Submit Electric Light Up with a New ERP system
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The document discusses Summit Electric Supply, a wholesale distributor of industrial electrical equipment. It lists 5 group members and provides background on Summit's operations across 3 divisions in multiple locations. Summit was facing issues with its legacy information system not being able to handle the business growth. The document then summarizes Summit's implementation of a new ERP system provided by SAP to improve business processes and operations.
Submit Electric Light Up with a New ERP system
- 1. GROUP MEMBERS 1. Arni B. Hj. Morshidi P14D461P 2. Anisah Bt Ismail P14D389P 3. Syarifah Rohaya Bt Wan Idris P14D397P 4. Dayang Adelina Bt Hj Abang Muan P14D394P 5. Norhana Aini Bt Saini P14D398P
- 2. Top wholesale distributors of industrial electrical equipment and supplies Founded in 1977 in Albuquerque, New Mexico A “middle man” 3 divisions: Global export – Houston, Marine – New Orleans, Sales - Dubai
- 3. A legacy information system not keep up with the business DONE MANUALLY • Only handle a fixed number of locations and limited of numbers used on documents IS DEPARTMENT • Had to use the same range of document numbers over again every few months Summit needed a system that could handle a very large number of SKUs Changed to new system ERP provided by SAP • That would require improve its business process and the way people worked.
- 4. • Whichbusiness processesarethe mostimportantat SummitElectricSupply?Why? • Whatproblemsdid Summithavewithits old systems? Whatwasthe businessimpactofthoseproblems? • How did Summit’sERPsystemimproveoperational efficiency anddecision making? Giveseveral examples.
- 5. • Describetwowaysin which Summit’scustomersbenefit fromthe newERPsystem. • DiagramSummit’soldandnew processforhandling chargeback.
- 6. the active management of supply chain activities to maximize customer value and achieve a sustainable competitive advantage. • Summit Electric Supply is one of the top wholesale distributors of industrial electrical equipment and supplies in U.S. • Distributes products that include motor control, wire and cable and etc. • As a “middle man” – obtains finished goods from manufacturers and sell them to electrical contractors working on projects • Handle a very large number of SKUs transaction in a very short lead times • Whichbusiness processesarethe mostimportantat SummitElectricSupply?Why?
- 7. ERP SYSTEM • A packaged business software system that enables a company to manage the efficient and effective use of its resources. SAP APPLICATION • SAP is a core ERP application and the best practices function in sale and distribution, materials management, Human Resources and Financials and its knowledge in distribution business. • SAP’s Net Weaver support Summit Electronic more organize and be able to control how much was needed to be produced and distributed. • It’s useful for business intelligence reporting and analysis. BATCH MANAGEMENT • It is a software that treats a wire reel a batch rather than single as single products. • It used to cater high demand for wires and cable products.
- 8. Used separate systems for orders and financial So that, the data could not be easily combined for business intelligence reporting and analysis The integration between sales entries and purchase order and back-end reporting. Only handle a fixed number of locations and limited range of numbers that could be used on documents I.S Department had to use the same range of document numbers over again every few months. • Whatproblemsdid Summithavewithits old systems? Whatwasthe businessimpactofthoseproblems?
- 9. The system was not able to keep up with the fast growing business. Not able to handle the volume and complexity of the company’s chargeback agreements and reporting capabilities were limited
- 10. ERP improved operational efficiency and give scalability and the ability in Summit’s business process Especially in supply chain areas like sales and distribution, inventory management and financial reporting system - as the company expected strong growth in these areas. • How did Summit’sERPsystemimproveoperational efficiency anddecision making? Give several examples.
- 11. • It’s running smaller and frequent inventory update throughout the day, instead of a night-which caused a delay. • New system provided accurate information of shipping order, which Summit’s was able to ship immediately. Runningmorefrequent inventoryupdates • To replenish wire and cable, the ERP batch material management identified the customer purchase amount, length of wire and product manufacturer. • Each time a customer buys a length of wire, the length is entered into the system to track how much of the “batch” was sold. Adaptingthe inventorytrackingprocess • To secure inventory for special customers, with long term projects, Summit created a “parent- child” warehouse relationship in ERP system to secure the materials in inventory as well as on premises. Changinghowinventoryis managedat jobsites
- 12. • To make a better manage its finance and ordering system, Summit implemented the SAP’s/NetWeaver BW data warehouse and business intelligence. • By integrating the NetWeaver, Summit was able to analyze the profit of each sales person, manufacturer, customer and branch. • Using SAP software, Summit was able to improve its ROI, by automating sales tax and chargeback’s. • The SAP/Paybacks and Chargeback’s application was able to identify the billing activity, if there was a chargeback, the SAP system would automatically submit the information to bill the chargeback- increase its chargeback claims of up to 118%. • Summit decision making for implementing the new ERP system was based on the growth of the organization, the complexities of processing orders, analyzing finances and back and reporting. • Once the new ERP/SAP was in place, Summit management was able to focus on sales and orders and quotes, supplier performance and delivery schedule. • The new SAP/ERP has allowed Summit to run its operations with flexibility and allow the SAP to operate efficiently. • The new ERP system allowed management to have a greater vision for decision making and managing its operations Business intelligence
- 13. Customer can relyon the company for theirneeds and products • The company now more efficient • The company wants that customers to feel that they can provide that they have produced products the customer want and sent to them in short time period. To accommodate largecustomers with long termjob sites • SES sets up temporary warehouse on site to supply electrical products. • Create “parent – child” warehouse relationship – to able to work with customers. • The warehouse can be controlled like subparts of the main SES warehouse. • It helps to prevent anybody from selling the consigned inventory into the warehouse. • Describetwowaysin which Summit’scustomersbenefit fromthe newERPsystem.
- 14. Chargeback is the return of funds to a consumer. The chargeback mechanism exists primarily for consumer protection. For the distribution company, chargeback occurs when the supplier sells a product at a higher price to the distributor than the price they have set with the end user. • DiagramSummit’sold andnew processforhandling chargeback
- 15. Look through customers invoices Identify specific manufacturer which Summit chargeback could claim Input data manually in Excel spreadsheet Submit paper copies of invoices to vendors Received responds from vendors End of process
- 16. All chargeback agreement loaded in SAP system System review billing activity and do a matching to create a separate chargeback documents Automatically submit the information and chargeback document to identified vendor End of process