INFORMATION TECHNOLOGY FOR MANAGEMENT

IMPLEMENTATION OF ERP
AT TAN HIEP PHAT COMPANY



Professor: Dr. Huy Nguyen
Class: MBAOUM0514
Group 7
inh Th Qunh Nhung
Nguyn Vn Vng
Nguyn nh Nh H


1

CHAPTER I
The introduction of Tan Hiep Phat Company and Finance and Accounting Division
1. I ntroduction of Tan Hiep Phat Company
The company was found in 1994, it has been a famous
beverage company which provides consumers healthy and
beneficial products. It is called a pioneer corporation in
changing Vietnamese peoples habit of drinking beverages.
12 kinds of market leading beverage products are produced
at company such as: Vitamin supplementary drink, Dr. Thanh
herbal tea, green tea, energy drink No.1, Soy milk, fruit juice
and so on.





The companys products are rated Vietnamese high quality products, honoured of Country
Brand Nam, especially governments certificate of merit and valuable prizes. These
achievements are thanks to Quality management system ISO 9001:2000, Environmental
management system ISO 14001:2004, and Food safety management system based on HACCP
(2006).
Tan Hiep Phat is proud to be one of companies that possesses lots of the most modern
manufacturing technologies such as Aseptic cold sterilization method, European and Japanese
manufacturing technology.
At present, there are 400 professional executive officers and staff that were well trained,
experienced, and enthusiastic and dedicated to the development of the company. Tan Hiep Phat
is one of the biggest corporations with the annual turnover of billions of dollars. It has become
an internal top beverage company and is expanding to the other parts of the world.


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2. I ntroduction of finance and accounting department
Accounting activities can generally be classified as either financial accounting or managerial
accounting.
Financial accounting consists of documenting all transactions of a company that have an
impact on the financial state of the firm, and then using these documented transactions to create
reports for external parties and agencies.
Managerial accounting deals with determining the costs and profitability of the companys
activities. While the information in a companys balance sheet and income statement shows
whether a firm is making an overall profit, the goal of managerial accounting is to provide
managers with detailed information that allows them to determine the profitability of a particular
product, sales region, or marketing campaign. Managerial accounting provides information that
managers use to control a companys day-to-day activities and to develop long-term plans for
operations, marketing, personnel needs, repayment of debt, and other management issues
Common financial statements include balance sheets and income statements.
The balance sheet is a statement that shows account balances such as cash held, amounts
owed to the company by customers, the cost of raw materials and finished-goods inventory,
long-term assets such as buildings, amounts owed to vendors, amounts owed to banks and other
creditors, and amounts that the owners have invested in the company. A balance sheet is a good


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overview of a companys financial health at a point in time, a key consideration for a companys
creditors and owners.
The income statement, or profit and loss (P&L) statement, shows the companys sales, cost of
sales, and the profit or loss for a period of time (typically a quarter or year). Profitability is
important to creditors and owners. It is also important information for managers in charge of
day-to-day operations. A manager sees profits as indicators of success and losses as indicators of
problems to be solved.
a. Functions of accounting department
The functions of the accounting and finance department in any business can get a little
confusing. Entrepreneurs tend think and move quickly, so it is a key to your success that the
accounting department becomes one the anchors of stability in your company.
The essential roles and duties of virtually any accounting department should include the
following:
Money out making payments and keeping the bills paid
Money in processing incoming payments
Payroll make sure everyone gets paid (including the government)
Reporting preparing financial reports, e.g. P&L, Balance sheets and budgets.
Financial Controls to avoid errors, fraud and theft
Accounting Department Responsibilities in Detail
Accounts Payable (money out) In order to maintain great relationships with vendors
making sure that everyone gets paid on time is a vital role. The role of the accounting
department includes keeping an eye on opportunities to save money, for example, determining if
there are discounts or incentives available for paying certain vendors more quickly. At the very
least, AP should be scheduled to assure that the least amount of money has to go out per
payment, i.e., no late payment charges!
Accounts Receivable and Revenue Tracking (money in) Another critical duty of the
accounting department is to account for and track receivables, including outstanding invoices
and any required collection actions. Accounts receivable is responsible for creating and tracking
invoices. The responsibility here includes assuring that customers pay those invoices on time,
so a system of friendly reminders is crucial.


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Payroll Payroll is a critical function of the accounting department and includes making
sure all employees are paid accurately and timely. In addition, proper tax is assessed and tax
payments are on time with state and federal government agencies.
Reporting and Financial Statements The primary reason you collect data properly in
your accounting software is to prepare financial reports that can be used for budgeting,
forecasting and other decision making processes. In addition, these and other reports are needed
for communication to investors, banks and other professionals that play a role in the growth of
your business.
Financial Controls Financial controls include reconciliations, dividing the responsibilities
and following the GAAP standards of accounting principles, all of which are implemented with
view toward compliance, fraud and theft prevention. The role of the Controller is to ensure
procedures are set up properly to manage that process without errors.
These are just some of the main roles and functions of the accounting department in
businesses, there are many more responsibilities the accounting department is responsible for
and a number of subcategories. Those will depend upon the specific nature of your business. For
instance, inventory control and tracking, government forms and tax filings and fund raising
might be other essential areas of focus that your accounting department would be responsible
for.
Defining those responsibilities is essential for your business. While the specific roles may
vary from business to business, one thing is certain: If your accounting department does not
perform these key functions effectively and efficiently, you could be headed for some serious
(and not so pleasant) surprises.
The great news is that if these functions are covered well, youll find that your accounting
department creates a solid base and the most important measurement tool for your companys
entire operation.







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b. Duties of accounting department
Planning for annual incomings and outgoings of company.
Being responsible for the task of incomings and outgoings, checking the amount of capital
expenditures, use of materials, tracking debt comparison.
Support the board of directors to allocate finances for the branches
Deploy financial and accounting operations of the entire company;
Perform the balance sheet for each quarter on time and join other divisions for checking
the loss and profit of branches; help division of directors control capital, and profits
clearly.
Make the salary and other policies for staffs of company.
Prepare the financial and tax statements, tax according to the governments laws.
Analyze the financial situation, and balance the budget, public debt in the company and
report periodically under the request of the director.
Be responsible for constructing, drafting documents related to the work of finance,
accounting, management regulations on financial expenditures to submit for the director.
Be reponsible for working with the tax authorities, auditing, and financial inspection;
Set up the documents of medium term and short term loans.
Join the preparation, and monitor, check disbursement schedule.
Coordinate with other divisions, the staffs in the acquisition, disposal or sale of assets of
the Company









6

CHAPTER II
PROBLEMS ENCOUNTERED AT TAN HIEP PHAT & SOLUTIONS
1. Problems encountered
Work has been settled of waiting for sending information through many stages and
departments. This makes customers, partners not satisfied; labor productivitys staff was
reducing, especially jobs require high specialization. Databases are not synchronized because
they are provided by many departments; and collecting of databases and information which is
reported to the division of directors and managers is always slow as the result of waiting for
other divisions reports. This affects the seniors management and decision making. Moreover,
collecting information form divisions require their allowance, and it affects the work and culture
in the company.
2. Solutions to solve problems
To solve the above problem, the company must not only change the style of management and
administration, the recruitment, training and staff development, but change in the application of
information technology (IT) to serve the management. The change in the application of
information technology includes changing the purchase of separate softwares for each division
into designing and installing integrated information system. And the application and
implementation of ERP is an effective tool to help business solve encountered problems.
Thanks to ERP, manufacturing procedures in business take place in accordance with the
work flow (work-flow). Shortly after the work is done in one stage, the information will be
updated immediately for each individual, and all of individuals and divisions have enough
information to process the next stages. This will help improve productivity and increase
satisfaction both customer and partners.
Besides, information is comprehensively updated and quickly integrated to provide to the
managers. This will help managers have the overview of companys manufacturing as well as
support managers management and decision making.
The divisions will connect and work on the computers. Decentralizing of accessing and
controling the information of each division will make the work performed easily and efficiently.
Each division doesnt depend on allowance of division of board directors, hence, staffs will have
chances to perform work individually, creatively and directors and managers will spend their
time on management.







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CHAPTER III
ANALYSES OF FINANCE AND ACCOUNTING DIVISION
1. I T based activities of finance and accounting division
Using computers systems (including hardware and software) to make salary reports,
set up functions, enter data, or process information
Analyzing data or information of financial operations of the company
Processing Information -- Categorizing, calculating, auditing, or verifying information
or data
Getting Information -- obtaining information from other divisions or all relevant
sources
Documenting/Recording Information -- Entering, recording, storing information
Communicating with divisions and customers
2. Capability of staff and business process for I T application
Staffs are very active and regularly take part in IT classes organized by company such
as doing the accouting books by computer, using computer softwares to report
business operations, analyzing data skills and presentation skills.
Directors and managers are dedicated to work and willing to help staffs solve problems
at work.
The company has been becoming a prestigious brand name for 20 years of producing
beverages, thus it has a lot of stable customers, shareholders for the maintenance of
manufacturing process.
The stable customers create a stable financial resource for company
Most of divisions are computer equiped.
The IT staffs are well - trained and skilled.







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CHAPTER IV
THE INTRODUCTION OF ERP AND THE BENEFITS OF ERP
TO TAN HIEP PHAT COMPANY
1. What is ERP?
ERP is an acronym for Enterprise Resource Planning; a term that is used for business
management systems which are designed to integrate the data sources and processes of an entire
organization into a unified system. A key element is the use of a single database to store data for
the various system modules. With a new management style, ERP is considered as an optimized
solution to help the company improve its own capacity in this aggressive market competition.
Unlike Microsoft office and accounting software, ERP helps accounting job overcome
limits both in distance and time thanks to high sharing capacity and connection between
divisions. As a result, information providing process will be more updated and reliable.
ERP is a business management softwareusually a suite of integrated applicationsthat a
company can use for its important business process such as manufacturing planning, products
purchasing, inventory management, transaction with providers, customer care service and
order tracking, etc.
Up to now ERP has been developed and connected with many different applications such as
SCM (Supply chain management), CRM (customer relationship management), and BI (Business
intelligence).
2. The differences between traditional accounting and ERP implementation
In the past, companies have had separate functional information systems: a marketing
information system, a manufacturing information system, and so on, each with its own way of
gathering data and its own file system for recording data. Companies built these integrated
systems primarily to handle the needs of the individual functional areas, and secondarily to
provide data to Accounting. With integrated systems, the functional areas shared their data with
Accounting, so Accounting could keep the books, that is, maintain records of all financial
transactions. Data sharing, however, usually did not occur in real time, so Accountings data
were often out of date. Further, because the shared data might not be the only information that
Accounting needed to prepare reports for management, accountants, and functional area clerks


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had to do significant research. Since the 1960s, legions of accountants, analysts, and
programmers have tried to make integrated systems work, but this approach has not worked very
well, as prior chapters illustrate.
An ERP system, with its centralized database, avoids these problems. For example, suppose
finished goods are transferred from the assembly line to the warehouse. An employee in the
warehouse can easily record the transaction, using a terminal or a bar-code scanner. In ERP, the
Materials Management module would see the transfer event as an increase in finished-goods
inventory available for shipment; the Accounting module would see the event as an increase in
the monetary value of finished goods. With ERP, everyone uses the same database to record
operating data. This database is then used to generate management reports, make financial
statements, and create budgets.
One advantage of an integrated information system is that it simplifies the process of closing
the books and preparing financial statements. There is no need to assemble data from different
systems because all of the required data are contained in a centralized system.
In an ERP system, the balance sheet and P&L statement are database reports. They can be
quickly generated at any time, and because the data to prepare the reports are read from the
database tables, these reports are always up-to-date. Another feature of the ERP balance sheet
and P&L statement is the ability to quickly display data at different levels of detail. In addition,
the system allows the user to create financial statement variants, which are financial statements
in other formats, prepared to suit the needs of different users.
In traditional accounting, a companys accounts are kept in a record called the general
ledger. In the ERP system, input to the general ledger occurs simultaneously with the business
transaction in the specific module. Many ERP modules cause transaction data to be entered into
the general ledger, including:
Sales and Distribution (SD), which lets the user record sales and creates an accounts
receivable entry (a general ledger document that indicates a customer owes money for the goods
received).
Materials Management (MM), which controls purchasing and recording of inventory
changes. The creation of a purchase order creates an accounts payable entry in the general
ledger, noting that the company has an obligation to pay for goods that it will receive. Whenever


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material moves into or out of inventory (purchased materials arrive from the vendor, materials
are taken out of inventory to support production, or finished goods go from production to
inventory), general ledger accounts are affected.
Financial Accounting (FA), which manages the accounts receivable and accounts payable
items created in the SD and MM modules, respectively. The FI module is also where the general
ledger accounts are closed at the end of a fiscal period (quarter or year) and financial statements
are generated.
Controlling (CO), which tracks the costs associated with producing products. To make a
profit, it is critical for the company to have an accurate picture of its product costs, allowing it to
make correct decisions about product pricing and promotions, as well as capital investments.
Human Resources (HR), which manages the recruiting, hiring, compensation, termination,
and severance of employees. The HR module also manages benefits and generates the payroll.
Asset Management (AM) which manages fixed-asset purchases (plant and machinery) and
the related depreciation.
Business managers use accounting data to perform profitability analyses of a company and
its products. When data are inaccurate or incomplete, the analyses are flawed. There are three
main reasons for inaccurate or incomplete data: inconsistent recordkeeping, inaccurate inventory
costing systems, and problems consolidating data from subsidiaries. When managers want to
evaluate the efficiency of Productions operations. Production uses paper records, so data must
be taken from the paper records and entered into a spreadsheet. As often happens, those paper
records might be inaccurate or missing, making the validity of the final report questionable.
There are many variations on this theme. Conceivably, a companys divisions do maintain
the same data about a function, but often each divisions system was created at a different time,
each using a different file system. To answer a managers question, at least one set of data
would need to be rekeyed into a spreadsheet (or some other middleware program) for the
merged analysis. Again, it is possible to get an answer, but doing so takes time. Besides, without
integrated information systems, much of the effort of accounting and reporting to management
resembles the situation in these examples: working around the limitations of the information
systems to produce useful output.



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With an ERP system, however, this sort of effort is minimized or eliminated because both
divisions record and store their data in the same way, in the same records. If the companys
process was changed to fit the best practices of the software when the system was installed, the
managers of each division would have agreed on the way to store and collect data, as part of the
systems configuration. Later, questions can be answered in a few minutes by any accountant (or
manager or salesperson, for that matter) who understands how to execute a query in the database
language, or how to use built-in management- reporting tools.
Correctly calculating inventory costs is one of the most important and challenging
accounting tasks in any manufacturing company. Managers need to know how much it costs to
make individual products, so they can identify which products are profitable and which are not.
First, we will provide an overview of inventory cost accounting. Next, we will see how an ERP
system can improve the accuracy of inventory cost accounting. Finally, we will discuss the
rationale behind activity-based costing as a method to further improve the accuracy of inventory
cost accounting.
3. The benefits of ERP to finance and accounting division
A comprehensive ERP and Accounting system leads to performance increase, workflow
synchronization, and standardized information exchange formats, complete overview of the
enterprise functioning, global decision optimization, speed enhancement and much more.
Some other benefits to mention from an ERP solution would include: enhanced productivity and
corporate financial performance, improved business forecasting and organized work flows.
Benefits of Implementing an ERP and Accounting Application
A perfectly integrated system connecting all the functional areas together.
The capability to streamline different organizational processes and workflows.
The ability to effortlessly communicate (interface) information across various
departments.
Improved efficiency, performance and productivity levels.
Enhanced tracking and forecasting.
Improved customer service and satisfaction.


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Provides top-down view of the enterprise (no islands of information).
Real time information is available to management anywhere, anytime to make proper
decisions.
Help reduce operating costs ERP software attempts to integrate business processes
across departments onto a single enterprise-wide information system. The major
benefits of ERP are improved coordination across functional departments and
increased efficiencies of doing business. The immediate benefit from implementing
ERP systems are reduced operating costs.
Facilitate Day-to-Day Management The other benefits from implementing ERP
systems is facilitation of day-to-day management. ERP systems offer better
accessibility to data so that management can have up-to-the-minute access to
information for decision making and managerial control. ERP software helps track
actual costs of activities and revenue generating activities.
Support Strategic Planning Strategic Planning is a deliberate set of steps that
assess needs and resources; define a target audience and a set of goals and objectives;
plan and design coordinated strategies with evidence of success; logically connect
these strategies to needs, assets and desired outcomes; and measure and evaluate the
process and outcomes
4. The benefits of ERP to Tan Hiep Phat Company
In 2009, Tan Hiep Phat decided to deploy SAP ECC 6.0 solution with the investment of 2
million USD. Viet Nam CSC Company coordinated with Tan Hiep Phat to organize hand-over
ceremony of ERP system 0n May 4
th
, 2010.
A survey conducted at Tan Hiep Phat Company for the reason of applying ERP system
received the result of the vision of manager (74%), the increasing of information need of
company (63%). Besides, old information system didnt respond to management needs and open
the scale of operation which also play important role in applying ERP system at business.




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The reasons of ERP implementation Amount
ln
g
Rate
(%)
Old information system with many faults 2 11%
Old information system doesnt not meet management requirement


8 42%
The increasing need for companys information 12 63 %
Increase the scale of operation (more branches) 6 32%
Expand the scope of activities (various products) 8 42%
Competitive pressures between companies 6 32%
Designated by the oversea main company 4 21%
The vision of manager 14 74%
Being aware of the importance of ERP through workshop /
consultation
8 42%
About the benefits of ERP: The trait of ERP is the management by process, so many people
say that application of ERP heps business control operational process closely (95%), united and
obvious business process (68%). In addition, because of connecting and sharing capacity from
the system, providing information needs to be updated and reliable (79%)
The benefits of ERP implementation Amount
ln
g
Rate
(%)
Providing information opportunely and reliably 15 79%
Support decision making process and planning effectively

12 63%
United and obvious business process 13 68%
Saving time and expense 8 42%
Control operational process closely 18 95%
Change habits and effective working manners 7 37%

This project not only deploys with basic modules such as purchasing goods, manufacturing,
selling, accounting but also open deployment of other applications such as debt management,
cash flow management, credit limit management, profitability analysis and business planning
outline, BI solution. Furthermore, Tan Hiep Phat successfully deployed specific applications for
companys manufacturing and goods distribution such as the management of returnable glass
bottles process.
After the deployment of ERP system, Tan Hiep Phat got some benefits: optimize business
process, apply international standard process in operating, planning and coordinating
manufacturing plans, increase manufacturing effectiveness and supplying goods to the market
in peak months, enhance the effectiveness of product quality and sales management, help
inventory scientifically, quickly and accurately.



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a. The capacity of storing and management of various databases
Data sheets like potential customers list, transaction data sheet, manufacturing data sheet
and etc can be added by modules used for embedding and linking different databases such as
texts (TXT), documents (DOC), Excel sheet (XLS), images (BMP, JPG..), sounds (WAV,
MP3), video (MPEG, DAT..) and so forth. For example, customers databases can be
embedded to become customers information, machines maintaining instructions can be
embedded to become devices information. When databases are embedded, they are directly
stored into server and in case of being linked, databases are stored on HDD with form of files
and programs are automatically accessed via files.
b. The capacity of linking databases between modules
A data sheet or a report of a module can be used in different modules of the system. For
instance, the databases of customers contracts in customer management module can be used in
accounting module to check the payment of contract. The inventory report in accounting module
can be used in orders management module to check the inventories.
Databases can be automatically moved between modules when users command on the
software interface. For instance, the databases of orders in orders management module can be
moved to manufacturing management module by ticking orders.
c. Constantly update databases and perform customization
Databases are immediately and constantly updated into the system when the staff accesses
the software. This advantage helps divisions continuously carry out work at the company more
easily. Thanks processes in ERP system, databases in modules are linked together and processed
quickly. After databases are processed, the users can have a look on the screen or the printed
papers. Thanks to ERP, the staff at company can customize some information such as filter
databases, arrange data before being printed out or convert data into other formats (Excel, Word,
Html, SQL table, Mail).
d. Remote access
ADSL technology provides the ability to create a virtual private network (VPN). Accessing
the ERP system can be done from everywhere. Collecting information and databases from other
branches become more easily and efficient. For example, customers can make a products buying
contract at the main company, but they can get the products at branches by the linking and
sharing databases in ERP system.







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CHAPTER V
SALES AND PURCHASING PROCESS AT TAN HIEP PHAT COMPANY
1. I ntroduction of sales and purchasing process

Selling and purchasing process at the Tan Hiep Phat company includes the relationships
between the division of sales department, accounting department and warehouse department.
Selling and purchasing process at the Tan Hiep Phat company includes the relationships
between the division of sales department, accounting department and warehouse department.


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1. Customers ask the sales department to quote the price of products
2. The sales department receives the requirement from the customers and sets up the quotation.
3. The sales department informs prices to customers
4. After customers receive the quotation and if they agree, they will make the order form
5. Customers send the order form to the sales department
6. Based on the order form of customers, the sales department will make the sales form, and
then sends it to the warehouse department
7. Simultaneously, the sales department sends the order form to the accounting department
8. Based on the sales form from the sales department, the warehouse department will set up
warehouse exporting document and delivery form
9. The warehouse department sends warehouse exporting form to the accounting department
10. Based on warehouse exporting form, selling form, the accounting department will set up a
bill of sale
11. The accounting department sends the selling form to the warehouse department
12. The warehouse department delivers goods to customers with the delivery note and the bill of
sale
13. Customers will make the payment
(a) In case the payment is cash, the accounting department will make the receipt.
(b) In case the payment by banking, the accounting department will set up the form
acknowledging the customers payment
The selling and purchasing process is very complex and confusing. In case the unexpected
incidents happen, the process will be interrupted. Most of people think this process is very easy
like entering the order, printing the receipt, delivering goods, and receive customers payment.
Thus applying ERP to improve selling and purchasing process at company will solve this
complexity and make the process become easier and faster.







17

2. I ntroduction of sales and purchasing process







This process allows Tan Hiep Phat to control selling and purchasing process obvious and
fully from the arising of purchasing requirement to the stage of receiving goods and making
payment. This process is performed by modules such Purchasing, Warehouse, accounting and
general ledger. This process allows Tan Hiep Phat to control the following information.
Manage the requests of purchasing goods: thanks to the integrated system, the requests of
purchasing goods can be generated automatically from manufacturing module (when the
system calculates a lack of supplies and goods to serve production and sold on the market).
Manage order forms and purchasing contract: This function enables the company to store
information related to the purchasing order or purchasing contract with a full range of
information related to purchasing process such as vendor, purchasing date, delivery date,
effective date, item, quantity, unit price, payment terms ...
Manage the delivery tracking: through order forms, the system can automatically receive the
information of products and compare with order forms. In addition, this function allows
users to manage goods return.
Manage order forms: system can automatically print purchasing invoice based on
purchasing information or accountants can manually enter into the system. This function is
performed on the receivable accounting module.
Manage payment: this function belongs to receivable accounting module and performs the
storing of documents related the payment of purchasing goods.
Manage accounting: the accounting must be related to the purchasing process done
automatically when creating transactions such as warehousing, goods return, and payments.
The entries are stored in the accounting diary and will be updated to the ledger later.


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CHAPTER VI
THE IMPACT OF ERP TO ACCOUNTING INFORMATION SYSTEM (AIS)
When using ERP, there are 3 groups of functions closely related to the accounting job:
declaration, entering data and providing information.
Declaration includes general information and list of objects. List of objects are constantly
update during the operations of company such as distributors, customers, goods, banks ... The
declaration specifically decentralize for those who are responsible for accounting module and
other modules.
Entering data includes inputting balance and accrual. In the ERP system, entering data
doesnt take time because it can get information from modules.
Providing information: In accounting division, the decentralization is seriously controlled
with the rights such as viewing, adding, editing and deleting. Individuals between modules
must be decentralized with rights to access their own modules and other modules.
Figure: The impact of ERP to AIS

















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The impact of ERP to the AIS processes
Collecting data
To collect databases, the company should consider what kind of information is. Then
collecting data should be carried out according to the companys process. Collected databases
include resources, events, and agent.
Collecting data for operations arising from manufacturing process should be considered
carefully. Besides, the company needs to set up the system of account lists and vouchers. In
selling and purchasing process, analyzing related activities, divisions and resources will help
define how vouchers are set up and approved.
Processing data
After collecting input data, the next is monitoring the data processing. It includes:
Set up and circulate documents
Perfome the task of entering vouchers includes contents, requirements of input
Process documents in accounting division: based accounting books, individuals in
accounting department will perform the task of input.
Summarize information to report to the users
Providing information
The results of collecting, processing, summerizing and storing data process is providing
information. AIS is a process of defining reports based the requests of system. Jobs need to be
done:
Classify and identify the reports to provide for the users
Identify the informations content in each report
Determine the time and individuals will perform the task of reporting
Identify the users who will use reports
Identify methods of providing information of report s
Sketch, illustrate the provided reports
Identify methods of processing information and reporting



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Controlling
Controlling is an important activity of AIS. It includes controlling of sources, processing
and providing information
AIS is very essential for companies at Vietnam especially for Tan Hiep Phat. All the
businesses must go through system development cycle. This cycle includes 4 stages: analyzing
system, designing system, implementing system and operating system.
When implementing ERP, AIS plays an important in the development of the company and
especially accounting division. Therefore, businesses must pay attention to the systems content
(collecting data, processing data, providing information, controlling ...) and businesss process
from the analysis of system to operation of system
The impact of AIS to Accounting department
ERP and AIS have the same functions such colleting, processing, storing data to provide users
with the information. This information includes horizontal and vertical information
For horizontal information, it will support for making decision of managers with different
levels such as structured decision, semi-structured decision and unstructured decision.
However, to be able to manage overall system, accounting department as well as other
department may face challenges in changing work process. ERP is not only software but a new
style of management on the basis of information technology applications.
With accounting division, ERP helps create a finance controlling system effectively through
cross checking. Analyzing, summarizing, and processing data are done quickly based on clear
division of responsibilities in the system. And the management of warehouse, customer
liabilities is also updated from time to time.
When applying ERP, reports are done thanks various information from modules. It helps
businesses over problem of sharing information.
Thanks to ERP, operations in the business will be done closely and effectively. Businesss
activities are restructured and standardized. Coordinating and sharing sources helps manage
activities, expenses and improve the productivity.
With increasing pressure of competition, businesses always look for solutions to enhance
the effectiveness of business management. ERP is a system that can allow the users to apply
the information technology into planning and manage businesss sources effectively.


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CHAPTER VII
THE PROCESS OF COMBINING DATABASES BETWEEN MODULES AND
GAP ANALYSIS
1. Converting databases between accounting, sales and inventory modules










22



1. When customers contact the sales department to purchase
2. Sales department receives information from customers and enter data into the internal
management system
3. Accounting department looks up on internal system management for the information of
orders and payment. In case the payment is done, accounting department sends orders to
inventory
4. Inventory division receives payment form and orders on internal system, it will export
products to customers
5. Inventory division will update the amount of exported products on managing system
6. Sales department will update the mount of sold product on managing system

2. Converting databases between accounting, sales and inventory modules
Implementation methodology will be parallel done on the new system and the old system.
It takes two months to deploy the databases converting between accounting, sales and inventory
modules.
* The two first weeks, the department will perform the following tasks:



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Sales:
Must complete tasks; standardize data such as sales planning, sales policy, quotes, orders,
delivery / invoice / payment to convert to the new system (internal management systems "ERP")
Warehouse:
Perform tasks of data standardization and reports statistic such as: forecast materials demand,
import / export / inventory, transfer, inventory to switch to the new system (internal
management systems "ERP")
Accounting and Finance
Perform tasks of data standardization and reports statistic such as: financial Plans / expenses,
the accounts receivable / payable, cost accounting, fixed assets / equipment management and
accounting division will collect to convert to the new system (System Management internal
management "ERP")
* The last two weeks of the first month, the department will perform the following tasks:
Prepare machines for the project (such as computers, printers, and other devices)
Prepare human resources to deploy the project (as assign individuals to implement new project
and ensure the operations of old system)
For example: 10 staff in finance and accounting division, 5 employees perform work in old
system and 5 staff implement a new project.
The training for individuals to deploy the new project
* The first two weeks of the second month, the divisions will implement the following tasks:
Integrate Accounting, Sale, and Inventory modules and do trial on the system
Divisions check and control data from the new system and give feedback to the project team.
Check report forms, details and the process of importing and exporting goods, check accounts
receivable and payable, etc.
* The last two weeks of the second month, the department will perform the following tasks:
Divisions assign individuals for receiving the new system.






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Figure: The process of converting databases

Stt
Comparison Criteria
Before deploying
ERP
After deploying
ERP
01 Discrete and uncontrolled data x
02 Centralized and easily expolited data x
03 Outdated and unpreserved information
technology systems
x
04 Modern information technology systems x
05 Decreased labor productivity and stagnant
operating management
x
06 Increased labor productivity, operating
management and revenues
x
07 Shared data via USB and portable devices x
08 Automaitcally exploited data on the system x
09 Manual management of sales and inventory x
10 Modern system - based management of sales and
inventory
x
11 Accounting activities are done manually x
12 Accounting activities are done on modern
system and saved into one main server
x
13 Low - level competition of finished goods x
14 High quality and green finished goods x
15 Uncared culture and brand name of the company x
16 Cared culture and brand name of company by all
staffs
x






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CHAPTER VIII
FINALISE PLAN BY KEY CONCERNS AND PERPECTIVES OF ERP
AT TAN HIEP PHAT COMPANY
1. The results of the company's ERP implementation:
Achieved successes
After the ERP is implemented throughout the company, Tan Hiep Phat reports basic results.
The system helps companies operate tightly, avoid risks in accounting; with clear
decentralization in system, finance and accounting division operates effectively than before. The
stages of warehouse management, distribution and administration of business, customer
relationship and manufacturing have been better managed, significantly reducing risks. Sales
and distribution divisions become flexibly; more smoothly. And monitoring functions are
carried out in real time.
The knowledge and skills of staff at THP are more advanced than before. IT infrastructure is
synchronized, standardized and consolidated. Mr. Tran Qui Thanh (general director of the
company) said that from 2009 to now, Tan Hiep Phat has invested for IT with a total of $2
million (including ERP components) and confirms thanks to further investment, THP is more
confident to deploy the larger projects in the future.
Regarding the organizational structure of the company, in addition to improving employee
knowledge, the system has met the needs of the users. The management becomes concentrated
obviously and efficiently.
THP has been particularly successful in the distribution channel. Distributors can connect
directly to system through the Internet by using SAP program, or in the form of offline
connection using Microsoft Solomon Software. Besides agents use PDA softwares that supplier
supports to record the transaction. The salesmen use PDA connected to the distribution system
in order to update the information.
THP also unifies the business processes in accordance with the distributors requirements
under the orders of managers such as cost management, promotion, distribution plan, as well as
business processes for salesmen by PDA.
Basic results from the ERP implementation that Tan Hiep Phat receives:
- Optimize business processes and apply international standards for operations at the company


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- Prepare and coordinate production plan effectively
- Improve the management of product quality, and semi-finished products, help to test the
product in a scientific, fast and accurate way.
- ERP system helps Tan Hiep Phat administer, operate and control business operations of the
company more easily, effectively and obtain manufacturing revenues higher.
Limitations
Lack of human resources: When deploying ERP, human resources play important roles at the
company. However, Tan Hiep Phat has to face with the difficulty of lack of human resources. In
addition human resources lack ERP knowledge.
Large investment costs: Tan Hiep Phat spent a large cost for this investment.
Difficulties
Although CSC is an enterprise specializing in providing software solutions in Vietnam but
CSC's ability to meet the entire process of Tan Hiep Phat ERP is not enough. However, human
resources, technologies and abilities of CSC are just limited.
Therefore, Tan Hiep Phat bought Oracle and SAP software solutions and SAP to improve the
ability of technology management at a high level. Tan Hiep Phat may buy Oracle solutions for
core management competencies and CRM (Customer Relationship Management) of SAP to
strengthen the ability to manage clients at the highest level. At a certain level, the ERPs
functionalities in Oracle of CRM have not been proved. This is because of abilities; lack of
human resources which make the cost for implementing ERP in THP is increased a lot. At the
same time, the ability to synchronize for the management process of the solutions is also
reduced significantly.
The cost of ERP investment and to bring it into operation depends on a lot on hardwares, also
softwares and staffs abilities. Hardware system needs investing a lot to be able to run all the
modules. Software system is also regularly updated to the latest versions for managing more
effectively. Besides staffs abilities are required to use this system. Investment on human
resources is a long process. Tan Hiep Phat wants to use the ERP system; it not only invests in
infrastructure, but also focuses on qualified human resources to implement the system. Human
resources not only understand the general situation of Tan Hiep Phat, but also have abilities to
operate the system.


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2. The reasons for the success of implementing ERP at Tan Hiep Phat
The commitment and strong support of the division of directors
THP has assigned a professionals team to actively take part in the project
Professional and well trained IT staffs
In addition, the project is supported by the manufacturing management system of THP,
the solution provider is Oracle and the independent consulting company
Participation of Tan Hiep Phat, Oracle and IBM. They all clearly define objectives but
always assign people to deal with issues arising during the process of implementing
project.