Case Study:

Numerous information systems are available within SAP ERP to support most of the processes that we will discuss in this book. Information systems (IS) can be divided into three broad categories: logistics information systems (LIS), financial information systems (FIS), and human resources information systems (HRIS). Logistics information systems support all of the logistics processes. Recall that logistical processes are concerned with acquiring, storing, creating, and distributing materials. The components of LIS include purchasing IS, sales IS, inventory control IS (IWM processes), quality management IS, plant maintenance IS, and shop floor IS (production processes). The financial information system supports reporting related to the general ledger (e.g., balance sheet, income statement, statement of cash flows), accounts receivable, and accounts payable. The HRIS is used to retrieve information about different HR components such as personnel, positions, and jobs.

Recall that information systems are part of the OLAP component of SAP ERP, and they utilize information structures to provide analytic capabilities. There are two types of information structuresstandard and user-defined. Standard information structures are predefined in the SAP ERP system, and they collect the data needed to generate the most commonly used reports. SAP ERP also enables users to define their own structures, known as user defined information structures, to meet specific reporting requirements.

Finally, information structures enable users to conduct two types of analysis standard and flexible. Standard analysis provides predefined analytics for data in standard information structures. This type of analysis is sufficient for most analytic requirements. When standard analysis is insufficient, users can conduct flexible analysis to customize the reporting. In contrast to standard analysis, flexible analysis allows users to define the content and format of the analysis. Specifically, it enables users to combine available characteristics and key figures as needed and to create new key figures using user-specified formulas. It also provides users with several layout options.

To summarize, the OLTP component of SAP ERP offers reporting in the form of work lists and online lists that are based on detailed transaction data.

In contrast, the OLAP component offers reporting via information systems, based on aggregated data in information structures. These capabilities are limited to data within the SAP ERP system. Today, however, companies need even more powerful reporting capabilities that combine data from multiple sources. This is the domain of business intelligence.

Q1. As an information systems project manager, on what bases would you select the modules and the functionalities of the enterprise systems to fit with your business needs and requirements?

Q2. Analyze the capabilities and the type of reporting you are seeking for your project and illustrate the right approach in selecting the suitable IS vendor for the project.