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ERP Integration Techniques  (article by Prabha Jha)

If there was ever a time when users and vendors thought monster enterprise resource planning (ERP) software packages could solve all of a client's problems, those days are over. Even as SAP AG, the leading ERP vendor, works to improve the breadth and depth of its own warehouse management and logistics solutions, the company continues to publish new interfaces that make it easier for third-party solutions to integrate with and add functionality to a company's R/3 system. Other ERP vendors, including Baan, J.D. Edwards, and PeopleSoft, are also publishing new interfaces and tools to allow data collection, warehouse management, and other systems to integrate more easily and reliably with ERP.

In for a pleasant surprise in the working relationship they find with clients. "I make sure my ERP clients realize that failure is not an option," said Dave Czaplicki of Systems Technical Sales (STS) in Bellevue, WA. "The technical team assembled to implement senior management's ERP investment will succeed, or their successors will." This realization forms a fast bond between the client team and the systems integrator and helps when the inevitable implementation challenges arise.  

In the ERP world, a significant portion of the implementation budget is typically earmarked for professional services and quality advice. This contrasts sharply with the situation familiar to automatic identification and data capture (AIDC) integrators, in which the amount of money clients expect to pay for hardware is about what they would pay at a discount wholesaler, with handholding and training built into the overall price quote. Getting into the ERP integration business may be part of a strategic plan, or it may arise from a particular business opportunity. Whatever the path, it is important to understand that a variety of technical paths are indicated when a client asks you to "integrate" with its ERP system. Much depends on the client's definition of integration.

ERP Power Moves Out

Often, all a client really wants is to extend the value of its ERP investment to its mobile workers. The ERP software may already provide all the required business logic, but it may be available only to someone sitting at a desk and manipulating a full-screen display via multikey commands and mouse movements. For example, the ERP software may already adequately address materials receiving processes. Receiving personnel, however, may not be comfortable with a full-screen computer interface. Even with adequate training, time spent in front of the keyboard is time not spent handling material. An integrator with the skill to provide mobile access to the client's ERP system can bring significant value to the client.

One method for providing mobile access to ERP packages uses handheld (or forklift-mounted) data collection terminals and a radio frequency (RF)-based local area network (LAN). An array of radio network controllers connects to the client's wired network backbone and bridges RF traffic between the ERP package and the mobile terminals.

The software interface of choice depends on a client's current and future needs, but for the most basic ERP extension projects, terminal emulation fits the bill. All RF LAN suppliers offer terminal emulation solutions that make their hardware appear as wired terminals to the ERP (or other network-based) software package.

Most terminal emulation offerings give the integrator (or client) the ability to map a complex screen appearing on a wired terminal to a much smaller and more focused screen suitable for a handheld terminal. For example, a receiving screen from an ERP package might include the names, addresses, and phone numbers of the trading partners' purchasing agent and sales representative, plus use-by dates for perishable merchandise and other such information not required by the person unloading boxes from a truck. So-called "screen scraper" software provides an easy way to extract information required by the receiving clerk and format it for presentation on the small display in his or her hand.

This was exactly the solution STS recently provided to Tektronix Inc. (Wilsonville, OR), a manufacturer of measurement instruments, color printers, and video and network systems. Tektronix had previously installed an ERP package from QAD Inc. (Carpinteria, CA). STS used an RF LAN and terminal emulation to implement two applications for Tektronix: a mobile receiving program for the company's inbound international cargo area, where intermodal shipping containers are unloaded into a high-bay storage area, and a program that tracks incoming express shipments (Airborne, Federal Express, and UPS) from the receiving dock to the addressee.

All of the mobile hardware was supplied by Symbol Technologies, but STS used a network controller from Connect Inc. (Lisle, IL). The controller can be purchased either as a complete hardware/software unit or as a software-only product that can be loaded onto standard Unix platforms.

More Power

Sometimes in a client meeting, you can almost hear the guttural chant of "More power and functionality. ..." No matter how big and powerful the ERP system, many clients need more than the current installation supports. Some clients want you to implement business processes that are completely lacking in their ERP systems, while others need you to translate the overall business direction supported by the ERP package into a series of "what do I do next" directions for workers. Either way, you need tools that do more than just modify an ERP package's user interface. How you go about providing incremental power depends not only on what the client expects but also on how the ERP package is organized. Consider not only where the data resides but also how you access and manipulate business logic.

"ERP systems are basically databases with functionality built around the data," explained John Herendeen, manager of reuse, research, and development at Primix Solutions (Watertown, MA), an electronic business consulting and systems integration firm. As Mr. Herendeen noted, however, the way in which you get to and manipulate that data varies with each ERP system. The 4GL (fourth-generation programming language) used to modify the ERP system's functionality is different from vendor to vendor. Furthermore, there is more than one way to integrate with a specific ERP system. For example, integration mechanisms supported by SAP's R/3 include BAPIs (business application programming interfaces), IDOCs (intermediate documents), RFCs (remote function calls), and BDC (batch data communication), to name but a few. (For more information, see the sidebar, "Coming: More Stable ERP-to-WMS Integration," and its accompanying table below.)

Merely knowing how to manipulate the database, however, is still not sufficient to get business. STS managers tried this market entry path when they found themselves encountering a number of Oracle ERP installations in their target market of midsize manufacturing concerns. Oracle programming talent was readily available in their area, so they proceeded to build an interface and pursue business. But STS learned that technical expertise wasn't enough for its customers: Oracle customers required certification of the software solution. STS did not find it financially sensible to obtain certification. Instead, the company called upon BPA Systems (Austin, TX). STS continues to service its Oracle accounts and sells hardware directly to the customer; BPA provides the Oracle software.

These BPA products are written in PL/SQL, the native Oracle database language. The company provides Oracle-certified offerings for common supply chain functions such as receiving, inventory management, and WIP, plus an open interface to customize applications. (See the figure for an overview of how BPA's BP-Link works.) BPA's approach lets companies with Oracle programming talent continue to use those skills in data collection environments.

Because it integrates directly into the Oracle environment, BP-Link is not middleware. But like middleware products, BP-Link allows two systems (in this case, AIDC and Oracle) to communicate where they otherwise could not. In fact, the need to integrate AIDC hardware, as well as other software programs, with ERP has spawned a new category of middleware and add-ins called enterprise application integration (EAI) software.

Rather than learn the intricacies of each ERP system and obtain the attendant certification, many AIDC and WMS vendors are instead partnering with companies that specialize in EAI and already offer certified solutions. "Regardless of whether one uses BAPIs, BDC, or any other interface approach, the choice must still be made between manually coding the interface or using an EAI solution," stated John Hanger, vice president in charge of the SAP program at TSI International Software (Wilton, CT). TSI's Mercator product helps integrators build interfaces, convert data, and implement electronic data interchange (EDI) for ERP programs, including R/3. "The use of an EAI solution can mean a reduction [in initial programming effort] by up to 80 percent, plus an additional reduction in the total cost of ownership for the interfaces over time, thanks to improved maintainability. EAI solutions hide the technical complexity from the developer, allowing [the developer] to focus solely on the data relationships between the WMS and the ERP system."

In addition to making ERP integration easier and more reliable, EAI vendors are also changing their business practices to better address the midmarket. For example, as Oracle and BPA have begun addressing this segment—which has fewer resources than the corporate giants that ERP vendors like SAP, Baan, and PeopleSoft have traditionally targeted—BPA has had to change the way it prices and packages its software.

A typical midmarket ERP customer does not need high transaction volume, but must do a little bit of everything, making the entry price prohibitive under a formula that charged separately for the application development tool and each application. Explained BPA's David Brossette, "The typical middle-market customer just needs two people doing PO [purchase order] receiving and one person doing inventory transfer." BPA now spreads the cost of its development tool across the applications companies install. For example, BPA increased the cost of its receiving application from $15,000 to $18,000, but no longer charges separately for the development tool needed to customize it.

Junot Systems (Houston, TX) is developing a similar tool set for SAP R/3. Junot's goal is to develop a suite that connects multiple applications to multiple ERP packages. The company's first product, now in beta testing at the Samsung Semiconductor facility in San Jose, CA, connects RF data collection networks to SAP's R/3. Samsung is using the software to receive, pick, transfer stock, and perform cycle counts.

Junot's architecture uses a server running under Windows NT with an ActiveX interface through which personnel can call functions and pass data. (See "Junot's AIDC-to-R/3 Solution," right.) This server will eventually be used to tie different ERP packages together or to tie ERP packages to other application software or data collection hardware. The initial offering ties SAP to data collection hardware; the data collection interface is provided by RFGen, a software tool from DataMAX Software Group (El Dorado Hills, CA).

Junot's SAP module currently uses RFCs, a low-level interface that Junot considers necessary to provide sufficient flexibility for data collection functions. According to Trent Andrews at Junot Systems, the company was forced to use this solution because "if a customer had a business transaction that they had to have in SAP, and it happened not to be supported by an IDOC or a BAPI, then it couldn't be done [without RFCs]. All the BAPIs are not there yet. A lot of the data collection activities take place in materials management and logistics, and currently a lot of the BAPIs center around human resource activities. By using RFCs, we can do anything you can do in an SAP ABAP program."

Portal Proliferation

Despite Junot's having to bypass SAP's API, working through the APIs provided by ERP software vendors represents the future of integration in this market. In fact, Junot plans to support SAP's BAPIs next year.

A major benefit of BAPIs, as well as other ERP vendors' object-oriented interfaces, such as Baan's forthcoming BOIs (business object interfaces), is stability. An API provides a stable portal to an otherwise shifting application. "BAPIs will definitely reduce the amount of code maintenance, because they will stay compatible forever," stated Hartmut Schaper, vice president of SAP's general business unit and business framework architecture. If

SAP modifies the BAPIs in such a way that it requires the customer to rewrite code, Mr. Schaper said that SAP will announce the change two "major releases" in advance, to allow for smooth migration.

Another BAPI benefit is that developers can use APIs from within a variety of programming environments, including Microsoft's Visual Basic and Visual C++ and IBM's VisualAge for Java. This lets programmers access SAP functionality from within the tool they know, rather than learn SAP's ABAP 4GL. And, SAP says it will continue to publish BAPIs to improve the capability of third-party WMSs and logistics execution systems (LESs) to integrate with R/3.

"In version 4.5 of R/3 [slated for general availability in the second quarter of 1999], we will provide for a lot more communication between a WMS and the R/3 system," said Annigrette Sonnenberg, program director of SAP's logistics development, warehousing, and shipping unit. "We found out in setting up our own warehouse to support full SAP processes that the [range of] interfaces we've published was not broad enough."

While ERP vendors work on their APIs, a word of caution is in order: Before quoting a job based on an interface through an ERP API, make sure the API can do what you need. APIs may be optimized for financial or human resource applications and not yet capable of the detailed materials tracking for which AIDC integrators are typically hired. Being forced to shift from an API to lower-level coding, such as SAP RFCs, is a sure way to lose money on a fixed-price contract.

Changing Market Place & Manufacturing Environment

The market place has been changing continuously. With increasing competition customers have become more demanding. The product life cycles have come down drastically. New technologies are changing the way organizations do business.

A planning & control system like MRP II is becoming less relevant in today’s context because of the following important changes.

  1.  Manufacturing moving towards a make to order environment. This era is seeing a transition of products from being standardized to being highly customized. Hence making the planning process complex.

  2. Competition more on delivery. The quality and cost have become "entry-tickets" for the players who wish to compete in the market place. The competition is now going to be based on delivery lead times and flexibility.

  3. Need for a greater integration with the customers and suppliers.  

  4. Greater product differentiation

Where does ERP stop?

No doubt ERP has assisted companies in integrating various functions and in enhancing the business performance. But it is not totally free of pitfalls, which arise due to the basic design of the system.

The heart of the ERP is the transaction processing system and the MRP, both of which are internally focused and which help only in the planning and control of processes internal to the organization. They do not provide means with which the organization can be integrated with that of the customers and suppliers. ERP also does not provide the means to optimize the organizational resources.

Supply Chain Management 

Organizations have felt the need for going beyond mere transaction processing and automation of business processes. What is required to operate in complex business environment is a tool which can help in identifying and planning resources based on certain organizational constraints that are dynamic in nature.

SCM (Supply Cain Management) is a concept which will look at a business as a chain of inter connected entities and thus providing a see through perspective of the entire business. The supply chain can be modeled to reduce inventory, lead times and cost at each link under the given constraints.

Supply chain management has been used by a few organizations and they have obtained immense benefit from the same. P&G and Wall Mart in the US have linked their distribution and retail systems using IT. Now P&G will monitor the shelf inventories of Wall Mart directly and plan for replenishments accordingly. Wall Mart has proven beyond doubts the benefits of supply chain integration with suppliers and customers. It is time that others take the lessons and use them to remain competitive

SCM is not just EDI (Electronic Data Interchange) or POS (Point of Sales) systems, though they form critical elements of a supply chain. It is a concept and a philosophy. Integration of suppliers and Customers in to your systems, information sharing for mutual benefits, Modelling your organization in to a supply chain and improving the value addition at each stage, using information technology tools like (EDI, POS and ERP) for integration, all of these constitute a supply chain exercise.

Can ERP Packages help?

The question is how far the existing ERP packages can help in Supply Chain Integration. ERP vendors are increasingly incorporating Supply Chain requirements in to the standard ERP Packages. The trends in the ERP packages include (1) Constraint based planning (2) Applicability of the Internet – to enable integration between the different links of the supply chain. ERP, as it exists today, is necessary for providing Supply Chain integration. It acts as the link between supply chain and the demand chain.

But ERP alone is not sufficient. We can either look at the enhanced functionality provided by the existing ERP vendors or look at Supply Chain Package vendors. Leading ERP vendors like SAP, Baan, and Oracle have developed Supply chain capabilities by developing in-house extensions and by integrating with other third party solutions.

Supply chain solutions provided by vendors like i2, Manugistics and ProMIRA are also increasingly finding acceptance and are being used by organizations. But how far these packages have been able to address the supply chain requirements and  how it works in sync with existing ERP packages, is to be seen over a period of time.

What's in store for ERP in 2001?

The past year has been a rough one for enterprise resource planning (ERP) vendors. On top of unfavorable perceptions of ERP and falling stock valuations in Nasdaq, ERP vendors have struggled to convince potential customers that they can deliver e-business functionality. "(ERP) will be a part of the total process of the need to make companies flow information up and down the entire spectrum of the supply chain.

The future of ERP

ERP been a tour de force for many organizations, but as other segments of the enterprise application market fight for the spotlight, the  role of ERP in a company's application strategy is changing. While ERP's heady days of huge budgets and massive schedules may have passed, ERP (even on the downside of a wave) has continued to thrive, according to analysts. "ERP is very much alive," said Judy Hodges, an analyst with International Data Corporation in Framingham, MA. "It has become especially strategic in e-commerce where transactions tend to be more complex, smaller, and geographically diverse."  We will be using ERP/MRP systems internally and other system externally to satisfy our customer needs. I don't like the use of 'ERPII.' It still has the flavor of ERP, and we need to think of the complete process up and down the chain.I don't suggest 'supply chain management' is the new buzzword either—we need to bring together all the terms, SCM, MRP, ERP, CRM, EDI, WMS, APS, etc, and processes. What that new buzzword is and what it represents, only time will indicate." Thomas A. Bihun







































































































































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