Integrated Business Processes with ERP Systems

Simha R. Magal, Ph.D., is professor of management (MIS) and director, ERP initiative, in the Seidman College of Business at Grand Valley State University. He received his doctorate from the University of Georgia. His primary research interests include e-business and enterprise systems. Dr. Magal’s articles have appeared in such publications as MIS Quarterly, Journal of MIS, and Information and Management, among others, and he has served on the editorial boards of several journals. Dr. Magal has taught courses related to business processes and enterprise systems that utilize SAP for more than a decade. He is an SAP-certified associate consultant and a TERP10 academy instructor. Jeffrey Word, Ph.D., is vice president of product strategy at SAP AG. He is responsible for defining SAP's future product strategy and for fostering product innovation within SAP. Dr. Word has worked for several Global 1000 companies in the high-tech industry for nearly 20 years, specializing in business consulting and IT strategy. At SAP, he has driven the evolution of the company’s enterprise technology strategy, with a special focus on corporate process improvement initiatives and services-based IT architecture design. Dr. Word earned his Ph.D. in information systems at Manchester Business School in England.

1 Introduction to Business Processes 1

The Functional Organizational Structure 2

Business Processes 4

Global Bike Incorporated (GBI) 15

How to use This Book 16

2 Introduction to Enterprise Systems 23

Enterprise Systems 23

Data in an Enterprise System 29

Reporting 37

3 Introduction to Accounting 49

Organizational Data 51

Master Data 52

Key Concepts 58

Processes 61

Reporting 72

4 The Procurement Process 83

Organizational Data 84

Master Data 89

Key Concepts 95

Process 102

Reporting 119

5 The Fulfillment Process 127

Organizational Data 128

Master Data 139

Process 145

Credit Management Process 167

Reporting 170

6 The Production Process 179

Master Data 182

Process 196

Reporting 215

7 Inventory and Warehouse Management Processes 221

Inventory Management 222

Organizational Data in Warehouse Management 234

Master Data in Warehouse Management 239

Processes in Warehouse Management 242

Reporting 257

8 The Material Planning Process 269

Master Data 271

Process 285

Reporting 304

9 Process Integration 315

Procurement, Fulfi llment, and IWM Processes 318

Procurement, Fulfi llment, Production, and IWM Processes 332

Index 349