Creativity Session

[Virtual Presenter] We are pleased to introduce our presentation on Enterprise-wide Resource Planning System Development, which outlines the objectives and goals we have established for this significant project. We will now delve into the details of how we intend to accomplish these objectives..

[Audio] The table of contents outlines the key sections of our presentation. The executive summary provides a brief overview of the entire presentation. The objectives of this ERP system development project are discussed next. This is followed by defining what ERP means and its significance. The pros and cons of in-house development versus outsourcing versus off-the-shelf solutions are then explored. The project timeline is highlighted, showing the various stages involved. The project requirements, including manpower resources, materials resources, and project costs, are outlined afterwards. The benefits of a robust ERP system are discussed, and finally, the key takeaways are summarized. Annexes with additional information are included lastly..

[Audio] The implementation of an ERP system is a strategic move to unify and streamline business processes, increase operational efficiency, and drive growth. Two options exist: developing the system in-house or outsourcing it. Both approaches have their pros and cons. Developing in-house provides customization and control, but requires significant investment in personnel and infrastructure. Outsourcing, on the other hand, leverages external expertise, reduces costs, and accelerates delivery, but may compromise control and flexibility. Three key factors must be considered when deciding on the best approach: the level of control and flexibility required, budget constraints, and the availability of internal resources..

[Audio] We aim to build a customer-centric digital company by streamlining and standardizing business processes, creating synergy across the company, and maximizing investments in key areas. We also strive to contribute cost-savings services to business units, create innovative solutions, and institute breakthrough improvements in all areas of our business operations. Furthermore, we seek to create business opportunities for ourselves and our internal customers. In addition, we focus on building customer trust in our products and services, developing competent thriving teams, and creating an improved customer experience in the digital space..

[Audio] ERP is an interconnected system that aggregates and distributes information across a company. Its primary objective is to facilitate communication between different areas of a business. By integrating various aspects such as production, finance, distribution, and human resources, ERP applications can enhance a company's self-awareness. Additionally, ERP systems provide single-source solutions that streamline processes across the organization, allowing users to interact seamlessly within a unified interface and foster cross-functional collaboration..

[Audio] The development of an enterprise-wide resource planning system can be approached in three ways: in-house development, outsourcing, and off-the-shelf solutions. Each approach has its own set of advantages and disadvantages. In-house development offers greater control over the development process, allows direct oversight, and ensures alignment with the organization's goals. However, it often requires a significant investment in hiring, training, and maintaining a skilled, dedicated team, as well as ongoing operational costs..

[Audio] The team intends to complete the ERP system within one year, divided into five distinct software development and implementation phases, each corresponding to an ERP standard module. Each phase is expected to take eight months to complete, utilizing both Waterfall and Agile methodologies..

[Audio] A typical software development team structure typically includes various roles such as a business analyst, a product owner, a project manager, a product designer, a software architect, software developers, software testing engineers, including test automation engineers, as well as a DevOps engineer. However, in this specific project, we only require three software developers who will automate our manual processes. Furthermore, the Business Systems Analyst role can be taken over by the IT Manager/ERP Champion..

[Audio] The project requirements include material resources, which comprise both hardware and software. Hardware refers to the physical and visible components of the system, such as servers, monitors, CPUs, keyboards, and mice. Software, on the other hand, refers to a set of instructions that enables the hardware to perform a specific set of tasks. The software must be installed in the hardware to function properly, and similarly, the hardware must be present for the tasks to be performed. Both hardware and software are interdependent, yet they are also distinct from one another..

[Audio] The estimated project cost for developing the standard modules of an ERP system reveals that the In-House Development approach is substantially more costly than the Outsourced Development approach. Our analysis indicates that the In-House Development approach necessitates a 17% higher initial investment cost and a 24% higher professional services cost compared to outsourcing the development process. This underscores the significance of meticulously assessing the expenses linked to each development strategy when deciding on ERP system development..

[Audio] The data shows that in-house development costs approximately 25% more in terms of operational expenses, such as professional services, over a three-year period..

[Audio] Improved efficiency and productivity can be achieved through automation of repetitive tasks, reducing manual effort, minimizing errors, and ensuring real-time access to critical information. This leads to consistency and efficiency across all aspects of the organization..

[Audio] Implementation of a robust ERP system offers several benefits to an organization. Scalability and flexibility enable businesses to adapt to changing circumstances by adding new modules or customizing existing ones, allowing them to expand operations without requiring significant changes to the system. Enhanced collaboration among departments ensures everyone works towards the same goals, promoting competitive advantage by enabling quick responses to market changes and customer demands. Strategic alignment is ensured through tracking progress towards strategic goals and executing business strategies more effectively. Compliance and risk management are also guaranteed through detailed audit trails, robust security measures, and backup and recovery solutions..

[Audio] The implementation of an ERP system is a significant investment in our organization's future. This investment enhances operational capabilities and provides a unified platform for managing business processes, positioning the Company for sustained growth, increased efficiency, and improved decision-making. We have two options to develop this system: in-house development and outsourcing. In-house development gives us greater control over the development process, allowing direct oversight and ensuring alignment with our organizational goals. However, it requires a significant investment in hiring, training, and maintaining a skilled team, as well as ongoing operational costs. On the other hand, outsourcing offers access to specialized expertise, cost savings, scalability, and expedited project delivery. By leveraging external vendors, we can focus on our core business competencies while reducing the burden on internal resources. Although outsourcing has its benefits, it also comes with communication barriers, company culture differences, and the risk of quality issues..

[Audio] In-house development may be the preferred option for MSCPI because of its core competency, specific business needs, and long-term strategy and commitment. This choice takes into account that the company is still documenting and finalizing its core business processes for the ERP. Additionally, there may be a need for developing other business systems, such as HRIS, WMS, Asset Management, RMS, etc., which would require integration and incorporation into the ERP..

End of Presentation.

Annexes.

[Audio] The cost of developing our ERP system in-house over one year would be substantial. With our own resources, we would need to invest in personnel, infrastructure, and equipment. This would result in a significant expense, with estimated costs exceeding seventeen percent higher than those for outsourced development..

[Audio] The year-on-year cost for developing ERP systems in-house over a three-year horizon is estimated to be approximately twelve million dollars. This figure takes into account the costs associated with hiring and training personnel, acquiring necessary infrastructure, and maintaining the system over time..

[Audio] The cost of outsourcing developed systems over one year is estimated to be approximately $X. This figure takes into account all expenses related to maintaining and supporting these systems, including personnel costs, infrastructure requirements, and any necessary upgrades or modifications. By outsourcing these systems, we can reduce our internal resources dedicated to their maintenance and support, allowing us to focus on other critical business areas..

[Audio] The year-on-year cost of outsourcing developed systems over a three-year horizon is projected to remain stable, with no significant increase expected during this period. This means that our organization can expect consistent expenses for the next three years if we choose to outsource the development of these systems..

[Audio] The estimated cost of implementing off-the-shelf systems for one year is two million dollars, which covers all expenses related to system development, testing, and deployment..

[Audio] The year-on-year cost over a three-year horizon for an off-the-shelf system is critical information that organizations must consider when implementing an ERP system. While ERP systems can improve efficiency and streamline processes, they also come with a significant cost. It is essential for organizations to carefully consider the long-term cost implications of an ERP system before investing. The cost increases each year, with the largest jump occurring in the first year due to implementation and training costs. Ongoing maintenance and upgrade costs, as well as potential additional fees or charges, should also be considered. Proper budgeting and financial planning are crucial when implementing an ERP system, and this information serves as a reminder to carefully weigh the cost before making any decisions. The cost varies depending on the size and complexity of the organization, as well as the specific features and modules of the ERP system chosen..

[Audio] The ERP system can be extended with various add-on systems and modules, including Material Resource Planning, Customer Relations Management, Human Resource Information System, Warehouse Management System, Asset Management and Work Order System, Records Management System, and Electronic Forms. These additional tools can help the company streamline its operations and improve efficiency..