Transcript Overview and Case Study 2: ERPsim Manufacturing (I) Fall, 2011

Overview and Case Study 2:
ERPsim Manufacturing (I)
EGN 5621
Enterprise Systems Collaboration
Fall, 2011
Objective
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The objective of the Manufacturing
introductory ERPsim is to provide a quick
hands-on experience of an integrated
business process through an ERP
manufacturing ERPsim, which combines
basic operation functions, such as
planning, sales, production, procurement,
marketing, investment, and financial
accounting for learning how to make
business strategy and business decisions.
Corporate Roles Designation
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CEO (Team Leader)
◦ Watch financial statement
◦ Price market report
◦ Check summary sales report
◦ Check sales and market data
◦ Check inventory Report
Marketing Manager
◦ Marketing Expense Planning
◦ Price market report
◦ Check sales and market data
Sales Manager
◦ Change price
◦ Check summary sales report
◦ Check sales and market data
MM Manager
◦ Forecast – create planned indep. Req.
◦ MRP run
◦ Automatic generation of POs
◦ Purchase Order Tracking
◦ Check inventory Report
3
Operations in the
cash-to-cash cycle
The Virtual Business Environment
Simulation of a market
Automation of administrative tasks
Simulation of the passing of time
Organizational elements
Organizational elements
Organizational elements
Organizational elements
Data model of the main master
data used in the simulation game
Definition of master data (1/2)
Definition of master data (2/2)
List of master data to create for
the simulation
Muesli Cereals
Wheat
Nuts
Blueberries
Oats
Raisins
Strawberries
Your 6 products
40% wheat
40% oat
20% nut
1 box
1 bag
40% wheat
40% oat
20% raisin
1 box
1 bag
40% wheat
40% oat
20% blueberry
1 box
1 bag
50% wheat
50% oat
1 box
1 bag
40% wheat
40% oat
20% strawberry
1 box
1 bag
35% wheat
35% oat
10% raisin
10% nut
5% strawberry
5% blueberry
1 box
1 bag
Data model of product Y$$-F06
German market
North
DC10: 2 retailers
DC12: 19 retailers
West
DC10: 3 retailers
DC12: 17 retailers
South
DC10: 7 retailers
DC12: 23 retailers
Muesli Manufacturing
Association Label
Regulation
Input Cost
at low seasonal price
Number of stores by
geographical area
DC10
Hypermarkets
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Buy only large boxes (1 kg)
Payment delay of 20 steps
More sensitive to price
Less sensitive to advertising
Will have a stronger preference for 3
particular products during the simulation
DC12
Grocery chains
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Buy small boxes (0.5 kg) and large boxes
(1 kg)
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Payment delay of 10 to 15 steps
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Will have a stronger preference for 4
particular products during the simulation
DC14 Independent grocers
(will be used in Extension ERPsim)
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Only buy small boxes (0.5 kg)
Less price sensitive
Sensitive to advertising
Payment delay of 5 to 15 steps
Will have a stronger preference for 3
particular products during the simulation
Number of retailers per
Locations
Risk premium on credit
ratings
Production improvements
(will be used in extension ERPsim)
Warehousing cost
automatically charged
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Each team has 3 warehouse storage areas:
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Additional warehouse space can be rented:
◦ Finished product - space for 250,000 boxes
◦ Raw materials - space for 250,000 kg
◦ Packaging - space for 1,000,000 boxes and
space for 1,000,000 bags
◦ 100,000 boxes (or part thereof), @ € 200/step
(less than € 0.01 per box per step)
◦ 100,000 kg (or part thereof), @ € 350/step
(more expensive because it's raw food product)
◦ 100,000 boxes AND/OR bags (or part thereof),
@ € 50 step
Fixed costs per week
Review of the major rules
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You may not change the recipe of a product
if you are still carrying inventory
Customers preferences do not change
throughout the game, hence you may learn
from their past behavior
The company displaying the highest
shareholder’s equity at the end of the
simulation wins the game
You must behave ethically at all times
The end of game inventory will be value at
cost price in the final balance sheet.
Therefore, you shouldn’t sell under cost at
any time during the game.
Elements of a winning
strategy
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Use the ERP system efficiently
Do not run out of stock
Delays, production capacities and
liquidity constraints are important
elements of the game
Exploration and exploitation
Team organization is more important
than you think
Game layout
30 min
30 steps
30 min
30 steps
30 min
30 steps
Rules of the game
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Each round will be of 30 steps (approx 1 min per step)
End-of-round inventory is carried over to the next round
You can sell a product only if you have it in stock
You compete against the other teams and importers
Your objective is to maximize profit
Participant’s job aid
Let’s get started!
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Create your team :
• Max 4 persons : User 1 to User 4
• Up to 26 company : A to Z
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Log in using user name and passwords giving by your
teacher
Client 265
Login : intro_$#
$ = Team,
# = User 1 to User 4
Password: ERPSIM
Login information
SAP Menu & Navigation
Introductory Game:
Round 1
30 min
30 steps
Cost, inventory & initial pricing
Material
$$-F01
$$-F02
Nut Muesli
1.0 kg.
Blueberry
Muesli
1.0 kg.
Raw material Cost
€ 1.53
€ 1.97
€ 1.97
Standard cost
€ 2.48
€ 3.09
Initial price 10
12
€ 4.24
€ 4.49
100,000
Name
Initial stock
$$-F03
$$-F04
$$-F05
$$-F06
Original
Muesli
1.0 kg.
Mixed Fruit
Muesli
1.0 kg.
€ 1.38
€ 1.36
€ 1.76
€ 3.09
€ 2.50
€ 2.65
€ 2.89
€ 5.18
€ 5.43
€ 5.18
€ 5.43
€ 3.92
€ 4.17
€ 3.87
€ 4.12
€ 4.75
€ 5.00
100,000
100,000
100,000
100,000
100,000
Strawberry Raisin Muesli
Muesli
1.0 kg.
1.0 kg.
The Introductory game:
Round 1 (30 steps- days)
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You need to maintain the price of your 6 products and invest in
marketing.
What do you need to know in order to make that decision ?
You need to know how to :
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Maintain price list
See available stock
Monitor sales orders
Monitor competitors
Monitor your profit !
Participant’s job aid & Menu
Check product costing
Maintain Prices for DC 10 & 12
Marketing expense
Stock in material overview
Check sales summary report
Check sales order report
Check market report
Check financial statements
The Introductory game:
Round 1 (30 steps – 30 days)
We start the simulator for 30
steps
Introductory game:
Round 2
30 min
30 steps
Participant’s job aid & Menu
Release production order
Check production schedule
Parameters of the game
The Introductory game:
Round 2 (30 steps - days)
We start the simulator for 30
steps
Introductory game:
Round 3
30 min
30 steps
Participant’s job aid & Menu
Raw material cost per PO
Forecasting
Execute MRP
After the MRP run
Convert purchase requisitions into
purchase orders
The Introductory game:
Round 3 (30 steps – 30 days)
We start the simulator for the
last 30 steps
Track purchase orders
Profit center analysis
Liquidity planning