Group D

a. Explain how processes are inherent in application software. Are processes inherent only in Erp software, such as SAP or are they inherent in other products as well? Does Microsoft Word, for example have inherent processes? What characteristics and classifications of inherent processes does the comparison of SAP and Word suggest? When an organization acquires a business application from a big company like Oracle or SAP, the processes for using the software are built-in, inherent processes. Processes are inherited not only in Erp software, but in other software's as well, Microsoft word for example has inherent process of making the same application for every computer around the world.

b. Summarize the advantages and disadvantages of inherent process. Advantages - They make the software easier to use, processes are effective, efficient, and they have been proven to be successful. Disadvantages - Discourages innovation and competitive advantage.

c. The content of the Innovation in Practice box on page 273 is that ERP applications are becoming commodities. Define commodity and explain how the term pertains to ERP systems and processes. How does a vendor gain a competitive advantage when producing a commodity? Specifically how could Oracle, for example, gain a competitive advantage over SAP? A commodity is some good for which there is demand, but which is supplied without qualitative differentiation across a market. It is a product that is the same no matter who produces it. Applications become commodities because every business has to have it, and all of the businesses have the same application, because it is too expensive to make specific changes for every business in ETP systems. It is a very big advantage for a vendor to produce a commodity, because he can stock a big amount of product, if it is not unique. Vendor has the biggest advantage in the game; he already knows what customer needs. Oracle can hire more employees for cheaper labor, and teach them how to do one thing, rather than paying thousands of dollars on qualified specialists. Therefore Oracle can produce and deliver cheaper ERP software.goodqualitativedifferentiationmarket

d. Suppose that two companies using the same ERP systems have the exact same business processes. Does it necessarily follow that neither company can gain a competitive advantage over the other? Is there some way that one company can gain an advantage by better executing the identical process? How? Is such a competitive advantage sustainable? Would you rather have a competitive advantage by having better processes or a competitive advantage by having the same processes, but executing them better? Explain your reasoning. Every company has advantages in one way or another. Every company tries to go an extra mile for a customer in order to be more successful. Even though some companies have the same ERP software, there are different people using the software, which means different character, which means different approach. There are ways that one company can gain advantage by better executing the identical process by being more polite to the customer, or being more professional, or being more positive and so on… Is such competitive advantage sustainable? Sure! As long as company satisfies the customer! We would rather have a competitive advantage by having a competitive advantage by having the same process, but executing them better. No matter how sophisticated your ERP software is it all comes down to providing better service, and by executing process better your outcome becomes better.

e. Suppose that an ERP system maintains customer order data in the following three tables: CUSTOMER(custNum, name, Industry code, annual sales) ORDER (order number, order date, sales Person, name, amount, custName) PAYMENT (order number, payment date, payment amount) 1)Explain the relationships that are defined for these three tables. 2) Suppose that a company extracts this data from its ERP system and uses it to inform sales activities. What information could be obtained from this data? 3) How can the information obtained from this data provide a competitive advantage? (1) Order. OrderNumber and Payment. OrderNumber Customer. CustNumber and Order. CustNumber (2) The names of all customers and how much money they spent, who each customer’s salesperson is, when the customer placed orders, when they paid their bill, how much they paid, and how many payments they made. (3) It can be used to identify when a customer typically places an order so a salesperson can be proactive and reach out to them. It can be used to determine if a high volume customer should be given a discount to increase loyalty, and it can be used to identify what industry existing customers are in so the company can target other customers in that industry.

f. What does your answer to part e. suggest about a way that one company can gain a competitive advantage over another, even though both are using the same ERP system and processes? It suggests that even if both companies use the same ERP system and processes, their businesses will not be identical and it is still possible to gain a competitive advantage by using the ERP system in creative ways. (See e.3)