Unit 3. Chapter 19. Globalisation and international marketing

Question 1

Def. ERP (2)

Answer 1

• Enterprise Resource Planning: The use of a single computer application to plan the purchase and use of resources in an organisation to improve the efficiency of operations.
• Supply chain management (SCM) is the main application for ERP software.

Question 2

Def. Supply chain

Answer 2

All of the stages in the production process from obtaining raw materials to selling to the consumer - from point of origin to point of consumption.

Question 3

How does ERP help with the main stages of SCM? (6)

Answer 3

1. Plan: Deciding which resources (workers and machinery) are needed and their quantity
2. Suppliers: Choosing cost effective suppliers and order to arrive in time
3. Costs: At all stages costs can be calculated to help decide on appropriate pricing
4. Manufacture: Check the quality and rate of progress
5. Deliver: Pick most efficient and effective transport systems
6. Returns: If there’s a faulty product, it would be taken back and added to costs to the business

Question 4

Benefits of ERP (6)

Answer 4

1. Supply only according to demand -> lead production with minimum waste
2. JIT applicability
3. Reduces costs at all stages
4. Improved delivery times and consumer services
5. Departments are more linked by 1 database - allowing better coordination
6. Increase in information for managers to analyse for future decision making.

Question 5

Limitations of ERP (3)

Answer 5

1. The system is expensive
2. The multiple ways of operating in different departments is reduced to one -> may cause resentment and require training
3. Full implementation of ERP may take 1-3 years, and the technology might have advanced even further (fast changing markets)