1. EGN 5621 Enterprise Systems Collaboration Summer B, 2013
Case Study I
EGN Enterprise Systems Collaboration Summer B, 2013

2. Operate a Distribution Company (Operations & Trial Run)
EGN Enterprise Systems Collaboration Summer B, 2013

3. Teams Each time should have 3-6 participants.
Each team operates a bottle distribution company.
Participants make business decisions to ensure the profitability of their operation, using standard reports.

4. The (German) Market 6 products (boxes of 12x1L and 24x500mL)
3 areas with distinct marketing accounts
One distribution channel: 18
Market size of about € 6,000 per company per step
North
45 retailers
West
40 retailers
South
38 retailers

5. The 6 Products Product Code Product Description Units in box
Cost of boxes
$$-B01
1L ClearPure
12 bottles
11.99
$$-B02
1L Spritz
14.99
$$-B03
1L Lemon Spritz
16.99
$$-B04
500mL ClearPure
24 bottles
$$-B05
500mL Spritz
19.99
$$-B06
500mL Lemon Spritz
22.99

6. The Game Layout Design
20 steps
25 min

7. 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

8. 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 in the same team (ex. reporting, tracking, execution of orders, etc.)
All transactions are traceable, transactions with financial impacts can be reversed, never erased

9. 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

10. 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.

11. 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

12. 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

13. 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

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

15. SAP ERPsim Server, and Client for Distribution
Server: merida
Client: 205
Application Server:
merida.cob.csuchico.edu
System ID: MER
System #: 38

16. SAP ERPsim Server, and Client for Distribution

17. Getting Started: Set up teams: Userid: $# Password: ERPSIM Where
Companies : A to D
3- 6 persons in a team
Userid: $#
Where
$ = Assigned team letter,
# = User 1 to User 6
Password: ERPSIM

18. Login information Client will be provided by the instructor Login: $#
Where
$ = Team,
# = User 1 to User 6
Password: ERPSIM
You will have to change your password the first time you enter

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

20. Distribution Game: Round 1
25 min
20 steps

21. Check initial inventory

22. Check Financial Statement

23. Check Financial Statement
Click the green check to by-pass any questions

24. Check Initial Financial Statement
Click the green check to by-pass any questions

25. 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

26. Cost, inventory & initial pricing
Material
$$-B01
$$-B02
$$-B03
$$-B04
$$-B05
$$-B06
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

27. 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

28. Participant’s job aid & Menu

29. Maintain Prices for DC 18

30. Marketing expenses

31. 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

32. Stock in material overview

33. Check sales summary report

34. Check market report

35. Check sales order report

36. Distribution Game: Round 2
25 min
20 steps

37. It’s time to replenish !
You need to replenish. Replenishment will allow you to purchase the same quantity that you have sold.
Material
$$-B01
$$-B02
$$-B03
$$-B04
$$-B05
$$-B06
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.

38. Participant’s job aid & Menu

39. Create Planned Ind. Requirements

40. Create Planned Ind. Requirements

41. Execute MRP

42. After the MRP run

43. Convert purchase requisitions into purchase orders

44. Track purchase orders

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

46. Distribution Game: Round 3
25 min
20 steps

47. 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
$$-B01
$$-B02
$$-B03
$$-B04
$$-B05
$$-B06
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.

48. Participant’s job aid & Menu

49. Forecasting

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

51. 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

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

53. Check financial data

54. Analysis of Your Distribution Operation