Implementation of ERP System

ERP or the enterprise resource planning is an integrated approach for the organizations to integrate all of the business process through a single software system. It is important to identify that as all of the business process is integrated within a single software system, it also allows organizations to manage those process in an efficient method that enhances the business process. However, the most important aspect of this ERP system is that it automates the business process and therefore it is easier to manage the activities related to business and consumer management. Along with this ERP system provides various business related data that helps organizations to make decision that are effective and efficient as well. Therefore, ERP system allows organizations to make business strategies that ensures profitability and market performance as well which is important for any business.

Running head: IMPLEMENTATION OF ERP SYSTEM
IMPLEMENTATION OF ERP SYSTEM
Name of the Student
Name of the University
Author Note

1IMPLEMENTATION OF ERP SYSTEM
Table of Contents
Introduction:...............................................................................................................................2
Benefits of ERP system:.............................................................................................................3
Comparison of different ERP vendors:......................................................................................4
Analysis of alternative solution to SAP for enterprise resource planning or ERP:...................7
Why NetSuite ERP is better than SAP ERP:...........................................................................11
Cost benefit analysis for implementing SAP:..........................................................................12
Working mechanism of ERP:...................................................................................................21
References:...............................................................................................................................22

2IMPLEMENTATION OF ERP SYSTEM
Introduction:
ERP or the enterprise resource planning is an integrated approach for the organizations to
integrate all of the business process through a single software system. It is important to
identify that as all of the business process is integrated within a single software system, it also
allows organizations to manage those process in an efficient method that enhances the
business process (Elbahri et al. 2019). However, the most important aspect of this ERP
system is that it automates the business process and therefore it is easier to manage the
activities related to business and consumer management (Holsapple et al. 2019). Along with
this ERP system provides various business related data that helps organizations to make
decision that are effective and efficient as well. Therefore, ERP system allows organizations
to make business strategies that ensures profitability and market performance as well which is
important for any business.
This report has analysed benefits of ERP system in details and also compared various ERP
vendors in terms of features and benefits that these ERP systems provide. In this context, two
popular ERP vendors SAP and NetSuite are compared along with the cost benefit analysis to
recommend an alternative ERP solution from different vendor other than SAP. This analysis
not only consider disadvantages of the SAP ERP system, but also consider what advantages
are provided by the NetSuite ERP for providing a comprehensive overview regarding the
recommendation of NetSuite ERP in this context.

3IMPLEMENTATION OF ERP SYSTEM
Benefits of ERP system:
 It does not require different IT system for managing different aspect of the business
and all of the business requirements are integrated within a single software system
and therefore it is not only easier to manage but enhance this process as well (Nowak
and Kurbel 2016)
 ERP system automates most of the business requirements and therefore provide a
context to reduce operational cost which requires significant investment in any
business (Venkatraman and Fahd 2016).
 ERP system provides organizations data regarding consumers which helps
organization to design strategies that ensure enhance consumer management and
when organizations ensure that the consumer management is efficient, it ensures that
the overall business process is effective and efficient as well (Sun, Alles and
Vasarhelyi 2015)
 ERP system allows organizations to analyse market performance and preference of
consumers for any particular products. Therefore, it is easier for the organizations to
identify how the product or service will perform in the market even before it is
introduced in the market for the consumers (Lee, Wong and Hoo 2017)
Therefore, organizations are considering to invest in ERP system to automate business
process and ensure profitability along with enhanced market performance. That is why the
company should also consider in investing for implementing ERP system.

4IMPLEMENTATION OF ERP SYSTEM
ERP vendors Features
SAP ERP It provides ERP solution to manage entire
business process. It includes features such
as financials, sales, customer relationships,
and operations
NetSuite It provides extensive features required for
managing financial aspect of the business.
However, it is different from traditional
accounting software and it integrates
operations throughout the business process.
Along with this this provides real time data
regarding business process and consumer
management which enhances business
process
Infor M3 It is a comprehensive solution for
enterprise resource planning or ERP. With
this ERP solution companies are capable to
manage transaction across the organization
which include national and global
transaction. It also include manufacturing
process and supply chain process as well.
SYSPRO It is an ERP software that offers on-
premise and cloud implementation as well.
It provides organizations context to control
planning and management related to

5IMPLEMENTATION OF ERP SYSTEM
business process. Along with this, it also
offers visibility, agility, and control in
business process
PeopleSoft Enterprise It is designed according to the Pure
Internet Architecture and it offers
flexibility in configuration, and also allows
open as well integration from different
vendors which is an advantage of this ERP
solution
K8 It is a fully-integrated ERP solution. It
offers quotation management along with
sales order processing which consider
business intelligence, inventory
forecasting, and financial reporting for
providing ERP solution
Fidelio It is designed according to the Microsoft
technologies which include Quebec. It is
designed for wholesalers, distributors,
retailers and manufacturers. It offers
flexibility along with competitive
advantage for enhancing business process
Infor LN It is a cross-platform ERP solution and also
integrates effectively with other external
systems. These external system includes
the supply chain and the Web. This ERP

6IMPLEMENTATION OF ERP SYSTEM
solution integrates process such as make-
to-stock (MTS) and engineer-to-order
(ETO) and some cost reduction techniques
as well
Tropos It is an efficient ERP system that is
customized for the demand-driven
manufacturing and for the regulated
industries. although most of the ERP
systems were considered for the discrete
manufacturing, this ERP solution offers
complete manufacturing
Scoopsoft This ERP solution is developed by
Microsoft. It provides companies context to
customize the ETP solution so that it is
compatible with the new opportunities and
continued growth. Therefore, it enhances
the process of managing competitive
markets and designing new business
opportunities as well as described in this
context
Comparison of different ERP vendors:

7IMPLEMENTATION OF ERP SYSTEM
Analysis of alternative solution to SAP for enterprise resource planning or ERP:
Although, SAP is one of the most popular vendors providing ERP solutions, there are other
vendors who provide ERP solution with similar features offered by SAP. Therefore, it is
important to analysis an alternative ERP solution to identify if it is worth considering for
enterprise requirements (Surjit, Rathinamoorthy and Vardhini 2016). The ERP vendor that is
considered in this context is NetSuite, another popular ERP solution provider and it might be
chosen as an alternative to the SAP ERP. Therefore, a detailed comparison between Sap ERP
and NetSuite ERP is provided which analyses different features that are provided by the two
ERP vendors chosen in this context (Jha, Saini and Jha 2018). Not only features, a cost
benefit analysis is also provided for these ERP solutions to identify which ERP provide better
return on investment as this is an important aspect while investing in ERP solution.
Therefore, the organization will be capable of making an effective and efficient decision for
choosing an alternative vendor for ERP solution.
NetSuite vs SAP: Feature Comparison:
1. Features related to Financial Management:
SAP:
 Accounts Payable
 Accounts Receivable
 General Ledger
 Multi-Currency

8IMPLEMENTATION OF ERP SYSTEM
 Revenue Recognition (limited capabilities)
 Localization
(limited capabilities)
 Budgeting
NetSuite:
 Accounts Payable
 Accounts Receivable
 General Ledger
 Multi-currency/multi-tax,multi-language
 Fixed Assets
 Multi-Company & Consolidation
 Revenue Recognition
 Subscription Billing
 Forecasting & Budgeting
 Financial Planning (PBCS)
2. Features related to Supply Chain:
SAP:
 Order Management
 Production Management
 Inventory Management

9IMPLEMENTATION OF ERP SYSTEM
 Procurement
 Warehouse & Fulfilment
 Demand Planning
 WIP & Routing
 Work Orders & Assemblies
 Shop Floor Control & BOM Maintenance
NetSuite:
 Order Management
 Production Management
 Inventory Management
 Procurement
 Warehouse & Fulfilment
 Demand Planning
 WIP & Routing
 Work Orders & Assemblies
 Shop Floor Control & BOM Maintenance
3. Features related to Native Human Capital:
SAP:
Requires SuccessFactors
SAP:

10IMPLEMENTATION OF ERP SYSTEM
 Human Resources Management
 Payroll
 Employee Center
4. Features related to Commerce:
SAP:
Requires SAP Hybris & SAP C4/HANA
NetSuite:
 Point of Sale
 Ecommerce
 Order & Inventory Mgt
 Product Content Mgt
 Commerce Marketing Automation (Bronto)
5. Features related to automation of Professional Service:
SAP:
 Project Management
 Resource Management
 Timesheet Management
 Expense Management
NetSuite:
 Project Management

11IMPLEMENTATION OF ERP SYSTEM
 Resource Management
 Timesheet Management
 Expense Management
Why NetSuite ERP is better than SAP ERP:
It is identified from the analysis is that in terms of features that an organization might require
for automating its business process, there is not any significant differences between the SAP
ERP and NetSuite ERP (Chang and Hsu 2019). However, compared to NetSuite ERP, SAP
ERP has some disadvantages as well which include:
 One of the major drawback of SAP ERP, specially for the SMEs is that cost of
implementing SAP as ERP solution is significant and due to this SAP ERP is not
often compatible with business requirements of SMEs. Although there is a
customized version that is designed for the SMEs, but it does not offer all of the
features provided by the premium version (Jagoda and Samaranayake 2017)
 Although SAP offers various features, accessing those features is technically complex
and therefore proper training is required to ensure that the employees are capable of
accessing the system (Baig and Al Fadel 2017)
 Due to complex infrastructure requirement, it requires significant time for
implementing the system
 SAP introduces new version after every 6 months and therefore in order to make the
existing system consistent with the new features organizations are often required to
upgrade the existing ERP system and therefore, it increases cost for the organization

12IMPLEMENTATION OF ERP SYSTEM
It is not only about disadvantage of SAP ERP that the organization should chose NetSuite
ERP, it has its own benefits as well which are:
 It requires less complex infrastructure to implement NetSuite ERP and therefore, it
requires less time and also less cost for implementation of ERP system (Johansson et
al. 2015)
 It is easier to access and not technically complex and therefore, employees find it
easier to access this system (Johansson et al. 2015)
 NetSuite offers significant scalability and as the business grow it just needs to add
subscribers according to the requirements. However, it is important to note that there
is no requirement to consider to upgrade the overall infrastructure and therefore it
reduces the cost as well (Johansson et al. 2015)
 As NetSuite is implemented on cloud, it is possible to access this system from
anywhere and therefore it enhances productivity (Ram, Corkindale and Tagg 2016)
 Although implemented on cloud, it offers excellent security features and due to this
organizations are allowed to reduce spending on IT and consider that for investing in
resources for the business
 NetSuite offers excellent reliability with uptime of 99.9% which ensure that the
execution of the business process is effective and efficient as well
Cost benefit analysis for implementing SAP:
Cost-Benefit – INPUT VALUES

13IMPLEMENTATION OF ERP SYSTEM
Hardware $ 18,50,000.00
Software $ 24,20,000.00
Development team salaries $ 30,00,400.00
Training $ 12,80,000.00
Total Development Cost $ 85,50,400.00
Hardware $ 10,000.00
Software $ 1,250.00
Operational Labor $ 4,00,000.00
Total Operational Cost $ 4,11,250.00
Approximate salary savings $ 12,50,000.00
Reduced operating cost $ 27,50,000.00

14IMPLEMENTATION OF ERP SYSTEM
Total Benefit $ 40,00,000.00
Discount Rate Used 3.00%
Project
Cost-Benefit
Analysis
Analysis
Variables:
Enter values for the cost-benefit analysis
in the INPUT_VALUES worksheet.
Discount
Rate Used
3.00
%
Annual
Benefits
$40,0
0,000.
00
Annual
Operational
Costs
$
4,11,2
50.00
One-Time
Developmen
t Cost
$85,5
0,400.
00
Year of

15IMPLEMENTATION OF ERP SYSTEM
Project
0 1 2 3 4 5 TOTA
LS
Economic
Benefit
$0.00 #####
#####
##
#####
#####
##
$
40,00,
000.00
#####
#####
##
$
40,00,
000.00
Discount
Rate
1.000
0
0.970
9
0.942
6
0.9151 0.888
5
0.8626
PV of
Benefits
$0.00 $38,8
3,495.
15
$37,7
0,383.
64
$36,60
,566.6
4
$35,5
3,948.
19
$34,50
,435.1
4
NPV of all
BENEFITS
$0.00 #####
#####
##
#####
#####
##
#####
#####
###
#####
#####
##
#####
#####
###
######
######
##
One-Time
COSTS
####
####
###
Recurring
Costs
$0.00 #####
#####
##
#####
#####
##
$
(4,11,2
50.00)
$(4,1
1,250.
00)
$
(4,11,2
50.00)
Discount
Rate
1.000
0
0.970
9
0.942
6
0.9151 0.888
5
0.8626
PV of
Recurring
$0.00 #####
#####
#####
#####
$
(3,76,3
$(3,6
5,390.
$
(3,54,7

16IMPLEMENTATION OF ERP SYSTEM
Costs ## ## 52.01) 30) 47.86)
NPV of all
COSTS
####
####
###
#####
#####
##
#####
#####
##
$(97,1
3,666.
42)
#####
#####
##
#####
#####
###
######
######
##
Overall
NPV
$
78,85,0
24.17
Overall ROI
0.7557
Break-even
Analysis
Yearly NPV
Cash FLOW
####
####
###
#####
#####
##
#####
#####
##
$
32,84,
214.63
#####
#####
##
$
30,95,
687.27
Overall NPV
Cash FLOW
####
####
###
#####
#####
##
#####
#####
##
$
16,00,
779.00
#####
#####
##
$
78,85,
024.17
Cost benefit analysis for implementing NetSuite:
Cost-Benefit – INPUT VALUES
Hardware $ 16,50,000.00
Software $ 23,80,000.00
Development team salaries $ 28,00,400.00

17IMPLEMENTATION OF ERP SYSTEM
Training $ 12,50,000.00
Total Development Cost $ 80,80,400.00
Hardware $ 8,000.00
Software $ 1,040.00
Operational Labor $ 3,50,000.00
Total Operational Cost $ 3,59,040.00
Approximate salary savings $ 14,40,000.00
Reduced operating cost $ 28,50,000.00
Total Benefit $ 42,90,000.00
Discount Rate Used 3.00%

18IMPLEMENTATION OF ERP SYSTEM
Project Cost-
Benefit
Analysis
Analysis
Variables:
Enter values for the cost-benefit analysis in
the INPUT_VALUES worksheet.
Discount
Rate Used
3.00%
Annual
Benefits
$42,9
0,000.
00
Annual
Operational
Costs
$
3,59,0
40.00
One-Time
Development
Cost
$80,8
0,400.
00
Year of Project
0 1 2 3 4 5 TOTA
LS
Economic
Benefit
$0.00 #####
#####
##
#####
#####
##
$
42,90,0
00.00
#####
#####
##
$
42,90,0
00.00
Discount Rate 1.000
0
0.9709 0.9426 0.9151 0.8885 0.8626

19IMPLEMENTATION OF ERP SYSTEM
PV of
Benefits
$0.00 $41,65
,048.5
4
$40,43
,736.4
5
$39,25,
957.72
$38,11
,609.4
4
$37,00,
591.69
NPV of all
BENEFITS
$0.00 #####
#####
##
#####
#####
##
######
######
#
#####
#####
##
######
######
#
######
######
##
One-Time
COSTS
#####
#####
#
Recurring
Costs
$0.00 #####
#####
##
#####
#####
##
$
(3,59,0
40.00)
$(3,59
,040.0
0)
$
(3,59,0
40.00)
Discount Rate 1.000
0
0.9709 0.9426 0.9151 0.8885 0.8626
PV of
Recurring
Costs
$0.00 #####
#####
##
#####
#####
##
$
(3,28,5
72.46)
$(3,19
,002.3
9)
$
(3,09,7
11.06)
NPV of all
COSTS
#####
#####
#
#####
#####
##
#####
#####
##
$(90,9
5,984.6
2)
#####
#####
##
$(97,2
4,698.0
7)
$
(97,24,
698.07)
Overall NPV $
99,22,2

20IMPLEMENTATION OF ERP SYSTEM
45.76
Overall ROI
1.0203
Break-even
Analysis
Yearly NPV
Cash FLOW
#####
#####
#
#####
#####
##
#####
#####
##
$
35,97,3
85.26
#####
#####
##
$
33,90,8
80.63
Overall NPV
Cash FLOW
#####
#####
#
#####
#####
##
#####
#####
##
$
30,38,7
58.09
#####
#####
##
$
99,22,2
45.76
Working mechanism of ERP:
 It combines different business modules such as manufacturing, finance, customer
management into an single module and allows organizations to execute business
process through an integrated software (Nwankpa 2019)
 ERP system provides organizations data regarding consumers which helps
organization to design strategies
 ERP system allows organizations to analyse market performance and preference of
consumers for any particular products
Conclusion:
In terms of cost benefit analysis, it is identified that NetSuite ERP provides better return on
investment compared to the SAP ERP. Along with that, not only it provides similar features

21IMPLEMENTATION OF ERP SYSTEM
compared to SAP ERP, in some context, it offers some features that are better than the SAP
ERP. Therefore, NetSuite ERP is preferred for implementing ERP for SMEs and that is why
it is recommended to the organization for increasing their productivity and enhance the
business process.

22IMPLEMENTATION OF ERP SYSTEM
References:
Baig, J.J.A. and Al Fadel, M.A., 2017, December. Measuring reusability during requirement
engineering of an ERP implementation. In 2017 Eighth International Conference on
Intelligent Computing and Information Systems (ICICIS) (pp. 258-262). IEEE.
Chang, Y.W. and Hsu, P.Y., 2019. An empirical investigation of organizations’ switching
intention to cloud enterprise resource planning: a cost-benefit perspective. Information
Development, 35(2), pp.290-302.
Elbahri, F.M., Al-Sanjary, O.I., Ali, M.A., Naif, Z.A., Ibrahim, O.A. and Mohammed, M.N.,
2019, March. Difference Comparison of SAP, Oracle, and Microsoft Solutions Based on
Cloud ERP Systems: A Review. In 2019 IEEE 15th International Colloquium on Signal
Processing & Its Applications (CSPA) (pp. 65-70). IEEE.
Holsapple, C., Sena, M. and Wagner, W., 2019. The perceived success of ERP systems for
decision support. Information Technology and Management, 20(1), pp.1-7.
Jagoda, K. and Samaranayake, P., 2017. An integrated framework for ERP system
Implementation. International Journal of Accounting & Information Management, 25(1),
pp.91-109.
Jha, R., Saini, A.K. and Jha, A., 2018. A Comprehensive Computational Analysis of ERP
Vendor's Selection for Small and Medium Enterprises. Amity Business Review, 19(1).
Johansson, B., Alajbegovic, A., Alexopoulo, V. and Desalermos, A., 2015, January. Cloud
ERP adoption opportunities and concerns: the role of organizational size. In 2015 48th
Hawaii international conference on system sciences (pp. 4211-4219). IEEE.
Lee, M.J., Wong, W.Y. and Hoo, M.H., 2017, December. Next era of enterprise resource
planning system review on traditional on-premise ERP versus cloud-based ERP: Factors

23IMPLEMENTATION OF ERP SYSTEM
influence decision on migration to cloud-based ERP for Malaysian SMEs/SMIs. In 2017
IEEE Conference on Systems, Process and Control (ICSPC) (pp. 48-53). IEEE.
Nowak, D. and Kurbel, K., 2016, November. Understanding the Flexibility of Cloud ERP
Software. In International Conference on Enterprise Resource Planning Systems (pp. 135-
146). Springer, Cham.
Nwankpa, J.K., 2019. ERP Systems Benefit Realization and the Role of ERP-Enabled
Application Integration. In Advanced Methodologies and Technologies in Business
Operations and Management (pp. 802-815). IGI Global.
Ram, J., Corkindale, D. and Tagg, R., 2016. Empirical validation of a performance-based
innovation process model: a case of ERP. Journal of Computer Information Systems, 56(2),
pp.116-126.
Sun, T., Alles, M. and Vasarhelyi, M.A., 2015. Adopting continuous auditing: A cross-
sectional comparison between China and the United States. Managerial Auditing
Journal, 30(2), pp.176-204.
Surjit, R., Rathinamoorthy, R. and Vardhini, K.V., 2016. ERP for textiles and apparel
industry. WPI Publishing.
Venkatraman, S. and Fahd, K., 2016. Challenges and success factors of ERP systems in
Australian SMEs. Systems, 4(2), p.20.