The Diet Center's SAP ERP Decision: A Case Study Analysis

This case study analyzes The Diet Center's decision to implement SAP ERP to address operational and financial challenges. The report examines the company's growth strategy, mission, and vision in relation to ERP systems, highlighting the importance of an appropriate ERP system. It discusses the costs and benefits associated with ERP implementation, its impact on business activities, and potential future impacts on financial results. The analysis covers the need for ERP in managing operations, improving financial reporting, and streamlining business processes. The case study also explores the cost considerations, benefits such as improved data accessibility and streamlined processes, and the overall effect of the SAP ERP system on The Diet Center's operations and future prospects. The conclusion emphasizes the effectiveness of ERP systems in simplifying business processes and securing data.

RUNNING HEAD: SAP ERP DECISION 0
The Diet Center: The SAP ERP Decision
Student’s Details-
1-3-2020

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Contents
Introduction......................................................................................................................................2
Organization’s Growth Strategy......................................................................................................2
Mission and Vision regard to SAP ERP Decision...........................................................................2
Importance and Role of ERP System..............................................................................................3
Cost Associated with ERP System..................................................................................................4
Benefits Associated with ERP System............................................................................................4
Effect of ERP System on Business Activities.................................................................................5
Future Impact of SAP ERP System.................................................................................................5
Organization’s Future......................................................................................................................6
Conclusion.......................................................................................................................................6
References........................................................................................................................................7

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Introduction
Enterprise Resource Planning (ERP) is the procedure or a software allowing organizations to
effectively manage the operations and automated the business activities in order to make the
effective use of resources of the organization (Seethamraju, 2015). This can be availed through
SAP (System Applications and Products in Data Processing) ERP tool that can enable the
organization to virtually undertake the business through the integrated systems. Here, the report
is based on the SAP ERP decision of The Diet Center which is facing the issues in the operation
management and also in the support functions such as accounting, finance and procurement
departments (Al-Sabri, et al., 2018). The report will discuss the firm’s growth strategy, mission
and vision in relation to ERP systems along with the importance of appropriate ERP system into
the operations. The report will also discuss the cost and benefits of associated with the
installation of ERP system and its effect on the performance of the business and lastly, potential
future impact of ERP system onto the financial results of the company.
Organization’s Growth Strategy
Growth strategy is concerned with the long terms ability of the organization to increase the
profits and also make the stable financial results for the future (Kumar, 2016). Moreover, the
growth strategy of The Diet Center is to achieve a stable financial position through the
minimization of cost of operations and become the leading industry in terms of dietary
supplements to the customers. This is related to their decision of SAP ERP decision as this
software can help in the gaining of the competitive advantage in medical industry and increase
the sales growth and make steady growth into the market share which is concerned to be the
growth strategy of the company. This networking infrastructure can be an effective decision of
the company in which the company can undertake the growth strategy through ERP system in
order to get a sustainable growth (Fleig, et al., 2018).
Mission and Vision regard to SAP ERP Decision
Mission and vision of The Diet Center to make customers fit through the dietary supplements
and the Diet Center counseling that keeps the customers motivated throughout the weight loss
process (Diet Center, 2019). Apart from making the business profitable, the company strives to

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make the efficient delivery of services that can increase the customer satisfaction. Moreover, the
investment made into SAP ERP decision of the company can be an effective way to deal with the
customers and reducing the overall cost structure. The software introduced can better deal with
the customers such as it offered the lenient payment facilities which can be the good option for
the company to make the investment as it is integrated with the overall decision making and the
mission and vision of the company.
Importance and Role of ERP System
There is huge role and need of ERP System as it avails the company with the management tools
that fills the gap between the business process and the people. This is the helping hand of the
company as it has the capacity to synchronize all the information and communication which
altogether can manage the operations. Besides, when the company loses the proper
communication and spends insignificant time to be invested on this system which means that the
company is in the need of ERP system (Hadi, et al., 2018). Similarly, The Diet Center has to
incorporate the ERP software as it can help the company to manage the operations to increase the
financial results. The company’s business activities are in need of the reliable data that can only
be possible through the SAP ERP system. Moreover, the company can manage the inventory
through ERP.
Further, there is need and role of ERP system in an organization in which the organization can
make the cost and time efficiencies that can make the workflows smooth and also make the
automated process flows in which the company can manage the daily task activities which
enhances the productivity and reduces the operating and overhead cost. Also, the company can
make less errors and can automate the critical activities (Gupta, et al., 2018). Moreover, The Diet
Center has the need of the ERP system for automating the various business activities. As the
company has been suffering from the procurement problems in which the company has not
integrated the inventory and the accounting , the company can make use of the ERP system to
manage the financial data and reduce the duplicate transactions which can be the major reason
for the company to incorporate the ERP system which can enable the company to make the
management of the core operations and also enabling the company to maintain the relationship
between the suppliers and the customers.

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Cost Associated with ERP System
The cost of implementing the ERP System is based on the planning and the training
specifications, configuring the system and process change that can lead to the decision of the
overall cost of the ERP system to be implemented into the business operations. Specifically,
small to mid-sized organizations can cost the software installation around $75,000 to $750,000
(WorkWise Software, 2013). Moreover, this investment can be payable in the long run.
Additionally, The Diet Center has considered the cost of implementing SAP ERP system as cost
effective and is reliable software in order to migration to the SAP System. Jabri who is the Sales
Manager of System Applications and Data Processing (SAP) has explained that the software can
be expensive but it will be lesser than the annual cost incurred on the waste of labor, food and
materials. He later elaborated that the capital investment on ERP System would be the 10 per
cent of the company’s annual sales which is concerned to be the reasonable expenditure which
can bring various benefits when utilized properly.
Benefits Associated with ERP System
ERP systems are the assets of the organization as it protects information and runs the business
activities smoothly and also automating the process. Also, the organizations have been benefited
by the ERP systems as it provides the visibility of the management activities and also makes the
data easily accessible to the concerned parties (Nwankpa, 2019). It also provides the benefit of
single reporting in which the system provides the single trusted source that helps in making
comparison between several departments. Moreover, The Diet Center has been benefited by the
implementation of ERP System in which the company has earned a fair return on investment. As
a result of the proper implementation of the ERP system, the company can make their
accounting, financial and management reporting and also helped in optimizing the cost incurred
in the operations. Additionally, the company has been making the payment facilities easier and
also managing the stock in an effective way. It could facilitate the company to centralize the data
on one platform which can later be helpful in the facilitation of the effective management of data
through accessing the information onto the single medium that can make the information easily
available for everyone.

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Effect of ERP System on Business Activities
There is effect of ERP system on the various business activities in which the organizations can
make the business processes easier and also reduced the cost of operations. The business is
affected by the installation of ERP software in which the organization has improved their
business performance and thereby makes the business flow in an effective way (Suhaimi, et al.,
2016). Moreover, ERP System has been used by The Diet Center for the effective handling of the
internal system and operation management system. The company has been positively affected by
the use of ERP System in which the company has made the effective management reporting
through the integration of several interdepartmental communications. It has given numerous
customized template which are later used for the effective reporting (Haddara, 2018). The
company had effectively managed the executive team from one live database which enabled the
company to overlook the various activities more effectively from on medium.
In addition, there is effect of ERP System on the business activities of the organization in which
the organization can make their task completion in a cost and time effective way by which the
organization can make sure that the task has been undertaken in an effective way. Further, the
organization can reduce the communication barriers and maintains the interconnectivity. Further,
ERP has a negative effect on the organization as it requires the cost to be involved which can be
expensive (Motwani & Sharma, 2016). Thus, The Diet Center has to incur the significant sum of
money in the implementation of the SAP software for the management of the business activities.
Also, this has negative effect on the business due to resistances of change by the staff. Apart
from this, the company has been positively affected by the ERP System in which the company
has made their operation management in order to coordinate the financials of the main
departments of the company. The company can be benefitted by the SAP software decision in
which company can not only manage the inventory but also can take care of the integrity of the
data in which the organization can maintain the effectiveness of the data.
Future Impact of SAP ERP System
SAP ERP Systems has been matching the expectations of the business as it facilitates the
business with the controlling inventory and the Material Requirement Planning System that can
enhance the organization’s growth. Also, there is future impact of the SAP ERP System on the

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organization as it has made the information accessible to all the customers in an effective and
affordable way (Seidor, 2019). The organizations can effectively manage the back-office
functions, manage the accounting and the human resources for the future. Moreover, The Diet
Center has been impacted by the use of SAP ERP software that can later be used as the effective
tool for the facilitation of all kinds of the financial and the management reporting that can
increase the tendency of the management of the data later be used as the medium for the
operational functions (Stumvoll & Claus, 2016).
Organization’s Future
Organizational future depends on the effective service delivery to the customers that reduces the
cost and maximizes the output of the business. Moreover, the future of The Diet Center is
considered to be productive in the sense that it majorly focuses on the effectiveness in the
business process that can enable the company to make proper utilization of the technology and
make the effective service delivery to the customers of the company (Holsapple, et al., 2019).
Further, the company has been making the manufacturing at the lower cost and using ERP
System for the communication between the several departments and it also ensures that the SAP
software has to be implemented for the centralization of all the business functions. Thus, the
organization’s future can get affected by the use of ERP system and can facilitate in the quality
of service to be delivered to the customers (Menon, et al., 2019).
Conclusion
To conclude, it can be said that Enterprise Resource Planning System is an effective way to
make the business process easier and reliable. It facilitates the business to effectively manage
and protect the data through a range of software that can be used for the management of the
business activities. Here, the report is prepared on the SAP ERP decision of The Diet Center
which is the company that provide dietary supplements and also provides the dietary counseling.
The report has summarized that the company can make use of SAP ERP system for various
activities and that relates to their vision and growth strategy. Also, it can be concluded that ERP
is costly but its benefits cover the cost and will always productivity for the company. Majorly,
the company can get affected by the ERP System in which the company can face several risks

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and challenges through the installation of SAP ERP System. Also, this can be an effective
decision for the company in the future to increase the time and cost efficiencies.

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References
Al-Sabri, H., Al-Mashari, M. & Chikh, A., 2018. A comparative study and evaluation of ERP
reference models in the context of ERP IT-driven implementation: SAP ERP as a case study.
Business Process Management Journal, 24(4), pp. 943-964.
Diet Center, 2019. About Us. [Online]
Available at: https://www.dietcenter.com/about-us
[Accessed 3 January 2020].
Fleig, C., Augenstein, D. & Maedche, A., 2018. KeyPro-A Decision Support System for
Discovering Important Business Processes in Information Systems. In: International Conference
on Advanced Information Systems Engineering. s.l.:Springer, pp. 90-104.
Gupta, S. et al., 2018. Role of cloud ERP on the performance of an organization: contingent
resource-based view perspective. The International Journal of Logistics Management, 29(2), pp.
659-675.
Haddara, M., 2018. ERP systems selection in multinational enterprises: a practical guide.
International Journal of Information Systems and Project Management, 6(1), pp. 43-57.
Hadi, A., Alnoor, A. & Abdullah, H., 2018. Socio-technical approach, decision-making
environment, and sustainable performance: Role of ERP systems. Interdisciplinary Journal of
Information, Knowledge, and Management, Volume 13, pp. 397-415.
Holsapple, C., Sena, M. & Wagner, W., 2019. The perceived success of ERP systems for
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Kumar, D., 2016. Enterprise growth strategy: vision, planning and execution. s.l.:Routledge.
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Comparative Study. IUP Journal of Information Technology, 12(2).

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Nwankpa, J., 2019. ERP Systems Benefit Realization and the Role of ERP-Enabled Application
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[Accessed 4 January 2020].
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