1. Enterprise Systems Collaboration
EGN Enterprise Systems Collaboration Fall, 2011

2. Course Objectives
To learn how the ERP system supports business strategies.
To develop technical skills of making decisions using an enterprise software
To acquire a hands-on understanding of the concepts underlying enterprise systems operation
To appreciate first hand, the tangible benefits of enterprise integration

3. The Operations Scenario
You (your team) will operate a company in a simulated business environment to compete with several other competitors (i.e., other teams).
You (each team) will decide on business strategies and make business decisions toward maximum operation profit for your company, using an enterprise information system.

4. Corporate Roles Designation
CEO (Team Leader)
Watch financial statement
Price market report
Check summary sales report
Check sales and market data
Check inventory Report
Marketing Manager
Marketing Expense Planning
Sales Manager
Change price
MM Manager
Forecast – create planned indep. Req.
MRP run
Automatic generation of POs
Purchase Order Tracking

5. The Virtual Business Environment
Simulation of a market
Automation of administrative tasks
Simulation of the passing of time

6. Automated Business Processes
The Integrated ERP Environment
Automated Business Processes

7. The Simulated ERP Environment
Automated
Sales
Automated
Procurement
The game provides a complete overview of the full cash-to-cash cycle of a distribution company including planning, procurement and sales. The simulator will automate some of the transactions in the process, allowing you to focus on the more strategic decisions and transactions.
Automated
Planning
Watch this video clip for more information about ERPsim:
Automated

8. Three Case Studies

9. The Distribution Case Covers the following processes and operations:
Planning and Purchasing
Sales and Marketing

10. The Manufacturing Case
Covers the following processes and operations:
Planning and Purchasing
Production
Sales and Marketing
Master Data (BOM)
Advanced Options
Automatic asset depreciation posting*
Interest, Bank Loans, Credit Rating Management*
Allows for the reversal of the business cycle
*deactivated by default

11. The Manufacturing Case Extended
Covers the following processes and operations:
Planning and Purchasing
Production
Sales and Marketing
Master Data (BOM)
Advanced Options
Warehousing Costs
Production improvement
Automatic asset depreciation posting
Interest, Bank Loans, and Credit Rating Management

12. The Logistics Case The focus is set on data analysis
Covers the following processes and operations:
Planning and Purchasing
Transfers and logistics
Sales
The focus is set on data analysis
Overstock, out of stocks and wrong allocations of products can be costly to the team
Students must analyse data to understand the market and make better decisions

13. Operate a Distribution Company (Operations & Pilot Run)
EGN Enterprise Systems Collaboration Fall, 2011

14. Teams Each time should have 4 participants at most.
Each team operates a bottle distribution company.
Participants make business decisions to ensure the profitability of their operation, using standard reports.

15. The (German) Market 6 products (boxes of 12x1L and 24x500mL)
3 areas with distinct marketing accounts
One distribution channel: 14
Market size of about € 6,000 per company per step
North
45 retailers
West
40 retailers
South
38 retailers

16. The 6 Products Product Code Product Description Units in box
Cost of boxes
$$-F01
1L ClearPure
12 bottles
11.99
$$-F02
1L Spritz
14.99
$$-F03
1L Lemon Spritz
16.99
$$-F04
500mL ClearPure
24 bottles
$$-F05
500mL Spritz
19.99
$$-F06
500mL Lemon Spritz
22.99

17. The Game Layout Design
20 steps
25 min

18. Rules of the game
Each round will be of 20 steps (a bit more than 1 min per step)
End-of-round inventory is carried over to the next round
You can sell a product only if you have it in stock
You compete against the other teams and importers
Your objective is to maximize profit

19. ABC of the Enterprise system
An enterprise system is built around an integrated database
A system such as SAP contains tens of thousands of data tables
When a user creates, changes or views data in the system, he or she performs a transaction
Data changed or created by one user can be exploited by all other users (ex. reporting, tracking, execution of orders, etc.)
All transactions are traceable, transactions with financial impacts can be reversed, never erased

20. User interface
Users interact with the enterprise system through transactions.
A large number of pre-programmed transactions exist in SAP
Each transaction has a transaction code – one can call a transaction if one knows the transaction code
The SAP menu allows to browse and find the desired transaction
One can create a user menu or a list of favorites with the commonly used transactions

21. SAP Menu & Navigation Extras / Settings / Display Technical Names
Show some navigation. Begin by changing the settings to view the transaction codes. Browse the SAP menu to illustrate the depth of the system.

22. Reports and queries
Reports and queries are transactions that allow users to view existing data
A typical query is performed as follows:
In the first page of the transaction, you must enter the selection criteria for the query (ex. Company code, product code, etc.)
Then, click on to execute the query
A table containing the requested data will appear
The display and layout can sometimes be modified

23. Entering new data
Some transactions are designed to change or create new data (change forecast, release purchasing orders, change sale price, etc.)
The interface varies according to data required by the system
The system will not allow you to save information if all the compulsory fields have not been filled
You must save/release/confirm before exiting the transaction

24. Other useful buttons
Use the navigation buttons to go back or get out of a transaction
You can open up to 6 sessions. Click on to open a new session
Delete , search , select all , view , enter

25. Participant’s job aid
The job aid describes the set of transactions that must be performed by the participants.

26. Getting Started: Set up teams:
Max 4 persons: User 1 to User 4
Up to 26 companies : A to Z
Log in using user name and password given by the instructor.

27. Login information Client will be provided by the instructor
Login: intro_$ #
Where
$ = Team,
# = User 1 to User 4
Password: ERPSIM
You will have to change your password the first time you enter

28. Distribution Game: Round 1
25 min
20 steps

29. Cost, inventory & initial pricing
Material
$$-F01
$$-F02
$$-F03
$$-F04
$$-F05
$$-F06
Name
1L ClearPure
1L Spritz
1L Lemon Spritz
500mL ClearPure
500mL Spritz
500mL Lemon Spritz
Size 1L
500mL
Number of bottles in package 12 24
Cost
€11.99
€14.99
€16.99
€19.99
€22.99
Initial price
€17.99
€25.99
Initial stock
1,000

30. The Distribution Game: Quarter 1 (20 virtual steps)
Initial Financial Status:
11000 Fix Assets 250,000
70000 Common Stock (500,000)
Bank Cash Account 146,060
Finished Goods 103,940

31. The Distribution Case: Round 1 (20 steps)
You need to maintain the price of your 6 products and invest in marketing.
Need to know the following in order to make decisions:
Maintain price list
See available stock
Monitor sales orders
Monitor competitors

32. Participant’s job aid & Menu

33. Maintain Prices for DC 14

34. Marketing expenses

35. On marketing
Enter your daily marketing budget for each product and for each region
The impact of marketing in one region depends on your share of all marketing expenses in this region
Marketing induces customers to find your product “more desirable”
The daily marketing budget can be changed at any time

36. Stock in material overview

37. Check sales summary report

38. Check market report

39. Check sales order report

40. The Distribution Game: Round 1 (20 steps)
Now start the simulator for 20 steps

41. Distribution Game: Round 2
25 min
20 steps

42. It’s time to replenish !
You need to replenish. Replenishment will allow you to purchase the same quantity that you have sold.
Material
$$-F01
$$-F02
$$-F03
$$-F04
$$-F05
$$-F06
Name
1L ClearPure
1L Spritz
1L Lemon Spritz
500mL ClearPure
500mL Spritz
500mL Lemon Spritz
Initial forecast
1,000
Replenishment lead time
Up to 3 steps
Note to instructors: In Round 2, we propose that students do not change the forecast – and do it only in the 3rd and final Round.

43. Participant’s job aid & Menu

44. Execute MRP

45. After the MRP run

46. Convert purchase requisitions into purchase orders

47. Track purchase orders

48. The Distribution Game: Round 2 (20 steps)
Now start the simulator for 20 steps

49. Distribution Game: Round 3
25 min
20 steps

50. It’s time to replenish !
You need to replenish. Change your forecast to adapt the replenishment levels to your needs
What do you need to know in order to make that decision ?
Material
$$-F01
$$-F02
$$-F03
$$-F04
$$-F05
$$-F06
Name
1L ClearPure
1L Spritz
1L Lemon Spritz
500mL ClearPure
500mL Spritz
500mL Lemon Spritz
Initial forecast
1,000
Replenishment lead time
3 steps
Note to instructors: In Round 3, you introduce the concept of forecasting.

51. Participant’s job aid & Menu

52. Forecasting

53. The Distribution Game: Round 3 (20 steps)
Now start the simulator for the last 20 steps

54. Cash management You started with 146,060 in cash
You can reimburse your bank loan at anytime and save on interest payment
You can use all your cash to stock products, but …
If you run out of cash, your bank loan will be extended but you credit rating will go down and your interest payments will go up
Holding to much stock reduce your ability to response to customers’ preferences

55. Premium on credit ratings
Cre dit ra tings Risk Premium
AAA %
AA+
AA- A
BBB+
BBB
BBB-
BB+ BB
CC %

56. Check financial data
We must enter here the financial statement prior to Q4. This includes 1M in cash and 1,594,000 in inventory.

57. Analysis of Your Distribution Operation