Enterprise Resource Planning (ERP)

In the previous blog post, we discussed Customer Relationship Management (CRM). In this blog post, let us look at some of the fundamental aspects of Enterprise Resource Planning (ERP). In general, CRM system can be considered as a sub-set of the features of an Enterprise Resource Planning system.

ERP is an industry standard acronym for Enterprise Resource Planning. ERP is an Information Technology (IT) supported system, used to integrate the data and processes of an organization in a seamless fashion. In the earlier days of ERP, the term ERP was used to refer to the way large organizations planned to use their organizational wide resources. Today, ERP systems are used in all types of organizations, from small to medium sized and large organizations.

In the earlier days of computerization, core functions of an organization, like Customer Relations Management, Human Resources, Supply Chain Management, and Financials were all supported by stand-alone IT systems. This often resulted in duplication of data and the need for complicated data transfer protocols between systems. In such systems, any data mismatch during transfer can result in problems. From a database management and administration perspective also, it is often recommended to avoid duplication of data.

Current ERP systems are capable of covering a wide range of functions and integrating them into a single, unified database. A single, unified database removes the difficulties associated with transferring data between independent systems and duplication of data as discussed above. Enterprise Resource Planning systems can help in the management of many business activities, like sales, marketing, delivery, billing, production, inventory management, quality management, and human resource management, through a single system. ERP systems are sometimes referred to as ‘cross functional enterprise wide systems’ since all functional departments in an organization are managed through a single system.

The most important advantage of ERP system is often cited as the system’s ability to bring down operating costs and saving valuable time that would otherwise be wasted in manual procedures and unwanted delays. An ERP system also ensures faster processing of information, reduces the burden of documentation and associated manual workflows, avoids repeated data entry, and reduces cycle time. Another major advantage is efficient Customer Relationship Management. Customer queries and complaints can be tracked to closure very efficiently resulting in high levels of customer satisfaction – a key parameter in evaluating the performance of any organization. [In the previous post of this blog, we had a closer look at Customer Relationship Management systems]

ERP systems ensure that access to sensitive data of the organization is controlled in role-based manner. Thus, data is made available only on a ‘need-to-know’ basis, thereby plugging chances of leaking sensitive data.

ERP systems eases project management, enables better tracking of work in progress, enables quick creation of status reports and reduces process cycle time. ERP systems also act as ‘Decision Support Systems’ ensuring that decision can be made on the basis of up-to-date information. Besides, ERP systems have also resulted in better vendor and supply chain management. Automated work flows in ERP systems allow organizations to track and identify bottlenecks in process flows and make improvements.

Even though the merits of ERP systems often out weighs the demerits, the system and its adoption by organizations is not without disadvantages. The adoption of ERP by an organization is often referred to as ‘implementing ERP’ since ERP systems usually require customization based on the needs of the organization. 

First, an ERP implementation calls for a large investment in time and money. Next, the success of an ERP implementation depends on how well the employees of an organization understand the system and uses it regularly in their day-to-day business activities. This calls for heavy investments in training of employees. Besides the cost of training, employees engaged in training will often mean that regular business activities are sidelined, resulting in loss of revenue and business opportunities. These advantages imply that an organization needs to carefully plan and compare disadvantages against advantages before deciding to implement an ERP system.    

The implementation of an ERP system does not guarantee solutions to all the problems that an organization is facing. In fact, if the implementation is not carefully planned and the cutover from existing systems to ERP is not orchestrated in a fine manner, ERP implementations can result in more trouble. Still, a well-planned ERP implementation coupled with proper employee training and orientation will definitely enable an organization to compete globally in ever changing business scenarios. To sum it up, such a carefully planned ERP system is often considered as the perfect commercial embodiment of the verse: “Think Global. Act Local.”

This brings us to the end of this blog post on Enterprise Resource Planning (ERP). Thank you for your interest. 

Customer Relationship Management (CRM)

"The purpose of business is to create and keep a customer." --Peter Drucker

Customer Relationship Management (CRM) enables businesses to do exactly that – to create and keep a customer. Customer Relationship Management Systems are technology assisted systems, which enables enterprises to create and retain customers.

In this blog post, we will have a look at some of the basic concepts of Customer Relationship Management.  

There are several definitions for Customer Relationship Management but the most common one seems to be: CRM System involves the alignment of people, processes and technologies that help an enterprise manage customer relationships in an organized way. The aim of CRM is to build a stronger relationship with customers, which will lead to build both customer loyalty and increased profits.

Customer Relationship Management helps an organization to:

a) assist its marketing department in identifying their best customers for repeat business, manage marketing campaigns, and generate leads, which have a high chance of conversion into sales, for the sales team.
b) improve telesales, account management, and sales management by optimizing information shared by multiple employees
c) develop personalized relationships with customers, with the aim of improving customer satisfaction and maximizing profits; to identify the most profitable customers and provide them the highest level of service.
d) equip employees with the information and processes necessary to know their customers, understand and identify customer needs and effectively build relationships between the company, its customer base, distribution partners, and vendors.

The marketing department plans and runs marketing campaigns, which are programs and activities by which companies advertise products and services to potential customers. Different types of marketing campaigns include:

(i) Awareness Campaigns – used to increase awareness of a brand
(ii) Brand Campaigns – generally used by new companies to connect brand with services and offerings
(iii) Lead Generation Campaigns – used to collect contact information for use in direct marketing
(iv) Customer Loyalty Campaigns – used to recognize and reward regular customers

The leads generated by marketing campaigns is shared within the sales and marketing team. These leads will be contacted separately and depending on the response of the contact, the leads will be classified based on their probability of becoming a potential customer or prospect customer.

Once the lead gets elevated to the status of a potential customer or prospect customer [based on criteria set by the organization], the sales team aggressively keeps in touch with the contact until the potential customer is won (potential customer becomes a customer) or lost(potential customer decided not to go with the offering). The sales team is also responsible for providing details of the products/services offered by the organization. They also manage quotes/estimates and related negotiations. Other terms and conditions of the deal are also tracked and managed by the sales team. All information pertaining to activities carried out in relation to a lead/potential customer like e-mails, telephone calls and meetings and tracked by the sales team. Appropriate follow-up actions are also carried out and monitored by the sales team. If the potential customer or prospect customer is lost the circumstances are noted and will be analyzed later to avoid repeating such losses.

Once a potential customer agrees to buy a product/service from the company, the potential customer gets elevated to the status of ‘customer’ or ‘client’. In some organizations, the first time customers are referred to as ‘customer’ and from the second time, the customers are referred to as ‘client’.

Developing personalized relationship with customers is a key focus area for any CRM system. For this, every customer is assigned to a team member within the organization who is primarily responsible for maintaining the customer relationship in a cordial fashion. This involves major tasks like keeping track of resolution of customer complaints to relatively minor tasks like sending wishes/gifts to the customer on his/her birthday, wedding anniversary and during other events which have a personal significance for the customer. Such notes from the organization, though relatively minor from a CRM perspective, can often have profound impact on the customer in terms of ‘feel good’ factor.

Keeping a customer satisfied is not only good for repeat business from the same customer, but also in terms of ‘word of mouth’ publicity. Customer Relationship Management enables organizations to understand their customers better, identify customer needs, and build effective relationships between the organization, customers, vendors, and distribution partners. In order to derive full benefits from Customer Relationship Management Systems, they need to be tuned to specific needs of the industry. Studies have shown that careful implementation of CRM System and their diligent use has resulted in increase of sales volumes of up to and even more than 30%. ["On average, sales and marketing costs average from 15% - 35% of total corporate costs. So the effort to automate for more sales efficiency is absolutely essential. In cases reviewed, sales increases due to advanced CRM technology have ranged from 10% to more than 30%." --Harvard Business Review]

There are quite a few CRM Systems in use across different industry verticals. Open source CRM Systems are also becoming popular. We will not go into the details here as it is beyond the scope of this blog post.

Let us conclude this blog post with another quote by Peter Drucker: 

“We've spent the last 30 years focusing on the ‘T’ in IT[Information Technology], and we'll spend the next 30 years focusing on the ‘I’. ”  

And CRM is all about focusing on the ‘I’ – Information. 

~ Sunish

An Introduction to e-learning

"Online learning will rapidly become one of the most cost-effective ways to educate the world's expanding workforce."
--Jack Messman

Online learning, also known as e-learning, is fast becoming a preferred training mode in industry and academia alike. In this blog post, we will look at some of the basic concepts, advantages of e-learning, and explore the use of technology in e-learning.

Online learning can be asynchronous. Being asynchronous means that learners determine when and how to access online learning content. This is in contrast with the synchronous model of training where learners generally move through content in a pre-determined sequence.

Another characteristic of online learning is that it is available ‘on demand’ and ‘just in time’. Online learning content is often customized and personalized as per preferences of the learner. The ‘just in time’ delivery model allows the content to be continuously updated resulting in content relevant to the context.

Online learning is learner controlled. This implies that the learner has the option to pause and play content at the learner’s pace. This also allows the learner to reflect on content learned before moving on to later modules.

The content used for online learning is designed to be re-usable. ‘re-usable’ in this context means that basic units of content can be re-assembled to generate different types of content, suited to different needs of the intended audience.

Online learning is also designed to be platform independent. Content can be transformed into a variety of formats like XML, HMTL, PDF, e-book, etc., resulting on the same content being easily available across different platforms.

Online learning also allows learners across the globe to collaborate in real time resulting in a highly interactive learning experience. Online learning when used for distance education enables trainers to interact with a large number of trainees at multiple locations in real-time, resulting in cost-effective training programs.

Moving on to technologies used in e-learning, the online learning industry initially tried to replicate the class room experience online. Later, the industry was guided by the fact that technology is only the delivery mechanism and the industry has focused on the best method of online content delivery that is most comfortable to learners.

The earliest of the e-learning courses were computer based training and web based training. In computer based training, learning content on CD-ROM or other media was distributed to students and the in the case of web based training, content was delivered over the Internet. In both cases, the course was meant to be taken by trainees as an asynchronous, self-paced course. Web based training allows content to be easily updated and if the trainer and trainee are online at the same time, this mode allows interaction. The disadvantages of web based training include requirement of Internet connectivity and if the connectivity rates are high, it can be an expensive option in the case of large multimedia files.

Most of the computer based trainings and web based trainings are structured in a linear fashion where the trainee is expected to follow a single path through the course content. Some courses allow the learner to navigate based on needs or interests. There are also sophisticated courses, in which the path is customized as per trainee need and the progress the trainee makes in the initial stages of the course.

The technologies used for delivering asynchronous e-learning include e-mails and discussion forums. E-mails provide a faster means of traditional correspondence course. E-mails also act as a support medium in the case of learning management systems that allow uploading and sharing of content. Discussion forums provide a mechanism for discussion on specific course topics as well as informal exchanges related to course delivery. ‘Threading’ is a feature, which allows discussions to be grouped together, making it simpler to find related postings and responses. Threaded discussions are often also collapsible and expandable to allow students to manage the number of posts shown on the screen at a time and to facilitate browsing groups of posts.

Audio conferencing (using telephone or VoIP [Voice over Internet Protocol]), electronic white boards, instant messaging, text chat, video communication, and web casting are some of the technologies that support delivering synchronous e-learning courses.

Audio conferencing allows a group to interact in real time by sharing voice accompanied by slides or text. Audio quality is often a bottle neck while using this mode of delivery since poor audio quality will lead to a poor classroom experience for the trainees. The length of audio conferencing sessions, similar to traditional classroom lectures, need to be restricted to 1-2 hours. The rest of the technologies we are going to discuss below are used together with audio conferencing to enhance the classroom experience for synchronous e-learning courses.

An electronic white board typically consists of an electronic version the dry-erase boards found in conventional lecture rooms. They are used for free hand writing and drawing, and range from simple graphical editors to sophisticated versions incorporating slide show and other applications.

Instant messaging and text chat allows short and frequent messaging between participants of a synchronous e-learning program. Instant messaging typically involves pairs of individuals whereas in text chat a group of individuals is involved. Instant Messaging and chat tools vary in complexity from simple messaging to complex ones with built-in file sharing and private messaging.

Videoconferencing extends the capability of audio conferencing by the addition of video. Videoconferencing enables instructors to either stream video or enable videoconferencing, between instructors and students, between students, or between multiple classrooms. As in the case of audio, video quality has to be maintained for this mode of delivery to be successful. Streaming video is becoming more widely adopted and is often replayed rather than live.
 
Web casting involves combining one or more the technologies that we discussed above to delivery synchronous learning experience to students.

Before we conclude this blog post on e-learning, let us look at a learning related quote in the context of organizations.

"An organization's ability to learn and translate that learning into action is the ultimate competitive advantage."
--Jack Welch

And e-learning will help organizations learn what they need to know, when they need to know. 

~ Sunish