Comparison of an Enterprise Resource Planning System and a Cloud based Enterprise Resource Planning System in an Aluminium Supply Chain
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In this master thesis, an investigation has been carried out on whether or not a cloud based enterprise resource planning system (CERP) is better suited for an aluminium supply chain (ASC), than the traditional enterprise resource planning system (ERP). The main objective of the thesis was to increase the performance of the aluminium supply chain trough information sharing. First, an investigation in the form of literature study, on the ASC was conducted to discover the characteristic of the supply chain. It was found that an ASC could be both a MTS and a MTO SC, depending on which aluminium smelter you were looking at. It was also found that the ASC is a global SC, it produces in high volumes with a low variety of products, there are few customer segments and that it is driven by efficiency.Secondly, the CERP and the ERP systems were set up against each other, to discover the different pros and cons with implementing each one in the ASC. The pros for the ERP is that it is well-known as well as well-developed, so the companies know what they are buying. The main cons are that the ERP is not very flexible, it may prove difficult to implement, and the implementation demands enormous time and cost resources. The pros for the CERP is that it is the fastest way to the market, cheaper in the short term as well as for small businesses, it is more flexible and easier to access. The main cons of a CERP is security and the fact that it becomes expensive to a large company, since every participant have to pay a fee to get connected to the system. Thirdly, there were made some reflections on the future of the ASC, and the possibilities of how the CERP can evolve together with the emerging technology of smart factory. It was found that if smart factory was implemented through the ASC, enabled by technologies like auto-id and internet of things, the performance would increase immensely. At the same time, it was found that having such an integrated system is still some years away.This study found that setting up an ERP like a CERP in an aluminium supply chain, will do the information flow and the material flow more precise, which in turn will increase the performance of the aluminium supply chain. This means that the ERP system is located on a server in the main office, and is perceived as a CERP system for the other actors in the ASC. This implementation of an ERP system that operate like an CERP in the ASC will decrease the need for inventory, mitigate the bullwhip effect, utilize the production, optimize the customer interaction process, as well as make information easier obtainable.