Enterprise Resource
Planning (ERP)
Systems
Level 4
2025-2026
T. Najla`a Abutaleb
Najlaaabutaleb@gmail.com
Chapter One
Business Functions and Business Processes
Enterprise Resource Planning (ERP) programs: Core software used by
companies to coordinate information in every area of business
◦ Help manage companywide
business processes
◦ Use common database and
shared management reporting tools
Business process: collection of activities that takes some input and
creates an output that is of value to the customer
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To understand ERP, you must understand how a business works
◦ Functional areas of operation
◦ Business processes
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• Marketing and Sales (M/S)
• Supply Chain Management
(SCM)
• Accounting and Finance (A/F)
• Human Resources (HR)
Business functions: Activities specific to a functional area of operation
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Functional Areas of Operation (cont’d.)
Figure 1-1 Examples of functional areas of operation and their business functions
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Functional areas are interdependent
◦ Each requires data from the others
Better integration of functional areas leads to improvements in
communication, workflow, and success of company
Information system (IS): Computers, people, procedures, and software
that store, organize, and deliver information
Hardware Software Database
Procedures
Network People
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Information Systems Inside an Organization
Information Systems Among Organizations
Collection of activities that takes one or more kinds of input and creates
an output that is of value to customer
◦ Customer can be traditional external customer or internal customer
Thinking in terms of business processes helps managers to look at their
organization from the customer’s perspective
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Figure 1-2 Sample business processes related to the sale of a
personal smartphone
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🞂 Businesses must always consider customer’s viewpoint in any
transaction
🞂 Successful customer interaction
◦ Customer (either internal or external) is not required to interact with each
business function involved in the process, i.e. customer-facing functions versus
support functions
🞂 Successful business managers view business operations from the
perspective of a satisfied customer
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🞂 Sharing data effectively and efficiently between and within
functional
areas leads to more efficient business processes
🞂 Integrated information systems: Systems in which functional areas
share
data
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Figure 1-3 A process view of business
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🞂 Businesses take inputs (resources) and transform these inputs into goods
and services for customers
◦ Inputs: Material, people, equipment
🞂 Managing inputs and business processes effectively requires accurate
and up-to-date information
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Personal Business
The next slide shows an example of a
business process: ordering an E-ticket
from an airline web site
Traveler
Plan Trip
Check Flights
NO Seats
Available
?
YES
Submit Ticket Order
Receive e-Ticket
Receive Ticket Order
Traveler Airline Web Site
Seats NO
Notify Traveler
Plan Trip Available
YES
Check Flights Reserve Seats
NO
Use NO Frequent
Seats Credit Flyer Mileage
NO
Available Card? Sufficient?
? YES
Charge Credit Card YES
YES
Subtract Mileage
Submit Ticket Order
Charge NO
Notify Traveler
OK?
Receive e-Ticket YES
Confirm Flight(s)
Issue e-Ticket
🞂 Example: A fictitious coffee shop
◦ Examine business processes of the coffee shop
◦ See why coordination of functional areas helps achieve efficient and effective
business processes
◦ Look at how integration of the information system improves the business
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🞂 Functions of Marketing
and Sales
◦ Developing products
◦ Determining pricing
◦ Promoting products to customers
◦ Taking customers’ orders
◦ Helping create a sales forecast
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🞂 Marketing and Sales tasks for the coffee shop
◦ Formal recordkeeping not required
◦ Need to keep track of customers
◦ Product development can be done informally
◦ Good repeat customers allowed to charge purchases—up to a point
🞄 Records must show how much each customer owes and his or her
available credit
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