Table Of Contents

• Introduction
• A breif history of ERP
• Oracle Applcations: Introduction
• Career in Oracle application
• Overview of information flow between modules of Oracle Applications
•  High Level Business Process Flows
• Oracle General Ledger
• Oracle Accounts Payables
• Oracle Accounts Receivables
• Oracle Cash Management
• Oracle Assets
•  Procurement
• Order Fulfilment
•  Oracle HRMS

A Brief History of ERP

Introduction:

The American Institute of Certified Public Accountants (AICPA) defines accountancy as "the art of recording, classifying, and summarizing in a significant manner and in terms of money, transactions and events which are, in part at least, of financial character, and interpreting the results thereof."

Accounting is thousands of years old; the earliest accounting records, which date back more than 7,000 years, were found in Mesopotamia (Assyrians). The people of that time relied on primitive accounting methods to record the growth of crops and herds. Accounting evolved, improving over the years and advancing as business advanced.

Early accounts served mainly to assist the memory of the businessperson and the audience for the account was the proprietor or record keeper alone. Cruder forms of accounting were inadequate for the problems created by a business entity involving multiple investors, so double-entry bookkeeping first emerged in northern Italy in the 14th century, where trading ventures began to require more capital than a single individual was able to invest. The development of joint stock companies created wider audiences for accounts, as investors without firsthand knowledge of their operations relied on accounts to provide the requisite information. This development resulted in a split of accounting systems for internal (i.e. management accounting) and external (i.e. financial accounting) purposes, and subsequently also in accounting and disclosure regulations and a growing need for independent attestation of external accounts by auditors.

Today, accounting is called "the language of business" because it is the vehicle for reporting financial information about a business entity to many different groups of people. Accounting that concentrates on reporting to people inside the business entity is called management accounting and is used to provide information to employees, managers, owner-managers and auditors. Management accounting is concerned primarily with providing a basis for making management or operating decisions. Accounting that provides information to people outside the business entity is called financial accounting and provides information to present and potential shareholders, creditors such as banks or vendors, financial analysts, economists, and government agencies. Because these users have different needs, the presentation of financial accounts is very structured and subject to many more rules than management accounting. The body of rules that governs financial accounting in a given jurisdiction is called Generally Accepted Accounting Principles, or GAAP. Other rules include International Financial Reporting Standards, or IFRS, or US GAAP.

Source: http://en.wikipedia.org/wiki/Accountancy

ENTERPRISE RESOURCE PLANNING:

ERP stands for Enterprise Resource Planning. ERP is an enterprise-wide information system that facilitates the flow of information and coordinates all resources and activities within the business organization

Functions typically supported by the system include manufacturing, inventory, 
shipping, logistics, distribution, invoicing, and accounting. Some solutions now embed customer relationship management functionality. A wide variety of business activities including sales, marketing, billing, production, inventory management, human resource management, and quality control depend on these systems. The ERP system assists in managing the connections to outside stakeholders as well as enhancing performance management. It uses a centralized database and usually relies on a common computing platform. It provides the user a unified, consistent, uniform environment.  

Enterprise resource planning (ERP) systems integrate internal and external management information across an entire organization, embracing finance/accounting,manufacturing, sales and service, customer relationship management, etc. ERP systems automate this activity with an integrated software application. The purpose of ERP is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.

ERP systems can run on a variety of computer hardware and network configurations, typically employing a database as a repository for information.

ERP (Enterprise Resource Planning) systems typically include the following characteristics:

 An integrated system that operates in real time (or next to real time), without relying on periodic updates.

• A common database, which supports all applications.
• A consistent look and feel throughout each module.
• Installation of the system without elaborate application/data integration by the Information Technology (IT) department. 

Functional areas

The following are common functional areas covered in an ERP System. In many ERP Systems these are called and grouped together as ERP Modules:

• Financial Accounting
• General Ledger, Fixed Asset, Payables, Receivables, Cash Management, Financial Consolidation[disambiguation needed]
• Management Accounting
• Budgeting, Costing, Cost Management, Activity Based Costing
• Human Resources
• Recruiting, Training, Payroll, Benefits, 401K, Diversity Management, Retirement, Separation
• Manufacturing
• Engineering, Bill of Materials, Work Orders, Scheduling, Capacity, Workflow Management, Quality Control, Manufacturing Process, Manufacturing Projects, Manufacturing Flow, Product Life Cycle Management
• Supply Chain Management
• Supply Chain Planning, Supplier Scheduling, Order to Cash, Purchasing, Inventory, Product Configurator, Claim Processing
• Project Management
• Project Planning, Resource Planning, Project Costing, Work Break Down Structure, Billing, Time and Expense, Performance Units, Activity Management
• Customer Relationship Management
• Sales and Marketing, Commissions, Service, Customer Contact, Call Center Support - CRM systems are not always considered part of ERP systems but rather BSS systems . Specifically in Telecom scenario
• Data Services 
• Various "self–service" interfaces for customers, suppliers and/or employees
• Access Control
• Management of user privileges for various processes 

 Source:http://en.wikipedia.org/wiki/Enterprise_resource_planning

The term ERP was coined in 1990 by Gartner1, but its roots date to the 1960s. Back then, the concept applied to inventory management and control in the manufacturing sector. Software engineers created programs to monitor inventory, reconcile balances, and report on status. By the 1970s, this had evolved into Material Requirements Planning (MRP) systems for scheduling production processes.

In the 1980s, MRP grew to encompass more manufacturing processes, prompting many to call it MRP-II or Manufacturing Resource Planning. By 1990, these systems had expanded beyond inventory control and other operational processes to other back-office functions like accounting and human resources, setting the stage for ERP as we've come to know it.

Today, ERP has expanded to encompass business intelligence (BI) while also handling "front-office" functions such as sales force automation (SFA), marketing automation and ecommerce. With these product advancements and the success stories coming out of these systems, companies in a broad range of industries—from wholesale distribution to ecommerce—use ERP solutions.

Moreover, even though the "e" in ERP stands for "enterprise," high-growth and mid-size companies are now rapidly adopting ERP systems. Software-as-a-Service (SaaS) solutions—also referred to as "cloud computing"—have helped fuel this growth. Cloud-based solutions not only make ERP software more affordable, they also make these systems easier to implement and manage. Perhaps even more importantly, cloud ERP enables real-time reporting and BI, making them even valuable to executives and staff seeking visibility into the business.

As a result, companies of all sizes and a wide range of industries are transitioning to cloud ERP systems. In fact, Forrester predicts that SaaS-based ERP adoption will rise 21 percent annually through 2015.2 When you stop to consider the benefits of ERP, it's easy to see why it's become so popular and why its use will continue to grow so rapidly.

The Business Value of ERP

At its core, ERP helps employees do their jobs more efficiently by breaking down barriers between business units. More specifically, an ERP solution: 

• Gives a global, real-time view of data that can enable companies to address concerns proactively and drive improvements
• Improves financial compliance with regulatory standards and reduces risk
• Automates core business operations such as lead-to-cash, order-to-fulfillment, and procure-to-pay processes
• Enhances customer service by providing one source for billing and relationship tracking. 

When you add up these advantages, the value of ERP—particularly cloud ERP—is clear. With an ERP solution, employees have access to accurate information that enables them to make better decisions faster. Not only that, but ERP software helps to eliminate redundant processes and systems, dramatically lowering the cost of doing business overall.

Oracle Applications: Introduction

Oracle Applications comprise the applications software or business software of Oracle Corporation. The term refers to the non-database and non-middleware parts of Oracle's software portfolio.

Oracle sells many functional modules which use the Oracle RDBMS as a back-end, notably Oracle Financials, Oracle HRMS, Oracle Projects, Oracle CRM, Oracle Procurement, etc.

Oracle initially launched its application suite with financials software in the late 1980s. The offering as of 2009 extends to supply-chain management, human-resource management, warehouse-management, customer-relationship management, call-center services, product-lifecycle management, and many other areas. Both in-house expansion and the acquisition of other companies have vastly expanded Oracle's application software business.

Oracle released Oracle E-Business Suite (EBS/ e-BS) Release 12 (R12) — a bundling of several Oracle Applications applications — in February 2007. The release date coincided with new releases of other Oracle-owned products: JD Edwards EnterpriseOne, Siebel Systems and PeopleSoft. As of 2012 Oracle supports Release 11.5.10.2, Release 12.0.X, and Release 12.1.X of the Oracle E-Business Suite. The latest release of the software is called Oracle EBS R12.

Source: http://en.wikipedia.org/wiki/Oracle_Applications

Oracle Applications an Enterprise Resource Planning software:

 Oracle E-Business Suite is the most comprehensive suite of integrated, global business applications that enable organizations to make better decisions, reduce costs, and increase performance.

Why Oracle?

With hundreds of cross-industry capabilities spanning enterprise resource planning, customer relationship management, and supply chain planning, Oracle E-Business Suite applications help customers manage the complexities of global business environments no matter if the organization is small, medium, or large in size. As part of Oracle’s Applications Unlimited strategy, Oracle E-Business Suite applications will continue to be enhanced, thus protecting and extending the value of your software investment.

Source: http://www.oracle.com/in/products/applications/ebusiness/overview/index.html

Within the overall rubric of Oracle Applications - Apps, Oracle Corporation's E-Business Suite (also known as Applications/Apps or EB-Suite/EBS) consists of a collection of enterprise resource planning (ERP), customer relationship management (CRM), and supply-chain management (SCM) computer applications either developed or acquired by Oracle. The software utilizes Oracle's core Oracle relational database management system technology. The E-Business Suite (current version: 12.1) contains several product lines, including:

• Oracle CRM
• Oracle Financials
• Oracle HRMS
• Oracle Mobile Supply Chain Applications
• Oracle Order Management
• Oracle Procurement
• Oracle Project Portfolio Management
•  Oracle Quotes
• Oracle Transportation Management
• Oracle Warehouse Management Systems
• Oracle Inventory
• Oracle Enterprise Asset Management

Each product comprises several modules, each separately licensed.

Significant technologies incorporated into the applications include the Oracle database technologies, (engines for RDBMS, PL/SQL, Java, .NET, HTML and XML), the "technology stack" (Oracle Forms Server, Oracle Reports Server, Apache Web Server, Oracle Discoverer, Jinitiator and Sun's Java)

Oracle's next-generation Enterprise Resource Planning (ERP) applications for midsize organizations offer enterprise-class technology at an affordable price. With Oracle, you can leverage proven best practices to optimize business processes, reduce costs, and respond more quickly to changing market conditions.

Flexible, open, and scalable, Oracle ERP solutions provide a rapid return on investment and a low total cost of ownership. 

The Oracle E-Business Suite is a packaged ERP made up of more than 150 software modules which includes solution for various departments of an enterprise viz. financial management, supply chain management, manufacturing, project systems, human resources, and customer relationship management. Oracle E-Biz is a web based ERP which can be accesses over internet.

Oracle Corporation was always known for its robust database, over the last decade it has grown into an applications company.

Oracle is being used by a PC-Based company to Fortune500 companies having its geographical spread all over the world.

Strategic Acquisitions by Oracle:

Through our acquisition activities, Oracle seeks to strengthen its product offerings, accelerate innovation, meet customer demand more rapidly, and expand partner opportunities. An integral part of Oracle's Mergers and Acquisitions philosophy is our consistent commitment to customer service and product support while achieving our financial return objectives and creating value for our shareholders.Read More...

Career in Oracle Application:

Today’s market for the professionals who have the domain knowledge of any business stream like finance, supply chain, manufacturing and they know the functionality and application of Oracle e-Business suite( also called as e-Biz) has a huge demand in the market and is ever increasing.

Today Oracle application is world leader in ERP(Enterprise Resource Planning) market which has in the near past acquired many established ERPs like JD-Edwards, Peoplesoft, Seibel to name a few.

Currently Oracle e-Biz is having couple of versions in the market which has still not been upgraded. The versions are E-biz 11i, E-biz R12 and Fusion. Fusion is the latest version in the portfolio of Oracle applications.

There are three different tracks in which you can get experts to get a good job in the ERP market they are:

• Functional Consultant
• Technical Expert
• Apps DBA  

Functional Consultant: Functional Consultants are people who have done there basic studies in the relevant domain area (domain area can be Finance, Supply Chain, procurement, etc,) and have atleast two to three years of working experience in the specific domain area. For example if one wants to be a Functional Consultant (functional) then he needs to be a post graduate in commerce or Maters in business administration with two years of experience (or a graduate in commerce with 3+ years of experience) and should have under gone Oracle Functional consultant training.

Technical Expert is one who has the basic education like Degree in Engineering (BE) or B.Sc.(computer science) and has undergone additional training on the technology used in Oracle Applications. The technological skills to be possessed by a technical expert are as below:

• SQL/ PL SQL
• Developer 2000 (D2k)
• Reports
• Forms
• Knowledge of unix
• Java 

 DBA (Data base administrators): Each database requires at least one database administrator (DBA) to administer it. Because an Oracle database system can be large and can have many users, often this is not a one person job. In such cases, there is a group of DBAs who share responsibility.

A database administrator's responsibilities can include the following tasks:

• Installing and upgrading the Oracle server and application tools
• Allocating system storage and planning future storage requirements for the database system
• Creating primary database storage structures (tablespaces) after application developers have designed an application
• Creating primary objects (tables, views, indexes) once application developers have designed an application
• Modifying the database structure, as necessary, from information given by application developers
• Enrolling users and maintaining system security
• Ensuring compliance with your Oracle license agreement
• Controlling and monitoring user access to the database
• Monitoring and optimizing the performance of the database
• Planning for backup and recovery of database information
• Maintaining archived data on tape
• Backing up and restoring the database
• Contacting Oracle Corporation for technical support

Basic Of E-Business suite

As discussed in our earlier section that there are three different tracks in which you can get experts to get a good job in the ERP market they are:

• Functional Consultant
• Technical Expert
• Apps DBA  

Functional Consultants: Functional Consultants are the bridge between the client/ customer who is implementing Oracle applications and the technical team. Functional consultants role is very critical in implementing ERP. He has to correctly understand the requirement and then map to the functionalities to Oracle applications.

Oracle E-Business Suite is easy to implement and easy to adapt. In a survey it is found that the Total Cost of ownership of Oracle E-Biz the the lowest. It is also found that the average time to market is the least for the implementation of Oracle application.

Oracle E-Biz provides a variety of features and business processes that can improve the oraganizations productivity and effeciency.Success of any ERP implementation depends upon the involvement of Top management in the driving the implementation. The sucess also depends upon the decision taken during the requirement gathering sessions by the functional consultants. so it becomes responsibility from the functional consultant's part to make the customer unsderstand what the functional consultant wants to get from the customer. All the functional consutant should remember the golden rule "Input Grabage and the output will also be Grabage".

Some of the points to be kept in mind during the implementations are as follows:

1) first you should have a workshop for the customer to understand the concepts of implementation of Oracle E-Biz.

2) As a consultant you should fecilitate the customer in taking the decision( please bear in mind that you should not influence the customer in decision making.)

3) for each decisions made it would be advisable to debate on the pros and cons of the decision.

4) Try to involve all the stakeholders into decision making. this will avoid resentment in the users once Oracle E-Biz is implemented.

5) Avoid taking shortsighted implementation decisions which may loose the essence of implementing Oracle E-Biz.

6) As far as possible customizations should be discouraged. this will help in better maintanace of Oracle E-Biz after the implementation.

Overview of information flow between Oracle Application

Before we get into the basics of Essential setups and implementation steps it is necessary to know how information flows between different modules of Oracle Applications.

In Oracle application there are different modules. The modules can be considered as different departments of an organization. So, If we take an bird's eye view of an organization it would look like as shown in the picture below:

Oracle General Ledger, Accounts Payable, Accounts Receivables etc. these modules have effect on each other. This means that when any transaction is entered in accounts payable, there would be accounting entries generated for this. And these accounting entries are then posted to Oracle general ledger. Below is the high level schematic diagram of the application.

Click on the image to Zoom.

If we see the above diagram we can see that there are many modules between which the information flows. Here only some of the flows are shown due to complexity of flows.

Now, these modules can be grouped for ease of understanding the way oracle applications works. This grouping can be called as Business Process Flows or Business Flows. The different flows are as follows:

• Recruit to Retire
• Purchase to Pay
• Order to Make to Cash
• Record to report

We will see each of these business flows in detail.

High Level Business Process Flow

Business Process flow is the graphical presentation for specifying business process usinf flowcharts. the objective of Business Process Flow  is to support both technical users and business users. By providing a graphical representation business usres can easily understand complex business processes.

The primary objective of Business process Flows is to provide standard notation readily understandable by all business stakeholders. These include the business analysts who create and refine the processes, the technical developers responsible for implementing them, and the business managers who monitor and manage them. Consequently, Business Process Flows serves as a common language, bridging the communication gap that frequently occurs between business process design and implementation.

Here I am depicting the high level business process flows for the above mentioned flows. We will get into the details when we go to the specific chapter:

Hire (Recruit) to Retire: As the name suggest this flow takes care of all the organizational aspects from the time a person is recruited in an organization till he retires. Retirement can be of any kind. It can be age related retirement, employee resigns from the services or any other type where the person leaves the organization.
Click on the image to zoom:

Procure to pay (purchase to pay or P2P) is the process of obtaining and managing the raw materials needed for manufacturing a product or providing a service. It involves the transactional flow of data that is sent to a supplier as well as the data that surrounds the fulfillment of the actual order and payment for the product or service. According to the Chartered Institute of Purchasing and Supply, procure to pay should be a seamless process from point of order to payment. Technology can assist this process.

The goal of a procure-to-pay software system is to automate processes by introducing efficiency controls. For instance, to enforce buying controls, the software might cross-reference purchasing budgets to ensure compliance with pre-defined buying limits. A requisition that was within pre-defined limits would be programmatically routed for approval, converted into a purchase order once approved and immediately sent to the correct supplier by email.

A sophisticated procure to pay system is capable of extracting invoice and payment data from a general ledger, enterprise resource planning (ERP) or customer relationship management (CRM) systems while also accepting transaction data from banks, vendors, shipping and other outside sources and reconciling complex and multiple supplier statements to payments and good received.

Click on the image to zoom:

The Record to Report management process provides strategic, financial and operational feedback about how a business is performing. this process involves collecting, transforming and delivering relevant, timely and accurate information to stakeholders inside and outside the organization. such feedback provides insight into whether stakeholder expectations have been met.

Click on the image to zoom:

Order to cash (O2C) is a set of business processes that involve receiving and fulfilling customer requests for goods or services. O2C is the process of obtaining and managing the orders from the customer, this information is fed to the manufacturing department for manufacturing a product or providing a service. It involves the transactional flow of data that is sent from a customer as well as the data that surrounds the fulfilment of the actual order and receiving payment for the product or service.

Click on the image to zoom: