ERP System Analysis and Selection for GAP Russia's Operations

This report provides an analysis of Enterprise Resource Planning (ERP) systems, specifically focusing on the selection of the best ERP system for GAP Russia, a retail company operating in Russia. The report begins with an introduction to the importance of ERP systems in modern business, emphasizing their role in streamlining data flow and improving operational efficiency. It then outlines the management priorities that necessitate the implementation of an ERP system, including reporting and planning, efficiency, data security, supply chain management, and enhanced collaboration. The core of the report compares three ERP systems: SAP, 1C, and Microsoft Dynamics, evaluating their financial, technical, organizational, legal, economic, and personnel factors. The analysis considers the specific needs of GAP Russia, which include a system suitable for medium to large organizations with over 100 users and local support. Based on this evaluation, the report recommends 1C as the most suitable ERP system for GAP Russia. The report also addresses socio-economic issues that influence the selection and implementation of an ERP system, such as education and training, culture, and user competency. The conclusion reaffirms the benefits of implementing an ERP system and highlights the advantages of 1C for GAP Russia, including improved data flow, reduced human error, and enhanced productivity.

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ERP System
Name
Course
Date

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Introduction
The world, just like business, is developing at a high speed. Prospering and famous organizations are taking
measures to invade the market. Each geographic area has got its own resources and rules. People’s mentality, laws
and restrictions, politics, national traditions, and currency instability are some of the many hazards that
organizations are supposed to deal with. Ensuring that there is a stable information flow is important for the daily
operations for every part of the entire organizational mechanism. The organization should be able to securely
transact data, as well as ensure that the data is understandable and workable with for every department. The best
solution to such a need is having Enterprise Resource Planning. The system provides the capability of creating
strong and multi-dimensional networks that facilitate the staff to have equal ground and the same reporting system
within a specific franchise area. The diversity associated with ERP vendors regarding the different abilities, price
range, features, as well as IT supportability can be confusing and tricky. The report analysis and selects the best ERP
system to manage documentation flow and logistics operations of GAP Russia, -a retail company in Russia- by
covering some of the mentioned issues.
Management Priorities
Organizations that fail to implement an ERP system in their operations find it difficult to engage in proper
planning in the maintenance and production of materials. Implementing an ERP in organizational processes proves
to benefit the company by optimizing successful organizational operations that boost growth as well as enhance
efficiency.1 There are several management priorities resulting in organizational priorities which should be addressed
by the specific ERP.
Reporting and planning: The system ensures that the company has got a single reporting system. Having a
single source of information makes it easy for the ERP system to generate reports any time they are needed.2 The
software provides management with the opportunity of analyzing and comparing functions across all organizational
departments.
Efficiency: Including reduced IT as well as training costs, the software reduces the time and the effort
needed by the staff to conduct their operations. An ERP system that is properly implemented can be advantageous in
reducing or eliminating repetitive manual tasks. Likewise, the ERP can assist in the adoption and the
implementation of the best industry practices through alignment of all actions in the enterprise.
Data security and quality: Collaboration within a firm is enhanced through sharing information across
operational silos that include sales, business development, customer service, and marketing. However, widespread
information access requires managing the people that can see and alter the information. An ERP system has got an
intrinsic control that ensures it monitors to make sure that an organization’s data is secure. The simple input system
makes it possible for ERP to maintain high levels of data security.
Enhanced supply chain management: There are several ways through which an ERP system improves
supply chain management, particularly for firms that constantly deal with the movement of physical inventory as
well as production.3 Implementing the ERP system reduces the lead times, enhances on-time deliveries including
other benefits that improve the success of an organization’s overall business.4 Effectively designing the ERP
platform improves the supply chain, making it more responsive as a result of improved inventory management,
demand forecasting along with procurement.
Enhanced collaboration and workflows: A successful business requires collaboration between all
departments and among the staff. An ERP system streamlines collaboration by providing the staff with access to
information that they require and when they need it.5 The
1Huseyin et al., Selecting “The Best” ERP system, 2347.
2 Karande and Chakraborty, A Fuzzy-MOORA approach for ERP system selection, 16.
3 Huseyin et al., The impact of ERP systems and supply chain management, 1128.
4 Huseyin et al., Development of a hybrid methodology for ERP, 86.
5 Tuncay et al., A hybrid MCDM methodology for ERP, 209.

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ERP Systems
GAP Russia is a constantly growing organization, united with Marks & Spencer franchise. The company
has got an imposing network, and consequently, selecting the ERP system will be based on the systems that are
oriented on medium-sized as well as big organizations that have got more than 100 users. In addition, the vendor
should have support centers particularly in cities where the company’s offices are located, including a basic package
for the retail industry and which has got an implementation positive feedback.6 The companies that match these
descriptions are SAP, 1C, and Microsoft Dynamics.
SAP
The organization is the leading provider of business applications globally. The company’s main packages
for business automation are SAP Business One, - a business enclosure package applicable to small and medium-
sized firms with 100 staff.7 The other is SAP Business All-in-One that is applicable to large firms with up to 2,500
staff such as GAP Russia. The following are SAP’s advantages and disadvantages.
a. Financial Factor: Traditionally, this ERP package is the most expensive with prices per user annually are
approximately 1,860€ and has got low ROI due to the long time and costs required to implement it.
b. Technical Factor: The package is compatible with the most popular OS such as Windows. However, it
requires a large memory capacity and cannot be maintained by the internal IT department alone.
c. Organizational Factor: The package is usable and well composed. It is a special package to solve retail
problems but it allows minimal changes to be made and it is not flexible.
d. Law Factor: The package has been authorized for passing Russia’s tax inspection but it is not
recommended.
e. Economical Factor: SAP reduces the lead time but it does not do this immediately due to the time, -
approximately one year- required to install the system.
f. Personal Factor: SAP is hard to navigate and human errors are common.
Microsoft Dynamics
Microsoft Business Solutions has promoted its ERP packages across Russia, making it effectively capture a
significant share of the market. Microsoft provides two ERPs; Microsoft Dynamics AX applicable to small and
medium-sized firms and Microsoft Dynamics NAV for large organizations and it suits GAP Russia.8 Pros and cons
associated with Microsoft Dynamics include:
a. Financial Factor: Compared to other ERP systems, Microsoft dynamics provides the best ROI and its price
is approximate 1,248€.
b. Technical Factor: Since the system relates to Microsoft, it has incredible compatibility with Windows.
Internal IT specialists are able to deal with system issues by themselves.
c. Organizational Factor: The retail package answers nicely to basic needs. Microsoft dynamics considers the
constant adjustments in the business processes of an organization. The system’s flexible architecture makes
it possible to adjust business processes to align with new market needs cost-effectively and in a timely
manner.
d. Law Factor: The ERP is localized, meets Russia’s legislation requirements, certified by Russia’s Ministry
of Finance, and recommended by the Institute of Professional Accountants.
e. Economic Factor: It has a short order lead time.
f. Personnel Factor: Human errors are uncommon and users of the standard Office require little practice and
training.
1C
6 Garg and Garg, Factors influencing ERP implementation in retail sector, 426.
7 Putu et al., Business Process Requirements, 2438.
8 Haddara, ERP selection: the SMART way, 398.

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1C specializes in the development, publishing, distribution, as well as offer computer software support for
organizations and home use. The most common system developed by 1C is the 1C Enterprise and is widespread in
Russia, and has been adopted by several companies internationally.9 The pros and cons of this package are as
discussed.
a. Financial Factor: Of the three systems, this is the least expensive costing approximately 576€ per user
annually. Support is available across the entire Russian Federation and the costs are also low.
b. Technical Factor: The package is compatible with several operating systems such as Windows and Linux
and it does not need a large memory capacity.
c. Organizational Factor: Since it has existed for long in the Russian market, it has tailored its package to fit
almost all users including retail. The system is flexible to implement most changes.
d. Law Factor: 1C meets all Russian legislation requirements and is highly recommended.
e. Economical Factor: The ERP’s order lead time is short and the time reduction across all departments can be
noticed.
f. Personnel Factor: The ERP is quite intuitive because it uses Russian as the native language. However, ERP
requires training as well as practice for easy manipulation. 1C notices strange inputs, thus it is uncommon
to make an error.
Selecting the ERP
Weighing the factors discussed above and which indicate the pros and cons of each of the alternatives, the
best ERP system for GAP Russia can be identified. The organizational factors respond to the primary requirement of
this report which is to make the organization more manageable as well as create new and improved documentation
flow thus minimizing time loss.10 Economic factor comes second because the organizations aim at increasing their
profits. The financial score that determines the cost of acquiring and maintaining the ERP.11 Considering all the
factors under each ERP and rating them according to their importance, 1C and Microsoft have small differences.
However, 1C is the best system that GAP Russia can adapt because it is a highly recommended ERP in Russia and
most staff already have an experience using it.
Socio-Economic Issues
Implementing an ERP system in an organization is constructed, designed, modified, and shaped by the
assumptions, values, as well as interests of the developers, users, investors, including the involved actors. The theory
of social shaping of technology explains the impacts of social, cultural, as well as organizational factors when
selecting and implementing technology such as the ERP.12 An information system is a social system and its use and
acceptance are dependent on how humans interpret the technology. The assimilation and performance of an ERP are
only attainable if the socio-economical and technical subsystems are linked and treated as a work system’s
independent aspects.13 The social systems that affect the selection of an ERP in Russia, for instance, comprise of the
staff’s skills, values, knowledge, culture, attitude, along with the authority structures that exist in the organization.
Some of these socio-economic factors include:
Education and Training: The factor contributes the most quantifiable benefit in the implementation of an
ERP.14 Education exposure is necessary to ensure employees understand the system, increase satisfaction, and buy-
in.
Culture: Culture identifies an area of strong consensus where behaviors, values, as well as assumptions are
shared. Inability to deal with culture results in the failure of the ERP.
9 Stanciu and Tinca, ERP solutions between success and failure, 629.
10 Garg and Garg, An empirical study on critical failure factors, 503.
11 Manouchehr et al., Identifying and ranking the effective factors, 517.
12 Seethamraju and Sundar. "Influence of ERP systems on business process agility, 142.
13 Courtney et al., Atypical auditory refractory periods, 149.
14 Kaniadakis, ERP implementation as a broad socio-economic phenomenon, 263.

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User Competency: Refers to the employee’s ability to use a particular technology to its fullest aimed at
maximizing performance. Failure to have competent employees may hinder the selection and implementation of an
ERP system.
Although selecting an ERP is a tedious, risky, and difficult process, it is essential for GAP Russia’s future
prosperity and development.15 1C will effectively make the organization’s departments more transparent and boost
productivity. In addition, the ERP system will also facilitate a stable flow of data as well as minimize the possibility
of human error.
Conclusion
An ERP system provides the capability of creating strong and multi-dimensional networks that facilitate the
staff to have equal ground and the same reporting system within a specific franchise area. Also, an ERP system
establishes new bonds between varying departments in an organization. Management priorities that necessitate the
need of an ERP system include reporting and planning, efficiency, customer service, data security and quality,
enhanced supply chain management, and improved collaboration and workflows. 1C is the best ERP system GAP
Russia can implement because it is a highly recommended ERP in Russia and most staff already have an experience
using it. Also, the factors associated with the 1C system respond to the primary requirement of this report which is
to make the organization more manageable as well as create new and improved documentation flow thus minimizing
time loss.
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