An Analysis Of Large Companies Applying Enterprise

Published Date: 02 Nov 2017

Table of Contents

Research Proposal

A Title

An Analysis of Large Companies Applying Enterprise Resource Planning (ERP) System in China

Aims

The primary aim of this Research Proposal is to examine nature of large Chinese companies and their implementation of the Enterprise Resource Planning (ERP) software.

Understanding impacts that might enable the large companies, to become proactive in planning for implementation of ERP software. Also an understanding of how it is different from western ERP implementation.

Objectives

Defining and explaining the existent ERP implementations as the primary case, successfully used of some models of ERP.

Critical issues of the ERP adoption from large Chinese enterprises.

What are the difficulties faces the large Chinese companies to implement ERP systems.

What are the impacts of western experiences can be utilize to resolve main difficulties faces the large Chinese enterprises.

How can western ERP implementations experiences utilized to benefit the large Chinese enterprises?

Evaluation of some researches already done by other researchers.

Background

An enterprise resource planning (ERP) systems is the broad expression from an Integrated Enterprise Computer Systems. ERP system has developed from MRP and MRPII system. ERP is software facilitating the information to flow between all sections within the company. (Watson, E. E., Schneider, H. 1999)

Enterprise Resource Planning (ERP) system plays important roles in nowadays management of the companies, and beginning to be a spine of enterprises.

ERP system is great technicality and useful information systems that which is designed to increase managerial performances and competition by simplification of the organisations processes and elimination of data and work duplication. Several organisations have implemented ERP as an approach to achieving strategic competitiveness advantage; ERP systems todays have become significant in modern business. (Elmeziane, K. Elmeziane, M. 2012)

Throughout last three decade, enterprises in Chin had learned the lessons which are encouraging them to implemented technologies that can move the competition of industry. Chinese enterprises have realized that to achieving competitive advantage over making integration organisation decision in the supply chain by successful implementation of ERP system it will move their position in the global markets competitions. The improvements in a new technologies and change the company’s strategy, therefore turn into two main stabs to promotion of ERP development in Chines. An Enterprise Resource Planning has become the most important approach for many Chinese enterprises in order to reduce costs, inventory and lead time. (Wang, C., Xu, L., Liu, X., Qin, X. 2005)

An Enterprise Resource Planning (ERP) sector had witnessed fastest growing in last three decades in China. Chines enterprises after encouraged by Chines government and the overseas rivals, many local companies are chose Enterprise Resource Planning systems (ERP). Numbers of chines enterprises has adopted ERP system, which is let the demand for the ERP increase every year since 2003.

The research focused on large companies in china because they providing mainstream productivities in the industry. They are reflected as the models to the other enterprises to learn from them and enabling an entire industry to develop.

As well this research has compared Chines ERP implementation growth speed with developing countries, Chines growing still lower than expected.

Critical Review of Relevant Literature/Review of Current Systems

An Enterprise Resource Planning (ERP) is an information system which is highly supporting the management operations all over an enterprise, such as financial management, coordination of logistics, purchasing, production planning, manufacturing management, distribution management, marking and customer’s services management.

ERP software is application which is allowing the companies to manage their processes with potentials benefits of improving process flow, reduce inventory and enhance customer services.

An Enterprise Resource Planning purpose is integration functional area information’s system inside the firms into a consistent, organisation wide, web-allowed network. Although majority of large enterprises in the develop countries have implemented Enterprise Resource Planning, has faced some problems regarding ERP implementation. According to the Conference Board;

Untied State of America enterprises it takes six month long than expected to implement Enterprises Resource Planning.

20% of implementation been cancelled before completed.

25% is over budget average implementation. (.He, X. 2004)

ERP Market in China

ERP market in China started in 1980, has been prosperous in latest years, because informatics has played necessary roles in the growth of the firms. A request for enterprises managing systems increased vastly, in this situation, the demand to Enterprises Resource Planning is in increase and increase. Chinese Enterprise Resource Planning market at the moment is full potentials. The companies in China are aware that they cannot be dependent on low cost productions, whilst Enterprise Resources Planning is a decent mechanism for companies to improve their management performance. A research done by (CCID) China Centre for Information Industry which is known as Chines Marking Research Firm, an ERP market in China has growing rapidly, in 2003 is about $251 m to USD $571m in 2007. 23.75% is annual average growth.

In first half of 2009 the total sales was $ 296 m According to survey from CCW Research that total from the top ten of Enterprise Resource Planning (ERP) software vendors. A top six producers according to sales statistics were SAP, UFSoft, Oracle, KINGDEE, Digital China and GrnerSoft. The report from CCW research in 2009 about ERP market in China has shown domestic ERP vendor took the most shares of the market. The figures shown that a top six enterprises are dominating 87.7% of the Enterprise Resource Planning market; with chines four local enterprises hold 58.7% of the ERP market and 29% have been hold by two foreign companies. (CCID, 2008)

(Source: CCW Research 2009)

ERP adaptation and challenges

For the enterprises to achieve ERP implementation a successfully, there are some significant steps which are needed to be taken into consideration such as:

Identifying the enterprise motivation to adopt ERP system

For a successful ERP adaptation, the enterprises needed to check ERP capabilities.

When realized the significance of integrated ERP system, select an appropriate ERP systems, and understanding a critical issues of ERP implementation by evaluating ERP performance and impacts. (Wu, W. 2011)

A chines enterprise faces one of biggest challenges to Enterprise Resource Planning implementation is way of adaptation the ERP systems successfully into Chinese industry. Because of variances in managing system and approaches, many enterprises in China are managing their organisations by a system which is unique for themselves. The organisation process and operating decision in the manufacturing enterprises is highly dependent on management experiences and awareness. A communications between management staffs over reports which is printed as hard copy, after that will distribute into all departments one by one.

Moreover, for manufacturing practicing it was also the lack of equivalent technologies which closely competing those features in Enterprise Resource Planning system. An ERP system core is to calculating requirements for material and resource which is required to use in manufacturing primarily and simultaneously; however traditional managerial approach which is used by some Chinese enterprises were to achieve productions plan by fixing products quantities and types that a company going to produce in particular time. In order to fill in the gaps, enterprises were requested to quit the old planning system and arrange productions plan according to ERP system. . (Wang, C., Xu, L., Liu, X., Qin, X. 2005)

When Chines enterprises tried to adapting ERP systems, some studies began to localization of ERP system. Enterprise Resource Planning modules were categorized into three types:

Module to be used as its

Module to be used after modification

Module to be discard

Module such as MRP, customers order entry, inventory controlling were adopted without any modification.

Module for example purchasing controlling and production planning requiring modification in order to meets scenarios of the application.

Module such as finance controlling was partly rejected in early Enterprise Resource Planning (ERP) implementation because of the variances in accounting and taxations system. (Sheu, C., Chae, B., Yang, C. (2004)

Some studies have disclosed that imported ERP systems are partly doesn’t appropriate for Chinese enterprises’ position and effective implemented proportion is still very little. Although some Chinese enterprises by using western countries experiences, has enhance operation quality. Chinese enterprises have learned more from the way of western countries implemented ERP systems. Throughout previous decades, many failings have revealed that no global systems can be implementing in several countries effectively without resolve minor defects causing from differences in languages and cultural. (Ge. Vob, 2009).

Literature Review Results

Chinese first ERP implementation was happened in 1980 and enterprise likes SAP have dominating the market over there for more thin over 10 years. Chinese companies can be at the dangerous situation, if they don’t take into their consideration the indigenous environment and organisational cultural.

Nowadays Chinese enterprises in term of ERP implementation facing major challenges because of distinctive Chinese culture factors, comparing with global peers, Chinese local vendors look like having different advantages in product network, sales and localization. According to general manager of Kingdee Asia Mr Zeng Liang, may multinational companies looking to make balance between their management style and western style. The attributes of Chinese enterprises culture is different from western. Respecting and trusting cultural management, changes in culture and fragmentation in culture, all this factors creating an exceptional human and social characteristic to success. (Srivastava, M. Gips, B. J. 2009)

Research Methodology

In the literature review part and other parts I used secondary data such as professional journal articles data, books, news articles, report, and internet data, which has been published by different authors, concerning Enterprise Resource Planning implementation in china specially, and I combined them with other sources.

A secondary data have been used regularly as portion of former investigation or case study which has been done, and it will continuous used in research because?

It has less resources requiring and has a huge numbers. While designed the researching plan from scratch, the secondary data could find a sources which is answering research inquiries and also addressing the objectives. When reasonable secondary data exist, don’t need to research again and again wasting more time. (Bryman 2007)

A secondary data perhaps end into unexpected findings. Even if the results and definition from secondary data could be inappropriate for research purposes, so I have to put theoretical site into consideration. Reanalysis of data can also leading to unexpected different findings ( Saunders, M., 2009).

Project Plan