E-Business and ERP in One

E-Business and ERP in One

11064 ERP_Brochure 09/07/01 14:40 Side 1

The Paradigm Shift

The Internet is causing a paradigm shift, revolutionizing our

world and radically changing the ways in which we do busi-

ness. At Navision, we believe that all companies must enter

the brave new world of e-business – or perish. But since none

of us have ever been to this new world before, we are all

explorers mapping out new territory as we move forward.

This booklet presents the Navision perspective on this paradigm

shift and is designed to help you understand these changes and

better equip you to make the right decisions and choices as you

move forward.

As a supplier of ERP systems for mid-sized companies, the

needs and challenges facing this segment of the business

community are naturally our main focus.

Good reading!

Niels Bo Theilgaard

Corporate Product OfficerExecutive Vice President

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Contents

PART ONE: The Challenge of New Technologies

Why E-Business? Page 4

Lower Cost of Doing Business Page 4

Faster Time-to-Market Page 4

Better Customer Relations Page 5

The Next Wave Page 5

The Heart of the Matter Page 5

Fast Access Page 6

Moving into E-Business Page 6

Management Decision Page 6

Integration Is the Key Page 7

Supply Chain Management Page 7

PART TWO: Getting Started

Selecting the Right E-Business Solution Page 8

Integration Is Vital Page 8

ERP with an E-Business Add-on Page 9

Upgrading the E-Business Solution Page 9

The Need to Personalize Page 10

The Problem of Customization Page 11

PART THREE: E-Business and ERP in One

The Future-Safe E-Business Strategy Page 12

The Navision Advantage:

E-Business and ERP in One Page 12

Here and Now Benefits Page 13

How it Works Page 13

Some Relevant Details Page 13

Customization and Upgrades Page 13

Certified for Microsoft Windows 2000 Page 14

Navision Axapta: E-Business and ERP in One Page 14

In Conclusion Page 14

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The Challenge of New Technology

During the last few years, the changes brought about by the

Internet and the advent of stunning new technologies have

radically transformed the ways in which we do business. This

paradigm shift is driving companies not only to rethink their

organizational structures and business processes, but to

examine the Enterprise Resource Planning (ERP) systems

which are the living core of their business operations.

Why E-Business?

Why is everybody talking about e-business? What are the most

important reasons for expanding a company’s business into the

virtual realm of the Internet? The answer is simple – e-business

potentially translates into many short- and long-term benefits:

• Lower cost of doing business

• Faster time-to-market

• Better customer relations

In short: e-business translates into competitive advantage.

Lower Cost of Doing Business

Many companies investing in e-business experience high return

on their investments (ROI) with payback periods shorter than 12

months. These high ROIs stem from the reduced cost of con-

ducting business over the Internet. Automating administrative

tasks also results in fewer errors and less repetitive work, free-

ing resources to focus on more value-added activities.

Faster Time-to-Market

All industries around the world are facing increased competi-

tive pressures, with shorter market windows and product life

cycles. Bringing new products to market successfully requires

speed, optimal timing and effective communication processes,

with a seamless information flow to and from the distribution

channel and end-customers. The ability to react quickly to

changing market conditions is critical. In other words, the

capability to edit and change products, pricing and configura-

tions must be fast and flexible enough to deliver and maintain

a competitive edge.

Think about how long it takes for most companies to bring

new products to market and imagine what it would mean to be

able to reduce the gap between product readiness and the

sales revenues generated by that new product.

The ERP market faces a dramatic technology shift to

Internet-based applications.

With e-business, everyone works better and faster

because they have access to better and faster

information.

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Better Customer Relations

Customers are the business dimension that companies neglect

at their own peril. E-business provides the golden opportunity to

connect more closely with customers by providing them with the

services they need, such as up-to-date information on orders

and products around the clock. In addition, the ability to offer

online information on order history, product availability, price

calculations and delivery times enables customers to make

immediate buying decisions. In this way, costly waiting time is

avoided – and faster, more accurate order processing is ensured.

This translates into increased customer satisfaction and loyalty.

Of course, the really brilliant opportunity that e-business

offers is the ability to customize customer relationships (CRM)

by offering special services to individual customers. Everyone

knows it’s far more cost-efficient to keep present customers

happy and increase their business than it is to bring in new

customers.

The Next Wave

Business Community Integration is the name given by AMR to

the next wave of the e-business revolution – and it’s already

happening. In brief, Business Community Integration makes

the Internet a part of everyday business operations by moving

business processes online, connecting suppliers, partners and

customers. As this begins to happen, we see businesses on the

cutting edge of developments fast becoming even more inte-

grated across organizational lines. We also see the establish-

ment of virtual companies and the electronic inter-linking of

supply chains.

The Heart of the Matter

Despite all the changes in this fast-paced world of emerging

new technologies, ERP systems remain at the heart of the

matter. This is why ERP vendors will play a key role in future

developments. Quite simply, because they understand the

business processes which are at the core of every company’s

operations better than anyone else. Thus, they are in a unique

position to use their expertise to support the development of

Business Community Integration.

As the evolution proceeds, every company will discover one

crucial fact: before a company can take advantage of the great

opportunities offered by the virtual business world, the right

platform must exist. The real benefits of e-business and of

Business Community Integration will be achieved only when

company business solutions are based on a company’s core

ERP system. Ideally, this system should integrate seamlessly

all parts of the organization from purchasing to manufacturing,

logistics, service & support, order administration, sales & mar-

keting, human resources and finance.

To play the game, the right platform must exist.

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Fast Access

ERP software at its best provides a company with fast access

to high quality business information and ideally facilitates bet-

ter decision-making based on a professional analysis of this

information. It is vital to have a timely and correct picture of the

current business situation when it comes to exploiting new

business opportunities, opening doors to customers and sup-

pliers, and expanding a business beyond traditional organ-

izational boundaries.

Moving into E-Business

One of the biggest strategic decisions facing large and small

companies today is not if they should take the plunge into

e-business but how. This transition must take many factors

into account, such as:

• Existing business processes (so the move does not hamper

relationships with existing customers, dealers and suppliers)

• The infrastructure which already exists within the company

and represents major investments from the past

• The competitive landscape the company operates within,

including the company’s position and potential strategic

alliances made possible by the new business environment.

Management Decision

Entering the e-business arena is a strategic decision for execu-

tive management and not a decision for the IT department or

the sales and marketing department alone. This is because

the choices made when moving forward in e-business will be

a determining factor in the development of company business

opportunities in the future. Thus, investments made to execute

the new e-business strategy should strengthen competitiveness

and enable the company to take advantage of market opportu-

nities as the scope of the new e-business arena develops.

The shift to e-business tends to trigger a reevaluation

and redefinition of a company’s value proposition.

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Integration Is the Key

Since the implications of e-business are so far-reaching, the

decision to move forward should not be divorced from the rest

of the company’s business processes. In other words, the suc-

cessful move will not be isolated, but rather integrated into the

greater whole.

This is because a successful e-business solution does

many things. For instance, it facilitates the promise of accurate

deliveries, enables overnight order fulfillment and allows real-

time, self-service information. All of these require very tightly

integrated business systems. At the same time, no one wants to

invest in a solution which demands maintenance of redundant

databases, applications and business logic, separate develop-

ment tools, separate software platforms and so on.

Supply Chain Management

E-business is also drastically changing our models of customer

acquisition, procurement, pricing and customer satisfaction.

With e-business, all processes such as receiving and tracking

orders, purchasing, manufacturing, managing inventory and

servicing customers can be optimized. When these processes

are tightly integrated with a company’s full ERP system,

increased efficiency will deliver the full benefits of lower costs

and increased customer satisfaction.

So the question facing most companies is this: Is your

supply chain prepared to deal with the potential offered by

e-business? Can you deliver the speed your customers will be

expecting very soon?

Total connectivity is the end goal – to everyone,

everywhere.

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Getting Started

Selecting the Right E-Business Solution

Traditional ERP systems meet traditional business needs:

finance, trade, inventory, production, administration, etc. With

e-business being widely accepted as the “next step,” most

ERP vendors now offer e-business solutions. These solutions

can be built for a specific ERP system or they can be third

party solutions, which are packaged together with the original

ERP system.

When selecting an e-business solution, functionality is, of

course, important. The solution must meet your needs. Do you

want to serve customers, suppliers or employees via the

Internet? Most companies start with one of these areas and

then plan to add more in the future.

Developments are moving forward at such a fast pace

right now that the underlying technology is equally – if not

more – important than functionality. Why?

Because it is the basic technology of the system which will

enable companies to take advantage of what the very near

future will bring.

Since it is vitally important to understand the role of tech-

nology when making the decision to embark upon e-business,

let us take a brief look at some of the key points to consider.

Integration Is Vital

The risk of poor integration should not be underestimated.

When an ERP vendor adds e-business applications on top of

an existing ERP solution – by making “add-ons” in different

directions, there is a high risk that the applications are not

really integrated into the old system. As a result, the following

may ensue:

• A high degree of maintenance becomes necessary

• Redundant data develops

• More than one development tool must be used

• More than one database must be maintained

• A lack of flexibility develops

• A lack of adaptability is experienced.

All of the above will obviously increase the overall cost of

operating and maintaining the system.

Why does this happen? Typically because the new e-busi-

ness solutions often start at the customer level, for example,

with a Web shop, or by trading and selling goods via the

Internet. This can be implemented by an “add-on” such as

described above.

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ERP with an E-Business Add-on

In the scenario shown in the diagram, a separate database is

established when adding a separate e-business solution to the

ERP system. Since the Internet puts different requirements on

solutions running through a browser, the development tools

used to create the e-business solution are most often different

from the tools used to create the ERP system. This is where

problems begin. Suddenly the company has a setup, which

requires maintaining two separate systems, two different data-

bases, using two different development environments. In the

beginning this can work, but as the system increases in com-

plexity and new versions arrive or upgrades are required, all

changes must be coordinated in both databases and systems,

which can be quite a challenge to say the least.

Upgrading the E-Business Solution

Even though upgrading any software to a new version always

introduces the risk of some problems, it will certainly create

even more problems when changing to a completely different

system. This is why it is important to consider the upgrade

options that follow with a software system, be it ERP, e-business

or any other software.

Application maintenance and duplicate data lead to higher cost of ownership.

The diagram shows a traditional ERP system with a number of Windowsclients connecting to the database. The term “business logic” is used todescribe the rules and calculations contained within an application, whichis often placed on the client. In this scenario, this is usually referred toas two-tier client/server architecture.

The clients are so-called "fat" clients because the business logic isplaced with them. Examples of business logic include special customerdiscounts and trade agreements, conversion of measurements foritems in stock, or best inventory locations for incoming items.

Database

Windows clientswith Business logic

Synchronizing

e

Business logicWeb interface

Database

Browser clients

Traditional ERP System with an E-Business Add-on

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When an e-business solution is added on top of the ERP sys-

tem by the same software vendor, at least the synergy between

the two systems is ensured and there is only one vendor to

deal with. But when the ERP vendor has bought a third party

e-business solution and packaged it together with their own

ERP system, there are now two different systems working

together with only the vendor’s assurance that it will function

smoothly. In the most extreme or problematic scenario, the

ERP and e-business solutions come from two different soft-

ware vendors so the company must rely on consultants or its

own IT staff to integrate the two.

The Need to Personalize

Since the Web is a global phenomenon, internationalization is

an innate requirement of e-business solutions. Thus, most

companies are facing or will face diverse requests for trading

and transactions in different currencies with different date for-

mats and in different languages. Even though a large per-

centage of what’s on the Internet at present is in English,

many new users do not speak English. Add to this the fact that

today most users are accustomed to the new software norms

of screen and menu personalization, which makes this yet

another area to consider when defining Web site capabilities.

The future-safe ERP system and e-business solution will

be able to cope with these changing demands.

Version 3

Version 4

Version 5

STEP 1

e

Customer

preferences

personalization

STEP 2

Customization

e

+

STEP 3

Upgrade syncronization

e

+

+

The diagram below shows areas of concern that apply to all of the above-mentioned cases. Step 1: On the left-hand side is the ERP system. It comesout in version 3 with an e-business solution, e.g. a Web-shop for customers(first column on the right hand side). Step 2: At some point, the ERP systemneeds to be upgraded to version 4. Step 3: With version 4, the e-businesssolution probably also needs to be upgraded, and the vendor now introduces

a new e-business solution. With version 5, the scenario is the same: anupgrade of the ERP system and the two existing e-business solutions, and the introduction of another new e-business solution.

Complications in Upgrading an ERP System with Add-on E-Business Solutions

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The Problem of Customization

There are many very sound arguments for selecting a stan-

dard ERP package. However, this choice almost always

implies the need for at least some customization. When look-

ing at any e-business solution, the need for customization is

very likely to exist in varying degrees – and most companies

want their solutions to carry their own individual look.

Unfortunately, not all ERP systems support customization

well. So when selecting an e-business solution that is sepa-

rate from the core ERP system, this problem has the potential

to grow exponentially over time. Some things to consider:

• Are both the ERP system and the e-business solution cus-

tomizable?

• What development tools are needed to customize the two

applications? Are they the same or does customization require

two separate sets of tools – one for the ERP system and one

for the e-business solution?

• Especially in cases where ERP systems and e-business

solutions come from different vendors, how will future

upgrades affect customizations in either system?

• Can new e-business applications be added in the future?

• Will adding new applications mean starting again from

scratch and recoding the existing ERP business logic?

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E-Business and ERP in One

The Future-Safe E-Business Strategy

The bottom line is this: companies should only invest in an IT

system that supports their basic business model and future

strategy. Standardization, simplification of processes, adapt-

ability to changes in business processes, and scalability are

all key elements of a successful IT implementation strategy.

And when it comes to e-business, built-in Web functionality

should be a must.

The Advantage: E-Business & ERP in One

Navision Axapta™ provides the latest and best developments

in ERP systems because it was designed for Windows and the

Web right from the start. The secret behind the system is its

3-tier architecture, which means that Web functionality is fully

integrated into the solution. In other words, both Windows and

Web applications have their foundation in the same business

logic. As a result, with Navision Axapta, the costly and compli-

cated maneuvers mentioned in the previous sections are

avoided right from the start.

i

Business logic

Database

Browser clientsWindows clients

Navision Axapta’s three-tier architecture is the secret behind the sys-tem’s ability to integrate Web functionality into the ERP solution.

Key Characteristics of Navision Axapta include:• Three-tier architecture• One database• One source code• One toolbox• One application• Two interfaces: Windows and the Web

Designed for the Web

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Here and Now Benefits

Some of the most obvious benefits of Navision Axapta’s

e-business and ERP in one technology include:

• Lower costs

• Less maintenance

• No redundant data

• No redundant business logic

• Easy customization

• Easy to upgrade

• Greater flexibility

• Scalability

How it Works

MorphX™ Development Suite is the name of the Navision

Axapta toolbox. With it, companies can define and set up a

fully functional Web site quickly and easily. The Web client is

just another way to access the system. Navision Axapta con-

nects from Internet applications to the database through the

business logic in the system. This means there is no need to

develop the business logic over again, now or in the future.

A case in point: trade agreements are typically found not

as data in the database but as formulas to be calculated each

time a specific form is opened. With Navision Axapta, this type

of business logic from the backbone ERP system is automati-

cally included when developing front-end Web applications.

In short, with Navision Axapta, there’s nothing to stop con-

tinued growth.

Some Relevant Details

Since Navision Axapta was designed to meet the demands of

today’s business world, the system easily handles different cur-

rencies, date formats and languages. Language and currency

can be changed on the fly – chosen by users when logging on

to the Web site. This means that users of a site will be wel-

comed in their preferred language – with full access to their

order history whether entered via the Internet or using tradi-

tional means. Under the security setup, users can also verify

and correct their information (such as address and phone num-

bers) in the ERP system. This puts customers in charge of their

own data, which improves the data quality in the ERP system

and reduces the maintenance level for the company.

Customization and Upgrades

Because of Navision Axapta’s three-tier architecture, custo-

mizations to the ERP solution are also reflected in the “e” part

of the solution. Customizations can be made by a Navision

Solution Center – or by your own IT staff.

E-business and ERP in one translates into the com-

petitive solution.

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Even customizations that might need to be treated differently

in the two client interfaces are conducted efficiently since the

same set of tools is used for your ERP and e-customizations.

Due to the Navision Axapta component-based architec-

ture, upgrades to new versions are performed seamlessly.

Traditionally, customizations have caused many problems in

upgrade situations, but with Navision Axapta, the tailored

changes are carried along in the transition.

Since e-business is a completely integrated part of

Navision Axapta, synchronization is not an issue in upgrades

of the ERP and e-business solutions. This means tremendous

savings in resources and time, compared to the scenarios

described earlier.

Certified for Microsoft Windows 2000

Navision Axapta was the first ERP solution in the world to be

certified by Microsoft for Windows 2000. Windows 2000 has

already been deemed one of the most reliable, secure and

easy to use operating systems ever created. The certification

provides assurances to Navision Axapta users that the system

fully supports the Windows 2000 platform and leverages to the

maximum the new technologies introduced. Windows 2000 is

Microsoft’s platform for the Internet and with this the founda-

tion for “The Business Internet” is laid.

Navision Axapta: E-Business & ERP in One

To sum it all up: the technology and features offered by

Navision Axapta ensure your company has ERP and

e-business fully integrated. This delivers the basic freedom

every company is looking for: the ability to develop, change

and grow your systems as your strategic direction is clarified

and directed towards your future success.

In Conclusion

Without doubt, the ERP market in general is facing a dramat-

ic shift to Web-based applications. But the changes we are ex-

periencing at the moment are just the tip of the iceberg.

Market estimates indicate that Internet business between

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15

enterprises is already about 10 times as high as the business-

to-consumer trade. Some 31% of U.S. businesses are trading

over the Internet and that figure is expected to rise to more

than 90% during 2001. (Source: Goldman Sachs & Company.)

This dramatic shift means that the underlying technology,

design, and user interface of ERP systems must be adapted,

changed or redeveloped to support these new ways of doing

business in the marketplace. Navision Axapta is already there,

leading the way.

For Further Information

If you’d like to know more about Navision Axapta, schedule

a meeting, or see a demo, please check out our Web site:

www.navision.com

The paradigm shift is underway – and it is affecting

everyone.

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You Will Find

Navision Here

Australia

Austria

Belgium

Canada

Czech Republic

Denmark

Finland

France

Germany

Iceland

India

Italy

Lithuania

Norway

Poland

Portugal

Russia

Singapore

Slovenia

South Africa

Spain

Sweden

Switzerland

The Netherlands

USA

United Kingdom

W1-

AX

-A3B

R

Navision a/s is a leading global provider of cost-effective and adaptable

integrated business solutions that help companies in their quest to grow.

The company has 124,500 customers worldwide, a global network of

more than 2,000 partners, and 1,130 employees in 25 countries. The

Navision product line consists of Navision Axapta®, Navision Financials®/

Navision Attain™ and Navision XAL®. Navision a/s was created through

the merger of Navision Software a/s and Damgaard A/S in December 2000.

Its shares are listed on the Copenhagen Stock Exchange (CSE:NAVI).

The company is headquartered in Vedbaek, Denmark. You can learn more

about Navision a/s on the Internet at www.navision.com.

www.navision.com

Copyright © 2001 Navision a/s (NavisionDamgaard a/s),

CBR No. 76 24 72 18.

The trademarks referenced herein and marked with eitherTM or ® belong to Navision a/s (NavisionDamgaard a/s)

or Navision Development a/s.

Microsoft Windows 2000 is a trademark

of Microsoft Corporation. The names of

actual companies and products mentioned

herein may be the trademarks of their

respective owners.

No part of this document may be reproduced or transmitted

in any form or by any means, whole or in part without the

prior written permission of Navision a/s. Information in this

document is based on Navision Axapta version 2.5 and

subject to change without notice.

All rights are reserved.


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E-Business and ERP in One