This is the very reason why we need to have enterprise system. If we were to take a look at a commonly used definition of enterprise system, it is termed as a system that supports end-to-end business process. Over here, we have a picture of the 11 business processes that SAP defines, and if we were to look at the center part of this chart here, we have business processes of procurement, production, and fulfillment. We have seen in the earlier example of how fulfillment works when the Apple staff takes an order and ships it to a client. Also related to this process is the process of making and building this product, and that is known as production by SAP. At the same time, we also have the step of buying the raw materials to construct or to manufacture these goods, in the process of procurement. So, outside these three main steps, we have material planning, and material planning is nothing more than the planning of the purchase of raw materials so that they could seamlessly feed into the production process. In other words, you can understand this as the process of meeting the demand and supply of raw materials. Next in line, we have the process known as asset management, and some companies, after selling their products, the companies are still tasked to maintain these products. This is especially true for companies that are involved in the sales of large infrastructure products such as elevators and lift. In many companies, we also have this business process of human capital management, and this module over here does exactly that, of managing the payrolls, managing the tasks, responsibilities, and the training of employees. At a top of this chart, we see another module known as the inventory and warehouse management, and this module is largely responsible for the storage and the movement of goods within the warehouse. Then finally, we have two other business processes known as lifecycle data management, and also program project management, both are which are responsible for the design of products on new projects that a company have. So, quick question to you over here is that, do all firms necessary have to have each of these 11 processes? Take a moment to think about this. So if your answer is no, then you are correct, and an example of a company or a business that does not use things in the middle, procurement, production, and fulfillment, would be one lying in the service industry. So, a concrete example of that would be a university. A university does not produce any physical goods but the main objective is to train, educate students. So as a result of that is not all companies would get to use or to have each of this 11 business processes. So that's an important thing to take note. Companies, when they are buying or utilizing ERP systems, they need not be utilizing all of these different packages and modules. Another thing to note is that we have a broader definition of what ERP system is. For Gartner, they term ERP systems as a technology strategy in which business transactions are linked to financial transaction. So, looking back at this chart, it's actually not surprising to see why this definition is termed the way it is, because sitting right at the middle of this picture here, we see two modules, two business process that are highlighted in blue, financial accounting and management accounting. If we take a closer look at this picture, we would see that all the other business processes have lines drawn back to the center part, and what these lines actually mean is that behind each of these business activities and process, eventually it could be termed or referred to as a business or financial transaction. That's the reason why this definition provided by Gartner highlights the fact that the business transaction that we see in all companies can eventually be tied to financial transactions. So now, we have seen one instance of a ERP vendor, and that is SAP. Are you aware of other vendors that operates in this space or building enterprise systems? So you might be able to recall or remember somebody's name, so some big names that are involved in building and selling enterprise systems, include Oracle, Microsoft Dynamics, and even newer companies like Salesforce, as well. So, in the next few slides, we'll be talking mainly about SAP. SAP is one of the largest ERP providers known to have a large market share in today's market.
