Enterprise resource planning 1st by mary summer chapter 07

Enterprise Resource Planning, 1st
Edition by Mary Sumner
Chapter 7:
ERP Systems: Human Resources

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Objectives
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Examine the HR processes supported by ERP

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Understand the interrelationships among business
processes supporting human resource management

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Case: Atlantic Manufacturing
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Recruitment, training, and retention of sales
force is difficult
HR records inadequate
HR paperwork and compliance requirements
increase steadily
Management of compensation packages
difficult
Needs to create a strategy for controlling the
cost of various employee benefits
© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Human Resources Problems
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Maintaining accurate employee information

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Job analysis and design

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Applicant selection

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Compensation

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Benefit administration

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Training

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Governmental reporting

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

7-4


Evolution of HR Systems
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Traditionally relied upon stand-alone systems

– Specialized applications for applicant
tracking, compensation, benefits,
attendance
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Redundant data

– No link to financial systems
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ERP

– Linked to financial systems
– “Best practices”

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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ERP HR Modules
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Components
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HR Management
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Benefits administration
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Links employee data to actual benefits
Allows selection from group of benefits

Payroll
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Personnel records
Resumes

Paychecks, tax reports, accounting data

Time and labor management
Employee/Manager self service
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Travel reimbursement
Personnel data and benefits changes
Training class

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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HR Modules
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Attributes
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Integration
Common database
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Provide audit trails

Scalable and flexible
Drill-down capability
Workflow management for electronic routing of
documents and other document management
Process standardization
Security
User friendly and web-accessible

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Management Control Modules
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HR information enables management of diverse workforce
Supports managerial decision making through query and
reporting tools
Operational level controls

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Strategic level controls
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Maintain and update employee files
Job analysis files
Design files
Regulatory files
Skills inventory files
Human capital inventory for tracking employees
Position control linked to budgeting
Labor/management relationships
Business intelligence tools for predicting trends

Module integration is significant benefit
© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

7-9


Featured Article: Keep Track of
Your Employees
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What are the benefits of automated time and
attendance records?

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What advantages might accrue to employees using
these systems?

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Featured Article: Keep Track of
Your Employees, continued
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Employees’ attendance, time at work, and
skill levels
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Most companies uncertain
If tracked, usually manual
Records usually neglected
Often piece-meal, no end-to-end solution

Benefits of automating
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Eliminates manual process

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Time-consuming
Error-prone
Better analysis
More control

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Featured Article: Keep Track of
Your Employees, continued
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Banner Health
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Selected Kronos Inc. software
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Time- and labor-management
Accessible from web, phone, badge terminals
Information available in real-time

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Allows for quick staffing adjustments

Financial benefits to employees, company

Smurfit-Stone Container Corp
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Uses Workbrain Inc.’s ERM3, SAP financial
applications, and PeopleSoft payroll processing
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Web-based employee-relationship management
software
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Optimized scheduling and tracking of employees
Interfaces with PeopleSoft applications

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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Summary
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ERP systems include HR modules that offer records
management, benefits administration, and payroll

– Offer integrated operational and strategic
level controls
– Scalable and very flexible

© Prentice Hall, 2005: Enterprise Resource Planning, 1st Edition

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