- What is ERP? Explain the general Implementation methodology of ERP
Ans:-Enterprise resource planning software, or ERP, doesn’t live up to its acronym. Forget about planning—it doesn’t do much of that—and forget about resource, a throwaway term. But remember the enterprise part. This is ERP’s true ambition. It attempts to integrate all departments and functions across a company onto a single computer system that can serve all those different departments’ particular needs.
That is a tall order, building a single software program that serves the needs of people in finance as well as it does the people in human resources and in the warehouse. Each of those departments typically has its own computer system optimized for the particular ways that the department does its work. But ERP combines them all together into a single, integrated software program that runs off a single database so that the various departments can more easily share information and communicate with each other.
That integrated approach can have a tremendous payback if companies install the software correctly.
ERP vanquishes the old standalone computer systems in finance, HR, manufacturing and the warehouse, and replaces them with a single unified software program divided into software modules that roughly approximate the old standalone systems. Finance, manufacturing and the warehouse all still get their own software, except now the software is linked together so that someone in finance can look into the warehouse software to see if an order has been shipped. Most vendors’ ERP software is flexible enough that you can install some modules without buying the whole package. Many companies, for example, will just install an ERP finance or HR module and leave the rest of the functions for another day.
How can ERP improve a company’s business performance?
ERP’s best hope for demonstrating value is as a sort of battering ram for improving the way your company takes a customer order and processes it into an invoice and revenue—otherwise known as the order fulfillment process. That is why ERP is often referred to as back-office software. It doesn’t handle the up-front selling process (although most ERP vendors have developed CRM software or acquired pure-play CRM providers that can do this); rather, ERP takes a customer order and provides a software road map for automating the different steps along the path to fulfilling it. When a customer service representative enters a customer order into an ERP system, he has all the information necessary to complete the order (the customer’s credit rating and order history from the finance module, the company’s inventory levels from the warehouse module and the shipping dock’s trucking schedule from the logistics module, for example).
ERP Implementation Steps - Planning, Design and Implementation
Implementing an ERP software system not only involves a great deal of expenditure, efforts and time, it also involves change in some of the complex business processes. Such changes are often disliked by the employees and are a big risk. In order to ensure success, everyone in the company, from the leadership to back-office workers should cooperate.
Implementing ERP requires a team of experts who understand the business and technical aspects of the project. A separate ERP solution provider is employed for working with each department in understanding their processes and challenges.
Implementation of ERP involves the following steps:
Planning and Requirements Analysis
This is the initial phase where the company takes a decision on implementing ERP. The decision could based on their need to comply with legal requirements, replace their legacy applications, for benefits of integration, reduction of inventory, reduction of operational costs, risk management, additional functionality or speeding up processes.
The team chooses an ERP system. Typically a niche player in resource planning software development is chosen instead of developing from scratch. Some of the leading vendors are: SAP, PeopleSoft, Oracle, Sage Group, MS Business Solutions, SSA Global, Lawson and Intention.
Study your business processes well. Why do you need an ERP implemented? Before you take the huge decision, study the processes followed in your company for the day to-day work activities
Identify the Core Team. Core users are those who are the champions and well versed with the business processes in your organisation. There must be minimum of 3 core user champions from each department who understands the business processes well and who understands what to expect out of an ERP system.
Hire a group of professional consultants who will study the processes in your organisation and tell you whether implementing ERP is feasible for you in terms of resources and cost.
This is the phase where the ERP team re-engineers the business processes around the Best Practices wherever feasible and identifies the processes that will result in customizing the ERP software application. The IT infrastructure requirements based on ERP system architecture and vendor are prepared.
In this phase, the ERP team uses the identified business processes as the basis for implementation to build prototypes by choosing standard models, processes, inputs and outputs. This phase involves business super-users in determining the system elements.
This phase involves installation of the ERP software, migration of data from the old applications to the ERP system, configuring the ERP system for reporting, implementing security, interfaces
etc. The end users are involved at this stage to test the system after being trained. The implementation consultants seek feedback, identify software bugs/corrections, performance bottlenecks and apply the fixes. A decision on switching to the new ERP system is taken.
System Testing: In this phase, users are provided with the system clone to work on to test whether all of their requirements have been fulfilled.
- Go-Live: A day is decided based on the Project Charter when the company/organisation will actually start using the system and this day is termed as Go-Live.
After proper implementation and testing, it is time that the employees of the organization are trained to work on the system
This is an ongoing phase which involves patching/upgrading the software, enhancing the functionality of the applications, changes in reports etc. This is either taken care of by in-house IT department or outsourced to consulting firms
Assuming a decision on an ERP has been taken, the implementation normally consists of five stages:
- Continuous improvement
The structured implementation programme can speed system deployment and return on investment. This can be done in the following manner:
- Conducting an effective gap assessment
- Business and technical processes
- Organizational measures
- Data conversion and data clean-up
- Agreeing on the implementation boundaries
- Project sponsorship and governance
The implementation strategy is ultimately built on a foundation of people, processes and product
- Describe various evaluation criteria at the time of selection of ERP packages. Discuss the role of vendors, consultants and users for selection of ERP.
Ans:-Evaluation of ERP software is a very challenging and tedious task. Organizations are very cautious because the ERP they chose has a long term impact on the organization and organizational productivity. A wrong choice can easily land an organization in a mess which they will find difficult to come out of. As people say ´ERP is like a marriage´; once you start to use an ERP and have your Business Data on the ERP for some time, it will not be an easy task to switch over to another ERP. The heavy investments (more in terms of organizational resources than the money) and the complexities associated with the implementation make moving to another ERP an extremely tough decision. So there must be a diligent process for evaluating ERP software. The evaluation process of ERP software should be properly defined and directed. An ERP selection process will typically involve the following:
- ERP selection team: At the time of ERP selection, most of the companies follow the process set up by Chief Information Officer or IT Manager. In addition to CIO or IT Manager, the ERP selection teams should also comprise of functional heads, top management representatives and actual users. An experienced and matured team can certainly evaluate various vendors for their strengths and weaknesses and make a better selection.
Scope of ERP Software: A good ERP package must have functionalities to meet the present as well as future needs of the organization. Full scope of the ERP software should outline functional expectations of all business division such as Sales, Inventory, Finance, Procurement etc. It is very difficult to get an ERP Software which matches your needs 100%. Typically a 70% fit is considered fit enough. Though during the demos you may feel that a software meets your requirements 100% but that doesn’t happen in real. Firstly because Organizations are not very clear of the Requirements at the beginning phase. Secondly it is very difficult evaluate an ERP functionality in a demo which generally lasts about an hour. For that matter even if you had a demo lasting 4 hours you will not be able to understand an ERP in that detail which you normally need. A typical ERP software will have the following functionalities:
- Accounting / Finance
- Material Management
- Customer Relationship Management
- Graphical Dashboards now called as Management Dashboards
- Some Reporting tool (Either inbuilt or third party ones)
- And other industry specific modules like could be a Transportation Module, Fixed Deposit Management etc.
There are several ERP packages available in the market, each having its own strengths and weaknesses. Every package has its own concept, architecture and set of functionalities. Organization need to identify right vendor by analyzing many factors such as the product’s features, customization complexities, implementation success rate, cost, customer references, post implementation support, local and International presence and number of installations. ERP should also support multiple locations, multiple companies, multi currencies and multiple languages (if required).
TCO Analysis: When evaluating costs, besides the ERP Package price also include cost of future upgrades, implementation costs, customization costs, supporting software license costs (OS/Database etc.) and hardware costs etc. Also consider the costs that you will incur over a 5 year window at least. This will enable a fair comparison of several ERP packages, as well as define the long term ROI. Organization should also clarify with ERP vendor for any unforeseen and hidden costs that may arise in the due course.
- Integration with other Applications/Equipment:
Apart from ERP, organizations use several software applications. An ERP may also be required to integrate with these applications like Mail server, Attendance systems, Production Equipment, Weigh scales, Bar Coding machines etc. for exchanging data. Organizations should discuss these issues with ERP vendors during the evaluation phase itself. These interfacing also may require interaction of the ERP vendor with the manufacturer of these machines/applications to check if they will be able to provide the information to ERP vendor in some computer readable format.
3. User Friendliness:
A user friendly interface of ERP software increases the user acceptance rate. During ERP demo organizations should check how user friendly the system is.. They should check the navigation structure, clicks required to open a function, drill down options in reports, Graphical options etc.
4. Longevity of ERP Implementation partner:
ERP Implementation and support are a long drawn processes. Organizations may need frequent support and help during the lifecycle of ERP. This is where the longevity of the implementation partner plays an important role. It is imperative to the check the business background of the ERP implementation Partner. Some questions that organization should seek about the vendor are:
- How many years has the company been actively engaged in the software business?
- Identify their core business; ERP business should be one of their core businesses and not one of their smaller businesses. People often tend to hive off their smaller businesses as the Economies of Scales don’t justify for them to be in ERP business. In such a scenario you could often be left in the lurch. So you should have some Source Code arrangements like Escrow or some exit route for you if a Partner or the ERP vendor himself decides to shut shop.
- When was the ERP product launched in the market and what is the current release version?
- Check the customer list relevant to your business and the customer testimonials.
- Ask for Customer references. Try and visit their Client site though it may not be possible for time constraints as well as the reluctance of Clients to showcase their ERP to a third party. Plus for Clients such site visits are often a nuisance. Insist atleast on a Customer Reference from the ERP vendor
Role of the Vendor
As soon as the company signs the contract, the vendors should supply the product and its documentation. Once the software is delivered, the company can develop the training and testing environment for the implementation team. The roles of the vendors during and after implementation of ERP are:
- The vendor is responsible for fixing any problems in the software that the implementation team encounters.
- The vendor should have a liaison officer to constantly interact with the implementation team.
- The vendors provide initial training for the company’s key users. These key users are the ones who will define, together with the consultants, how the software is to serve the company.
- They are also called as in-house functional experts who decide how the functionalities are implemented to adapt the product to suit the company’s unique requirements. It is very important to provide these in-house experts a through training on the features of the package.
- Vendor’s training should include showing the key users how the package works, what are the major components, how the data and information flows across the system, what is flexible and what is not, what can be configured and what cannot, what can be customized and what should not, what are the limitations, what are the strengths and weaknesses and so on.
- The objective of the vendor training is to show how the system works, not to show how it should be implemented. This means that the vendor demonstrates the product as it exists and highlights what are the possible options available.
- Company’s employees who are participating in the vendor training should try to understand the characteristics of the package and the impact of the system on their business processes. The trainees should use these training sessions to question the vendor on all aspects of the system.
Business consultants are professional who specialize in developing techniques and methodologies for dealing with the implementation .They are the experts in the administration, management and control of various problems that crop up during the implementation.. Each of them has many man-years of implementation experience with various industries and would have time-tested methodologies and business practices that ensure successful implementation. They are good at all phases of the implementation lifecycle, right from package evaluation to end-user training. The only problem with these business consultants is that they are very expensive. Many of the big consulting firms invest a great deal of money in developing a range of consulting services and assign many of their professionals to become specialists in the various aspects of ERP packages and their implementation
Role of the consultants
- The role of the ERP consultants is known to all of us as we have seen many of them in action. The company places its trust in the consultants, that its business objectives will be achieved. The consultants ensure the success of the project. This produces quantifiable results to the satisfaction of the company management.
- Consultants administer each of the phases of the implementation. This ensure that the required activities occur at the scheduled time and at the desired level of quality with effective participation of all those who must participate. The consultants are responsible to convert the planned methodology into task and allocate right resource to complete that task.
- Consultants add value to the project. They bring the know-how about the package and about the implementation–the know-how that is not included in the standard documentation. This know-how (also known as practical knowledge) is derived from their expertise which stems from practical experience. Thus by eliminating the trial-and-error method of implementation, and by doing it right the first time, the consultants help in saving huge amounts of money, time and effort.
- Consultants should remain impartial while questioning current company processes in an effort to promote better businesses practices and better implementation results. They should strive to improve the company’s business processes so that the software package can be used as it was originally intended by its developers. Refining the company’s processes can only optimize the performance of the system and maximize future user satisfaction. The consultants are also responsible for analyzing and clearly addressing the customization issues.
- ERP consultants show the advantages and drawbacks of each area to the management and reach a consensus decision. Consultants need to balance their loyalty to the client and the project with that of defending the package vendor, when such defense is technically correct.
- Consultant alerts the company management about actions and decisions to be taken. This ensures that job will not be compromised and the implementation will not be jeopardized. Once the project is complete, consultants will leave the company. However, the knowledge of the project should remain within the organisation. Hence, consultants should train enough people in the organisation so that the work they have started is continued.
There are other tasks performed by the ERP consultants. They:
- Maintain technical documents on the projects.
- Analyse business requirements.
- Prepare the functional specifications for ERP program development.
- Perform Gap analysis and related studies.
- Assess the competence level of the users of the ERP system.
- Perform Product design and operations review.
- Identify requirements of the users of the ERP system.
- Interact with other modules consultants.
ERP end-users are the people who will be using the ERP system once it is implemented. Most of the functions that the end users used to perform are being automated by the ERP system. ERP system brings drastic transformation in the actual work process which leads to change in old job descriptions.
It is human nature to resist change. Implementation of an ERP system brings change in a very massive scale. Employees will fear that system will replace existing jobs, as many functions will be automated. Also people will be afraid of the amount of training they have to undergo and learning they have to do to use the new system. Job profiles will change, job responsibilities will undergo drastic alterations, and people will be forced to develop new skill sets. If these fears are not addressed and alleviated well in advance, it will cause trouble for the organisation.
The automation of the business processes, through technology, can eliminate the jobs of many employees whose function it is to record, control, calculate, analyze, file or prepare reports. Even though ERP systems eliminate many existing jobs, it creates many new ones with more responsibilities and value addition. Employees get away from the monotonous clerical work and transform themselves into highly valued individuals, in a new and challenging working environment using modern technology. If the company succeeds in convincing its employees to accept this fact and assist by giving them proper training, then the major obstacle in the path of an ERP implementation is solved.
For example, the recent research on SAP end-user training suggested that enterprises should allocate 17 percent of the total cost of an ERP project to training. Gartner research recognized training as the top priority, and suggested that companies that budget less than 13 percent of the implementation costs for training are three times more likely than companies that spend 17 percent or more to see their ERP projects run over time and over budget.
The impact of application on ERP end-user productivity is a complex undertaking because of the wide range of business functions and user types who interact with such systems. The business productivity framework is developed to measure how ERP end-users feel system affects their personal productivity.
- Briefly enumerate some of the key ERP modules keeping in view the Manufacturing perspective.
Ans:-The following are some important modules that being included in major ERP packages.
The financial activities of an organization by the finance department are recorded using various user interfaces and these interface screens related to the finance department are grouped into a single menu option and these set of options are called the finance module.
Financial module of an ERP system is used to record day to day transactions like receiving payments Customers, payments to vendors by raising cheques or through cash and journal entries. Over and above financial module records the data during
- Creation of a Customer Account
- Creating of a Vendor Account
- Creating a Bank Account.
- Creating a General Ledger Account
- Enhancing Chart of Accounts (when major changes to be made for preparing the financial statements).
Financial application components of an ERP solution work hand-in-hand to improve the bottom-line. This is true because the financial functionality is tightly integrated across all business areas and all geographic areas. This tight integration includes all the other different modules, from materials management to human resource to logistics.
The financial module of ERP also provides financial functionality and analysis support to lot of medium and large scale enterprises in Indian and abroad.
This module is used to record data related to the manufacturing department of the organization. Data is recorded in this module when Bill of Materials, Work Orders and WIP receipts are to be created for work orders.
In modern manufacturing operations, information starts at the top and the bottom simultaneously. Data originates at the machines, the process and the workers. It indicates what is being made, how and where, when it will be done, and why it won´t be on time.
ERP allows companies to balance customer demands impacted by multiple interrelated items and multiple plant locations. ERP adds applications for financials, supply chain, and distribution and requirements planning for multiple sites. It facilitates intelligent resource planning in the face of rapidly changing constraints such as materials availability, market readiness, plant capacities, personnel certification and business costs per location. In short ERP systems will allow decision makers to champion ´an intelligent, agile and responsive organization in the global marketplace of the next century.´
Sales and marketing Module
This module comprises of Contact Management and Sales Order Processing Management. It is an integrated solution comprising of marketing and sales activities. Organization can act immediately to improve sales, service and marketing effectiveness by using this module.
Sales and Marketing module also help to you getting your customer order management easier day by day. Use of this also includes maintaining customer information, quickly creating a quote or migrating them to sales order.
ERP Purchasing module streamline procurement of required raw materials. It automates the processes of identifying potential suppliers, negotiating price, awarding purchase order to the supplier, and billing processes. Purchase module is tightly integrated with the inventory control and production planning modules. Purchasing module is often integrated with supply chain management software.
Inventory Management Module
ERP Inventory Management module facilitates recording of data in the inventory department. Activities of the Inventory department such as receipt of goods, delivery of goods, maintenance of material in the stock sections, classifying all the materials, issuing of materials to the manufacturing department, rejections from the suppliers are recorded with full details.
Human Resource module
Human Resource (HR) module in ERP streamlines the management of human resources and human capitals. It comprises of four broad sections, mainly Training, Recruitment, Payroll and Attendance. HR module routinely maintains a complete employee database including contact information, salary details, attendance, performance evaluation and promotion of all employees.
- What is Knowledge Management? What pitfalls should be avoided while aligning Knowledge Management with the Business Strategy?
Ans.Knowledge Management, (KM) is a concept and a term that arose approximately two decades ago, roughly in 1990. Quite simply one might say that it means organizing an organization´s information and knowledge holistically, but that sounds a bit wooly, and surprisingly enough, even though it sounds overbroad, it is not the whole picture. Very early on in the KM movement, Davenport (1994) offered the still widely quoted definition:
"Knowledge management is the process of capturing, distributing, and effectively using knowledge."
This definition has the virtue of being simple, stark, and to the point. A few years later, the Gartner Group created another second definition of KM, which is perhaps the most frequently cited one (Duhon, 1998):
"Knowledge management is a discipline that promotes an integrated approach to identifying, capturing, evaluating, retrieving, and sharing all of an enterprise´s information assets. These assets may include databases, documents, policies, procedures, and previously un-captured expertise and experience in individual workers."
Explicit, Implicit and Tacit Knowledge
In the KM literature, knowledge is most commonly categorized as either explicit or tacit (that which is in people´s heads). This characterization is however rather too simple, but a more important point, and a criticism, is that it is misleading. A much more nuanced and useful characterization is to describe knowledge as explicit, implicit, and tacit.
Explicit: information or knowledge that is set out in tangible form.
Implicit: information or knowledge that is not set out in tangible form but could be made explicit.
Tacit: information or knowledge that one would have extreme difficulty operationally setting out in tangible form.
It is important to remember that knowledge management is not about managing knowledge for knowledge´s sake; the overall objective is to create value and to leverage, improve, and refine the firm´s competences and knowledge assets to meet organizational goals and targets. Implementing knowledge management thus has several dimensions including:
- KM Strategy: Knowledge management strategy must be dependent on corporate strategy. The objective is to manage, share, and create relevant knowledge assets that will help meet tactical and strategic requirements.
- Organizational Culture: The organizational culture influences the way people interact, the context within which knowledge is created, the resistance they will have towards certain changes, and ultimately the way they share (or the way they do not share) knowledge.
- Organizational Processes: The right processes, environments, and systems that enable KM to be implemented in the organization.
- Management & Leadership: KM requires competent and experienced leadership at all levels. There are a wide variety of KM-related roles that an organization may or may not need to implement, including a CKO, knowledge managers, knowledge brokers and so on. More on this in the section on KM positions and roles.
- Technology: The systems, tools, and technologies that fit the organization´s requirements - properly designed and implemented.
- Politics: The long-term support to implement and sustain initiatives that involve virtually all organizational functions, which may be costly to implement (both from the perspective of time and money), and which often do not have a directly visible return on investment.
What does KM really consist of? What operationally constitutes KM?
So what is involved in KM? The most obvious point is the making of the organization´s data and information available to the members of the organization through portals and with the use of content management systems. Content Management, sometimes known as Enterprise Content Management, is the most immediate and obvious part of KM. For a wonderful graphic snapshot of the content management domain go to realstorygroup.com and look at their 2012 Content Technology Vendor Map.
In addition to the obvious, however, there are three undertakings that are quintessentially KM, and those are the bases for most of what is described as KM.
(1) Lessons Learned Databases
Lessons Learned databases are databases that attempt to capture and to make accessible knowledge that has been operationally obtained and typically would not have been captured in a fixed medium (to use copyright terminology). In the KM context, the emphasis is typically upon capturing knowledge embedded in persons and making it explicit. The lessons learned concept or practice is one that might be described as having been birthed by KM, as there is very little in the way of a direct antecedent. Early in the KM movement, the phrase typically used was "best practices," but that phrase was soon replaced with "lessons learned." The reasons were that "lessons learned" was a broader and more inclusive term and because "best practice" seemed too restrictive and could be interpreted as meaning there was only one best practice in a situation.
The concept is by no means limited to the military.
The implementation of a lessons learned system is complex both politically and operationally. Many of the questions surrounding such a system are difficult to answer.
All these questions need to be carefully thought out and resolved, and the mechanisms designed and put in place before a lessons-learned system is launched. Inattention can easily lead to failure and the tarring of subsequent efforts
(2) Expertise Location
If knowledge resides in people, then one of the best ways to learn what an expert knows is to talk with that expert. Locating the right expert with the knowledge you need, though, can be a problem. The basic function of an expertise locator system is straightforward: it is to identify and locate those persons within an organization who have expertise in a particular area. Such systems were commonly known as "Yellow Page" systems in the early days of KM. In recent years, the term expertise locator or expertise location has replaced yellow pages as being rather more precise.
There are now three areas which typically supply data for an expertise locator system, employee resumes, employee self identification of areas of expertise, typically by being requested to fill out a form online, or by algorithmic analysis of electronic communications from and to the employee.
The latter approach is typically based on email traffic but can include other social networking electronic communications such as Twitter and Facebook.
(3) Communities of Practice (CoPs)
CoPs are groups of individuals with shared interests that come together in person or virtually to tell stories, to share and discuss problems and opportunities, discuss best practices, and talk over lessons learned (Wenger, 1998; Wenger & Snyder, 1999). Communities of practice emphasize the social nature of learning within or across organizations. Conversations around the water cooler are often taken for granted, but in geographically distributed organizations the water cooler needs to become virtual. Similarly, organizations find that when workers give up a company office to work online from home or on the road, the natural knowledge sharing that occurs in social spaces must be replicated virtually. In the context of KM, CoPs are generally understood to mean electronically linked communities. Electronic linkage is not essential, of course, but since KM arose in the consulting community from the awareness of the potential of Intranets to link geographically dispersed organizations, this orientation is understandable and inevitable.
The Stages of Development of KM
Looking at KM historically through the stages of its development tells us not only about the history of KM, but it also reveals a great deal about what constitutes KM.
First Stage of KM: Information Technology
The initial stage of KM was driven primarily by IT, information technology. That first stage has been described using an equestrian metaphor as “by the internet out of intellectual capital”. The concept of intellectual capital provided the justification and the framework, the seed, and the availability of the internet provided the tool. As described above, the consulting community jumped at the new capabilities provided by the Internet, using it first for themselves, realizing that if they shared knowledge across their organization more effectively, then they could avoid reinventing the wheel, underbid their competitors, and make more profit. The first use of the term Knowledge Management in the new context appears to have been at McKinsey. They realized quickly that they had a compelling new product. Ernst and Young organized the first conference on KM in 1992 in Boston (Prusak, 1999). The salient point is that the first stage of KM was about how to deploy that new technology to accomplish more effective use of information and knowledge.
Second Stage of KM: HR and Corporate Culture
The second stage of KM emerged when it became apparent that simply deploying new technology was not sufficient to effectively enable information and knowledge sharing. Human and cultural dimensions needed to be addressed. The second stage might be described as the “‘If you build it they will come’ is a fallacy” stage—the recognition that “If you build it they will come” is a recipe that can easily lead to quick and embarrassing failure if human factors are not sufficiently taken into account.
It became clear that KM implementation would involve changes in the corporate culture, in many cases rather significant changes. Consider the case above of the new pediatric medicine and the discovery of the efficacy of adding orange juice to the recipe. Pharmaceutical sales reps are compensated primarily not by salary, but by bonuses based on sales results. What is in it for that sales rep to share her new discovery when the most likely result is that next year her bonus would be substantially reduced? The changes in corporate culture needed to facilitate and encourage information and knowledge sharing can be major and profound. KM therefore extends far beyond just structuring information and knowledge and making it more accessible.
Third Stage of KM: Taxonomy and Content Management
The third stage developed from the awareness of the importance of content, and in particular the awareness of the importance of the irretrievability of content, and therefore of the importance of the arrangement, description, and structure of that content. Since a good alternative description for the second stage of KM is the “it’s no good if they don’t use it” stage, then in that vein, perhaps the best description for the new third stage is the “it’s no good if they try to use it but can’t find it” stage.
At KMWorld 2000 a track on Content Management appeared for the first time, and by the 2001 KMWorld Conference, Content Management had become the dominant track. In 2006, KMWorld added a two-day workshop entitled Taxonomy Boot Camp, which still exists today. The hallmark terms for the third stage of KM are taxonomy and content.
KM and Business Strategy should
– Influence each other
– Align with each other
– Together, define a point of mutual alignment
The Theoretical Foundations for Alignment
The multi-dimensional nature of alignment
The various dimensions of alignment reflect
distinct conceptual viewpoints
– The Knowledge Lifecycle
– Behavioral slack
– Static vs dynamic
– Engineered vs organic
– The Knowledge Utilization event (KU)
– And many, many others
- The situational nature of alignment
Each behavior is a response to a given situation. You can predict alignment, you can plan for it, and you can attempt to manage it
- You can only evaluate alignment by examining the results of the behaviors exhibited in a given situational context
- The elements of alignment
Behavior exists within a conceptual context that reflects the value space of the agent
- The critical elements of alignment include:
– Conceptual frameworks
– Value sets
– Exhibited behaviors
Pitfalls of A KM Initiative
According to Davenport and Prusak (2000), Collison and Parcell (2002) and David Skyrme Associates (2003), the following points should be carefully considered in order to avoid potential pitfalls of a knowledge management initiative.
- The key elements of people, process and technology should be equally resourced in terms of time and money.
- Lack of trust, need to encourage a culture of trust and openness. This is especially difficult when the converse has been true in an organisation.
- The business is too busy, people have other priorities. It is important to embed knowledge goals into company strategy and project planning so that it becomes acceptable for people to have time and space to reflect and seek out knowledge. Giving people time now will half the time later.
- Intolerance for mistakes or asking for help. The organisation culture should allow for mistakes, by accepting and rewarding creative errors and collaboration. Also, there should be no loss of status from not knowing everything.
- Do not attempt to implement everything at once. It is a long and iterative process, not a quick fix and the benefits are realised over a period of time.
- If knowledge management is to thrive, organisations must create a set of roles and skills to do the work of capturing, distributing and using knowledge.
In summary, implementing knowledge management is about bringing together, people, skills, business processes and technology infrastructure including content management in order to exploit an organisation’s knowledge base (Knight and Howes, 2003).
- Enumerate various Knowledge Management tools and techniques
Ans:More and more companies use knowledge management to leverage theis most important resource: knowledge.
Knowledge management tries to provide the means to capture, distribute and reuse knowledge both for explicit and tacit knowledge
- Knowledge management tools are technologies, broadly defined, which enhance and enable knowledge generation, codification, and transfer. As with any tools, they are designed to ease the burden of work, through augmentation and automation, allowing resources to be applied efficiently to the tasks for witch they are most suited.
Typology of Knowledge Tools
- Knowledge Generation
- Knowledge Codification
- Typology of knowledge
- Process Knowledge
- Factual Knowledge
- Catalog Knowledge
- Cultural Knowledge
- Representation of knowledge
- Knowledge Maps
- Organizational Thesaurus and Dictionary
- Knowledge Transfer
- Temporal Distance
- Physical Distance
- Social Distance
Aspects of Engineering Knowledge Management
- The term knowledge management describes a huge set of methods and tools reaching from information technology to social sciences. Engineering knowledge management is focused on the product creation process and the interface between engineering and manufacturing.
- Skill Management
- Capturing and distributing tacit knowledge like lessons learned and best practices
- Managing explicit knowledge like reports, documents, protocols
- Capturing and reusing design rationales
- Knowledge based engineering methods and application.
- Skill management deals with the maintenance and documentation of employees’ skills. Clearly, it is necessary to predict skills needed for the future and to take measures to get these. Yellow pages which contain the names and competency profiles of company experts help to get into contact and increase networking capabilities of new employees.
- Best practices describe optimal solutions for typical engineering problems. Lessons learned are experiences gained and errors made during a project whose application in other projects can greatly improve their performance.
- Design rationales capture the knowledge of design decisions made in the product creation phase. Modeling and reusing design rationales is a huge challenge for knowledge intensive companies because very few documents generated during product creation reveal the complex reasoning involved.
- Knowledge based engineering is a highly dynamic area of research. It deals with automatic knowledge processing that helps to support the engineer in repetitive tasks. Before a knowledge based engineering application can be deployed you have to collect the knowledge from the experts and find an appropriate representation for machine interface.
Knowledge Portals and Knowledge Management Tools
Portals are considered to be
Virtual workplaces that:
- Promote “secured” knowledge sharing among different categories of end users
- Provide access to stored structured data
- Organize unstructured data
- Web-based applications providing a single point of access to online information
- An emerging tool for
- Simplify access to data stored in various application systems
- Facilitate collaboration among employees
- Assist company in reaching customers
Knowledge portals provide
Two kinds of interfaces:
- The knowledge producer interface
- The knowledge consumer interface
Collaboration tools create a KM system that supports information sharing and reuse
Enable multiple users work together in a coordinated fashion over time (and space) via the portal
Types of collaborations
- Asynchronous collaboration
- Having no time or space constraints.
- Queries, responses, or access occur anytime and anyplace
- Synchronous collaboration
- Interaction that occurs immediately (within few seconds).
- It can use audio, video, or data technologies
- Comfortable e-mail systems
- A Web browser
- Simple search functionalities
- Collaboration services with a multipurpose database
- Web services
- Indexing services for full-text search of documents
- Well-organized central storage locations
Content Management – Categorization and Publishing
- Use metadata to define types of information
- Categorize similar documents into named groups
- Directory/Indexing capability to automatically manage growing warehouses of enterprise data
- Provide dynamic taxonomy maintenance
Intelligent Agents – Gathering and Personalization
- Software that executes a range of tasks autonomously (e.g., comparing, learning, searching)
- Discover previously unknown relationship details between organization and customers
- Analyze customer’s demand priorities by learning from their purchasing experience
- What is Supply Chain Management? What are its’ key drivers?
Ans:-Supply chain management (SCM) is the management of the flow of goods. It includes the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption. Interconnected or interlinked networks, channels and node businesses are involved in the provision of products and services required by end customers in a supply chain Supply chain management has been defined as the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand and measuring performance globally."[
SCM draws heavily from the areas of operations management, logistics, procurement, and information technology, and strives for an integrated approach
SCM components are the third element of the four-square circulation framework. The level of integration and management of a business process link is a function of the number and level of components added to the link. Consequently, adding more management components or increasing the level of each component can increase the level of integration of the business process link.
Literature on business process re-engineering [buyer-supplier relationships,[ and SCM suggests various possible components that should receive managerial attention when managing supply relationships. Lambert and Cooper (2000) identified the following components:
- Planning and control
- Work structure
- Organization structure
- Product flow facility structure
- Information flow facility structure
- Management methods
- Power and leadership structure
- Risk and reward structure
- Culture and attitude
Flow of supply chain management
In the supply chain there are three types of flow from the supplier to the end customer in the chain.
- Product Flow.
- Information flow.
- Money flow.
Product flow is nothing but starting from the raw materials to the end product to the customer.
Information flow is nothing but the sharing of information’s from the customer as well as supplier. It is both directions.
Money flow is nothing but the funds flow from the consumers to the manufacturer, from manufacturer to supplier.
Supply chain refers to all the facilities and processes used in supply of goods and services; from procurement of raw material, through manufacturing operations, up to delivery to final user, and supply chain management (SCM) refers to Management of all operations within a company impacting and interfacing other sections of the supply chain to improve entire supply chain performance.
The main functions and components of SCM include:
- Defining business boundaries and relationships
Defining business boundaries and relationships is at the core of all SCM initiatives. The most important of these business boundaries relates to the decisions on outsourcing. In addition to general concept of what to manufacture and process in-house, these boundaries also refer to the roles played by supplier and buyers in each other’s business decision and operational activities.
- Managing demand and supply
Demand management is managing the demand for goods and services along the supply chain. The basic demand is the demand for the ultimate product or service from the end user. To meet this demand of end user, different links in the supply chain need to supply some goods or service to the following link in the chain. In turn to meet their supply commitment they need inputs from the previous link.
Logistics refers to all the processes involved in storing, moving, transporting or in any other way handling material. Role of logistics in activities before start of material and after completion of manufacture up to transportation to the immediate customer has been well recognized in the past also. But the logistics cost and effectiveness is also affected by, and in turn affects all other activities along the supply chain.
Purchasing has the closest links with the supply side of the supply chain. It plays a key role in the total SCM functions. At strategic level, purchasing plays a decisive role in decisions on and implementation of business boundaries. It acts as a link between the vendors and the company to get involvement and help of vendors in matters like purchased material specification, matching of lot sizes and transportation packing.
Selling is the closest link with the demand side of the supply chain. It is directly responsible to help customer know, select, buy, pay for, and take away company’s product. These products may be sold to the customers directly or through a distribution network. A Sale plays an important part in decision on design of the distribution and is directly involved in its day-to-day operations.
- Manufacturing system interface
Manufacturing represents the core of internal operations of a company. No SCM policies can operate in isolation from the manufacturing activities. Manufacturing supports SCM in many ways like, reducing manufacturing lead times and supplying material closely matched to customer lot size and time requirements.
Product design has significant impact on efficiency and effectiveness of both supply and demand side of supply chain. In addition the basic quality of the finished product sold to the end user can be improved substantially by better collaboration among channel partners.
Logistics / Supply Chain in a business aim to the following contributions:
_Achieve maximum customer service level
_Ensure high product quality
_Achieve minimum (possible) cost
_Be flexible in the constant market changes
The Four Drivers of Supply Chain Performance
Driver 1: Inventory Requirements
- Inventory "stock age" exists in all supply chains because of a mismatch between supply and demand
- Inventory plays a significant role in a supply chain´s ability to support a firm´s competitive strategy
- A supply chain manager must make routine decisions to
create a more responsive and more efficient supply chain
Driver 2: Transportation
- Transportation moves the product between different locations in a supply chain
- Transportation is prominent in a company´s competitive strategy
- The fundamental trade-off for transportation is cost (efficiency) versus speed (responsiveness)
Driver 3: Facilities
- Facilities include all locations in the supply chain to store, assemble, or fabricate inventory
- Decisions regarding location, capacity, and flexibility of facilities significantly affect supply chain performance
- In DoD, depot and field repair facilities are cornerstones of the supply chain
Driver 4: Information
- Information serves as the connection between the supply chain´s various stages
- Information and information systems are an important part of balancing responsiveness versus efficiency
- Businesses must trade-off between efficiency and responsiveness when trying to include more supply chain information
- What is Customer Relationship Management? What are the various types of CRM
Software/CRM tools available in the market?
Ans::“Process of creating and maintaining relationships with business customers or consumers”
- “A holistic process of identifying, attracting, differentiating, and retaining customers”
- “Integrating the firm’s value chain to create enhanced customer value at every step”
- “An integrated cross-functional focus on improving customer retention and profitability for the company.”
Any application or initiative designed to help an organization optimize interactions with customers, suppliers, or prospects via one or more touch points for the purpose of acquiring, retaining, or cross-selling customers. Goodhue, Wixom, & Watson, 2002)
CRM Focuses on
CRM focus on providing and maintaining quality service by communicating and delivering products, services, information and solutions to address problems, wants and needs
- Can include:
- Call handling (the maintenance of outbound and inbound cal