a web-based erp system for business services and supply chain

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European Journal of Operational Research 187 (2008) 1310–1326

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A Web-based ERP system for business services and supplychain management: Application to real-world process scheduling

C.D. Tarantilis a,*, C.T. Kiranoudis b, N.D. Theodorakopoulos b

a Department of Management Science and Technology, Management Science Laboratory (MSL), Athens University of

Economics and Business, 9th Floor, Room 913, 47A Evelpidon Street and 33 Lefkados Street, 11362 Athens, Greeceb Department of Process Analysis and Systems Design, National Technical University, 15780 Athens, Greece

Available online 20 November 2006

Abstract

A Web-based ERP system developed for attacking business problems and managing real-world business processes rang-ing from simple office automation procedures to complicated supply chain planning is presented. The system’s Web-aspectprovides significant advantages, as the system is distributed through interoperable, cross-platform and highly pluggableWeb-service components. The system involves a powerful workflow engine that manages the entire process event flowwithin the enterprise increasing efficiency and control at the same time. Business processes, when needed, are controlledby the enterprise quality management system and consequently the ISO directives are accurately followed. A real-worldprocess scheduling system developed for the specific needs of Greek Construction Manufacturing Enterprises is illustratedas a detailed paradigm of the system’s capabilities. The problem was formulated to assign project tasks in form of lots toenterprise resources in order that resources idle time and delays in project preparation time were minimized. The problemwas solved by a simple and effective heuristic algorithm.� 2006 Elsevier B.V. All rights reserved.

Keywords: ERP; Electronic services; Web-based supply chain management; Construction project management; Business process mana-gement

1. Introduction

During the last decade, there has been acknowl-edged a tremendous change in enterprise-orientedbusiness software where traditional accountingand commercial management products have gradu-ally left their place to integrated solutions that

0377-2217/$ - see front matter � 2006 Elsevier B.V. All rights reserved

doi:10.1016/j.ejor.2006.09.015

* Corresponding author. Tel.: +30 210 8203677; fax: +30 2108816705.

E-mail address: [email protected] (C.D. Tarantilis).

would rigorously deal with every single businessaspect of each individual enterprise. These systems,typically called enterprise resource planning (ERP)systems, are usually developed as individual stand-alone monolithic applications or modular separabletools assembled in a Suite structure for all individ-ual business needs. Most systems in this categoryhave a similar client-server or multi-tier architecturebuilt around a central database server. Typically, intraditional multi-tier standalone ERP applications,critical application components (such as the Appli-cation server) are essential for any functionality,

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C.D. Tarantilis et al. / European Journal of Operational Research 187 (2008) 1310–1326 1311

transaction or access to the database. On the otherhand, a new generation of Web-based enterpriseinformation systems is gradually gaining ground,where the system structure is entirely modular, plug-gable and separable and no component or module isobligatory for the application’s operation. The sys-tem presented in this article belongs to the secondcategory, as it is developed on open-source Web-Development platforms and possesses modularand flexible structure.

Web-based techniques are less expensive, moreefficient and lately have been the target of mostdevelopment efforts. Additionally, web-access hasbeen severely facilitated by recent advances in tele-communications and network technology that favorthe creation of virtual private network (VPN) struc-tures which unite different enterprise spatial entities(stores, warehouses, offices etc.). VPNs are networksconstructed using external network infra-structure(usually the internet) to connect nodes. Web appli-cations are cross-platform in terms of operation sys-tem and hardware requirements. Finally, web-basedsolutions are able to easily interoperate with thewhole supply chain entity, consisting what is usuallyreferred as Virtual Enterprise (the enterprise alongwith its main associates, customers and suppliers)[1].

Besides, ERP systems cover a wide range of func-tionalities ranging from accounting to commercialoperations. In the proposed case, two major issuesbrought about new insight into business softwaresolution functionalities. The first one is the adoptionof quality management concepts in enterprise pro-cesses. In order to successfully implement qualitymanagement, organizations usually need to abideby the standards of quality management systems(such as ISO). Compliance with total quality stan-dards is very important, since it guarantees that aspecific company’s products and services are meet-ing specific quality criteria. To adopt each particularquality standard, several business processes, mostlyof bureaucratic nature, have to be carried out inorder to coincide with the standard procedures thatthe enterprise actually follows. As a result, if onewants to control these processes digitally, one hasto incorporate them in the main information systemof the company, which most of the times is an ERPapplication. The second issue is the need for the sys-tems to encompass more complex applications,which are vital to the enterprise efforts to exist inample competitiveness between its market rivals.Critical modules in this direction are the ones that

solve Supply Chain Management (SCM) and Logis-tics problems.

The information system presented in this manu-script possesses two basic parts. A workflow enginethat manages the entire business process task flowacross the enterprise, incorporating quality manage-ment rules and a resource management module,which utilizes a project scheduling managementsub-system. The scheduling problem is solved by asuitable heuristic algorithm.

In Section 2, a short list of combined supplychain and workflow management related work isprovided. Section 3 discusses the ERP and Web-ser-vices integration issue. In Section 4, a detaileddescription of the general solution framework ispresented. Section 5 provides the analysis of theproject scheduling algorithm. An illustrating exam-ple of one of the system’s implementations isreported in Section 6. The conclusions of the textare finally presented in Section 7.

2. Literature review

2.1. Combined business process and supply chain

management

Although ample Workflow Management Soft-ware systems (WfMSs) exist as stand-alone softwareapplications or even as modules of several types ofinformation systems, either on the commercial soft-ware area or in the academic field, the occasionswhere WfMSs are consolidated with SCM soft-ware solutions in the same system or even inmany integrated systems, are not proportionatelynumerous. Nevertheless, there have been somecases in the literature where solutions have beendeveloped combining WfMS and SCM features.For instance, Liu et al. [2] developed an inter-enter-prise (Virtual Enterprise) Workflow Supply ChainManagement information system, using a light-weight workflow engine and covering ordering,inventory and outsourcing operations of the virtualenterprise. Marquardt and Nagl [3] proposed someconcepts on a consolidated platform called CRCIMPROVE, regarding integration of chemical pro-cess management software systems with flowsheetand other application tools. However, the prob-lem of job time scheduling in a manufacturingenvironment and implementing workflow manage-ment system solutions at the same time on thesame information system, remains in generalunexplored.

1312 C.D. Tarantilis et al. / European Journal of Operational Research 187 (2008) 1310–1326

2.2. Latest developments in ERP systems

ERP systems and their journey along with SCMhave been studied in the literature though not exten-sively. Akkermans et al. [4] produced a research in23 separate firms about the results and future expec-tations of ERP systems implementations in a SCMperspective. Among the conclusions of the researchwas that one major drawback of then contemporaryERP systems, was the lack of Web-based, modular,separable ERP systems and lack of extended (or vir-tual) enterprise operation capabilities. In this con-text, one drawback subcategory of the non-modularity of ERP systems is the lack of modularmanagement of the supply chain. Olhager and Sell-din [5] presented a survey concerning the implemen-tation of ERP systems in Swedish firms. Moreover,they compared the survey results with similarresearch conducted in the US. The authors inferredamong others that many firms deploying ERPs con-sidered extending system scope mainly to integratetheir suppliers, customers or both to the system, toprovide additional e-commerce or e-business opera-tions and to increase supply chain functionalities.Ng and Ip [6] shaped an object oriented modelbased on the traditional N-tier logic for designingWeb-based ERP applications. Kelle and Akbulut[7] pointed out the main disadvantages of typicalERP systems in terms of supply chain managementand among these is the inability to support completeinformation flow across the extended enterprise.

ERP systems were formed as integrated stand-alone software systems incorporating materialsrequirements planning, accounting, order entry, dis-tribution and shop floor control functionalities.After that, ERP systems (or extended ERP systems)began accumulating other mainly supply chainrelated functions, such as demand forecasting,scheduling, warehousing, capacity requirementsplanning and logistics. In the last years, two veryimportant tendencies are monitored regardingERP systems, the one relates to the addition of evenmore functionalities, such as project management,content management, workflows, enterprise portals,customer relationship management, humanresource management and knowledge managementand the other is linked to the need to disintegratelarge-scale ERP applications to autonomous, easilypluggable, reusable and loosely-coupled applicationcomponents. Accordingly, ERP systems may com-prise from parts independent from each other,which will plug and operate like Lego bricks into

enterprise systems in contrast to previous closednon-modular architectures. As a result, an enter-prise will not have to acquire the whole enterprisesoftware suite, but will be able to choose each mod-ule even from different vendors and create a unique,cost-efficient and tailor-made solution. This conceptcan be realized through Web-Service related meth-odologies such as SOA (service oriented architec-ture) and Web-development techniques in general.These directions and evolutions can be traced onthe documentation of grand international enterprisesoftware vendors like Oracle, SAP, PeopleSoft,www.salesforce.com or even in smaller outfits likeExact Software Inc or Hyperion. Some vendorshave developed distinct products in this philosophysuch as the Oracle Fusion Middleware of Oracle.

3. ERP systems and Web services

Enterprise resource planning software systemsattempt to integrate all departments and functionsacross a company onto a single information systemthat can serve all those different departments’ par-ticular needs. Typically, a department with special-ized functions and needs may have its owninformation system, customized to its particularprocedures and duties. Nonetheless, the main effortof an ERP implementation is to combine as manyfunctionalities as possible into a single, integratedsoftware program that runs on a single database,in order that the various departments can easilyshare information and communicate with eachother. This approach can have a tremendous pay-back if companies implement the software properly.Customer order is an illustrating example of a pro-cess benefiting from implementation of such sys-tems. Normally, when a customer places an order,it begins a mostly paper-based journey around thecompany, often being transferred into different soft-ware systems along the way. This process may incurdelays and errors. Meanwhile, access to criticalorder information is not directly available to every-one involved when needed. The combination of tra-ditional ERP functions enriched with BusinessProcess Management and SCM functionalities sub-stitutes specialized department operation softwaresystems, reducing costs, complexity and informationinconsistency. Most vendors’ ERP software is flexi-ble enough to provide modular implementationcapabilities.

ERP systems can accelerate business processesexecution times, such as that of ordering process

http://www.salesforce.com


mentioned earlier. This is the main concept behindthe system proposed and described in this paper.Information flow is realized through a powerfuldatabase driven workflow engine, described in detailin the following section.

In the context of ERP, Web Services offer twocrucial advantages: ease of integration and costreductions through the hosted application model.Integration is a major source of expenditure forenterprises due to business software system com-plexity. Customers and outsourcing vendors maydemand access to information provided to internalERP users—such as order status, inventory levels,and invoice data—even without having an ERP cli-ent software. This is where Web Services interfere,enabling seamless data access to the authenticatedusers at the right time from everywhere withoutthe need of specific software clients. With the avail-ability of Web Services, integration can be achievedwith superior reliability, security, manageability,testing and effectiveness. Web Services use object-oriented technology to mix data and programmingelements in Web Service methods that can beaccessed by different applications. Web Servicesenable proprietary applications to communicateover the Web. Proprietary ERP applications andWeb Services can use integration or other tools—such as SAP’s Netweaver, HP’s E-Speak toolsets;IBM’s Dynamic e-business (infrastructure and soft-ware); and Sun ONE (Forte technology and iPla-net’s ECXpert)—all of which facilitate data flowand communication across diverse applications.Web-Services combined with ERP provide an inte-grated, multi-component application software plat-form ideal for performing multiple businessfunctions.

The enterprise may still require a traditional ERPapplication for its internal operations. Web Services

Fig. 1. Architecture of traditional standalo

allow the enterprise to access needed informationeffectively. As this new technology gains ground,more vendors support Web Service solutionsblended with XML technologies. Subsequently,Web Service broker hubs are introduced. A brokerhub offers a portal providing a user interface forusers so that they can locate, evaluate, subscribeto, cancel, manage, or monitor Web Services. Anincreasing number of business software vendorsare delivering Web Service broker hubs, such asSAP and Oracle for users of mySAP and OracleE-Business Suite respectively. Intuit and Peachtreeoffer them with QuickBooks and Peachtree Com-plete Accounting. Microsoft with Navision is a ven-dor offering a Web Service broker hub for mid-tierERP software users.

Fig. 1 shows a common three-tier developmentstructure, which is the most widespread form ofN-Tier architectures. According to 3-tier logic, threedifferent layers (tiers) exist, which are independentparts of executable code, presentation, businesslogic and data layers. Presentation layer is responsi-ble for managing user-interface and sometimes secu-rity issues. Business logic layer controls all datatransfer between the user-interface and the data tier,retrieving, modifying, storing, deleting and validat-ing data. Data tier is a tier responsible for the data-base or sometimes is the database itself. Usually,data and business logic tiers comprise the applica-tion server of a distributed information system.

The structural differences between a typical N-tier ERP and the proposed Web-based ERP canbe understood by comparing Figs. 1 and 2. In con-trast to most standalone ERP systems, where all orsome of the integral application components, suchas the application server, are essential for their oper-ation, in our web-based scaleable approach, eachuser logins into the system via a web-portal and

ne N-Tier ERP software applications.

Fig. 2. Architecture of the proposed Web-based ERP with separable software modules.

Fig. 3. IE user interface of the tool involving: process/tasks tree frame control, notification event tags notification, calendar frame forpersonnel programmed tasks with detailed description of calendar events.


then information flow components (including theembedded workflow engine described in the next

section), navigate the user through the independentsystem’s functionalities. Each web-service compo-


nent is autonomous and is easily pluggable evenacross applications.

In Fig. 3, the main graphical user-interface of theinformation flow management module of the appli-cation is presented. Three areas appear clearly in thefigure, on the left side, there is the business processinitiation area where each user of the informationsystem is able to initiate the business processes he/she is entitled to. According to the system’s philos-ophy even a simple data form (for example the maincustomer form) may represent a business processwith only one phase. Thus, the accessibility of dataas well as the initiation of business processes is con-trolled by this web-based component. In the othertwo areas of the user-interface on the right, theupper first presents the events that stem from busi-ness process stage activities. These events emergeand lead to other web data forms or non-initiatingbusiness process dialogs. The user-interface areabelow is linked with resource and time management,containing from simple calendars to project/produc-tion management Gantt charts.

The system was developed using open sourceActive Web Server Pages Technology (PHP andJavaScript) and ANSI SQL. One of the system’smain requirements is the existence of an RDBMSdatabase application, preferably Oracle, MS SQLServer or MySQL.

4. Web-based business processes and system

implementation

In this section, the business process managementaspect of the proposed Web-based ERP system ispresented. Within this context, many informationsystems have been developed during the last yearsthat interact with business processes of enterprises.The labels of such systems vary from WorkflowManagement (WFM), Business Process Manage-ment (BPM), to Enterprise Document Management(EDM) and Product Data Management (PDM) sys-tems [8]. Numerous definitions of such systems areprovided in the literature [9]. In general, most suchsystems handle workflows as an abstract entitywithin the enterprise and do not interact with theactual management of the involved resources. Thereis also a wide variety of Workflow engines, compo-nents that provide the mechanisms to manage work-flows dynamically. Although one of the system’score activities is Business Process Management, itsfunctionality goes beyond workflows, to other func-tionality areas such as Operations or SCM.

Companies need business process managementsystems in order to automate, enhance and optimizeworkflows, but also need quality management sys-tems to improve quality in every business activityand to control and standardize business processes.Additionally, successful Quality Management Sys-tems implementation increases performance stan-dards and customer satisfaction. Moreover,quality certifications improve product and brandimage and sometimes offer a significant competitiveadvantage to companies. During a Quality certifica-tion procedure, an enterprise should document itsbusiness processes in order to certify them accord-ing to a Quality Management System’s standards(ISO for example). Besides, during that process, acompany has to record its organizational structure,job-descriptions and organizational charts. There-fore, such procedures give exposure to business pro-cesses and present an excellent opportunity for theenterprise to enhance or re-engineer them. Throughthe job-description phase, job positions aredescribed in detail and roles of employees in theenterprise are defined. Roles are associated withtasks. All this type of data is the main configurationinput of the proposed Web-based ERP.

The whole procedure of combined implementa-tion of the proposed Web-based ERP and the Qual-ity Management System is depicted thoroughly inFig. 4. In this figure implementation phases areshown from top to the bottom of the figure, require-ments (input), customization, deployment, resultingmodules (output). The certification according to aquality standard is a corollary of putting into prac-tice the system’s Quality Management module andconsequently is also shown in the figure near theoutput modules.

On the other hand, Quality Systems that are notsupported with a software solution are very rigidand entail much paperwork. As a result, QualitySystems become slow, difficult to control, in-flexi-ble, sometimes even chaotic and eventually ineffi-cient. Consequently, the need arises forinformation systems, which help enterprises to buildand operate a Quality Management System and atthe same time streamline workflows, encounterreal-life business problems and manage the actualresources of the enterprise.

The workflow engine is the component of theproposed Web-based ERP information systemwhich handles the control-flow (or process) perspec-tive of the business process management module ofthe system [10]. That means that the workflow

Fig. 4. Structural representation of the system’s implementation phases.


engine manipulates the flow of tasks and businessevents among the groups and users of the system,defining the sequence followed.

The workflow engine has been developed usingObject Oriented Programming (OOP) techniquesand is comprised of several objects that interact witha relational database and appropriate documentsand files, producing sequences of tasks and events,navigating business workflows. PHP scripting lan-guage provides most required object-oriented capa-bilities similar to those of standalone softwarelanguages.

The main class components of the workflowengine that formulate a corresponding Application

Programmers Interface (API) library are thefollowing:

• Session class (bHierarchical, bByPass properties,suggestChild( ), evolve( )methods)

• Process class• Task class• Event class• DataClass class

The Session class object contains user informa-tion, which also contain group information. Usu-ally, Tasks, which in Petri-net terminology aredescribed by places, are assigned to specific groups

Process Initialization

Process End

Task 1

Task 2

Task 3

Event 1

Event 2

User Action

Group(s)/User(s)Notification

Group(s)/User(s)Notification

User Action

User Action

Fig. 5. Workflow mechanism of process/task/event creationstructure.


[10,11]. Groups may represent actual operationaldepartments of a company such as the sales depart-ment, or specific job-positions, or even virtual enti-ties in the company. Furthermore, Tasks cannot beassigned to groups rather than to specific users/resources of the system. Events, which in Petri-netterminology have a similar function with tokens,wait to be enacted in each user’s event queue. Whena user interacts with an Event and causes an actionthat will proceed the Process, suggestChild( )method gets called. This method’s role is to navigatethe workflow, choosing the correct next Task orTasks and finding the appropriate users or groups.Group or user assignment to a Task can also bedynamic. For instance, it can be decided by theinput of the user of the previous task. Moreover,when the bHierarchical property is true, suggest-

Child( ) can seek the next users or groups hierarchi-cally. For example, in a procurement process, everydepartment manager approves the procurementorders of the department members. Then when aprocurement order is placed by a user, the systemthrough suggestChild( ) method seeks, followingthe hierarchy through the organizational chart ofthe company, for a director who is entitled to offeran approval for the procurement order. When thebByPass property is enabled, the system can by-passa Task or a Process if there is no user available toexecute the Task. For example, a Task in a businessProcess can be by-passed when the resources (users)who have the privilege to perform that Task are onvacation. The workflow engine supports AND-splits & joins as well as OR-splits & joins, respec-tively [10]. Any Task can have unlimited numberof results and be considered as initial. Then,evolve( ) method gets called to create the new Events,to send them to the appointed groups or users andto destroy the previous old Events. In Petri-netterminology, evolve( ) method is used to triggertokens. An Event can be linked to specific datarecords in tables of the relational database or tospecific documents in the system or both. TheSession object can stop any process when it isdemanded.

The Process class object is a reusable object com-ponent which usually depicts a specific real-life busi-ness process. Business processes comprise of asequence of Tasks, which are elementary explicitunits of work performed by a user or a group ofthe system. They may include other sub-processes.The business object acquires the business processdata from the relational database.

The Event class object represents a link betweentwo consecutive Tasks and notifies the resources(groups or users) involved in the execution of apending Task. The Event class object provides alsoinformation about forms, documents and data rela-ted to the task through the Document and DataClass

class objects. The DataClass class object, which isused extensively by the system even outside thescope of the Workflow Engine, is the object thatoperates as the main communication tool with therelational database. A typical workflow mechanismof process/task/event creation structure is presentedin Fig. 5.

Roles and authorities to execute specific Tasks orto initiate Processes can derive automatically fromthe organizational chart of the company or thejob-descriptions of the system users. This input datais part of the Quality Management System andneeds to be defined to comply with its requirements.The proposed Web-ERP provides the ability tomanage any resource of the enterprise (employees,machines, vehicles, materials) either on pro-grammed or on actual schedule (timesheets). Inother words, the system tracks not only what wasplanned, but also what really happens. Moreover,it provides us with a real-time costing ability forevery activity of the enterprise.

Apart from the three main functionality areas,the tool operation covers the following modules.


• Office Automation• Customer Relationship Management (CRM)• Supply Chain Management (SCM)• Human Resources Management (HRM)• Equipment Management (EM)• Quality Management (QM)

The presented tool has been implemented withgreat success on over 40 large, small and mediumGreek enterprises solving core operational problemson the following sectors: Construction, media,retail, manufacturing, education, software, consult-ing, financial services, transportation and insurance.

5. Management of the manufacturing process

One the most powerful properties of the pro-posed Web-ERP tool is the ability to integratethrough its workflow and resource planning pro-cesses, several supply chain problems. One of themost significant examples is the manufacturing pro-cess management tool developed for several Greekmanufacturing firms. The infrastructure of the pro-duction process in most manufacturing constructioncompanies (such as the ones forming metallic con-structions and building hardware) usually entailsthe simultaneous operation of several major depart-mental sections that prepare final ordered products.The main characteristic of products prepared bysuch firms is that although almost none has thesame structure, they are made using similar manu-facturing procedures. Orders dispatched by the cen-tral ordering system, usually suited to customerdesire, involve products not known beforehandwhose preparation is likely to combine many opera-tions. Moreover, according to the preparation sche-dule of each product, there are cases where severalsections of resources are involved. In addition tothe above, the course of manufacturing action isnot known before the order is placed [12].

In construction manufacturing systems such asthe one discussed here, there are two basic require-ments posed by the production department thatruns the operation. The first one involves the timepriority of each order. Typically, if a client posesan order at a given time, it is assumed that this orderis prepared with higher priority than others dis-patched later. This rule is actually followed in theproduction process of the enterprise to achieve asmooth operation. The second one involves the min-imization of order completion times, subject to lim-itations imposed partly by resources in equipment

and personnel and above all by the individual char-acteristics of the manufacturing process. In mostsuch enterprises, compliance with both criteriadepends on the experience of the operating person-nel. The proposed system utilizes an efficient modulefor scheduling manufacturing processes, whichschedules all manufacturing operations. In fact, itis supplied with the production profiles of each task,resources available regarding equipment and per-sonnel and customer orders. Subsequently, itadvises on the reliable course of action in each sec-tion with respect to the following rules:

• each order is scheduled so that it is completed inthe least possible time, that is to say order make-span is minimized;

• all tasks in the same order will commence at thesame time, unless this is limited by resource avail-ability in each production section;

• time priorities between orders are kept, unless thecurrent set-up situation allows an order to becompleted before others of higher priorities with-out affecting their schedule.

The most characteristic feature of the proposedscheduling system is the fact that ordering informa-tion is dispatched by the system to manufacturingsections at specific time intervals. As a result, sched-uling decisions instantly affect the scheduling proce-dure which manages manufacturing resources [13–16].

The complete manufacturing task descriptionaccording customer’s desire and needs involves thepreparation of each task in phases that block timein each available resource in a specific way. For eachphase, there is a job t assigned to it that involvestimes tt

S (start time) and ttF (finish time). In the con-

vention used in the algorithm of this manuscript,time within jobs starts at job completion pointand moves backwards. Thus, the reference zeropoint for measuring job preparation time is placedat the task completion time point. The reason forthis convention is obvious; job completion is theonly valid reference time measuring point regardingjob preparation. Obviously, start and finish timesfor each job can result in various job patterns withineach task. Jobs can be overlapping, they can involvethe same resource type in parallel or sequentially,etc. Each job can be accomplished by resources ofone and only one specific resource type ri, whichbelongs to a set of resource types R ={r1, r2, . . . , rN}. For each resource type ri, there is a


number of similar resources nri , of identical charac-teristics. As a result, each task phase can be exe-cuted in any resource that belongs to the resourcetype associated with it. Using this notation a taskp, is a set of objects (jobs) where each one is charac-terized by a start and finish time and an associatedresource type, p ¼ fðti

S; tiF; riÞ; i ¼ 1; . . . ; nPg. An

order s, is a set of tasks s ¼ fðqpi; piÞ; i ¼

1; . . . ; nsg. The algorithm developed, is used toschedule a set of orders S of different dispatch timeson the available set of resources R, whereas thenumber of available resources for each resourcetype nri varies with time, due to equipment malfunc-tions during operation or the presence of availablepersonnel operating the equipment.

Supposing that an infinite number of resourcesper resource type was available. The maximum fin-ish time of all tasks in each order would obviouslybe the order make-span. In addition, all orderswould be scheduled to achieve this makes-span. Inthe real-world system, two sources of delay willappear. If an order involved a large number oftasks, their processing on limited resources woulddefinitely not allow their simultaneous completion.In this case, the second rule mentioned above wouldbe violated, and certain tasks would simply wait forothers to be executed, due to the limitation of avail-able resources. This is the first source of delay. Inthis case, the second rule mentioned above woulddictate that all delayed tasks would be executed asclose to order dispatch time as possible. In this case,the order make-span is the maximum of finish timesplus task delay over all tasks in the order. The sec-ond source of delay is caused by the fact that whenthe order scheduling pattern is determined, fittingthe order to the available resources might reach apoint where no available time in resources couldbe found due to the presence of other orders. In thiscase, older orders have higher priorities and cannotbe displaced in time. Therefore, order completionshould be delayed until all tasks are assigned toavailable resources. The proposed system followstwo basic principles; time priority of each orderand make-span pattern of each order. The imple-mentation of these principles and the evaluation oftotal order delay in available equipment is carriedout in the following two phases for the tasks of eachorder in the departmental operation schedule. Algo-rithm formulation is presented in relevant pseudo-code functions. The operation of department sche-dule simply iterates these two phases for each orderdispatched by the enterprise ordering system.

for each order i dispatched, order byorder_dispatch_timebegin

scheduleOrder(i);fitOrder(i);

endscheduleOrder(i)begin

set p as the set of tasks of order i; //copyfrom order tasks setwhile p is not empty

delay=0;set s as the task of maximum finish timethat belongs to p;for all jobs t in s

set r the associate resource type of job t

for all machines m in resource type r

if s does not fit in any machine m

delay++;ends.delay = delay;remove s from p;

endendfitOrder(i)begin

set p as the set of tasks of order i; //copy fromorder tasks setdelay = 0;for all tasks s in order i ordered as searched inscheduleOrder(i);

for all jobs t in s

set r the associate resource type of job t

for all machines m in resource type r

if s delayed by s.delay does not fit inany machine m

delay++;end

endend

The algorithm suggests that each order put for-ward by the company dispatching system is itera-tively treated through two discrete phases. Thefirst one assumes that all resources are availablefor all order tasks and relevant jobs, inserting taskjobs to resources without considering the presenceof other orders placed before occupying resources.It greedily selects tasks of decreasing total finishtime and puts them in the first available resourceadjacent to order dispatch point in order that eachone is completed at exactly order completion time.


If this is impossible due to resources alreadyblocked by tasks and jobs selected previously inthe order, the task (and its jobs) is shifted (delayed)in time until non-occupied resources are found. Thedelay between tasks in each order is recorded. Thesecond phase keeps delays constant between tasksof the same order as evaluated in the previous phaseand strives to fit each order task job in availableresource machines. If even one job cannot find freeresource time placement, the entire order is shifted(delayed) until all tasks and jobs are assigned toavailable resources. Furthermore, the order delayis recorded again. As a result, the two sources ofdelay, delay between tasks of the same order anddelay between orders, are easily tracked andrecorded. In all cases, the delay is measured fromthe exact time point where the order was placed inthe system. The most common delay unit is an hour,but the algorithm can function with any other timesubdivision.

A typical example of the Gantt chart resourcecalendar is presented in Fig. 6. When applied toan actual manufacturing process of 3 resource types

Fig. 6. Typical Gantt Chart Calendar for t

with 3 resources for each type, the calendar takesthe form of Fig. 6. Each horizontal row within a cal-endar day represents a resource. Furthermore, eachhorizontal colored bar illustrates a specific job andeach different color shows a different order. Greylines between chart horizontal rows denote the divi-sion between resources of different resource types.The figure divides time in working days and work-ing hours.

In Fig. 7, a problem with eight resource types andthree available resources for each type is shown. Azoomed frame of a specific day gives greater detailof the assignment of tasks to production lines. Thenumbers on each bar present the job’s order, taskand job numbers. The user is able to see the detailedstart and finish times for each job and also to formthe actual, real-life production schedule.

Typically, the workflow process works as fol-lows; once in a working day production plannersapprove scheduling plan suggested by the algorithmand after the end of each shift, the system isinformed about the actual task completion and theactual task start and finish times. In this way, an

hree resource types and 8 hours shift.

Fig. 7. Actual Gantt chart from an 8-resource type manufacturing process involving a detailed task and job dialog.


on-going process of planning and confirming is putinto practice in order to monitor planned and actualtasks. Accordingly, reports on discrepanciesbetween planned and actual process times can begenerated.

6. Case study

6.1. Background

A case will be presented where ManufacturingManagement integrates with Business Process Man-agement through the information system’s utiliza-tion. The case study concerns one of the biggestGreek construction companies which focuses onthe creation of metallurgical constructions. Theenterprise had turnover over 30 million euros in2004 and played a key role in the development ofthe infrastructure that was used in the facilities ofthe Athens 2004 Summer Olympic Games. Theenterprise is located in the area of Attika near Ath-ens capital of Greece and operates on great public

or private infrastructure works (for example stadi-ums or large bridges) and at the same time has sev-eral industrial customers, such as metal, mining andcement industries, supermarkets, power-plants,shipbuilding enterprises, oil refineries and others.Additionally, the enterprise operates inside and out-side of Greece. Furthermore, this company employsapproximately 200 persons. Some of them work onconstruction sites and others in the company’s man-ufacturing facilities.

6.2. System implementation

In this example, this enterprise implemented theWeb-based ERP system to streamline many of itscritical processes including processes concerningcompany operations like procurement and projectmanagement or processes concerning customers likecustomer complaints. The business processesinvolved in the project are presented in detail inTable 1. The system supported both the Greekand the English language, because many of the

Table 1Typical business processes for the ERP presented

Businessprocess

Pre-ERP conditions ERP implementation results

Customercomplaints

Customer complaints records were paper ISO forms.Management had almost no control

The whole process is automated through the system’sworkflow engine. Management is notified instantly

Procurement Procurement requests of various departments weretransferred tediously via ISO forms across the enterprise toacquire director and upper management approval. Nocontrol, coordination and reporting abilities were available

Every involved employee is notified automatically, allprocurement orders are approved by directors and theupper management electronically. Real-time reportsavailable for every procurement request in the enterprise.Process execution times reduced dramatically

Productionplanning

Production scheduling was manual and based on empiricaland intuitive criteria. Production planning team estimateddelivery times and schedules, which were inflexible andsometimes not accurate enough

Production scheduling is formed automatically by thealgorithm presented in Section 5. The system providedflexible schedules and lower delivery-times. The systemoffers ability of instant rescheduling with every new order.The input data stem directly from sales department

Qualitycontrol

Quality control of final or middle products was kept onISO forms on hard-copy. No statistical analysis available

Quality control is kept in the system, various methods ofdata statistical analysis and reporting available

Sales Promotion activities (calls, meetings, faxes) were arbitraryand there was no data available about their effectiveness.Offers and contracts were on hard-copy form only

Each promotion’s activity result is measured. Successfulpromotion actions are automatically connected withresulting offers and even contracts. Reports are availableand decision making is enhanced. Contract, offer data iswidely accessible and transparent

Fig. 8. Business process diagram presenting the case study, whereworkflow management is integrated with the production sched-uling module of the system.


employees were not Greek and used Oracle 8i as arelational database management system (RDBMS).

One business process where workflow manage-ment co-operated with production planning wasthe customer offer process. The upper managementof the enterprise was severely concerned about theoperation of the sales department. Therefore, theyexpressed a will to quantify and monitor customerrelationship data and promotion activities, includ-ing customer calls, meetings, offers, offer modifica-tions, after-sales communication and above allcontracts. All these types of actions formed a singlebusiness process to our system, called the offer pro-cess. Moreover, the fact that each contract whichinvolved one or more projects was fully customizedand different from anything else produced by thecompany in the past, incurred the need to transfercontract and project related information directlyto the operations department of the enterprise. Fur-thermore, most customer orders were very sensitivein terms of delivery dates and as a result the enter-prise faced a need to forecast reliable project deliv-ery times and to optimize production scheduling.

Consequently, a customized offer process wasdeveloped on the system as illustrated in Fig. 8.One of the tasks of this process was the manufactur-ing management procedure described in the previ-ous section. When the offer process leads to acontract, then the operations department of the

enterprise is instantly notified by the system andrelated project information is added to the inputof the scheduling algorithm. In this way, not onlywere new orders added to the new productionschedules, but also production management hadthe ability to prioritize orders automatically, to

Table 2Project execution phases (job-types)

Index Phase Critical resource type

1 Cutting Equipment2 Welding (agglutination) Equipment/personnel3 Shaping4 Puncture/perforation Personnel5 Assembly Personnel6 Electric welding Personnel7 Grinding Personnel8 Painting Personnel9 Fitting Personnel

10 Shear nailing Equipment


interact with different production planning scenar-ios and to project accurate assessments of eachorder’s delivery times.

The enterprise has several production lines andeach of them is entitled to perform different sets ofjob-types. Moreover, the organization faced a pro-ject scheduling problem, where multiple fully cus-tomizable projects needed co-ordination and cost-reduction, both in the company’s manufacturingfacilities and in the customer’s site. Additionally,the firm encountered tight deadlines and sometimesrising costs due to the high use of overtime. Eachproduction line has a definite number of criticalresources. Resources that define a production line’scapacity are called critical. On some productionlines critical resources may be employees and onothers machines. Thus, each production line repre-sents a resource type (ri) and each critical resource,machine or employee, which belongs to the previ-ously mentioned production line forms a memberof the set of similar resources ðnriÞ, as described inSection 4. Production phases (job-types) are dividedto lots. A lot is the minimum inseparable amount ofwork and when it begins processing it should endwithout interruptions and when it ends the createdstock is transferred to the next phase. Lot-sizes foreach production line and task are defined by theproduction planning team. In the algorithm descrip-tion of Section 5 jobs play the role of lots. The pro-duction planning team requested a smallmodification of the algorithm presented in Section5. They wanted to be able to prioritize ordersregardless the time they entered the order queue inthe system. For instance, if a large contractor waswilling to pay a very high price, as long as its projectis finished in short deadlines, this order could have agreater priority than older ones with more flexibletime schedules. Thus, priority grades were intro-duced into the system and the scheduling algorithm,meaning that among orders of the same prioritygrade, the older one gets processes first, but an orderof a higher priority grade precedes all orders oflower priority grades.

The proposed Web-based ERP contains eachpiece of productive equipment and employees andtheir job-descriptions in the database for qualitymanagement purposes. Accordingly, tasks, jobsand job-types are defined for each project (order)during the project definition phase as depicted inthe Fig. 8. In this figure, S represents process initia-tion point, E1 occurs when promotion efforts do notresult to a new offer, E2 happens when an offer is

rejected by the customer, R1 is an OR-split event-condition-action (ECA) point where the followingcases arise:

• If an offer needs review, the offer is altered andresent to the customer.

• If an offer is rejected, offer rejection state isreached.

• If an offer is approved the process proceeds to thecontract stage.

The user of the system is able to execute thescheduling algorithm. Additionally, the user is ableto alter lot-sizes of each task at any time. After eachexecution, the planning team puts the schedule intopractice, then inspects the actual result of the pro-duction activities, feeds the actual data input intothe system and re-schedules the production planperiodically or whenever seems useful. The planningteam of the enterprise decided to follow this proce-dure on daily basis.

Apart from the business process managementand manufacturing management modules of theWeb-based ERP, the company utilized other usefulmodules of the application, such resource manage-ment and quality management. The enterprise hadalready implemented a quality management system(ISO) and had obtained certification of variousquality standards including ISO. As a result, thequality management system module of the Web-base ERP was adjusted to the company’s alreadyoperating quality system.

6.3. Project scheduling

Production line available resources range fromone to five depending on project execution phase.The phases and the job type-related critical

Table 3Problem description, estimated work hours per project per phase

Phase Resources 1 2 3 4 5 6 7 8

1 Cutting 3 80 240 40 120 240 80 120 1402 Welding 3 120 120 40 120 60 240 80 603 Shaping 2 40 160 40 120 40 400 40 404 Perforation 2 60 200 24 120 24 400 54 405 Assembly 3 40 40 48 120 8 400 60 406 Electric welding 5 160 120 16 120 240 400 240 2607 Grinding 3 240 120 24 120 120 400 140 2608 Painting 2 48 40 24 120 80 240 120 249 Fitting 3 40 24 24 120 14 160 40 24

10 Shear nailing 2 24 16 24 120 20 200 40 24

Table 4Problem of Table 3 system project planning results in work hours

Project 1 2 3 4 5 6 7 8

Executiontime

240 240 120 208 320 600 384 504

Table 5Relationship between completion time improvement and problemscope

Total number ofprojects

1–10

11–20

21–30

31–40

41–50

>50

Schedules in thiscategory

3 8 5 3 1 2

Completion timeimprovement (%)

9.2 10.4 22.3 12.3 8.5 29.5


resources are presented in Table 2. At most phasesthere are up to three work shifts per day. Addition-ally, minimum and maximum overtime can be cho-sen in problem formulation. A particular instance ofthe problem and its subsequent solution will bestudied.

The problem is composed of eight concurrentprojects, each of them containing all 10 project exe-cution phases. Detailed problem data is presented inTable 3. A common lot-size is chosen for all phasesof 8 hours and all phases in all projects are consid-ered successive. That means that a project executionphase can initiate only after a processed lot has beenreceived by the previous one. Each project hasunique deadlines and for each phase a differentnumber of critical resources is available. Productionlines work in three 8-hour shifts and no overtime isinto consideration.

Before the advent of the system, due to the largecomplexity of the problem, no precise estimateswere achievable. Nonetheless, there was an elemen-tary project planning process, according to whichwork hour estimations were added per project exe-cution phase. The sum was divided to the numberof available critical resources for the specific phase.The phase with the maximum ratio was defined asthe production bottleneck and this phase definedthe resulting plan. In the case of the problemdescribed in Table 3, bottleneck phase is the grind-ing operation. Exact project execution phase initia-tion times could not be calculated, but a safety timespace was considered between production phasesfrom 1 to 5 business work days. In our case theold planning method produced a schedule of a totalduration of 800 work hours. On the contrary, theproposed system produced a detailed planning solu-tion described in Table 4 in 600 work hours. For atypical plan number of projects in process rangesfrom 4 to 55 with up to 10 project execution phases.

With this kind of input the scheduling algorithm canproduce results is less than a second in a typical cli-ent PC. In general, in several real-life examples,total project execution times were reduced from0% to 40% and detailed work hour cost reports wereavailable. A comparison was made between theresults of 22 past project schedules and the ones thatwould have been produced by the system bearing inmind problem scope (total number of projects). Theresults are presented in Table 5, showing the averageproject completion time improvement for eachcategory.

6.4. ERP implementation benefits

Through the use of the system the enterpriseobtained the following results:

• Enhanced company operation through streamlin-ing, improving and controlling business processesof major importance such as procurement, cus-


tomer offers, customer complaints, equipmentmaintenance, marketing campaigns and others.

• Significant cost-reductions and time-savings in allthe above mentioned business processes.

• Ability to manage service related personnel andrelated costs through the use of the resourcemanagement module of the system. In the past,the company could allocate only the productiveresources’ (workers and construction site relatedcosts) cost to each company activity. Now bytaking advantage of the resource management(timesheets) module of the system, the enterpriseis able to manage the cost of the service personnel(engineering, R&D departments, etc.) involved.

• Upgraded use of the company’s already operat-ing quality management system, which was notsupported by an information system. The use ofthe proposed ERP system enabled the enterpriseto avoid much paperwork, to reduce personnel’soccupation times with quality management issuesand to provide report insight to the management.

• Flexible and efficient production planning byimplementing the manufacturing management(scheduling) module of the system. Project deliv-ery times and idle times were reduced signifi-cantly, productivity was raised, more precisedelivery time assessment incurred stock levelminimization and customer satisfactionimproved.

• Facilitated communication and data, transfer ofcritical information for the whole enterprise.Now employees have instant access to real-timedata, documents and reports that concern theirduties. View of information flow is fully custom-ized according to each user position.

• Finally, the company exploited the abilitiesto control sales and promotion activitiesthrough the system, received quantitative dataabout the results of each promotion techniqueand managed to increase sales departmentefficiency.

7. Conclusions

In this paper, a novel Web-based ERP systemdeveloped for attacking business problems andmanaging real-world supply chain problems waspresented. It involved a powerful workflow businessprocess mechanism and a complete enterpriseresource management engine. The system imple-mentation includes a bridge between business pro-

cess management and production scheduling.Moreover, information system capabilities arepresented through an illustrating case study onone of the system’s implementations, revealing ahands-on view to the system implementationbenefits.

This work may present an opportunity to inte-grate genuine and innovative business problem solu-tions within the context of the latest trend in ERPsystems as well as in enterprise software in general,which is the utilization of Web-based techniques.For instance, an extension of this work may bethe employment of intelligent vehicle routing prob-lem (VRP) solution methodologies to an integratedWeb-based ERP system specialized for the needs oftransportation management.

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