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Understanding Lean ERP
Part 1 of 6

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Lean Manufacturing, Basics, Principles, Techniques

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People are often told that the technological components that make up modern software systems shouldn't matter and that it's what you see that counts. Contrary to that belief, it's what you don't see that can kill a project or constrain a business at a critical moment. It is increasingly important that managers, both technical and nontechnical, stay abreast of new developments in technology that directly impact the ERP mar­ket. Most important are those technologies deemed to be "enabling" in nature.

We begin our discussion of ERP "technology layers" by first defin­ing ERP itself. The APICS Dictionary defines enterprise resources plan­ning (ERP) as follows: "ERP: A complete set of functional modules designed to identify and plan the enterprise-wide resources necessary to take, make, ship, and account for customer orders or services."

The Dictionary goes on to say: "An ERP system differs from the typical MRPII system in technical requirements such as graphical user interface, use of a fourth generation language and computer-aided soft­ware engineering tools in development, client/server architecture, and open systems portability."
When you consider investing in ERP technology today, your choices go much further than a mere consideration of the high-level function­ality that you require. As the APICS definition suggests, you must also look at the user interface tools, the relational database management system, and the "openness" of the operating system. All of these ele­ments in concert make up the integrated technical environment of your ERP solution and its presentation to your users.


The APICS definition gives us a fair idea of what is deemed to be a baseline standard for state-of-the-art ERP systems. On the other hand, it stops short of truly defining the enabling technology beneath the application programs themselves. Fundamentally there are five com­ponents that provide the basis for workable enterprise systems. They are (in reverse hierarchy)

1. hardware
2. networking systems and operating systems software (OS)
3. relational database management systems (RDBMS)
4. business logic layer
5. the user interface (UI).

We define these components as "layers" because they are the nec­essary building blocks for a complete ERP system. Of course, it is not only the functionality that is required within each layer, but also the integration and communications between the layers that is important. Each layer must be considered in terms of the upward and downward compatibility with the others.

Additionally, many systems practitioners extend the concept of re­quiredintegration beyond the existing applications. They suggest that the ERP modules must be designed in such a way as to anticipate fu­ture software developments, both internal and external. This may be forward thinking, but necessary to consider the impact of future devel­opments and ability of your ERP system to incorporate and/or commu­nicate with new technologies. The advent of advanced planning and scheduling (APS) systems and the promises and challenges of inte­grating them within existing ERP systems is one example. We term such systems "E-ERP," or "extended" ERP.

Figure 1 depicts our concept of the five technology layers that form the building blocks for a robust ERP environment. During strategic planning for information systems, it is recommended that any solution (and, in fact, each layer) be measured in terms of its

• viability
• durability
• cost justification.

In the sections that follow, and using the above criteria as a base­line, we will describe each layer, discuss the strategic qualifiers that should be considered when investing in each layer, and provide sug­gestions as to how each layer can be leveraged to bring your company competitive advantage..

To Be Continued


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