Enhancing ERP system's functionality with discrete event simulation

Young Bai Moon · Dinar Phatak

63 citations0/0 files storedIndustrial Management & Data Systems

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ERP Systems Implementation and Impact Simulation Techniques and Applications Simulation and Modeling Applications

Abstract

Purpose To develop a methodology to augment enterprise resource planning (ERP) systems with the discrete event simulation's inherent ability to handle the uncertainties. Design/methodology/approach The ERP system still contains and uses the material requirements planning (MRP) logic as its central planning function. As a result, the ERP system inherits a number of shortcomings associated with the MRP system, including unrealistic lead‐time determination. The developed methodology employs bi‐directional feedback between the non‐stochastic ERP system and the discrete event simulation model until a set of converged lead times is determined. Findings An example of determining realistic production lead‐time data in the ERP system is presented to illustrate how such a marriage can be achieved. Research limitations/implications The research demonstrates that the limited planning functionality of the ERP system can be complemented by external system such as discrete event simulation models. The specific steps developed for this research can be adopted for other enhancements in different but comparable situations. Practical implications The organizations who have been using the discrete event simulation in their planning and decision‐making processes can integrate their simulation models and the ERP system following the steps presented in this paper. The ideas in this paper can be used to look for automatic data collection process to update or build the simulation models. Originality/value The ERP implementation is a significant investment for any corporation. Once the ERP implementation is completed successfully, the corporations must look for ways to maximally return on their investment. The research results may be used to enhance the implemented ERP systems or to fully utilize the capabilities in a corporation.

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References

1998Putting the enterprise into the enterprise system.1990Introduction to Simulation Using Siman 2006Enterprise resource planning survey of Korean manufacturing firms 2004Enterprise systems and the supply chain 2002Enterprise resource planning survey of Swedish manufacturing firms 2005Causes influencing the effectiveness of the post‐implementation ERP system 2005Enterprise resource planning and organisational innovation: a management perspective 2004Process mapping in successful ERP implementations

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2006An exploratory study of enterprise resource planning adoption in Greek companies 2012Input data management in simulation – Industrial practices and future trends 2016Achieving manufacturing excellence through the integration of enterprise systems and simulation 2014Business process re-design methodology to support supply chain integration 2015A business process re-design methodology to support supply chain integration: Application in an Airline MRO supply chain

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