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Unlocking Your ERP Data: Business Intelligence for ERP Systems

  • June 01 2001, 1:00am EDT
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Enterprise resource planning (ERP) systems brought the promise of a single, integrated processing environment to an otherwise chaotic mix of business applications tied together by a maze of complex interface programs (if tied together at all). The promise of the ERP system was that one system would solve all the information needs of an organization. This allure, and the Y2K threat, led many organizations to spend millions of dollars in ERP software licenses, consulting services and business process reengineering efforts to achieve one information backbone for the organization. The results have been mixed. Although ERP systems are good at capturing and storing data, the systems lack capabilities to analyze and report data. The ERP system is the backbone of data processing for many organizations, but business users are frustrated with the inability to get information out of the system.

The data warehouse is a necessity for these organizations. The ERP system has limitations inherent in the design of transaction-processing systems. Operational systems are structured to capture data and to operate, but not to report. The ERP data schema is ex-tremely complex, containing thousands of tables with hundreds of columns, cryptically named, with relationships that are difficult to decipher. The ERP solution was developed to integrate the business processes across the entire supply chain with a modular design structure to allow organizations to select only components. Theoretically, all the data is in the ERP system. Yet it remains locked, not easily retrieved for analysis. In addition, the ERP systems can't accommodate data from other applications and external sources necessary for the analytic processing of the intelligent enterprise.

Corporate data is the lifeblood of the competitive organization; ERP is the heart. It is the data warehouse that is the brain consolidating the ERP data along with external sources of data in the creation of information and support of analysis. It is the business intelligence environment that can unlock the information collected by the ERP system.

The information you get from the data collected in the ERP and other enterprise applications is the competitive advantage in the information age. The natural conclusion to be drawn is as follows: Businesses need an approach that allows for rapid deployment of a flexible data warehouse which can store data historically but allow for changes to the data structures as the information needs evolve.

Selecting the best approach is based, to a great degree, on where you fall along the operational environment complexity continuum. The following scenarios define the continuum:

  1. You have a single, vanilla installation of the ERP software and have converted much of the historical data from legacy systems replaced by the ERP implementation. This is the simplest case; however, given the complex and time-consuming efforts required to install the ERP system and convert data from the legacy environment, it is doubtful any legacy data was converted to the ERP.
  2. You have a single, vanilla installation of the ERP, plus historical data sitting in idle legacy systems. This is a more likely situation, requiring consolidated reporting to view historical trends.
  3. You have a single, enterprise-wide ERP application with many custom-izations. In the vanilla install of an ERP solution, the business processes are changed to match those supported by the system. If you couldn't or wouldn't modify your processes, then you customized your ERP system. This requires a customized data warehousing environment.
  4. You have only implemented components of one ERP system and use other business application systems and interfaces for business functions. This scenario may be due to the inability to reengineer all business processes or a decision to use best-of- breed solutions from various vendors based on application coverage, product performance and process implementation.
  5. You have multiple business units utilizing multiple ERP systems to perform similar business functions. This situation exists as a company grows through acquisition. It may not be feasible or a priority to move all business units to one ERP environment.

The keys to a successful business intelligence data warehouse environment are the tools and methodologies used to extract, store and access the data. The selection must be based on the business requirements and the technical infrastructure. Tools that provide real benefits to organizations in one part of the continuum may fall far short for organizations in another.
Establishing a business intelligence data warehouse is the best way to unlock the data in your ERP system. To enable the real power of the information, you need a solution that is flexible and extensible. ERP vendors are focusing on their own data warehousing solutions, and third-party data warehouse vendors are rallying around the ERP marketplace. The number of options is overwhelming. Matching the right tools to the business requirements and the operational landscape will ensure success.

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