ABSTRACT
Untuk bersaing di pasar yang kompetitif, perusahaan dituntut untuk memberikan pelayanan yang lebih baik untuk pelanggan, karena itu perusahaan harus mempunyai sistem manajemen yang baik. Sistem manajemen suatu perusahaan biasanya terdiri dari manajemen pembelian, penjualan dan distribusi, keuangan, produksi, dan persediaan. Masalah yang paling sering muncul dalam perusahaan adalah masalah manajemen persediaan. Persediaan biasanya merupakan bagian terpenting dalam perusahaan dan mempengaruhi seluruh aspek bisnis perusahaan. Skripsi ini akan menerangkan bagaimana Enterprise Resource Planning (ERP) dapat membantu perusahaan dalam mengatasi masalah – masalah yang disebut diatas.
Dalam menulis skripsi ini, saya akan melakukan observasi pada salah satu perusahaan lokal yang telah berhasil mengimplementasikan ERP, yaitu PT SALUYU MOTOR. Untuk mendapatkan data-data yang mendukung untuk penulisan ini, saya menggunakan metode wawancara pada beberapa staff termasuk salah satu pemilik perusahaan dan juga metode perbandingan dengan membandingkan keadaan perusahaan sebelum dan sesudah mengimplementasi ERP.
Saya berharap skripsi ini dapat membantu perusahaan-perusahaan terutama perusahaan yang belum atau akan menggunakan system ERP untuk mengenal dan memahami konsep ERP dan belajar dari perusahaan yang telah berhasil mengimplementasikannya.
TABLE OF CONTENT
Pages
APPROVAL PAGE ... i
ABSTRACT... ii
DECLARATION OF ORIGINALITY ... iii
PREFACE ……… iv
TABLE OF CONTENT ... v
I. INTRODUCTION 1.1. Background ... 1
1.2. Identification of Problems ... 5
1.3. Objectives ... 5
1.4. Limitations of Study ... 6
1.5. Layout of the Thesis ... 6 II. THEORETICAL REVIEW 2.1. Operation Management ……….. 8
2.2. Inventory Management ………9
2.3. Enterprise Resource Planning (ERP) ………. 11
2.4. Cost and Benefits of ERP ………. 14
2.4.2. Cost of ERP ……… 16
III. CASE ANALYSIS 3.1. Company Profile ……… 17
3.2. Inventory System Problem (Before ERP) ……….. 19
3.3. Planning and Implementations of ERP ……….. 21
3.4. Inventory Management with ERP ………... 23
IV. CONCLUSION AND SUGGESTION 4.1. Conclusion ………...27
4.2. Suggestion ………...28
BIBLIOGRAPHY ………….………...29
APPENDICES ……….………...30
CHAPTER 1
INTRODUCTION
1.1 Background
In today’s globalization era, companies have to compete with the
competitive market, and thus they are required to give better service to the
demanding market locally and internationally. In order to maintain and expand its
market share, companies are required to give better services to their customers,
deliver better quality products with lower cost. To do this, first of all, companies
must have a good management system. With a good management system,
companies will be able to work effectively and efficiently to provide a better
customer service.
Maintaining a good management system is not easy. It requires
integration in each department and discipline. A company management usually
includes purchasing management, sales and distribution, financials, production,
and inventory. One of the common management problems most companies face
is managing inventory. “Inventory is a list of goods and materials, or those goods
and materials themselves, held available in stock by a business.”
To most companies such as retail industries, inventory is the backbone
which affects the whole aspects of their business. For these companies,
Inventory is their largest asset, therefore it must be properly managed. Good
inventory management will reduce operating cost and time which leads to an
increase in company’s cash flow. On the other hand, mismanagement of
inventory may increase operation time and cost which will lead to declining cash
flow and a loss in market share to competitors.
This inventory management problem was also faced by PT SALUYU
Motor. PT SALUYU MOTOR BANDUNG is a local company located on Jalan
Asia Afrika, Bandung, which focuses on distributing cars and spare parts.
Established in 1974, PT SALUYU MOTOR BANDUNG started its business by
importing cars from Australia. It now has four sister companies and five outlets
spread in Bandung and is an authorized distributor of four automotive vendors,
Mitsubishi (main dealer), Nissan (main dealer), Ford (main dealer), and Suzuki
(sub dealer).
Based on the interview conducted in 2007, Mr. Satria, the managing
director of PT SALUYU Motor, confirms that the company has been facing
management problems. He admits that as the company grows, managing the
company has become more and more difficult. “It was hard already with only one
outlet, and now we have five outlets, and they are much harder to maintain,” he
said.
Moreover, as the company’s early system was not integrated and
computerized, it was impossible to create real time reports of the stock they had.
With the old inventory system, they had difficulties in calculating their stock
values. This had made them difficult to calculate their expenses and set the
appropriate selling prices. The company’s 2003 annual reports alone said that
they had lost almost 50 millions rupiahs from lost or broken inventory.
On the other hand, Mr Satria says that the company handles more than
100 orders per day. It means inaccurate inventory will make orders fall out. In
papers, they run out of stock, but actually they have some stocks left. Bad
inventory management also causes high level inventory which results in high
maintenance cost, which will result in lower annual profits. For that reason, PT
SALUYU MOTOR BANDUNG has been trying to fix those problems.
Problems stated above are what encouraged PT SALUYU MOTOR
BANDUNG to turn to Enterprise Resource Planning (ERP). In early 2004, the
company started implementing ERP and finished the project successfully in early
2005. And now, with ERP the company is able to perform better and faster. ERP
has helped the company to increase their inventory accuracy from 20 percent to
90 percent. Moreover, it has also helped the company to cut operating time,
reduced paper and data redundancy, increased customer satisfaction level, cut
expenses and increased profits.
Moreover, Mr. Satria says that at first they consider ERP as a burden
because it means adaptation to something new. But in the end, implementing
ERP is all worth doing. ERP has helped them to work more effectively and
efficiently. Managing the company has never been easier, according to Mr.
MOTOR BANDUNG to fix their inventory management problems. But first it is
important to understand the concept of ERP.
Whitten (2004: 33) describes ERP as a software application that fully
integrates information systems that span most or all of the basic, core business
functions (including transaction processing and management information for
those business functions). ERP can also be described as
“an industry term for the broad set of activities supported by multi-module application software that helps a manufacturer or other business manage the important parts of its business, including product planning, parts purchasing, maintaining inventories, interacting with suppliers, providing customer service, and tracking orders. ERP can also include application modules for the finance and human resources
aspects of a business “(http://searchsap.techtarget.com/sDefinition/0,290660,sid21_gci21394
6,00.html, 20/03/2007).
In short, ERP is a software application that can help business owners to
manage their company more effectively and efficiently. In the early stage, ERP
was designed to help manufacturing company manage their production. Later,
ERP has been successfully implemented to various types of business from retail
to service company.
Therefore, virtually, all organizations, large and small, may use ERP
software to improve their businesses. A local system developer named Reynaldi
who is experienced in ERP implementation says that, a successful
implementation of ERP software will significantly reduce work time and operation
cost, which results in increase of annual profit and better services to the
customers. He also says that ERP organizes information in a centralized
database and integrates most departments in the company. Therefore, business
owners will have more control over their company, which will help them to make
better business decisions.
In this case study I would like to observe the way PT SALUYU MOTOR
BANDUNG manages their businesses, especially, their inventory before and
after implementing ERP. I would also like to analyze the benefits PT SALUYU
MOTOR BANDUNG has gained from the implementation of ERP.
1.2 Identification of the Problems
In this case study, I would discuss the problems listedbelow:
1. What inventory problems did PT SALUYU MOTOR BANDUNG have
before implementing ERP?
2. How is implementingERP able to eliminate these problems?
3. What steps have the company taken in planning and implementing ERP
successfully?
1.3 Objectives
My objectives in writing this case study are:
1. To collect information on problems that the company faced before
implementing ERP.
2. Analyze and observe the way ERP eliminates these problems and improve
the company's performance.
3. To collect information on what makes a successful ERP implementation. I
have to take before and after implementing ERP so that companies may
experience full benefits of the implementation.
1.4 Limitation of Study
I would like to conduct research about PT SALUYU MOTOR BANDUNG
management problems and analyze how ERP eliminates these problems mainly
in the inventory sector. This thesis does not cover the following points:
• The technical aspect which are correlated with ERP technology, hardware,
and software (for instance connection, database, data transfer and speed)
• The cost of ERP implementation (for instance consultant, software license
and technical support)
• Other management problems outside Inventory.
• The company’s confidential information such as financial reports.
1.5 Layout of the Thesis
This thesis starts with the Abstract, a concise summary of the entire paper
in Indonesian. This Abstract is followed by the Preface, in which
acknowledgments are given to those contributing and involved in the work. After
that is the Table of Contents and the Appendices followed by its four chapters
Chapter I : Introduction to the study.
Chapter II : Theoretical Review of basic theories or concepts related to
the Case Study
Chapter III : Findings and Discussion of the study, including ways of
collecting data, information or data gathered and
discussion of important findings.
Chapter IV : Conclusion, in which major statements are made along
with some suggestion or implication for further study is
CHAPTER 4
CONCLUSION & SUGGESTIONS
4.1 Conclusion
In this chapter I will present my conclusion. From the first chapter until the
third chapter, we have seen some problems that PT SALUYU MOTOR
BANDUNG has and how ERP is able to eliminate those problems. Based on the
interviews and analysis that have been conducted, I have come to believe that
ERP implementation is able improve the company management system, in this
context is its inventory. The company significantly increases the accuracy of its
inventory. By using ERP real time reports, the company is able to calculate how
much time they need from the day customers make their orders until the time
customers get their orders. This has increased on time deliveries. ERP is able to
reduce cost and improve annual profits.
We have seen that PT SALUYU MOTOR BANDUNG has successfully
implemented ERP, but we need to remember that not all ERP implementation
turns to success. Based on my observation, I have drawn some key points of
what makes ERP implementation in PT SALUYU MOTOR BANDUNG turn into
success:
• Companies must commit to the projects, and willing to leave their old
business process. Not many companies are willing to learn a new
process.
• Good communication from the company with the ERP vendors.
I believe that if companies follow what PT SALUYU MOTOR BANDUNG
has done to make the implementation worked out, it should worked out to most
companies.
4.2 Suggestions
Most companies which are willing to go bigger should implement ERP.
ERP helps a company’s management especially in the inventory management
system. Not every ERP project turns into success, but a successful
implementation will improve company’s performance. Therefore I suggest
companies to consider implementing ERP because it has both sides of cost and
benefits.
In the end, I hope all the information in this case study may help
companies which have similar problems as PT SALUYU MOTOR BANDUNG in
BIBLIOGRAPHY
Books:
• Robbins and Barnwell. Organization Theory 4th Edition. Australia: Pearson
Education Australia, 2002.
• Whitten, Bentley, and Dittman. System Analysis and Design. McGraw Hill,
2004
Internet Websites:
• BBC Website. <http://bbc.co.uk>
• EBZ Beratungszentrum Gmbh Website.
<http://www.ebz-beratungszentrum.de>
• Find Articles Website. <http://findarticles.com>
• Linktionary On-line Dictionary. <http://www.linktionary.com>
• Marios Alexandrou Page. <http://www.mariosalexandrou.com>
• Michael Goldman Page. <http://www.michaelgoldman.com>
• SAP Technology. <hhtp://serachsap.techtarget.com>
• Wikipedia Online Encyclopedia. <http://www.wikipedia.org>
