Exploiting data

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Enterprise resource planning (ERP)

An ERP is a unique repository of all resources of a company: it contains information about sales, accounting, etc. ERPs are generally organized in small modules (cf. concept of modularity) because processes became very complex: every company has different processes and requirements, it is thus easier to work with modules. In order to illustrate how an Enterprise resource planning (ERP) works, we are going to use Odoo. It is an open-source ERP. The company developing it (called Odoo as well) is based in Louvain-la-Neuve, near Brussels, and it is considered as being one of the biggest player in the field. It is worth noting that Odoo is one among others. SAP is also well-known in the area. For instance, ULB is calling it for its management.

Two types of data in an ERP

  1. Master data: master data are entities that your company knows. They are descriptions of something the company is in contact with. Customers, Products, Suppliers, Employees, etc. are all defined as master data. Most users in an ERP cannot directly create, modify or delete master data. Creating master data does not have any implication in the real world: it is just the definition of entities.
  2. Once the master data is created, we can start performing transactions.Transaction data is what is produced by the users as they perform their daily tasks. Transactions are creations, modifications, deletions of objects (as opposed to entities). You have for example a new transaction written in database every time a worker in a factory launches a production order to transform raw materials into finished products. This is the only think that most users produce in the ERP.

ERP is also a tool for tactical analysis and strategy as it produces statistics and graphs about our sales, inventory, etc.

We call transactions the modifications, creations, deletions of objects. This is the opposite of entities. You have to describe "how something look like" during master data creation, but you don't have any interaction/manipulation with the actual object. This can be a size, a price, a name, a weight, etc. It is very important to make a difference between Transaction data and Master Data so that every time you buy materials, for example, you don't need to re-enter the characteristics of it.

Customer relationship management (CRM)

CRM standing for Customer Relationship Management is a frequent complement to an ERP. Customer Relationship includes in fact all the interactions between a company and its existing or potentials clients. By studying the expectations and desires of their clients, companies expect to building loyalty. Indeed, almost every company depends on acquiring new clients and retaining existing ones to survive so this is something managers usually want to measure and control very closely. It is often integrated within the ERP: a CRM usually has a functionality enabling sending sales orders directly to the ERP through an interface linking both systems. It also helps in the planning process as it provides you with the volume of orders you are likely to receive in a near to mid-range future.
The CRM is composed as a pipeline, a funnel. It is a sort of a canvas where we can create and keep track of potential customers to prospects (New => Qualified => Proposition => Won).

Why is it so important for companies nowadays?

The increasing automation of marketing and e-commerce processes can quickly come at the expense of customers. Some of them may feel that they are no longer adequately supported and monitored, especially when communication is standardised. This can lead to dissatisfaction. The CRM must mitigate this feeling. As part of a customer-oriented approach, it aims to personalise communication with customers and potential customers as simply and effectively as possible.

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