4.4. Business Process Reengineering by ERP system

Facing the complicated environment as shown in Table 2, Neo-Neo must reengineer its business process to keep its competitive advantages. For the external environment, as a medium company, Neo-Neo has little power to change it, especially in the global market. The advice strategy is WO strategy that takes advantages of external opportunity and avoids internal weakness. Business Process Reengineering is required to pay more attention to the demand increase and outdate the old information system. Using ERP can help Neo-Neo to achieve business process reengineering.

 

(1)ERP system is beneficial to the external opportunity

 

With the increase of the demand from global market, the demands will become diverse and complaints will become more complicated, which will greatly affect the customers satisfaction. Neo-Neo cannot deal with the changed demand and complaint in time just relying on the old systems. When receiving the opinions or complaints from customers, ERP system can automatically analyze the information and transform the information to the responsible departments to deal with it, then, the responsible can analyze the information and share with the other departments to find out the best solution. ERP system can make the customers information reacted in the shortest time, which is helpful to cultivate the customer loyalty. Once the problems solved, ERP system will take note the case to provide the base for the next time, which make the managers adjust their strategy to the changed environment.

 

(2)ERP system can avoid internal weakness

 

ERP system is an integrated system from the external environment to the internal environment. The internal problems can also be solved by ERP system. ERP system can make the information flow smoothly among different departments that different departments can easily communicate with each other, and Neo-Neo has large amount of new products which should be managed by force, ERP system can help the R&D departments to trace each new product and collect information from customers, which will make the new product nearer to the customer. In addition, ERP system can arrange the best inventory level by the efficient planning and controlling to decrease the operation cost.

Conclusion

Though analyzing the external environment by PESTEL and Five Force Model, PESTEL analysis shows that economic factors, social factors and technological factors are favorable to development of Neo-Neo while political factors and legal factor are negative to Neo-Neo; Five Force Model illustrates the threat of entry and substitutions and the bargaining power of suppliers are positive to Neo-Neo while the other two are negative to it. The paper also analyze the internal environment from several aspects, the result shows that Neo-Neo has strong power on R&D, production and marketing but weak in employee retention and information system which is harmful to the future development of Neo-Neo (Neo-Neo official website, 2012). To better understand the business environment, SWTO analysis is used to identify the strengths and weakness of the internal environment and the threat and opportunity of

external environment. Based on the comprehensive analysis of external environment and internal environment, Neo-Neo is suggested to reengineer its business process to the changed business environment by the ERP system. ERP system is an integrated system connecting the external demands to the internal management. ERP system can make the company more sensitive to the customers’ reaction and demand, which will help the company grasp the external opportunity; also, it can help the internal information flow smoothly and better communication with each department, which will greatly improve the working efficiency and improve the employee satisfaction.