Strategic ERP System for Steel Manufacturing: Improving Business

This report provides an in-depth analysis of implementing an Enterprise Resource Planning (ERP) system, specifically SAP MII, within a steel manufacturing environment. It covers the business processes involved in steel production, from raw material procurement to finished product, and details the development of business requirements for an ERP system tailored to this industry. The report outlines the system requirements, including managing RFQs, purchase requisitions, and material master records, and discusses vendor and software selection, emphasizing the benefits of SAP MII for monitoring and reporting in manufacturing. Furthermore, it examines how companies can leverage ERP technologies to enhance business efficiency by improving speed, accuracy, and decision-making, while also addressing potential security risks and data breaches associated with ERP implementation, offering guidelines for risk mitigation. The report concludes by highlighting the overall advantages of ERP systems in optimizing plant performance, ensuring timely delivery, improving quality, and reducing manufacturing costs.

Running head: STRATEGIC INFORMATION SYSTEM
Strategic Information System
Name of the University
Name of the student
Authors note

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Table of Contents
Introduction......................................................................................................................................2
Business Process..............................................................................................................................3
Development of the Business Requirement.....................................................................................4
Determination of the system requirements......................................................................................5
Vendor and software selection.........................................................................................................6
Ways in which companies utilize such technologies to improve business efficiency.....................9
Evaluating the level of efficiency of the technology implementation...........................................11
Examining the potential security risks and data breaches.............................................................12
Guidelines for mitigating the risk..................................................................................................14
Conclusion.....................................................................................................................................15
References......................................................................................................................................17

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Introduction
“Enterprise resource planning (ERP)”, is considered as integration of the core business
process which often takes place in the real time and the same is mediated among the “software
and technology”. Some of the main categorization of the ERP module has been included with the
integration of the various types of the components which are seen to be associated to the
procurement, production (PLM), distribution, accounting, human resource, corporate governance
performance, customer services management and sales. The procurement functions are carried
out with the maximization of the cost savings with the support for the end to end procurement
and beneficial in terms of the planning and optimization of the manufacturing capacity along
with material resources. s
The production planning through SAP is considered as the important factor for the all the
key modules to handle the capacity planning, execution of production and planning of material,
bill of material and movement of goods. In general, the SAP PP module is able to handle the
master data with maintaining a master data which is required for the “Bill of Materials (BOMs)
activity”, routing of materials and maintaining a separate component. It needs to be further
discerned that the SAP PP module is seen to be varying as per the as per the nature of
manufacturing industry.
Some of the main discourse of the report aims to implement the ERP system in a
manufacturing process environment. The various sections of the study have covered the
development of the business requirements and determination of the business requirements which
are seen to be in line with the various types of the adjustment allowed within the ERP system.

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The ERP system has allowed for the overall determination of the system requirements along with
the software and vendor selection. Some of the other sections of the repot has been conducive in
terms of addressing the ways in which the organizations are depicted to utilize such a technology
for improving the efficiency of the business. The later excerpts of the have also discusses about
the significant challenges in the overall implementation process.
Business Process
The company is seen to be involved in the manufacturing operation of the steel which are
seen to be based on producing flat steel with the main operations in the “Australia, New Zealand,
Pacific Islands, North America, and Asia”. The company is depicted to be headquartered in
Melbourne, Victoria. The total employee strength of the company is depicted with 16000
personnel and aims to be one of the largest steel plant in Australia. The business will further aim
to compete with the various types of the companies which are depicted to be operating in
Australia in the same field. Some of the notable mentions of such companies include Orrcon
Steel, Whyalla Steelworks, Lysaght (Australian company), Arrium and Astra Resources plc
(Ning et al. 2015).
The business process of the business comprises of the producing steel from the iron ore
and scrap. Some of the main activities in the steel manufacturing process has been seen to be
taken into consideration with the various type of the factors which are seen to be based on the
removing the components such as “nitrogen, silicon, phosphorus, sulfur” and additional carbon
are separated from the “raw iron, and alloying elements such as manganese, nickel, chromium
and vanadium” which is needed to produce different grades of steel (Knoll et al. 2017). Some of
the manufacturing process is further included with the use of different grades of steel. This is
often considered with the limiting the dissolved the gases like Nitrogen and Oxygen and the

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various types of the entrained impurities in the steel. This is further seen to be considered with
the inclusion of the different types of the impurities which are required for ensuring that the
quality of the product is casted from the liquid steel (The Library of Manufacturing 2016).
Development of the Business Requirement
The main initiation of the business will involve the identification of the products which is
needed for the manufacturing process. The second step is considered with the preparation of the
feasibility report which is required to find the feasibility of producing the product selected. It
needs to be further discerned that the feasibility report will be able to depict the main changes
which needs to be applied both in terms of the technical and financial feasibility. This step needs
to be followed with the market identification which is seen to be considered with the various
types of the factors which are seen to be directly associated to the identify the technical
feasibility. In the third stage the business is required to identify the various types of the factor
which are seen to be associated to the tracing of the product for the sources of financing the
operational cost and deciding on any new business venture (Billinghurst, Clark and Lee 2015).
The important consideration for the management of the day to day operations of the
manufacturing process needs to be conducted with the different types of the activities which
needs to be relied on management of the personnel and ensuring the efficiency among the
business process with the integration of the finance, material procurement and the need for the
marketing. The aforementioned measures taken by the company will be able to ensure that the
business requirement selected for the manufacturing process are aligned with the various
activities which are considered with present availability of the resources. In addition to this, the
important requirement of the business needs to be ensured with the considerations of appropriate
selection of the vendor. In addition, the various activities off the business needs to be also

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endorse that the activities of the business are taken into account with the appropriate
consideration of government licenses (Singh and Best 2015).
Determination of the system requirements
The system requirement for the ERP process is included with the consideration of the
procurement of the materials from the vendors for the manufacturer of the steel. It needs to be
further considered with the various type of the procurement activities which needs to be taken
into account with ensuring that the business is in line with the “RFQ (request for quotations)” in
the ERP system. This has been depicted to be to be conducive for the making the PO for the raw
materials. The raw materials which the company intends procure is seen to be based on the bids
which is chosen among the vendor for making the PO for the raw material. It needs to be further
understood that the material the company wants to procure should be having the appropriate
“MMR(Material master record)” and for the vendor “(Vendor master record)” (Bromiley et al.
2015).
On the other hand, it needs to be prepare its system for any instance of contingency. It is
seen that if the company doesn’t want to go for the “RFQ”, which can be made directly made
with the “PR (Purchase requisition)” and preparation of the PO. Post generation of the PO in the
ERP system the companies need to ensure that there is sufficient amount of goods receipt and
which the vendors needs to use with the MIRO invoice receipt. In addition to this, the important
aspects of the procurement process for the business needs to be based on the several types of the
considerations which needs to be taken into account with the consideration of the different type
of the factor associated to as getting the “finished product from the subcontractor and giving him
the semi-finished product” (Ning et al. 2015). This can be fulfilled by the company ibn terms of
the procurement of the materials by maintaining an SO in the ERP system. Some of the different

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types of the other requirement of the products needs to be made in the compliance with the
location factors (Markandeya and Roy 2014).
The ERP system need to appropriately account for the locational factors which are
associated to the location of the plants and ensure that the same is updated in the ERP system.
The ERP system is also required to made the make the necessary provision which will be able to
account for the provision for the stock transfer and transfer posting scenario within the ERP
system (Campbell 2016).
Vendor and software selection
The main selection of the software for the present process is considered with the
application of the SAP MII in the manufacturing plant of the company. The essential features of
the software will be conducive for the business in terms of the ensuring that the various types of
the procedures for the business are taken into consideration as per the other manufacturing
industries which are critical for “recording, monitoring, and reporting” (Ferlay et al. 2015).
The functional scope of the of the software has been identified with the various type the
process included in the planning of the ERP consists of the activities such as Plant
Synchronization with the Business Processes, Manufacturing Data Objects, perfuming the
activities for the MII based Worker UI and performing the various types of the actions which are
taken into account with Shop Floor Actions and Data (Board 2017). The fundamental scope of
the software is further depicted with the diagram as follows:

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Figure: Functional Scope of SAP
(Source: Sapevent.ch. 2018)
This software will be fulfilling the requirements of the manufacturing process by
consideration of the discrete steel producing company which is relevant to the present scope of
the requirement of the repot. TI needs to be further discerned that the different types of
consideration for the SAP process will be included with the process for the production order,
capacity requirement, material requirement and batch details.

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Figure: SAP MII for Steel manufacturing
(Source: Sapevent.ch. 2018)
Some of the different type of the other functional scope of the model has been further
identified with the consideration of the batch manufacturing operations which is included with
the PP-PI data model for the process industry. The manufacturing process of the company will be
hugely benefitted with the application of this process. This particular consideration is identified
to be conducive with the different types of the activities such as segregating the manufacturing
process as per work preparation, work execution, documentation and performance functions. The
application of this software into the current manufacturing process will conducive in various
ways which will be able to ensure the preparation of the manufacturing order list, work
instructions, quality control and production confirmation. In addition to this the various functions
associated to the documentation will be ensured with the consideration of the actions related to
the maintaining of the shift book, monitoring and logging process.

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Figure Packaged batch solution offered by SAP for manufacturing
(Source: Tutorials Point 2015)
Ways in which companies utilize such technologies to improve business efficiency
The ERP system such as SAP has allowed the enterprises to achieve a significant amount
of improvement in the plant performance, improvement in terms of the timely delivery,
improvement in the quality, reducing the overall percentage of the defects, increasing the return
on assets and minimizing the manufacturing costs (Stoyanov and Diderich 2017). The three ways
of bringing efficiency in the organizations are listed as follows:
1. Improve speed and accuracy by going paperless
In general, the organizations are able to identify the key benefits of the ERP process with
the use of various types of the initiatives which are associated with improving the speed and
accuracy of the overall process. The use of ERP system like Sap has allowed the organizations to
receive a considerable amount invoices in electronic form thereby reducing the need to paper. It

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needs to be also discerned that the application of several types of the technologies by the
organizations has been conducive in terms allowing the companies to process faster, cost
efficient and increase the operational efficiency (Wu 2014).
2. Automation of workflows
Secondly the ERP system is identified to be responsible for automation of the workflows
thereby increasing the overall speed of the process and improving the overall efficiency. Despite
of such measures the use of smart applications has been also conducive for the companies in the
implementing of the smart applications and robotic process automation thereby bringing
improvement as much s possible. The various types of the applications which are discerned to be
used for the artificial intelligence is also depicted to be conducive for the organizations in terms
of the bringing the various types of the functions which are considered to be eliminating the
redundant work and saving a considerable amount of time for processing, thereby allowing the
business to focus on a more valuable task (Wolch, Byrne and Newell 2014).
3. Cloud based solutions
Some of the other direct benefits are associated to consider the cloud-based solutions
which are seen to be related to provide several flexible pricings due to the modern design of the
software. It needs to be further understood that the application of such a software has been
beneficial for the moving the consumer process, content centric which have a relatively self-
contained cloud platform. Typically SAP HANA cloud platform allows a seamless connectivity
on- promise and new cloud components (Kiselicki, Josimovski and Stepanoska 2016).

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Evaluating the level of efficiency of the technology implementation
The level of technology implementation is discerned to be conducive for the business to
closely monitor the production planning and control activities. In addition to this, the SAP PP is
closely associated to the SAP ERP modules. The SAP ERP modules will be conducive in
integrating the “SAP Sales and Distribution (SD)”, “SAP Material Management (MM)”,
“Quality Management, Finance Accounting”, and “Project System”. The SAP PP and SAP MM
module will be conducive in tracking of the movement of the goods and track the auto goods
receipt. Some of the various types of the other elements of the module will include the “creation
of a reservation for Production Order/Planning”. These modules will be also conducive in
creating a reservation for the production order/ planning.
Figure: Production Planning Details in SAP
(Source Markandeya and Roy 2014)

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The integration of the SAP PP and SAP SD will be able to check the availability of the
material for the production order. In addition to this, it is conducive for performing the MRP Run
identify the type of the requirement. In addition to this this directly helpful in integrating the
various elements of the Bill of Material components and operation. Additionally, the integration
of this model with the SAP PP and SAP FICO has been taken into account with updating the
price of the material and master data. It will be further able to define the activity type in the cost
center and at the same time assign the type to the cost center. This also seen to be useful for the
cost estimation and production cost controlling.
Figure: Procedure of recording BOM
(Source: Tutorials Point 2015)
Examining the potential security risks and data breaches
A breach in the cyber security of a company can completely devastate a company. The
loss of the sensitive data information may lead to several concerns in the future which are related
to the loss of “sensitive data, data, fraud, lawsuits and recovery expenses” along with significant

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nature of the PR nightmares which can easily grow further in the future. It needs to be also
understood that the 2017 ERP Cybersecurity Survey the predicted average cost of security
breach in Sap is estimated at $ 5 million and more than one third of the respondents have
estimated a damage of more than $ 10 million. SAP is further depicted to be relied on a
complicated software platform thereby having a fair share of the vulnerabilities (Schneider-
Simon and Schneider-Simon 2018).
In 2013, the USIS a federal contractor has determined several instances of infiltration by
the cyber attackers. This has been identified with a security of more than 25,000 government
workers being compromised. USIS lost more than $ 2.8 billion in contracts. The management of
needs be particularly aware of the other risks like:
 Outdated, unsupported software
The risk of outdated unsupported software is seen to be associated to the various type of
the concerns which are seen to be associated to the crashes and integration issues. The old
versions of SAP may be compatible to the integration of the various considerations for the
newer products (Adam Bluemner and Adam Bluemner 2014).
 Insufficient reporting capability
The top reason for the lack of functionality has been seen to be evaluated with the varies
types of the factors which are related with the concerns such as loosing track of the user
systems.
 Technical personnel and providers
The organizations have been further seen to be on the verge of the problem which are
seen to be faced by the management due to the “external threats, data center procedures, and

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end-user security”. In several instances the access to the soft coded system is overlooked for
the access for the system configuration settings.
 Delayed updates
The ERP accounting software is related to various types of the concerns which are
directly associated to the delay in terms of company to update their software.
Guidelines for mitigating the risk
In order to stay on top of all SAP cybersecurity news, the companies need to identify the
relevant nature of the risk which are associated to the identification of the vulnerability. It is
important for the company to clearly define the person who is in charge of the SAP cyber
security. In several cases the clarification of the “processes and roles and decision making” is
essential to identify the type of ownership for the company’s SAP cybersecurity which is
identified with a considerable amount of share for preventing any future occurrence for cyber
threat. It is also necessary to consider the aspect to prevent the various threat of the cyber
security which requires to be adopted with clear and forward thinking of leadership ideas (Rid
and Buchanan 2015).
Some of the main concerns for the outdated, unsupported software needs to be dealt with
is seen to be based on “upgrading to the newest versions of the software”. This will allow the
companies to move to the new software altogether. In addition to this, the problem of insufficient
“reporting capability can lead to external reporting and a loss of data control” (Lee, Kao and
Yang 2014). This needs to be addressed with the important reason for driving the ERP purchase
is considered with the various types of factors can be directly seen to be related to the different
aspect of solving the problem through considering some separate personnel keeping track of the

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external reporting. Additionally, the organizations can look forward to establish a separate
directory who will be able to keep track of the data and maintain the necessary information
which are seen to be considered with the various types of the factors associated to making
mandatory requirements for making the direct reporting. The organizations need to ensure that
the different types of the upgrades for the software’s are not delayed, thereby prevent it from the
possible threat of the cycler attackers (Haddara and Elragal 2015).
Conclusion
The main discourse of the report associated to the main manufacturing process is
considered with producing steel from the iron ore and scrap. Some of the main activities in the
steel manufacturing process is seen to be taken into consideration with the various type of the
factors which are seen to be based on the removing the components such as “nitrogen, silicon,
phosphorus, sulfur” and additional carbon are separated from the “raw iron, and alloying
elements such as manganese, nickel, chromium and vanadium” which is needed to produce
different grades of steel. In addition to this, the details about the determination of the system
requirements is based with ensuring that the business is in line with the “RFQ (request for
quotations)” in the ERP system. This has been depicted to be to be conducive for the making the
PO for the raw materials. The raw materials which the company intends procure is seen to be
based on the bids which is chosen among the vendor for making the PO for the raw material. If
the company doesn’t want to go for the “RFQ”, which can be made directly made with the “PR
(Purchase requisition)” and preparation of the PO. Post generation of the PO in the ERP system
the companies need to ensure that there is sufficient amount of goods receipt and which the
vendors needs to use with the MIRO invoice receipt. The main consideration for the vendor and
software selection is based on the different types of the consideration for the main selection of

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the software for the present process is considered with the application of the SAP MII in the
manufacturing plant of the company. The level of technology implementation has been discerned
to be conducive for the business to closely monitor the production planning and control
activities. In addition to this, the SAP PP is closely associated to the SAP ERP modules. The
SAP ERP modules will be conducive in integrating the “SAP Sales and Distribution (SD)”,
“SAP Material Management (MM)”, “Quality Management, Finance Accounting”, and “Project
System”. In terms of mitigating the threats it is important for the company to clearly define the
person who is in charge of the SAP cyber security. In several cases the clarification of the
“processes and roles and decision making” is essential to identify the type of ownership for the
company’s SAP cybersecurity which is identified with a considerable amount of share for
preventing any future occurrence for cyber threat.

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