, so there should be a system for that.
• No proper supplier and customer information, which is a must to get business on right time

• The logistics system can be improved by further studies

• The finance module should be implemented with more efficiency.

• The HR module can also be automated so that the recruitment process will be made more easy.

• The purchase order details are fed manually with the designed system ,It can be scanned and be given as input.

• The system should be made available for more users and other branches of the company can also use this system.

• The company should have a proper ERP team to rectify the problems on a regular basis


Most companies treat ERPs as projects, with the assumption that some day the projects will end. But an enterprise system is not a project; it’s a way of life. No organization can say “we we’re finished” and few ever will. There will always be new modules and versions to install, acquire or divested business units to deal with and better fits to be achieved between the business and the system. Even if an organization could declare final victory on implementation of ERPs, many additional years could be spend in getting real business value from them. However, an organization can only get the maximum value of these inputs, if it successfully adopts and effectively uses their system.
The hype and the mystical aura that surrounds ERP and the articles and news items in the media, have made ERP the latest buzz word. Hundreds of professionals want to join the ERP band wagon. Clearly ERP is a hotter-than-hot field right now.

Chapter 7



• Alexis Leon , “ERP Demystified” ,ninth print 2004, Tata Mac Graw hill Publishing company limited
? Shelly & Cashman , “System Analysis and Design”, Fourth Edition


Course Technology,a division of Thomson Learning.

7.2 References

• S.C.Gupta , “Fundamentals of statistics”,Third edition 2000

Himalaya Publishing House.

? Sherwin,Doudlas s,” The ethical roots of the business system”,Harvard business review,1993.

1. Are you trained on your current system?
Proficiency level 0

Proficiency level 1

Proficiency level 2

Proficiency level 3

2. Are you able to work on the software comfortably?
Highly comfortable Moderately comfortable Moderately uncomfortable Highly uncomfortable

3. Do you think you are saving your time by using your current system?
To great extend

To some extend

It is a waste of time


4. Do you have a search engine in your system?


5. Are you able to retrieve your required information?
Very difficult Difficult Easy

Very easy

6. Are you able to produce the reports according to your requirements?
Very difficult Difficult Easy
Very easy

7. Is taking printouts possible in your system?
Very difficult



Very easy

8. Is it possible for all of you all to access the system simultaneously?
Very difficult



Very easy

9. Do you have scrap management facility?


10. Are you able to categorize all your products with the current system?
Very difficult



Very easy
11. Do you think efficient planning can be done with your existing system?
To great extend

To some extend

It is a waste of time


12. Is your system user friendly?
To a great extend

To some extend

It is a waste of time

Not at all

13. Do you think that your system should be updated?


14. Do you think that a change in current technology will improve the productivity of your work?

To a great extend

To some extend

It is a waste of time

Not at all

15. How you rate your system?

Excellent Good Average Bad
7.4 Glossary

BPR – business Process Reengineering CIS – Corporate Information Systems DSS – Support Systems
EIS – Executive Information Systems ERP – Enterprise Resource Planning EWS – Enterprise Wide Systems
IIS – Integrated Information Systems
MIS – Management Information Systems
MRP – Material Resource Planning
MRP II – Manufacturing Resource Planning
MRP III – Money Resource Planning